UN Sacco By-Laws 2015(Revision)
United Nations Savings and Credit Cooperative Society Ltd
By Laws 2015
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UN Sacco By-Laws 2015(Revision)
TABLE OF CONTENTS
No. Page
1. Name and Area of Operation...................................................................................5
2. Registered Office, Postal Address and Society Branches........................................5
3. Binding powers of these by-laws.............................................................................5
4. Definitions and Interpretations ...............................................................................5
5. Objects ..................................................................................................................7
6. Co-operative Principles and values..........................................................................8
7. Membership composition.........................................................................................9
8. Membership Eligibility............................................................................................9
9. Qualifications for membership................................................................................9
10. Application for membership..................................................................................10
11. Admission into membership .................................................................................10
12. Refusal of Admission to membership....................................................................10
13. Rights of members.................................................................................................10
14. Obligations of members ........................................................................................11
15. Member’s Personal Statement...............................................................................11
16. Penalties and Fines.................................................................................................11
17. Termination of membership...................................................................................12
18. Suspension and Expulsion.....................................................................................12
19. Procedure of Suspension and Expulsion................................................................12
20. Withdrawal from the Society.................................................................................13
21. Payment on Cessation of Membership..................................................................13
22. Nominee ................................................................................................................14
23. Payment to Nominee..............................................................................................14
24. Shares.....................................................................................................................14
25. Deposits .................................................................................................................15
26. Liability of members..............................................................................................15
27. Funds of the Sacco Society ...................................................................................15
28. Power to borrow.....................................................................................................16
29. Receipting for money.............................................................................................16
30. Payments and disbursements.................................................................................16
31. General Meeting ....................................................................................................17
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32. Transition to a delegates system............................................................................17
33. Notice of Meetings……………………………………………………………….17
34. Quorum..................................................................................................................18
35. Required majority..................................................................................................18
36. Enforcement of decision........................................................................................18
37. Chairman at meetings............................................................................................18
38. Identification of Members......................................................................................18
39. Powers and Duties of Annual General Meeting....................................................18
40. Record of business.................................................................................................19
41. Elections.................................................................................................................20
42. Board of Directors ................................................................................................21
43. Eligibility for Membership to the Board ..............................................................22
44. Duties and Powers of the Board.............................................................................23
45. Legal Standard of Care..........................................................................................25
46. Indemnity and declaration of wealth ....................................................................25
47. Code of conduct.....................................................................................................25
48. Conflict of interest.................................................................................................25
49. Confidentiality by Officers of the Society.............................................................26
50. Delegation of Duties by the board.........................................................................26
51. Records of business of the Board ..........................................................................26
52. Board and Board Committees ...............................................................................26
53. Suspension from the Board....................................................................................27
54. Removal of A Board Member from Office............................................................27
55. Board Elections......................................................................................................27
56. The Chairman and Vice-Chairman........................................................................28
57. Honorary Secretary................................................................................................28
58. Board Committees ................................................................................................28
59. Supervisory committee. ........................................................................................33
60. The Chief Executive Officer..................................................................................34
61. Books of Accounts and Records ...........................................................................35
62. Policies and procedures .........................................................................................36
63. Authorization to Sign Documents..........................................................................36
64. Common seal ........................................................................................................37
65. Inspection of documents .......................................................................................37
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66. Miscellaneous……………………………………………………………………..37
67. Financial year.........................................................................................................38
68. Distribution of Surplus funds.................................................................................38
69. Dissolution.............................................................................................................38
70. Disputes..................................................................................................................38
71. Amendment of By-laws ........................................................................................39
72. Acceptance ............................................................................................................39
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UN Sacco By-Laws 2015(Revision)
BY-LAWS OF THE UNITED NATIONS SAVINGS & CREDIT CO-OPERATIVE
SOCIETY LIMITED (UN SACCO LTD)
1. NAME AND AREA OF OPERATION
This Society shall be called UNITED NATIONS SAVINGS & CREDIT CO-
OPERATIVE SOCIETY LIMITED, hereinafter referred to in these By-laws as “the
Sacco Society” and its area of operation shall be within the Republic of Kenya and any other
location as approved by the Board and licenced by the Regulator.
2. REGISTERED OFFICE, POSTAL ADDRESS AND SOCIETY BRANCHES
a) The registered office of the Sacco Society shall be situated at United Nations Complex,
Nairobi and its postal address shall be P.O. Box 30552-00100, Nairobi. Any change of
address of the Sacco Society shall be furnished to the Registrar of Co-operative
Societies and to the members of the Sacco Society.
b) The Sacco Society shall seek a written approval from the Authority to open a new
branch, relocate or close a place of business.
