Trouble for Saccos as non-core members seek leadership roles

By Azael Masese

The move by some Saccos to bar non-core members from elective positions has come under sharp criticism even as the Government seeks to enhance good governance in the entities.

Most Saccos rebranded and opened the common bond to allow members from outside their traditional catchment areas to join the Saccos but didn’t change the bylaws that spell the election of members or delegates to the board.

Some societies group original members in group ‘A’ while non-core members are grouped in B or C and cannot vie for the managerial positions.

For example, if a teacher based Sacco opens the common bond and allows farmers, business people and employees of other state corporations, only teachers can be in the board of directors.

So emotive is the issue that other cases have proceeded to court for interpretation.

Trans Nation Sacco CEO Luncham Mugambi said the issue is sensitive hence there is need for players in the industry to rethink.

“Non-core membership cannot be locked out from vying since they have a democratic right,” noted Mugambi.

He stated that a society cannot say that leadership must come from a particular class yet they allowed everyone else to join the society after opening the common bond.

Mugambi admitted the issue faces the Sacco sub sector but needs sober minds to address it once for all.

“It would be unjust to deny a businessman with substantial investment and interest in the Sacco the opportunity to vie because he/she is not a core member,” he said.

He noted that the issue poses biasness in picking leadership to steer the society to the next level, likening it to throwing out the baby with the bathwater.

“You cannot deny a member who willingly joined the opportunity to view for a particular seat. Since it is voluntary membership and democratically controlled by members, one is free to vie,” he said.

Former Stake Kenya Sacco CEO Bridgit Magoko called on the review of the bylaws that bar non-core members from contesting for elective positions.

“Some Saccos have classes of membership, which is important for recording purposes but not to lock them out from elections,” she said.

Magoko, who is currently a cooperative officer under Migori, argues that members with substantial savings both in share capital and deposits stand a better chance to be elected.

However, Mombasa Port Sacco CEO Dedan Ondieki said they have given non-core members a chance to elect their own delegates.

“The core membership has a number of zones but there is one reserved for non-core membership. The membership could be small but it also depends on how much they contribute to the society,” he said.

Ondieki disclosed that the society did not have representation from the non-core membership but initiated it.

“In case they need two, they need to convince us as to why they need another slot,’ he said.

To be elected as a delegate or board member in some societies, one must have a minimum savings within the Sacco as high as Sh1.5 million.

To entrench transparency and fairness, Saccos have come under closer scrutiny due to the huge resources within their disposal.

Sacco Societies Regulatory Authority (SASRA) has ramped up efforts to ensure there is good governance in the societies.

During the celebrations to mark 50 years of Tembo Sacco, SASRA CEO Peter Njuguna implored members to put the right leaders in place.

Njuguna stated that cooperatives that put the right leaders in office gift themselves.  

To further improve governance in the societies, the Government introduced new requirements where those intending to seek leadership positions must have a minimum education level of Form Four and conform to Chapter Six on Integrity as outlined in the Constitution of Kenya, 2010.

The new Cooperative Society Bill 2021 indicates that the cooperative sector will have sanity and eliminate corrupt tendencies and gross mismanagement of members’ hard-earned resources by leaders.

Once enacted into law, it will address key challenges such as poor governance, leadership wrangles, cybercrime, low technology adoption and poor implementation of current regulations. 

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