Nakuru County Government and the United States Agency for International Development (USAID) have partnered in training officials from seven coffee cooperative societies with the objective of improving governance and accountability in the sector.
County Chief Officer of Cooperatives Martin Kagai said the County was also collaborating with the national government to strengthen cooperatives as the preferred vehicles for development adding that good corporate governance, innovation and adoption of best practices was critical for the continued growth of the cooperative movement.
Speaking when he officially inaugurated the training at Kenya Assemblies of God (KAG) Youth Center, at Maili Sita area of Bahati Sub-county, Kagai regretted that the co-operative movement had been bedevilled by serious governance issues, which resulted in members losing millions of shillings through theft by officials and wrong investment decisions.
The training conducted by USAID’s Kenya Small Business Development Centers (Kenya SBDC) attracted leadership from Jumatatu, Solai, Ndemu, Mutungati, Mandizi, Kiremba, and Wikurie coffee cooperatives societies.
The Kenya Small Business Development Centers (Kenya SBDC) is a five-year programme funded by USAID and is being implemented by Strathmore University Business School (SBS).
The Chief Officer observed that bad governance in agricultural-based cooperative societies affects not only household incomes, but also threatens food security and nutrition in addition to slowing down economic growth.
He was however happy that through the training partnerships, many cooperatives have grown to become industry giants who have extended their business beyond the primary role of marketing produce for small-holder farmers and ventured into provision of financial services.
Through the training, Kagai observed, leaders acquire skills, knowledge and understanding to enable them make decisions beneficial to the interests of the cooperatives and its members.“The training is designed to help leaders to provide a constructive and enabling environment for good governance to thrive. It will offer opportunities for managers and employees to understand the unique nature of the cooperative business and the needs of members,” added Kagai.
While appreciating the role played by cooperative officials, the Chief Officer said that a cooperative society with accountable and transparent leadership would be able to reduce the cost of marketing farmers’ produce, enabling them to realize higher returns through provision of a reliable and remunerative outlet for their products.
The Chief officer stated that co-operatives hold over 40 per cent of the GDP and 35 per cent of total savings in the country, adding that if they were well managed, they would easily change the country by distributing wealth to a larger population.
“In 2022, agriculture contributed 22.4 to Kenya’s Gross Domestic Product while accounting for 51 per cent of exports. The sector employs 60 percent of Kenyans,” said Kagai.
In the past, there have been concerns over corruption and weak management structures of a number of co-operatives which resulted to misappropriation of funds, poor business planning, unrealistic and conflicting goals and targets.
Nakuru County Director of Cooperatives Ms Josephine Ngandu observed that with the sector holding 30 per cent of the national savings, it was one of the vehicles that could be employed in mobilizing resources for development and alleviation of poverty, particularly in the rural areas.
The Director expressed optimism that measures initiated by the government in recent years would start bearing fruits with leadership disputes expected to reduce.
Some of the measures include legislation, which demands that managers be trained in the management of co-operatives.
The co-operatives have also been restricted in their investment options, requiring them to maintain certain liquidity levels to increase lending to their members.
Ms. Ngandu noted that the County has enacted the Cooperative Revolving Development Fund Act to establish a revolving fund for cooperative societies. The fund is managed by a board and money borrowed by the entity must be approved by the Assembly.
The fund managers are required to conduct civic education to promote awareness and understanding of the operations of the fund among stakeholders.
Nakuru SBDC County Coordinator George Makau noted that the SBDC programme was committed to ensuring cooperatives increased their productivity and profitability and ultimately become sustainable entities.
He said the programme was keen to customize solutions to every cooperative society to ensure they reach their potential.
By Esther Mwangi and Okello Tracy
