MINUTES OF THE 28TH MSEA STRATEGY AND BUSINESS DEVELOPMENT

SERVICES COMMITTEE MEETING HELD ON THURSDAY, 3RD DECEMBER 2020 AT

MSEA HEADQUARTERS

MEMBERS PRESENT
Ms. Zohra Baraka - Chairperson
Mr. Isaac Mbingi - Member
Eng. Mr. Charles Kalomba - Member
Mr. Anthony Kwache - Member
Ms. Mary Karanja - Member (attending virtually)
Mr. Humphrey Njoroge - Member (attending virtually)
Ms. Rose Mwongera - Member (attending virtually)
Ms. Caroline Karanja - Member (attending virtually)
Mr. Henry M. Rithaa - Director General/CEO-Secretary

IN ATTENDANCE
Ms.Catherine Mungania - Registrar, MSE
Mr. Samuel Matonda - Director, Business Development Services
Mr. Richard Omelu - Director, Strategy
Ms. Mary Chege - Chief Legal Officer-taking minutes

MSEA SBDSC MIN01/03/12/2020: PRELIMINARIES.

The Chairperson called the meeting to order at 9.20 a.m. Opening prayers were led by
Mr. Henry M. Rithaa, the Director General/CEO.

MSEA SBDSC MIN02/03/12/2020: CONFIRMATION OF QUORUM AND

APOLOGIES.

The Secretary confirmed there was sufficient quorum for the meeting and that the meeting
was properly constituted. There were no apologies.

MSEA SBDSC MIN03/03/12/2020: DECLARATION OF CONFLICT OF INTEREST.

None of the members declared conflict of interest in any of the Agenda items.

28th Board Strategy and Business Development Services Committee Minutes 1

MSEA SBDSC MIN04/03/12/2020: ADOPTION OF THE AGENDA.

The meeting Agenda was adopted by the members as follows:

1. Preliminaries.
2. Apologies and confirmation of quorum.
3. Declaration of conflict of interest.
4. Adoption of the Agenda.
5. Confirmation of Minutes of the 27th Strategy and Business Development Services
Committee meeting held on 7th September 2020.
6. Matters arising from the Minutes of the 27th Strategy and Business Development
Services Committee meeting held on 7th September 2020.
7. Quarterly Strategy and Business Development report for the quarter ended 30 th
September 2020.
• MSEA Strategic Plan 2020-2024.
• Strategic partnerships and collaborations.
• KYEOP Project.
• Capacity building and training.
• Marketing support.
• Covid-19 response.

8. Operationalization of the MSE Registrar’s office.

• Work plan.
• MSEs Registration operational manual.
• MSE regulations.
• Development of MSE CRM system in partnership with UNDP.

9. MSEAs Communications strategy.

10. Strategy and Business Development Board Committee Charter.
11. Any other Business.

MSEA SBDSC MIN05/03/12/2020: CONFIRMATION OF MINUTES OF THE 27TH

STRATEGY AND BUSINESS DEVELOPMENT
SERVICES COMMITTEE MEETING HELD ON
7TH SEPTEMBER 2020.

Following a proposal by Director Humphrey Njoroge seconded by Director Eng. Charles

Kalomba, the Minutes of the 27th Strategy and Business Development Services
Committee meeting held on 7th September 2020 were confirmed as a true record of the
proceedings thereat.

28th Board Strategy and Business Development Services Committee Minutes 2

 MSEA SBDSC MIN06/03/12/2020: MATTERS ARISING FROM THE MINUTES OF
THE 27TH STRATEGY AND BUSINESS
DEVELOPMENT SERVICES COMMITTEE
MEETING HELD ON 7TH SEPTEMBER 2020.

The report on matters arising was adopted as tabled.

MSEA SBDSC MIN07/03/12/2020: QUARTERLY STRATEGY AND BUSINESS

DEVELOPMENT REPORT FOR THE
QUARTER ENDED 30TH SEPTEMBER 2020.

