KENYA Trends and Developments Contributed by: Sammy Ndolo, Brian Muchiri, Nicholas Owino and Valere Nyaboke, Cliffe Dekker Hofmeyr
Kieti Law LLP Merchant Square, 3rd floor, Block D Riverside Drive PO Box 22602-00505 Nairobi Kenya Tel: +25 471 056 0114 Email: cakenya@cdhlegal.com Web: www.cliffedekkerhofmeyr.com/en/kieti-law/
Introduction Kenya’s corporate governance landscape has entered a pivotal phase characterised by maturity, strategic intent and increased global alignment. The 2025–2026 period marks a decisive shift from rule–based com - pliance towards governance excellence, with boards and regulators alike treating governance as a driver of long–term value creation, investor confidence and market integrity. This evolution is occurring against the backdrop of significant legislative developments, including: • landmark reforms to anti-money laundering legisla - tion; • the emergence of proposed artificial intelligence regulation; and • enhanced scrutiny of beneficial ownership struc - tures. Measured improvements in governance scores across listed issuers, significant regulatory reform and increased board accountability reflect a market that is no longer defensively responding to rules but proactively shaping governance outcomes. Kenya is increasingly positioning itself as a governance bench - mark in East and Southern Africa, particularly in capi - tal markets, state–influenced entities and ESG–driven investment. This article examines the key trends and developments shaping Kenya’s corporate governance environment over the past twelve months.
From Compliance to Governance Leadership Kenya’s listed capital markets have transitioned into a clear phase of governance maturity. In the 2024/2025 financial year, the average weighted corporate gov - ernance score of issuers rose to 78.88%, up from 73.56% in the previous period, as measured against the Code of Corporate Governance Practices for Issu - ers of Securities to the Public, 2015 (the “CG Code”). Most notably, for the first time since formalised gov - ernance scoring was introduced, all assessed gov - ernance principles attained a leadership rating. This milestone signals not merely incremental improve - ment, but an institutional shift in how governance is understood and practised across the market. Boards are increasingly taking direct ownership of governance outcomes rather than treating govern - ance as a function delegated to compliance, legal or company secretarial teams. Governance considera - tions are now routinely embedded into strategic plan - ning processes, executive performance assessment and capital allocation decisions, reflecting a broader appreciation of governance as a driver of long–term value creation rather than a regulatory obligation. This trend is reinforced by the foundational govern - ance requirements under the Companies Act, 2015, which codifies directors’ duties, derivative actions and related-party transaction controls, providing the statu - tory underpinning for enhanced board accountability. Directors’ fiduciary obligations to act in good faith, exercise reasonable care and diligence and promote the success of the company have become central to
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