Neuroanatomía de la conducta agresiva

This document is obtained and summarised from European Corporate governance Institute, available at www.ecgi.org. This document, principles of corporate governance 2002, was prepared by the Private Sector Corporate Governance Trust in Kenya. In November 1998 and March 1999, consultative corporate governance seminars were held and resolved that a private sector initiative for corporate governance be established in Kenya to formulate and develop a code of best practice for corporate governance. However, these good corporate governance principles are neither prescriptive nor mandatory but are designed as a basis to help companies in Kenya to formulate their own specific codes of best practice. If all corporate entity in Kenya examines its own governance practices, enhance its own governance practices and improves what needs to be improved, then the purpose in which the guidelines are formulated would be served. Chapter three of the document set out sample code of best practice for corporate governance in Kenya. The main information in the code relevant to this study is summarised below:

Board of Directors: The code urges the board of directors to act in the best interest

of their company and to exercise leadership and judgement to direct their company to achieve continuing prosperity. Therefore, the code tasks the board of directors to perform certain functions which include (1) directing the company to achieve continuing prosperity (2) acting in the best interest of their company and respecting principles such as accountability and transparency (3) making sure that companies comply with every relevant regulations, laws and codes of best business practice (4) ensuring that there is a good communication with the shareholders and the stakeholders (5) regular assessment of the effectiveness and performance of individual directors including the CEO and (6) to monitor performance indicators and key risk areas and to identify them. In order for the board of directors to fulfil

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their functions well the code advises them on certain things such as defining the limits of authority of the top executives and the CEO, defining how the board will operate, having regular meetings and monitor the management performance.

Board meetings: The code discusses about board meetings, but did not state a

particular number of meetings that organisations should have each year. The chairman is expected to chair meetings. The chairman must ensure order, good conduct of meetings and giving opportunity to participants to speak to ensure that decisions are made fairly.A company would develop standing orders or regulations to regulate the conduct of board meetings, including how to nominate someone to preside a meeting if chairman or vice chairman is not present to chair a particular meeting. The code requires the board to ensure that key members of management are brought into the board meetings so that they can participate and add value to their deliberations and work on behalf of the Board. According to the code, it is the responsibility of the chairperson to prepare agenda for board meetings and chairperson should consult company secretary, the board and the chief executive. Management are expected to agree in advance the calendar of board meetings. Management are also expected to highlight important issues that needs attention of the board, which should be discussed at meetings. The board manual highlights that it is a duty of board directors to attend board meetings and must devote enough time and attention to affairs of their company.

Independent/nonexecutive directors: The code urges corporations in Kenya to

ensure that the composition of their board is a balance of executive and non- executive directors to avoid individuals or group of individuals dominating decision making. Like many other corporate governance codes, the code in Kenya requires the independent non-executive directors to be independent of management and free from any business and relationship that can affect the exercise of their ability to bring an independent judgement to bear on issues of strategy. The code also recommends the flowing: (1) that at least one third of the company members in Kenya must be non-executive directors (2) people should not hold many non- executive directors if they hold full time position in another company (3) person with relationship with the director in one company, whether personal or social, cannot become non-executive director in that company and (4) direct customers, suppliers or trading associates a company cannot become non-executive director of that company. The code recommends independent non-executive directors to be

independent of the management and free from anything which will affect their capacity to be independent judge to bear on issues of strategy. Where conflict of interest is likely to occur, for example performance evaluation and directors’ nomination and remuneration, independent directors must be relied upon.

CEO/Chairman: The code advises the chairman of the board to be different from

the managing director. Therefore, it is obvious that the code supports the split role of CEO and the chairman in order to balance power and authority and to avoid individuals having unfettered powers of decision. However, the code makes it clear that if for some reasons if the two roles are combined, the reasons for combining should be explained publicly. The code sets some responsibility for the chairman which include leading the board, assisting effective management and chair board meetings, making sure that good conduct, order, giving opportunity for members to speak and making sure decisions are made.