INDICATORS OF GOOD GOVERNANCE IN SACCOs

  • Participation

The concept of people’s participation in their own development is central for good, effective and efficient governance of the SACCOs. All women and men who are shareholders/ members should have a voice in the decision-making process either directly or through the organs that represent them. Such participation should be fair and free of intimidation, duress or undue influence.

  • Transparency

All processes, decisions and relevant information should be conducted in a transparent manner and should be accessible to all those concerned.
Governance organs should hold regular meetings to direct the affairs of their SACCOs. The Committees should meet at least once a month while the General Meeting should be held at least once a year. Being working committees, the Credit/Loans and Supervisory/ Audit Committees should meet regularly to ensure close supervision of the SACCOs’ leading and general business.

  • Accountability

All decision-makers; Administrative Committee, Supervisory Committee, Audit Committee and Management must be accountable to their immediate supervisors and ultimately, to the members (through the General Assembly) and the members of their
communities.

  • Consensus Orientation

In-spite of the uniform membership criteria, there is bound to be differing interests, views and opinions in the SACCO. It is, therefore, very important to reach broad consensus among the parties concerned on all matters of the SACCOs’ operations. This will best be achieved through an all-inclusive participatory approach, transparent systems and operations, and full accountability to the members.
People in positions of power, like chairpersons, should be open to differing viewpoints.

  • Efficiency and Effectiveness

The governance and management organs of the SACCOs must have processes and procedures which produce results in time, using resources in the most economical way. The results should meet the needs of clients and stakeholders. This is an indicator of good governance.

  • Equity (fairness to all)

All members and clients should have equal opportunities to benefit from the SACCOs’ services in order to improve their economic status and share in the vision of the society. They should therefore, be equally accorded the SACCOs’ opportunities and services. The basis for equitable participation could either be a combination of the members’ share capital and saving deposits or any one of them as it may have been agreed upon. In the governance organs, none should be suppressed, ignored or shut up when they have suggestions.

  • Respect for Rules, Policies and Regulations

The legal framework and policies under which SACCOs are regulated and operate should be respected, strictly and impartially enforced. They should be made known to all members at all times.

  • Strategic and Visionary Leadership

The SACCOs must have leaders and managers who have a vision for and commitment to the organization. The leaders and managers should seek and improve their institutions and do all that is necessary to satisfy the needs of their members and the communities in which they are located. Their character and past record should be free of any professional and operational flaws. Such leaders and managers need to have strategic thinking so that the affairs of the SACCO are managed with a sense of purpose.

  • Knowledge and Skill in Leadership

The members of the governance organs should be knowledgeable and trainable in the matters of the SACCOs’ governance and operations. It would be of good if all members of the governance committee (the Administrative Committee, Audit and Loans Committees) were holders of at least Ordinary Level Certificate or higher qualification.

  • Organizational Performance and Growth

SACCO growth both in portfolio size and savings volumes is often an indication of good governance. Sound Governance will lead to sound management and sound operations. In return, these aspects will lead to excellence in performance. Continued growth of the SACCO will result in its survival and sustainability in the long-term. In the same respect, a poorly governed SACCO will hardly post good performance and annual growth on a continuous basis.

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