Governance

The Central Bank of Kenya has a Board of Directors whose primary function is to determine the Policies of the Bank and to review the performance of the Bank. However, the Monetary Policy Committee, under the chairmanship of the Governor, is independently responsible for the formulation of Monetary Policy. The Board is composed of a Non-Executive Chairperson, the Governor, Principal Secretary to the National Treasury, and eight other Non-Executive Directors. The Board holds regular meetings at which it receives briefings on the Bank’s activities, decisions, implementation of policies and the performance of the financial sector and the economy. The Central Bank of Kenya Act provides for the qualifications of the Directors, the appointment procedures, and the other duties and responsibilities of the Board.

Role and Legal Status
Under the Central Bank of Kenya Act (Cap. 491), the responsibility for determining the policy of the Bank, other than the formulation of monetary policy, is given to the Board of Directors. The Board of Directors of the Central Bank of Kenya is responsible for:

(a) Determining the policy of the Bank, other than the formulation of monetary policy.
(b) Determining the objectives of the Bank, including oversight for its financial management and strategy.
(c) Keeping under constant review the performance of the Bank in carrying out its functions.
(d) Keeping under constant review the performance of the Governor in discharging the responsibility of that office.
(e) Keeping under constant review the performance of the Governor in ensuring that the Bank achieves its Objectives.
(f) Determining whether the policy statements made are consistent with the Bank’s primary function and policy objectives of the Bank.
(g) Keeping under constant review the use of Bank’s resources.

Membership
The Board comprises 11 members consisting of the Chairperson, the Governor; the Permanent Secretary to the National Treasury or his representative who shall be a non-voting member, and eight other non-executive directors.

The chairperson and directors are appointed by the President with the approval of Parliament and hold office for a period of four years but shall be eligible for re-appointment for one further term of four years. Persons eligible to be appointed to the Board must be citizens of Kenya who are knowledgeable or experienced in monetary, financial, banking and economic matters or other disciplines relevant to the functions of the Bank.

Meetings
The Chairperson convenes the meetings of the Board not less than once in every two months, or whenever the business of the Bank so requires, or whenever he is so requested in writing by at least three directors. In the absence of the Chairperson at a meeting, the members present shall elect one of the members appointed under paragraph to preside at that meeting of the Board.

A quorum for any meeting of the Board shall be the Chairperson, the Governor and three directors. Decisions of the Board are adopted by a majority of the votes of those present at that meeting and in case of an equality of votes the Chairperson or the person presiding at the meeting shall have a second or casting vote. The Board may delegate to any committee of the Board or to any member thereof, or to any officer, employee or agent of the Bank the exercise of any of the powers or the performance of any of the functions or duties of the Board under the CBK Act or any other written law.

Mr. Musangi was appointed as the Chairman of the Board of Directors by H.E. President William Ruto for a four-year term in September 2023. Mr. Musangi obtained his Bachelor of Laws (LLB) Honours Degree from the University of Hull (UK) and was admitted to the Bar in 1995. He is a member of the Law Society of Kenya and the Commonwealth Lawyers Association. He is a Senior Partner at Mukite Musangi and Company Advocates and has 29 years experience in diverse areas of mainly corporate and commercial legal practice.

Mr. Musangi has served as Chairman of the Public Procurement Regulatory Board and of the Rift Valley Law Society and as Council Member of the Nakuru Business Association. He also Chairs the Boards of GenAfrica Asset Managers and Smart Applications International and serves on the Boards of Centum Investment Company PLC and Haco Industries.

He currently advises several local and multi-national corporations on governance, strategy and legal matters in a variety of economic sectors.

FCPA Sophie Moturi is a finance and governance professional with extensive experience in board leadership and financial oversight. She holds a master’s degree in Banking and Finance from Moi University and a Bachelor of Commerce (Accounting) degree from the University of Nairobi. She is a Certified Public Accountant and a Fellow of the Institute of Certified Public Accountants of Kenya (ICPAK), as well as a member of the Association of Women Accountants of Kenya.

FCPA Moturi has served on numerous boards and committees, including the Micro Enterprises Support Programme Trust, the Public Sector Accounting Standards Board, and the Governing Council of the International Leadership University (ILU). She was also a member of the Independent Electoral and Boundaries Commission (IEBC) Selection Panel in 2011, a Council Member of the Association of Professional Societies of East Africa (APSEA), Chairperson of the Association of Women Accountants of Kenya, and Trustee of the Kenya Professionals Development Fund among others.

