Following the liberalisation of the cooperative sector vide the Sessional Paper No 6 of 1997 and the subsequent enactment of the Cooperative Societies Act , No.12 of 1997 (Amendment 2004), supervisory committees were introduced in all cooperatives.
Their mandate is to oversight cooperatives, a function that had hitherto been played by cooperative officers from the government.
Status of Supervisory Committees vis a vis management committees
Under the law, both committees are equals since both were elected by members during AGMs/ADMs where they also report back. In simple terms, they both derive their legitimacy from AGMs/ADMs.
This implies that supervisory committees are not subcommittees of management or boards. The scope of their duties is anchored in the rules and bylaws of Saccos.
They should indemnify cooperatives since they are entrusted with a very important yet highly susceptible role of keeping tabs on the cooperatives’ operations. They have unlimited access to records and hold quarterly joint meetings with their counterparts from the board of directors.
Consequently, they bear the brunt of any losses or cases of mismanagement that are perpetrated by the management under their watch!
Members should therefore be extra vigilant when electing members of the Supervisory committees.
In my view, the only sustainable way of restoring sanity in the cooperative sector is to promote “self-regulation”! Members should have some say on the kind of controls they want adopted in their cooperatives since in any case, they are the greatest stakeholders in these organisations.
This is also in sync with the policy interventions contained in the Sessional Paper No 4 of 2020.
If that happens, members will stop pointing fingers at Regulatory Authorities whose capacity is at times overwhelmed.
By Fred Sitati
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