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Post Reply: MPs Propose Three-Year Term Limit for State Corporation CEOs

<blockquote><div class="quotetitle">Quote from <a class="profile-link highlight-moderator" href="https://lawguide.co.ke/understanding-law/legal-forum/profile/lawyer/">Lawyer</a> on July 28, 2025, 9:46 am</div><div id="pl-7258"  class="panel-layout" ><div id="pg-7258-0"  class="panel-grid panel-no-style" ><div id="pgc-7258-0-0"  class="panel-grid-cell"  data-weight="1" ><div id="panel-7258-0-0-0" class="so-panel widget widget_sow-editor panel-first-child panel-last-child" data-index="0" data-style="{&quot;background_image_attachment&quot;:false,&quot;background_display&quot;:&quot;tile&quot;,&quot;background_image_size&quot;:&quot;full&quot;,&quot;background_image_opacity&quot;:&quot;100&quot;,&quot;border_thickness&quot;:&quot;1px&quot;}" ><div
			
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	<p dir="ltr" data-pm-slice="0 0 []">A new legislative proposal in Kenya aims to cap the tenure of chief executive officers and directors-general of state-owned enterprises at three years, with the possibility of a single renewal for an additional three-year term. This move seeks to standardize leadership terms across parastatals, addressing inconsistencies in governance and promoting accountability in public institutions.</p>
<p dir="ltr">The proposal, introduced through amendments to the State Corporations Act, comes as part of broader efforts to reform the management of state entities. Lawmakers argue that the current framework, which allows varying tenures across different parastatals, creates confusion and undermines effective oversight. By establishing a uniform three-year term, renewable once, the bill aims to ensure equal treatment and enhance governance practices in Kenya’s public sector.</p>
<p dir="ltr">The initiative is driven by concerns over prolonged tenures that may lead to complacency or misuse of authority. Supporters of the bill contend that shorter, fixed terms will encourage fresh leadership, foster innovation, and reduce the risk of entrenched interests within state corporations. The proposal also aligns with ongoing reforms under President William Ruto’s administration, which has emphasized restructuring public institutions to improve efficiency and accountability.</p>
<p dir="ltr">Under the proposed law, current CEOs and directors-general will serve out their existing terms but will only be eligible for a single additional three-year term upon renewal. This provision ensures a smooth transition while implementing the new rules. For example, the tenure of Eng. Kung’u Ndung’u, Director-General of the Kenya National Highways Authority, appointed in 2021, would be affected, potentially ending in 2027 instead of 2031 as originally planned.</p>
<p dir="ltr">The bill has sparked discussions about its potential impact on Kenya’s state corporations, which play a critical role in sectors such as infrastructure, energy, and education. Proponents believe the change will strengthen oversight by allowing regular evaluation of leadership performance. Critics, however, caution that frequent leadership changes could disrupt long-term projects and institutional stability, particularly in agencies handling major infrastructure developments.</p>
<p dir="ltr">The proposal comes at a time when the government is undertaking significant reshuffles in state corporations, partly influenced by a political partnership between President Ruto and opposition leader Raila Odinga. These changes are seen as an effort to create space for new leadership and align public institutions with the administration’s development goals.</p>
<p dir="ltr">Public reactions to the bill are mixed. Some Kenyans welcome the move, viewing it as a step toward curbing mismanagement and ensuring accountability. Others express concerns that shorter terms may deter experienced professionals from taking up leadership roles in state corporations due to job insecurity.</p>
<p dir="ltr">The amendments to the State Corporations Act are currently under consideration in Parliament, with lawmakers expected to engage in public consultations before finalizing the legislation. If passed, the bill could mark a significant shift in how state-owned enterprises are governed, setting a precedent for leadership accountability in Kenya’s public sector.</p>
<p dir="ltr">As the debate continues, stakeholders are closely watching how this proposal will shape the future of state corporations and their contribution to national development. The outcome of this legislative effort could redefine leadership dynamics in Kenya’s public institutions for years to come.</p>
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