Safaricom Shareholders to Vote on Sweeping Governance Changes at July AGM

Safaricom PLC  shareholders will consider a series of proposed amendments to the company’s Articles of Association at the Annual General Meeting (AGM) scheduled for July 31, 2026. The proposed changes, outlined in an explanatory memorandum issued by the Board of Directors, seek to update the company’s governance framework following a requisition by shareholder Vodafone Kenya Limited (VKL). 

According to the memorandum, the proposed amendments were submitted under Section 312 of the Companies Act and require approval by at least 75% of votes cast to be adopted. Each amendment will be voted on separately as a special resolution. The Board noted that its role is to present the resolutions to shareholders without recommending either approval or rejection, encouraging investors to make their own independent assessment.

Among the key proposals is a change to the composition of the Board of Directors. The amendments would establish a minimum of seven directors while removing the current maximum limit. The proposals would also allow Vodafone Kenya Limited and CST to each appoint one director for every complete 10% of issued share capital they hold, aligning board representation with shareholding.

Another significant proposal relates to the appointment of the Chief Executive Officer (CEO). Under the amendments, the CEO would be selected from a list of nominees provided by Vodafone Kenya Limited, provided the shareholder maintains more than a 50% stake in the company. The proposals also stipulate that the Chief Financial Officer (CFO) would serve as the CEO’s alternate on the Board.

The resolutions further seek to introduce a mechanism for resolving board deadlocks. If approved, persistent deadlocks would be decided by directors appointed by Vodafone Kenya Limited and CST. Other proposed amendments include revising board quorum requirements to a simple majority of directors and requiring ordinary board resolutions to be passed by a simple majority.

Additional changes cover dividend policy and reserve management. Directors would be required to comply with the company’s approved dividend policy when recommending or paying dividends, while retaining the discretion to set aside reserves in accordance with the dividend policy. The amendments would also reserve certain rights for the Government of Kenya, including consent over changes to the company’s name and decisions affecting operations outside Kenya and Ethiopia.

The memorandum notes that some directors have declared potential conflicts of interest because they are nominees of Vodafone Kenya Limited or the Government of Kenya. However, the Board said it believes this will not influence its decision to present the resolutions to shareholders, while confirming that both Vodafone Kenya Limited and the Government of Kenya are entitled to vote their respective shareholdings.

If approved at the AGM, the amended Articles will be filed with the Registrar of Companies within 14 days, bringing Safaricom’s governance framework in line with the new resolutions.