A parliamentary committee has proposed sweeping changes to the governance of State corporations, calling for a uniform three-year term limit for all chief executive officers and directors-general in government-owned agencies.
In a report backing the Kenya Roads (Amendment) Bill, 2025, the National Assembly Committee on Transport and Infrastructure said the current discrepancies in the tenure of State entity bosses have led to inequity and legal uncertainty, and must be harmonised under the State Corporations Act, Cap. 446.
“All chief executive officers and directors-general of State entities will have tenures capped at three years, renewable once,” the committee stated in its report.
Currently, some State corporations—particularly in the roads sector such as the Kenya National Highways Authority (KeNHA), Kenya Rural Roads Authority (KeRRA), and Kenya Urban Roads Authority (KURA)—offer five-year renewable contracts, while most other agencies enforce three-year renewable terms.
The committee argues that this inconsistency has led to “discrepancies and unfair treatment” of officials across various entities.
The proposal aims to standardise leadership structures, ensuring parity among agencies and improving accountability. If adopted, all CEOs and directors-general, regardless of the agency, would serve a single term of three years, extendable once under clear legislative guidelines.
The committee also questioned the politicisation of appointments, noting that CEO positions are often used to reward political loyalty.
Appointments are typically made by Cabinet Secretaries in consultation with the boards of State agencies. However, the lack of legal clarity on term limits has previously resulted in lawsuits, a point raised by former Head of Public Service Joseph Kinyua.
Meanwhile, the committee’s report coincided with a financial summary showing that some parastatals recorded profit before taxation of Sh277.27 million, with total comprehensive losses of Sh142.78 million for the financial year ending March 31, 2025. The basic and diluted earnings per share stood at 0.37, up from 0.29 the previous year.
The lawmakers argue that clarity and consistency in leadership tenure could enhance performance and fiscal discipline in State corporations.
