Kakuzi has lost an appeal against the Capital Market Authority’s (CMA) probe after a tribunal ruled in the authority’s favour.

This follows inquiries against Kakuzi and the evaluation of corporate governance findings were deemed separate legal processes by the tribunal in an ongoing case.

The ruling comes after the Nairobi Securities Exchange (NSE) listed company filed an appeal against CMA asking the tribunal to set aside directives from the authority as contained in summons for information.

CMA had issued a summons for information dated June 14, 2021, informing the company that it had initiated, on its motion, an inquiry into the affairs of the company. The inquiry was based on CMA’s findings and recommendations on Kakuzi’s governance assessment audit for the financial year 2019, particularly on the management and operational services agreements.

The authority also inquired about business dealings and agreements with related companies, human rights abuse payment of Sh696 million and weak management and board governance structures.

In the same summons, the authority sought to be furnished with information and certified copies of several documents.

Upon receipt of the documents and information, the Authority issued individual summons dated September 1, 2022, to the appellants to which the company claimed not to have been informed when the investigations began, the specifics of the conflict of interest and the particulars of financial impropriety. The company further demanded that the summons dated September 1 2022 be withdrawn to agree on new dates for the interview.

During the period before the inquiry, the authority received from Kakuzi Plc, the company’s Corporate Governance self-assessment report for the year ended December 31, 2021.

The authority then carried out an assessment indicating that the company demonstrated its commitment to good governance and sustainability.

Drawing reference to that assessment, Kakuzi wrote a letter to the authority, pointing out that the ongoing inquiry could not proceed any further, adding that the same issues had been dealt with in the corporate governance assessment report.

The authority then wrote back informing the company that the corporate governance assessment was a completely independent process from the June 2021 inquiry, reiterating that the inquiry was still ongoing.