3. BINDING POWERS OF THESE BY-LAWS
These By-laws of the Sacco Society, shall, when registered, bind the Sacco Society and the
members thereof to the same extent as if they were signed by each member and contained
covenants on the part of each member for him or herself and his/her personal representatives
to observe all the provisions of the by-laws.
4. DEFINITIONS AND INTERPRETATIONS
4.1 Definitions
In these By-laws, unless the context otherwise suggests, words or phrases shall be
interpreted in accordance with the SACCO Societies Act of 2008 and Regulations
hereinafter referred to as the “ACT” and “Regulations” respectively, the Co-operatives
Societies Act CAP 490 Laws of Kenya and the rules made thereunder, hereinafter referred
to as the “Co-operative Act” and “Rules” respectively.
4.2 In these by-laws where the masculine gender is referred to, it will be construed to include
the feminine gender.
4.3 In these by-laws save as otherwise expressly stated:
a) “Committee” shall mean Committee of the board established as per the regulations.
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b) “Authority” shall mean the Sacco Societies Regulatory Authority.
c) “Board of Directors” shall refer to persons elected in a duly convened general meeting to
govern the business of the Sacco society as per these by-laws hereinafter referred to as the
“board”.
d) “CEO’’ shall mean the Chief Executive Officer.
e) “Commissioner” shall mean “the Commissioner for Co-operative Development as provided
for in the Co-operative Societies Act Cap 490.
f) “ A SACCO Society “means a credit and savings co-operative society registered under the
Co-operative Act CAP 490 and licenced under the Sacco Societies Act, 2008.
g) “Core capital’’ means fully paid up members’ shares, disclosed reserves, retained earnings,
grants and donations all of which are not meant to be expended unless on liquidation of the
Sacco Society;
h) “Deposit” means a sum of money received or paid on terms under which it shall be repaid
with or without interest or premium and either on demand or at a time or in circumstances
agreed by or on behalf of the person making the payment and the person receiving it.
i) “Dividend” shall mean members’ share of the surplus of the Society which is divided
amongst its members based on shares holding.
j) “Dormant accounts” means savings or deposits accounts maintained by the Sacco Society
that are not operational or have no transactions within the prescribed period.
k) “General Meeting” shall be a meeting (either “annual” or “special”) for all members duly
convened by the Sacco Society to conduct its business.
l) “Member” includes a person or a co-operative society joining in the application for the
registration of a society, and a person or co-operative society admitted to membership after
registration in accordance with these by-laws.
m) “Members of the immediate family” when used in these By-laws, includes, the spouse,
children, brothers, sisters or parents of each person eligible to be a member of the Society
whether or not residing in the same household.
n) “Next of Kin” shall mean the members’ closest living blood relative(s)
o) “Non-withdrawable deposits’’ are deposits made to the Sacco Society by a member
through the Back Office Operations (BOSA) and shall not be withdrawable in whole or in
part unless on resignation of a member.
p) “Returning officer” is a person appointed to oversee or conduct the elections of the society
at a general meeting.
q) “SASRA” means The SACCO Societies Regulatory Authority.
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r) “Share Capital” shall mean members’ equity in the form of issued and fully paid up shares
of common stock.
s) “Tribunal” means the Co-operative Tribunal established under the Co-operative Societies
Act CAP 490 to hear and determine disputes.
t) “Withdrawable deposits’’ are deposits made to the Society’s Front Office Service
Operations (FOSA) and shall be withdrawable according to the terms and conditions as
provided by the Sacco society.
u) “Nominee” Shall mean a person or entity that is requested or named to act for a member of
the Sacco society.
v) “Member in good standing” shall mean a member who is current on the repayment of
his/her loan due to the Sacco society and who is current in making his/her required
contribution and has not in any way acted in a manner which is potentially damaging to the
Sacco society and has fully complied with the policies and rules set by the Sacco society.
4.4 Interpretations
a) Any questions or dispute concerning the interpretation of these By-laws on any matters not
provided for therein, errors and omissions shall be referred to the Tribunal.
b) Words importing the masculine gender only include also the feminine gender.
5. OBJECTS
5.1 The object for which the Sacco Society is established is to promote the quality of life of
its members by providing quality financial products and services.
5.2 In particular the Sacco Society shall undertake:
a) To promote thrift among its members by affording them an opportunity for accumulating
their savings and deposits and providing them with credit exclusively provided and
productive purposes, at fair and reasonable rate of interest: thereby enabling them to use
and control their money for their mutual benefit.
b) To ensure personal growth through the introduction of new products and services that will
promote the economic base of the members;
c) To ensure progress of members and Sacco Society through continuous education programs
on savings and proper use of credit, reduction of poverty, human dignity and co-operation.
d) To apply the co-operative principle of co-operation among co-operatives in order to
promote members’ interests. In furtherance to its objective the Sacco society may affiliate
to the relevant national co-operative union and Apex society.
