The board of The Nairobi Hospital has been arm-twisted by the government into accepting State compliant individuals into the prestigious hospital’s key policy making organ.
The upshot is that you now have a board of seven directors elected by shareholders and seven who have been imposed by the State.
The spin they will give you is that the antagonistic camps within the board have reached a negotiated settlement and that the multiple court cases they have instituted against each another will be withdrawn.
Yet the bare truth of the matter is that the directors were literally forced to co-opt the State influenced appointees into the board after succumbing to intimidation following the raid at the hospital and confiscation of documents and laptop belonging to directors and top managers by a team of multi-security agencies comprising the anti-money laundering agency, the National Intelligence and the Directorate of Criminal Investigations Economic Crimes Unit.
In effect, what has happened at The Nairobi Hospital is now under what you can describe in contemporary parlance as a ‘broad-based’ board.
It is an outrageous invasion into the running of this autonomous private company by the political elite of the administration of President William Ruto.
It is a very scary trend, and we can only pray that we are not regressing to the dark era of former President Daniel Arap Moi, when the government meddled into affairs of autonomous private companies and associations killed colonial-era farmer-owned companies.
The Nairobi Hospital is owned by a colonial era association known as the Kenya Hospital Association (KHA). Here is a bit of historical background.
In their wisdom, farmers in colonial Kenya established autonomous farmer-owned companies such as the Kenya Planters Co-operative Union Ltd (KPCU), the Kenya Co-operative Ltd (KCC) and the Kenya Farmers Association Ltd (KFA).
Because of the persistent interference into their affairs, these autonomous farmers owned companies all collapsed. The first to be killed was KFA; a profitable company that had been created by settler farmers to buy inputs in bulk on behalf of members.
I still remember how Moi’s henchmen mobilised and herded thousands of non-farmers into Nakuru’s Afraha Stadium to vote to convert the company into a co-operative. To complete the takeover, the then Commissioner of Co-operatives Alfrick Birgen was appointed as managing director.
The next farmer owned company to be targeted was KCC which although technically registered as a co-operative, was in reality; a private company that was listed on the Nairobi Stock Exchange.
KPCU had been registered by colonial farmers both as co-operative and a limited liability company. They dissolved it and created an entity called National Co-operative Coffee Union.
What is my point in going back to history? To drive home the point that the structure of ownership of The Nairobi Hospital - the fact that any Dick and Harry can pay Sh 10,000 today, become a member of KHA tomorrow and vote in its next AGM; leaves the company badly exposed to machinations by politically connected businessmen.
Nairobi Hospital is a Sh12 billion turnover company. Its portfolio in government paper is in billions. It sits on a 20 acre piece of land in the high-end Upper Hill area of Nairobi.
What is to stop a politically connected oligarch with an eye on the big and lucrative contracts floated by the company, from registering as many people as members of the association, transport them in buses to the AGM and make sure they not only vote out non-compliant board members but also strike out resolutions that don’t favour his business interests?
It is an open secret that one of the main dynamics at play in the current dispute are manoeuvres by sections of oligarch of the ICT sector to influence an impending procurement of a $ 5.8 million hospital managements information system. When you are about to lose a lucrative contract, you create chaos and disruption to delay decisions.
During the last AGM, one side of the political divide quietly mobilised hundreds of new members who were transported to the venue of the meeting at the prestigious Anderson Hall in ‘Embasava’ matatus to vote out their opponents. It was a rare spectacle because the 'rented crowds' stormed the place dressed in white lab coats.
From court documents, I have read how one player one day sent Sh 5 million by RTGS to the association to pay for 333 new members.
On the face of it, perfectly legal. What the power players behind such manoeuvres forget is that greedy regime players can play the same game and supplant the incumbents.
Long term, I think members should start debating the option of public listing where major owners are associations of stakeholders, doctors, nurses and instructional investors. The government must butt out of Nairobi Hospital. Period.
The writer is the former Managing Editor for The EastAfrican
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