ROTARY CLUB PRESENTATION
Dr. Abbas Gullet
Secretary General
Kenya Red Cross Society
14th June 2013
Establishing Institutional
Resilience through Good
Governance :
The Case Study of Kenya Red Cross
Introduction

Current global quest for so-called “good governance” in all types of
organizations including humanitarian entities such as red cross national
societies

An organization has good governance when it has an internal system of
checks and balances to ensure that the public interest is served.

An explicit governance structure is the first step in establishing a stable
and reliable framework for accountability and good governance

Checklists include key concepts in governance are:

Accountability, efficiency, effectiveness, predictability, sound financial
management, fighting corruption and transparency.
Key Issues in good governance

organisational aspects
•
Are there both executive/management and governance structures?
•
Are they separated?
•
Is the oversight real, not only symbolic?
•
Is it clear who makes what, who is responsible for what?
•
Are staff aware of and does it respect the above mentioned?

financial aspects and transparency
•
Are there effective budgeting and fiscal systems at place?
•
Is there an effective oversight over financial issues?
•
Is the national Society transparent transparent?
Key Challenges facing national
societies in Africa

Exposed GOVERNANCE FAILURES that leads to lack of
accountability arrangements which constitutes a breeding
ground for

Corruption and wanton theft

Concentration of power- that lack of seperation of functions

Lack of democracy in the selection of the governance
teams.

Lack of internal control systems such as audits, proper fiscal
policies.

Compromised and poorly skilled management teams
Why is Good Governance Critical

Economic sustainability: With good governance NSs
become independent in the long run.

Diversification of income base with an increase in the faith
of the donors

Ensure effectiveness in an increasingly complex
environment

Corruption and lack of accountability jeopardises important
sociocultural values associated with humanitarian work

Dysfunctional national societies have huge impact on
society
Evolution of management of public
bodies in Africa such as ANSs
The old public management
bureacratic style, ineffective management, lack of
transparency
↓
The new public management
market-driven approach, effective management,proper boards,
separation of functions between board and management
↓
Good governance
new syntesis and maturity - aimed to reach sustainable
growth and efficiency , as well as beneficiary satisfaction.
Dual Governance Structure

It is based on distinction between organizational entities that is
governance and management, and the distribution of decision-making
between them. This dual governance structure is the key to maintaining
good governance

This arrangement helps retrain and moderate the control of any one
person or group of persons to ensure the organizational resources are
well managed.

Complete separation is essential. For example even when the
management teams/staff understand the organization very well,
presence of staff members in governance teams blurs the distinction
and leads to conflict of interest.

Complete requirement for avoiding conflict of interest i.e through
declarations of wealth, conflict of interest declarations/policy
Board/Governance as Principal
governance Body

There should be a governing body that wields constant and consistent
oversight and decision-making authority.

Usually a separate body that exercises governance functions such as
setting policies and strategies.

The board should represent the interest of all the stakeholders.

The collective leadership of the board should facilitate and organization
to be focused on the mission of the organization and resist special
agendas, interests of specific persons.

It is the collective decision making of the board as a team with multiple
experiences and talents that helps the board function effectively

It is therefore critical to have a board constituting multiple experiences
and professionals.
Good Governance and Internal
Controls

Internal controls promotes efficiency and integrity

Among these controls include professional accounting
standards, seperational of transactional responsibilities and
annual audits.

The internal controls should be reviewed periodically and to
ensure that they are being observed.

Central internal control is annual audits. This speaks loudly
about financial reliability.
Experience of the Kenya Red
Cross
The KRCS Journey of 8 Years
KRCS was mismanaged and bankrupt &
equated to a leaking bucket.
Was in debt of $500,000 & rated as one of
the most corrupt NSs.
A problem of leadership, governance & lack
of Accountability.
Was least responsive to National
emergencies.
KRCS HQ 9 years ago
Limited partners & donors due to lack of
credibility & bad image.
There was a problem with programmes.
Lack of professionals with overstaffing &
demotivated staff.
The Society took a decision to change things
KRCS HQ, Nairobi in 2013.
Change Movement

Audited our operational systems using SGS audits to establish key gaps and
weaknesses.