The quarterly Strategy and Business Development Services Committee report for the
quarter ended 30th September 2020 was tabled with the following
deliberations/resolutions ensuing:

i. MSEA Strategic Plan 2020-2024.

Management reported that the amendments proposed during the Board retreat held on
13th and 14th October 2020 had been incorporated into the Strategic plan. Further,
UNDESA had, in principle, agreed to finance the stakeholder’s validation forum, launch
of strategic plan and development of the strategic plan implementation framework. The
planned activities would be facilitated by the Consultant, Mr. Mathew Malinda. However,
approval of the proposed Budget amount by UNDESA was pending.

The Committee noted the current delay in launching of the Strategic plan and emphasized
the need for Management to achieve the stated target dates of 21st January 2021 for the
stakeholders validation forum and 4th February 2021 for launch of the strategic plan.
Management was asked to submit the proposed roadmap and budget towards launch of
the strategic plan to the Committee members after the meeting. Further, Management
was asked to submit a breakdown of UNDESA funding to the Committee members.

ii. Strategic partnerships and collaborations.

(a) Approved partnerships.

The Committee noted the progress made in implementing approved partnerships; Family
Bank, Equity Bank, Gulf Bank and Innovations for Poverty alleviation. With regard to the
banking partners, the Committee asked Management to review the process of identifying
MSEs that would qualify for funding or capacity building to ensure the MSEs were spread
across the country and not just in areas where the banks had existing bank branches.
Additionally, Management was asked to review the MSE credit rating process that had
been developed by Metropol Corporation. Upon review of the suitability of the credit rating
process by the Board, it could be recommended for adoption by the MSE funders thereby
easing the appraisal process for MSEs seeking funding. Director Charles Kalomba was
asked to initiate discussions between Metropol Corporation and MSEA, and to request
Metropol to submit the proposal for collaboration to MSEA.

28th Board Strategy and Business Development Services Committee Minutes 3

 (b) Proposed partnerships.

The Committee noted the proposed partnerships with Google, Facebook and Kenya
Network Information Centre (KENIC) all of which were aimed at creating digital presence
and digital marketing opportunities for MSEs. For the successful implementation of these
initiatives, Management was asked to look into the issue of provision of cheap data for
MSEs and to explore the possibility of strategic collaboration with Safaricom who had
rolled out a bulk data product for digital marketing. Management undertook to present
substantive concept papers on the partnerships for review by the Committee at its next
meeting.

The Committee passed a resolution recommending the proposed camel milk value
addition project in Wajir for approval by the Board. The Project had been proposed by
Management following the recommendation by the Board requiring Management to
reorient the CIDCs by developing initiatives that targeted/exploited the
resources/opportunities available within the locality of the CIDCs. Management was also
working to implement other targeted initiatives such as bee keeping in Injara, and
agribusiness in Uriri, Matayos and Lamu West.

Management was asked to explore collaboration with Gearbox, and potential benefits
that would accrue to MSEs from amongst the services offered by Gearbox including
provision of working space, shared prototyping facilities, training in manufacturing,
fabrication and design as well as mentorship, investment opportunities and community
development.

iii. KYEOP Project.

The Committee reviewed the status update report on KYEOP with the following
discussions/resolutions ensuing:

a) There was significant delay in implementation of the project by an approximate 6

months period attributable to Covid-19, delays by the Consultants, KPMG, and the
judges amongst others. Further, the process of randomization and selection of
youth who would get Kshs. 3.6 million grant had not been completed.

b) The number of youth who had successfully gone through the program was very
small. Of the 4951 youth who had been invited to participate in the online Business
Plan training, only 1,064 had enrolled into the program and out of these, only 812
youth had completed all the learning modules. Additionally, of the 250 youth
shortlisted to receive grants of Kshs. 900,000, only 75 had pitched in front of the
KPMG panel.

c) Members noted the need for strategic review, decision making and action to
remedy the current situation else the project would not achieve the desired
outcomes of job creation, outreach to a significant number of youth in Kenya,

28th Board Strategy and Business Development Services Committee Minutes 4

 developing business skills amongst the youth and empowering the youth to build
sustainable businesses.