She started her career at Price Waterhouse, served in senior roles in NGOs including Country Director and as Chairman of Life in Abundance International-a global non-governmental organization. Most recently, FCPA Moturi served in the public sector as a Commissioner at the Salaries and Remuneration Commission (SRC).

CPA Abdullahi Abdi is a strategic leader and expert in policy advocacy and development, with over 22 years of extensive experience in leadership, governance, and socio-economic transformation. He has spearheaded initiatives that address critical issues such as climate change resilience and livelihood, child protection and education, women’s empowerment, principles of just governance, peacebuilding, and conflict transformation.

CPA Abdullahi serves as the Executive Director of Womankind Kenya, a national non-governmental organization. Additionally, Abdullahi chairs the Adaptation Consortium Trust, leading the strategic implementation of climate change financing. He also served as a Council Member at Koitaleel Samoei University College, and as a Board of Director at Coast Development Authority. He also worked as Senior Relationship Manager in the Banking Sector and Associate Consultant at Dayibson Consulting Limited.

CPA Abdullahi holds a PhD in Leadership and Management from the Management University of Africa, a Master of Business Administration (MBA-Finance) from United States International University, and a Bachelor of Commerce (B. Com – Accounting) from Kenyatta University. He also holds Leadership Certifications from Havard Kennedy School, Aga Khan University and Kenya School of Government. He is a Certified Public Accountant (CPA-K) and an active member of the Institute of Certified Public Accountants of Kenya (ICPAK) and Kenya Institute of Management (KIM).

Ms. Beatrice Kosgei is an Advocate of the High Court of Kenya with over 30 years’ experience in litigation, conveyance, commercial and corporate law, company secretarial practice and corporate management.

Ms. Kosgei holds a Master of Laws degree in Commercial and Corporate Law from the University of London and a Bachelor of Laws from the University of Nairobi. In addition, she is a Certified Public Secretary and Certified Governance Auditor.

Ms. Kosgei is a member of several professional bodies including the Law Society of Kenya, the Institute of Certified Secretaries of Kenya, the East Africa Law Society and Institute of Directors of Kenya.

Ms. Kosgei currently offers consultancy with a focus on legal advisory, commercial law and corporate governance. Her previous executive roles include General Manager, Legal Services and Company Secretary at the Geothermal Development Company; Corporation Secretary and Head of Legal Affairs at the Kenya Trade Network Agency; and Corporation Secretary at the Agricultural Development Corporation.

Mr. David Owuor is a seasoned Fintech Executive with over 15 years of expertise shaping Africa’s digital financial landscape. His expertise lies in the design, deployment, and scaling of AI-powered, data-driven financial technology solutions that drive institutional efficiency, regulatory compliance, and inclusive economic growth.

A visionary leader, Mr. Owuor specializes in strategy-driven innovation, leveraging data analytics, machine learning, and API-led architectures to expand financial inclusion and enhance institutional performance. His work spans Core Banking modernization, Digital Lending, Mobile, Internet and Agency Banking, Payments Infrastructure, and Credit Scoring Platforms. He has led multi-country programs integrating modern fintech into mainstream banking, public financial initiatives, and microfinance ecosystems across Africa.

Currently, Mr. Owuor serves as Vice President of Fintech Innovations at Pathways Technologies where he leads a portfolio of strategic implementations across Sub-Saharan Africa. He also works closely with development agencies and research institutions to advance access to finance through digital innovation. His previous leadership roles include Senior Project Manager at Craft Silicon and Head of Projects at Code Matrix in Malawi.

Mr. Owuor has a Bachelor of Science degree in Information Technology from Jomo Kenyatta University of Agriculture and Technology (JKUAT).

Mr. Pius Ang’asa is a seasoned technology and business leader with over 24 years of experience in the telecommunications industry, spanning multiple geographies across Europe and Africa. Over the course of his career, Mr. Ang’asa has held diverse leadership roles ranging from telecom engineering to branch and country management as well as serving as Regional Business Head for Central, East, and West Africa.

Passionate about the power of technology, Mr. Ang’asa is a strong advocate for digital transformation as a key driver of relevance and competitiveness in the 21st century for any organization or nation. He also firmly believes that a sustainable organization is one that scores highly on its environmental practices, social responsibilities, and internal governance structures (ESG).

Mr. Ang’asa holds a bachelor’s degree in technology from Moi University and an MBA from the University of Nairobi.

