Kenyan CEO’s Overpaid: How Much is Too Much?

Kenyan CEO’s Overpaid: How Much is Too Much?
If you haven’t bought the East African newspaper by Nation Media then you’re missing a lot. The current and career related headline reads, Revealed: The fat pay packets of Kenya’s business leaders. If you have a copy then you will have a ready answer when I ask, are Kenyan bosses grossly overpaid?

Some of the figures I am looking at make my head get dizzy. Safaricom paid a total of K’sh 310.7 million as salary and bonuses to their top three member of staff namely Michael Joseph the CEO, Christopher Tiffin CFC, and Les Baillie the Chief Operating Officer. Yaani these three guys make enough in a year to open a small bank in Kenya (You only need K’sh 250M). Assuming equal pay then each is taking home K’sh 8.6M. Now, Michael being the top dog I don’t think he’s earning the equivalent of number two and three and hence my estimate of a salary of K’sh 10M.

My good bank in the name of Equity paid 13 of its directors K’sh 299Million taking second place. For all those disgruntled staff at Equity bank now you know where your money goes. This figure translates to K’sh 1.9Million bob a month. But I don’t think Mwangi the C.E.O makes this partly amount. He must be in the league of K’sh 5M and above. And did you know James Mwangi owns 4.1% of Equity Bank issued shares translating to a value of K’sh 4.1Billion.

Following is East Africa Breweries paying four of its top employees a total of K’sh 220.5M. BAT Kenya comes a distant fourth with a pay of K’sh 136.4M to its top four employees. And on the bottom five is Bamburi Cement with a figure of K’sh 107M for it’s top three staff.

On the same article, the newspaper has quoted K’sh 30,000 as the average pay for a Kenyan employee. Obviously some of you are making much more than this but when you take the average across the many sectors it comes to that. Believe you me, I know of MBA graduates earning less than K’sh 10K.

The reason why I am highlighting the article is because of the accepted culture in many private companies in Kenya of paying handsomely senior management and directors in expense of the foot soldiers. The people who market the product or service, the ones who interact with clients daily, the one’s who suffer daily abuses from irate customers, the one’s who suffer in the cold and dusty roads etc. Why is this so?

There is a deliberate attempt to cut down on staff cost and reward top management and directors. This is how companies are getting away with it.

1.Mismatched workers:
Do you know why Kenya banks employ B.Com graduates and CPA-K as cashiers or customer service personnel? Jobs four form graduates can perform beyond expectations! At the end of two years I can assure you that no one will be interested with your qualifications for the simple reason that you studied for one thing and here you are practicing another. The employer clearly knows this but it’s to their advantage since the longer you stay with them at that position the better you will become but at the same time posing a lesser risk of leaving them. In short, you are selling yourself cheap!!

2.Divide & Rule:

I know of cases where the salary between a supervisor and immediate staff is a hefty K’sh 50K. Now, being only human, do you think the supervisor will see the need to ‘tetea’ you for a salary increment. Normally, the company will make sure that the supervisor or manager knows that were your salary to be reviewed upwards his or hers will be affected negatively. In this instance the management is in bed with the employer in an incestuous relationship.

3.Different Department, Different pay:

I have a lot of admiration for secretaries and admin staff. These chaps are the face of the company. But dear Kenyans, why the poor pay? This madness is extended to departments that aren’t concerned with the core mandate of the business. Take Kenya Airways for example, Pilots are paid from 800K and above (Starting 400K upwards). Compare this to accounting staff that get less than 100K even with those having more than three years experience. The case is not any different from Nation Media Group where accounts assistant earn less than 28K when Sheila Mwanyiga of Nation fetch K’sh 500K upwards. Where is the fairness?

These are just some of the ploy used by companies to deny many employees their rightful share of pay. Which method or tool do they use at your firm?