President William Ruto has introduced new guidelines for the management of state corporations, as detailed in a gazette notice dated May 24. The new directives replace the previous guidelines from 2004.
According to the notice, the terms and conditions of service for board members and staff of state corporations will now adhere to the 2024 Guidelines on the Management of State Corporations. Ruto has mandated that all boards of state corporations ensure the immediate implementation of these new guidelines.
“All Boards of State Corporations are directed to secure the immediate implementation of the 2024 Guidelines on the Management of State Corporations (May 2024),” Ruto stated. He also instructed all Cabinet Secretaries to ensure full compliance with his Executive Order.
President Ruto emphasized the significant role state corporations play in the socioeconomic development of the nation. He underscored the importance of effective and accountable governance to maximize their contribution to national development.
In November 2004, the government had issued guidelines for the terms and conditions of service for the chairperson, board members, and chief executive officers of state corporations. Ruto noted that the evolving operating environment, emerging needs, and global trends necessitated a review of these guidelines to align with international best practices.
The revised guidelines aim to promote the efficient, effective, and prudent use of public resources, ensuring fiscal sustainability and improved performance of state corporations. They provide an objective mechanism for evaluating performance, rewarding success, and addressing poor performance.
“The revised Guidelines do not replace the Mwongozo Code of Governance for State Corporations but rather seek to augment its provisions, incorporating lessons learned during its implementation into the management of the sector,” Ruto explained.
The 2024 guidelines have been developed in consultation with key stakeholders, including the Public Service Commission (PSC) and the Salaries and Remuneration Commission (SRC). They received approval from the Cabinet on April 23, 2024.