Establishment of a new board-getting right people in, and the wrong ones off
the bus.

Included co-opting professionals and experts in various fields such legal,
health, finance, management.

Put in place appropriate policies including in the areas of finance,
procurement, risk management, human resource. Instituted regular audits.

Reviewed legal base to provide for separation of powers between
management and governance.

Put in place mechanisms for election of board members through regular
periods.
How we did it at KRCS




2005- SGS Auditing
Restructuring,
downsizing. and hiring
professionals.
Training for Governance
& staff.
Development through
strategic plans that are
carefully implemented.
Training session for KRCS staff
KRCS Governance a meeting
Best Practices from KRCS
Walking the talk by adhering to our vision of being the most
effective & most trusted & self-sustaining humanitarian
organization in Kenya.
Transparency at all levels.
 All Board & SMT signed oath of office
 Declaration of assets & wealth
and conflict of no interest.
 Signed code of conduct.
Elections every three years
 Board vetted by and elections conducted
IEBC before elections
 Annual audits at all levels of society.
KRCS Elections conducted by IIEBC in 2010.
KRCS Today

KRCS is the lead humanitarian
agency of choice for Government
& other stakeholders.
 Responds to disasters in the
shortest time possible through 64
branches, 8 regions & HQ
networks.
 NFIs for up to 30,000 families.
 Was appointed the lead
humanitarian agency in Kenya.
KRCS volunteers respond to an accident
KRCS warehouse with prepositioned stock.
Food Security projects
Investing & Increase in Value
Bold step in investments and
property development, among
them, the Red Court hotels and
E-Plus ambulances.
Funds now generated from
KRCS business activities
ploughed back to the
humanitarian work.
Business arm of KRCS run
by professionals.
E-Plus state-of-art ambulances
The Boma Hotel in Nairobi, fully owned by KRCS.
Red Court & Boma Hotels
Red Court Hotel, Eldoret under construction
Red Court Hotel in Nyeri.
Red Court Hotel conference complex, Nairobi.
The Boma Hotel, Nairobi
KRCS SUCCESS - RECOGNITION
First non-profit organisation to be awarded
Super brands status, 2007/2008, in recognition of
its brand.
Road Safety Award 2012
Governance Award 2012 for Best Humanitarian
Organisation
KRCS has attained a special status; awarded the
Millennium Development Goals (MDGs) 2010, 2011
and 2012 Champion of the Year: Eradication of
extreme poverty & Malaria Control .
KRCS team receives MDGs Award 2010.
Awarded by Public Relations Award in 2009,
2010 and 2011 for PR Excellence.
Principle Recipient of Round 10 Global Fund.
Refugee operations in partnership with
UNHCR.
Above: HMM Award & Below: Award in PR excellence.
Future Plans
To remain true to the
humanitarian mandate
despite an investment
mindset; first in, last out.
Look for more business
ventures for financial
sustainability.
Move forward through
new strategy anchored on
three pillars:
INTERNATIONAL CENTRE FOR HUMANITARIAN AFFAIRS
Proactively alleviating human suffering through
generating and imparting knowledge
RESEARCH & INNOVATION
•Identifying Evolving Needs
•Conducting &
Disseminating Research
•Preserving & Sharing
Knowledge
KNOWLEDGE GENERATION
& TRAINING
•Generating Knowledge
•Disseminating knowledge
•Filling Skill Gaps
•Building Capacity
POLICY & ADVOCACY
•Informing Policy &
Implementation
•Influencing Stakeholders
•Governance Management
MAJOR AREAS OF INTEREST:
Disaster Management, Food Security, Peace Negotiations &Conflict Management, Health, Water and
Sanitation, Malaria, HIV/ AIDS, Emergency Medical Support, Community Outreach & Empowerment,
Volunteerism...
THE END
THANK YOU.