Management was asked to submit a detailed report showing the approved

schedule of activities and budget versus the actual status of implementation, action
taken by Management to mitigate the delay such as seeking approval for extension
of timelines and variation of contracts on the timelines and budget as applicable,
the future plan of action to enhance the number of youth successfully going
through the program as well as rehabilitating the youth who had fallen out back
into the program in light of the current and developing mitigations against Covid-
19.

Management reported that following a second review by the World Bank on the progress
in implementation of the project by MSEA and other implementing agencies such as NITA
and Ministry of Labour amongst others, World Bank had recognized MSEA as the best
performing implementation agent for the second time. World Bank had intimated the
possibility of enhancing MSEAs scope. Management undertook to submit the two review
reports to the Committee members.

In response to a question on the role of MSEA on various business plan competition

projects being carried out by various institutions such as KEBs, Management reported
that they were not directly involved but had peer supported a number of those institutions
in developing their projects by sharing insights learnt from the KYEOP project.

iv. 21st EAC Micro and Small Enterprises trade fair.

Members noted the postponement of the 21st EAC Micro and Small Enterprises trade fair
from the scheduled date of December 2020 to sometime in March 2021 owing to Covid-
19. Management was asked to update the Committee members once the new dates and
venue were fixed.

v. Covid-19 response.

The Committee noted the initiatives that had been undertaken in response to Covid-19.
Management reported that the goods distributed had been largely procured from MSEs
as directed by the Board. However, there were a number of lessons learnt during the
process such the need to develop capacity amongst MSEs particularly with regard to their
structure and documentation to enable them access government contracts.

In order to enhance the responsiveness by Committee members in addressing issues

encountered in the course of their day to day interaction with the MSE sector members
that they represented on the Board, the Committee Chair asked Members to escalate
issues requiring Management action through the Director General/CEO.

28th Board Strategy and Business Development Services Committee Minutes 5

The Committee adopted the quarterly Strategy and Business Development Services
Committee report for the quarter ended 30th September 2020 subject to the foregoing
resolutions.

MSEA SBDSC MIN08/03/12/2020: OPERATIONALIZATION OF THE MSE

REGISTRAR’S OFFICE.

The report on operationalization of the MSE Registrar’s Office was tabled with the
following discussions/resolutions ensuing:

i. Registrar’s Work plan.

The Committee adopted the report on the Registrar’s work plan as tabled and
recommended the Registrar’s work plan for approval by the Board.

ii. MSEs Registration operational manual.

The Committee reviewed the report on the MSEs Registration operational manual with
the following discussions/resolutions ensuing:

a) The MSE certificate of registration should distinguish between micro and small
enterprises in accordance with the definitions provided under the MSE Act. The
certificates should be virtually generated and printable at remote locations.

b) The process should capture information that would enable the Registrar to monitor
and enforce compliance with obligations under the MSE Act and regulations such
as maintenance of books of account, rendering of accounts by the Treasurer,
ensuring a democratic elections process amongst others.

c) The process should capture details and develop a database of the economic
activities of the members to enable MSEA to develop targeted solutions based on
the MSEs funding requirements.

d) The process should capture data and enable the Registrar to enforce good
corporate citizenship such as payment of taxes by MSEs.

e) The process should track the growth of entities and their migration from one level
to another e,g from a micro to a small enterprise and eventually to beyond the
small enterprise level to ensure that the initiatives implemented by MSEA for each
of the categories benefitted the intended beneficiaries.

The Committee adopted the MSEs Registration operational manual to be recommended

to the Board for approval subject to incorporation of the foregoing resolutions.

28th Board Strategy and Business Development Services Committee Minutes 6

 iii. MSE regulations.

