Biased composition of Board of Directors

The appointment of the BoD does not follow the correct procedure due to political interference.

Risk type: Cause

Risk driver: Internal

DESCRIPTION

The BoD of an organisztion has an oversight and steering role in management and decision-making. Consequently, BoD members are in a position to exert influence on major decisions related to the operations and strategic development of an organization. Nomination procedures may not be enforced, which can open the door for undue influence. In many instances the appointment of BoD members continues to be a political matter, and is therefore prone to patronage and nepotism. As a consequence, the composition of the BoD may be biased towards certain political interests. Moreover, if the BoD membership is seen as a political favour rather than as a professional appointment, members will be prone to expect personal gains.

RED FLAGS

All:

• The composition of the BoD is not in line with governance guidelines.
• Nomination procedures are unclear or not enforced.
• BoD members are appointed without proper justification or qualification.

Utility:

The majority of BoD members belong to the families, political parties or other affiliated groups of local politicians.

KEY GUIDING DOCUMENTS

STRATEGIC, 2009, Corruption Practices and the Available Complaint, Feedback and Redress Tool(s) and Anti-corruption Tool(s) in Water and Sanitation Sector – Bondo District, Strategic Public Relations and Research Limited, Draft prepared for Kenya Water for Health Organisation (KWAHO) and United Nations Development Programme (UNDP)

TARGETED EXAMPLES

Church selects management committee¹

Target group: Utilities

Location: South Sakwa, Kenya

The South Sakwa Water project was steeped in controversy pitting the WSP [utility] against the Catholic Church which were the originators of the project. While there were clear cases of mismanagement, the church insisted on selecting those who could be in the management committees. The project ended up with a committee that could not question some of the practices that only stalled the project.

FULL REFERENCES

1. STRATEGIC, 2009, Corruption Practices and the Available Complaint, Feedback and Redress Tool(s) and Anti-corruption Tool(s) in Water and Sanitation Sector – Bondo District, Strategic Public Relations and Research Limited, Draft prepared for Kenya Water for Health Organisation (KWAHO) and United Nations Development Programme (UNDP)