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e) To ensure safety and soundness of the members funds through appropriate risk
management framework.
5.2 For the attainment of the above objects, the Sacco Society may do all acts and things that are
permissible under the Sacco Societies Act and Regulations, Co-operative Act and Rules,
these By-laws and all such other things as are incidental or consequential to the economic
enhancement of its members’ interests provided such act is approved by the members in a
general meeting.
6. CO-OPERATIVE PRINCIPLES AND VALUES
In order to achieve its objects the Sacco Society shall act in accordance with the following
Co-operative principles and relevant values.
6.1. Principles
(i) Voluntary and open membership
The Sacco Society shall always be guided by the principle of voluntary and open
membership in its member recruitment drive without political, ethnic, religious,
gender or social discrimination.
(ii) Democratic member control
The Sacco Society will be fully controlled by members who will have equal voting
rights on the basis of one member one vote.
(iii) Economic participation by members
Members shall contribute equitably to the capital of the Sacco Society and share in
the results of its operations.
(iv) Autonomy and independence
The Sacco Society shall operate on mutually acceptable terms with its stakeholders
who will ensure its autonomy and independence.
(v) Education, training and information
The Sacco Society shall foster reciprocal, on–going education programs for
members, leaders, staff and the community so that they can teach and learn from
each other or from the appropriate resource persons in understanding and carrying
out their respective roles.
(vi) Co-operation among co-operatives
In order to better serve the interests of the members and the community, the Sacco
Society shall actively co-operate with other co-operatives locally, regionally,
nationally and internationally.
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(vii) Concern for community in General
The Sacco Society shall show concern to the community in which it exists and
operates.
6.2 Values
The values shall include self-help, mutual responsibility, equality and equity. The Sacco Society
shall practice honesty, openness and social responsibility in all its activities.
7. MEMBERSHIP COMPOSITION
Membership in the Sacco Society shall consist of:-
a) Original members who signed the application for registration.
b) New members subsequently admitted in accordance with these by-laws.
8. MEMBERSHIP ELIGIBILTY
A person of either gender shall be eligible for membership if he/she is within the following
Common bond:-
a) Is an employee of the United Nations (U.N) or any UN affiliated or Specialised Agency of
the United Nations.
b) Is an employee of Diplomatic Missions and International Organizations in Kenya as may
be approved by the board from time to time.
c) Is an employee of the Sacco Society or its Subsidiaries
d) Is a spouse, child, brother, sister or parent of any of the persons in (a) to (c) above
e) Is a Co-operative Society registered under the Act
f) Is a subsidiary Company of the Society as may be authorised by a resolution through the
general membership as per Section 16 of the Cooperative Societies Act CAP 490.
g) Is an employee or an officer of other organisations as approved by the Board from time to
time.
h) Is a former member of the Sacco Society who withdrew while in good standing.
9. QUALIFICATIONS FOR MEMBERSHIP
A person may become a member of the Sacco Society if he/she fulfils the following
qualifications:-
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a) Is within the field of membership as prescribed in these By–laws;
b) Has attained age of majority as prescribed under the relevant laws.
c) Is not a member of another SACCO Society with similar objectives and within the same
area of operation;
d) Is not directly, a money lender or carrying out such activities detrimental to the
objectives of the Sacco Society;
e) Is of good character;
f) Is of sound mind;
g) Pays entrance fee, deposits and minimum share capital as prescribed in the Membership
Policy
10. APPLICATION FOR MEMBERSHIP
a) Every applicant for membership shall complete an “application for membership” form.
The form shall be drawn to show all the information required for the purpose of
registration of the member.
11. ADMISSION INTO MEMBERSHIP
An applicant shall be admitted to membership on approval of the Board of Directors, but shall
not qualify for the rights and privileges of membership until he has paid in full the pre-requisite
entrance fee, deposit and shares as may be prescribed in the Membership Policy.
12. REFUSAL OF ADMISSION TO MEMBERSHIP
The Board of Directors may refuse to admit into membership any applicant by giving him/her
reason(s) for such refusal in writing, provided that, the person whose membership has been
refused, if aggrieved by the decision, shall have the right to appeal to the next General Meeting
through a registered member or the CEO.
13. RIGHTS OF MEMBERS
A member of the Sacco Society shall have the right to;
a) Attend and participate in decision making at all general meetings of the Sacco society and
vote;
b) Be elected to the organs of the Sacco society subject these by-laws.
c) Enjoy use of the facilities and Services of the Sacco society subject to the Sacco society’s
by-laws.