The executive management team comprises the Governor, two Deputy Governors and heads of department. The Governor and Deputy Governors are appointed by the President through a transparent and competitive process and with the approval of Parliament. The Governor and Deputy Governors hold office for a term of four years, but are eligible for re-appointment for one further term of four years.

The Governor is the chief executive officer of the Bank and, subject to the general policy decisions of the Board, is responsible for the management of the Bank, including the organisation, appointment and dismissal of the staff in accordance with the general terms and conditions of service established by the Board, the Governor has authority to incur expenditure for the Bank within the administrative budget approved by the Board.

Dr. Kamau Thugge C.B.S., is the tenth Governor of the Central Bank of Kenya (CBK), and has been in office since June 19, 2023.

Dr. Thugge joined CBK after a long and distinguished career in the international and Kenyan public service. He worked in the International Monetary Fund (IMF) in both policymaking and non-policymaking departments. These include the Policy Review and Development Department and the Trade Policy Division. In these roles, Dr. Thugge helped to design the Highly Indebted Poor Countries Initiative (HIPC) as well as other policy initiatives. He also worked on various Article IV missions. Dr. Thugge also served as Mission Chief to Botswana and Lesotho in the wake of the Global Financial Crisis.

Dr. Thugge has held various senior roles in Kenya, including as the Head of the Fiscal and Monetary Affairs Department at the National Treasury, as Economic Secretary and as Senior Economic Advisor. Dr. Thugge also served as Principal Secretary at the National Treasury, and lately as Senior Advisor to the President and Head of Fiscal and Budget Affairs. Dr. Thugge helped to design and implement various laws including the Public Finance Management Act, the Commission on Revenue Allocation Act, the Independent Officers (Appointment) Act, the Public Procurement and Disposal of Assets Act, and many more. In these roles, he also served on various boards including that of the Central Bank of Kenya, the Monetary Policy Advisory Committee (and later the Monetary Policy Committee), the Kenya Revenue Authority and the Capital Markets Authority.

The Governor holds a Bachelor’s Degree from the Colorado College, and Master’s and PhD Degrees in Economics from Johns Hopkins University in the United States.

The Bank is committed to entrenching best practices in Enterprise Risk Management (ERM) to achieve its vision to be “a world class modern central bank.” ERM promotes a risk-aware culture in the Bank so that all staff act with full knowledge of the implications of their decisions and actions in pursuing the mission and goals of the institution.

Risk management forms the Bank’s second line of defence towards the process of achieving its mandate and strategic objectives, and is thus a central part of the Central Bank of Kenya’s (CBK) Strategic Management. The bank units form the first line of defence, whereas Internal Audit provides the third line of defence, which is independent assurance.

Risk Management
The risk management function is charged with the following roles:
a)    Spearheading formulation of a Risk Management Policy for the Bank that clearly stipulates:
•    The objectives of the Bank’s Risk Management arrangements.
•    Structures responsible for managing risk within the Bank.
•    The Bank’s risk tolerance levels.
•    The Bank’s Risk Management frameworks that will help to identify, assess, monitor and manage potential risks and opportunities.
•    The mode of creating risk awareness within the Bank including appropriate education.
b)    Systematic assessment of risks throughout the Bank in consultation with the Departmental Heads, through interactive sessions like Control and Risk Self-Assessment (CRSA), by reviewing the Bank’s main activities and understanding how these activities can generate risks. The Function ensures that clear responsibilities and consistent frameworks are put in place to define, assess, monitor and control risk throughout the Bank, while at the same time creating risk management awareness amongst all members of staff. The main activities of the Bank which the Risk Management Function reviews on a regular basis include:
•    Monetary Policy
•    Financial System Stability
•    Banking Services
•    The Issuance of Currency
•    Foreign Reserves Management and Intervention Capacity
•    Real Time Gross Settlement System (RTGS) – KEPSS
•    National Debt Services
•    Internal support arrangements necessary for the above functions, including Procurement, Accounting, IT Services, Financial Markets Settlements, Internal Audit and Human Resources
c)    Reporting, documenting and maintaining a data base for the risks identified throughout the Bank (the Risks Register) and developing risk indicators that are used to signal possible problem areas and act as an early warning system.
d)    Assessing and documenting risk Incidence Reports in all areas of the Bank for management information.
e)    Carrying out regular risk reviews of major projects in the Bank.