Management reported that the amended MSE regulations incorporating stakeholder

comments had been submitted to the office of the Cabinet Secretary. Additionally, the
regulations had been amended to incorporate the BBI proposals providing for registration
and certification of MSEs owned by youth, women and persons with disabilities by MSEA
to enable the MSEs to qualify for government contracts. Hence, the title of the MSE
(Association) Regulations had been changed to MSE (Registration) Regulations. The
MSE (Worksite) Regulations had been further amended to incorporate development and
management of all infrastructure provided under the MSE Act and as proposed under
the BBI report hence necessitating a change of name from MSE (Worksite) Regulations
to MSE (Infrastructure) Regulations.

Management was asked to submit the amended regulations to the Committee members.

The Committee adopted the report on MSE Regulations to be recommended to the Board
for approval subject to the foregoing resolution.

iv. Development of MSE CRM and Call Centre systems in partnership with
UNDP.

The Committee reviewed the report on MSE CRM and Call Centre systems being
developed in partnership with UNDP with the following discussions/resolutions ensuing.

a) Management was asked to ensure proper documentation of the scope of work and
financial terms agreed with UNDP.

b) All references to SME be amended to MSE.

c) The systems under development should be forward looking and provide for future
capabilities and functionalities such as integration with mobile payment solutions,
networks of other financial institutions and MSE strategic partners, management
of the MSE fund.

d) The system should be developed to capture and analyse relevant and qualitative
data relating to the MSEs that would aid in policy and decision making such as
economic activities of the MSEs, their performance and growth, geographical
spread.

e) Management should develop a back office system for supporting the MSEs in
aspects such as book keeping and preparedness to access government contracts.

f) Management should ensure there is a proper mechanism and environment for

hosting, maintaining and managing the servers.

28th Board Strategy and Business Development Services Committee Minutes 7

The Committee adopted the report on development of MSE CRM and Call Centre
systems in partnership with UNDP to be recommended to the Board for approval subject
to the foregoing resolutions.

MSEA SBDSC MIN09/03/12/2020: MSEAs COMMUNICATIONS STRATEGY.

Director Simon Nyamolo presented the report on MSEAs Communications Strategy.

The Committee adopted the report on MSEAs Communications Strategy and

recommended the same for approval by the Board noting development and
implementation of MSEAs communications strategy was long overdue. There was need
to create greater visibility and media presence of the initiatives being undertaken by the
Government relating to the MSE sector through MSEA.

Management was asked to maintain a comprehensive record on MSEAs history, work

being undertaken by MSEA, the challenges and lessons learnt for future reference.

MSEA SBDSC MIN10/03/12/2020: STRATEGY AND BUSINESS DEVELOPMENT

BOARD COMMITTEE CHARTER.

Management reported that a consolidated Board and Board Committee’s Charter had
been developed incorporating the approved Committees terms of reference. The Charter
would be presented to the Board for consideration.

The Committee asked Management to submit the Charter to the Committee members
after the meeting.

MSEA SBDSC MIN11/03/12/2020: ANY OTHER BUSINESS

The Committee recommended fast tracking of the development of the Board performance
improvement plan and submission of the plan to the relevant authorities as recommended
in the Board evaluation report presented by the State Corporations Advisory Committee
at the previous Board meeting held on 28th September 2020.

Committee members who had attended the Board induction program held at the Kenya
School of Government in Embu between the 26th-28th November 2020 thanked the Board
for affording them the opportunity for training and the Director General/CEO for organising
the same. They noted that the training had enhanced their skills and effectiveness as
Directors.

There being no other business the meeting ended at 1.23 p.m. Closing prayers were led
by Director Mary Kinuthia.

28th Board Strategy and Business Development Services Committee Minutes 8

Approved for circulation

Secretary……………………………………….. Date………………………..

Chairperson………………………………………Date……………………….

Confirmed at a meeting

Secretary……………………………………….. Date………………………..

Chairperson………………………………………Date………………………..

28th Board Strategy and Business Development Services Committee Minutes 9