Business Continuity Management (BCM)

Central Bank of Kenya as a regulator recognises its obligation to staff, government, the public, investors and other stakeholders for the continuity of its business operations. The Bank recognises the need to have sustainable critical business operations functional at all times for the purpose of maintaining its ability to fulfil its mandate as provided for under the Central Bank of Kenya Act Cap 491 of the Laws of Kenya.

Risk Management is charged with the following roles in BCM for the Bank:
a)    Spearheading the formulation and implementation of the Bank’s Business Continuity Management (BCM) programme and embedding the BCM culture within the Bank.
a)    Spearheading the formulation and implementation of the Bank’s Business BCM Policy aimed at ensuring Bank’s resilience and effective response to major operational disruptions that may arise from potential disasters.
b)    Coordinating the development, regular exercising and maintenance of the Bank’s Business Continuity Plan (BCP).

Compliance Risk Management and Ethics

The objective of the Bank is to meet stakeholders’ expectations consistent with its core mandate of formulating and implementing monetary policy directed at achieving and maintaining stability in the general level of prices and fostering the liquidity, solvency and proper functioning of a stable market-based financial system.
In pursuing this mandate, the
Bank is committed to adopting best practice and standards in the areas of accountability, transparency and business ethics.

Risk Management compliance is in six parts:
a)    Deals with stakeholder expectations consistent with the Banks core mandate of formulating and implementing monetary policy directed at achieving and maintaining stability.
b)    Deals with the scope of the policy and policy statement. Under the scope, the applicability of the policy is specified. The policy statement states what the bank aims to achieve through adopting the world’s best practices.
c)    Deals with the compliance framework and spells out what it shall achieve through allocation of responsibilities, identification of compliance risk, monitoring, investigating and reporting in line with applicable laws, regulations, standards and codes of conduct.
d)    Deals with the operation structure and implementation steps and it entails the identification and evaluation, setting of the policy, embedding the policy, monitoring, investigation and reporting compliance.
e)    Deals with the roles and the responsibilities of different stakeholders, namely the Board, Governor, Bank Risk Management Committee, compliance function, Internal Audit and staff.
f)    Deals with the review of the policy where the Risk management function shall on a regular basis assess and review the compliance policy to ensure that it remains relevant to the needs of the bank.

Anti-Money Laundering and Combatting the Financing of Terrorism (AML/CFT)

Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) are serious crimes that adversely affect the integrity of any country’s economic, social and political structures. Money laundering undermines the financial system, encourages crime, dampens Foreign Direct Investment and criminalises society.

Risk Management Function at the Central Bank of Kenya works closely with the Financial Reporting Centre (FRC) in the fight against money laundering and the financing of terrorism and is cognisant of the possibility that its services could be exposed to the risk of money laundering and terrorism financing. Through the AML/CFT Policy, the Central Bank of Kenya spells out measures to ensure that the Bank’s facilities are not used in the commission of, or to further the commission of, financial crimes, particularly money laundering and the financing of terrorist activities.

Internal audit is one of the key components of Central Bank of Kenya’s system of internal controls. It comprises plans of organisation and all methods and measures adopted by the Bank to safeguard its assets, check the accuracy and reliability of its accounting data, promote operational efficiency and encourage adherence to prescribed policies, laws and regulations.

Internal auditing is defined by the Institute of Internal Auditors as “an independent, objective assurance and consulting activity designed to add value and improve an organisation’s operations. It helps an organisation accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.”

Internal audit is a key corporate governance mechanism that complements other cornerstones of corporate governance, namely external auditors, Audit Committee and management. It assists in regulating and directing the activities of the Bank.

The Internal Audit Department is headed by a Director who is currently deputised by an Assistant Director and supported by auditors who are allocated a portfolio of operational and information systems audits to carry out during the specified period, and based on their competencies. The Director, Internal Audit, reports administratively to the Governor and operationally to the Board Audit Committee.

Internal audit performs two main functions: to provide audit/assurance and consulting/advisory services. These may be as part of their normal, routine activities or in response to specific requests from management.

Audit Services are generally a planned and objective examination of evidence for the purpose of providing an independent assessment on risk management, control or governance processes of the Bank. Examples of planned activities include financial, performance, compliance, system security, and due diligence engagements.

Advisory service activities are those whose nature and scope are agreed upon with the client and which are intended to add value and improve operations. Advisory activities may involve providing informal or formal advice, analysis, assessments, and serving on task forces and committees to review operations and make recommendations.

The Internal Audit Department has adopted a holistic, collaborative approach to auditing that combines all elements of traditional audit approaches, which include comprehensive financial, operational, and information technology (IT) reviews.