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d) All legitimate information relating to the Sacco society, including Internal Regulations,
Registers, Minutes of the General Meetings, Supervisory Committee reports, Annual
Accounts and inventories at the Sacco society’s registered office.
14. OBLIGATIONS OF MEMBERS
A members of the Sacco Society shall have the obligation to;-
a) Observe and comply with all the Sacco society’s by-laws and decisions taken by relevant
organs of the Sacco society;
b) Buy and pay up for shares or make any other regular payments provided for in these by-
laws;
c) Meet the debts of the Sacco society in case of insolvency in accordance with the provisions
of the Co-operative Act CAP 490 and these by-laws.
15. MEMBER’S PERSONAL ACCOUNT STATEMENT
Every member shall receive regular statements at least once every six months, which shall
contain particulars of membership, shares, deposits and loan transactions with the Sacco society.
16. PENALTIES AND FINES
a) Any member of the Sacco society who wilfully acts in violation of these by-laws or
regulations shall be liable to a fine not exceeding Kenya Shillings Twenty Thousand
(Kshs.20,000.00) for each offence not withstanding any other action that may be taken
against him in accordance with the Act, Rules, these By-laws or any other applicable law.
b) The Board of Directors of the Sacco Society shall have powers to hear and determine
matters relating to any alleged violation of these By-laws by members. Any member
aggrieved by the decision of the Board of Directors may appeal to the General Meeting
whose decision shall be final. Provided this provision should not prejudice a member’s right
to refer the matter to the Tribunal if the issue constitutes a dispute.
c) Any penalty not paid within 30 days from the date it was levied shall be recovered from the
member’s deposits.
17. TERMINATION OF MEMBERSHIP
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Membership in the Sacco society shall cease with effect from the date of:
i. Death
ii. Withdrawal
iii. Expulsion
iv. Being certified insane
v. Transferring all shares to another member
vi. Failure to remit regular savings and loan repayments for a continuous period of six
months without valid reasons or leave of the Sacco society.
vii. Ceasing to hold qualification for membership as specified in these By-laws.
viii. Being declared bankrupt by a court of law.
18. SUSPENSION AND EXPULSION
The Board of Directors may suspend - subject to the decision of the general meeting - to expel a
member who;
a) Fails to fulfil his/her obligations to the Sacco Society whether stated in these by-laws,
general internal regulations, a resolution of the general meeting or in contravention of
any other legal document, provided such a member has been called upon to do so but
has failed,
b) Is convicted in a court of law for a criminal offence involving dishonesty or fraud or
imprisonment for a period of three months or more,
c) Is a member of another Sacco society serving a similar purpose,
d) Acts in a manner prejudicial to the interests of the Sacco society,
e) Is found to have wilfully furnished false particulars in his application for membership to
the Sacco society,
f) For any other reason approved by the General Meeting and/or as may be contained in
the Sacco Society’s code of ethics.
19. PROCEDURE OF SUSPENSION AND EXPULSION
a) Upon formal and written communication and proof that a member has committed a
violation punishable by expulsion, the Board of Directors shall provide written notice to the
member stating the reason(s) for the suspension and proposed expulsion, and grant the
member 30 days to prepare a defence, if any.
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b) Upon expiry of the 30 days and taking into consideration the member’s defence, the Board
shall initiate an Administrative Inquiry and take a decision on its findings within 15 days.
The Board may;
i. Suspend the member pending ratification by the members in the general meeting
ii. Impose any other punishment as provided for in these by-laws or any other
applicable law.
c) A member so suspended may appeal to the General Meeting if not satisfied with the
decision of the board provided the notice and grounds of such appeal have been filed with
the Chief Executive Officer not less than 30 days before the date of the general meeting.
d) A member so suspended loses voting rights, may not qualify for new loans but shall
continue repaying existing loans, but shall not attend Sacco Society meetings unless invited
by the Chief Executive Officer in writing.
The decision of the Meeting on such expulsion shall be final; provided that such a member shall
have the right to appeal to the Tribunal within 14 days if the issue constitutes a dispute.
20. WITHDRAWAL FROM THE SACCO SOCIETY
A member may at any time withdraw from the Sacco Society by giving sixty (60) days’
written notice to the board or as may be provided for in the Membership Policy.
21. PAYMENT ON CESSATION OF MEMBERSHIP OR/ AND WITHDRWAL
FROM THE SACCO SOCIETY
On cessation of membership, a person shall be refunded the following amounts;
a) Any deposits, dividends or interests due to him prior to the date membership ceased and
b) Any other sums held by the Sacco society on his behalf after deduction of any sum owed to
the Sacco society.
c) A member who withdraws will be required to provide alternative guarantors for loans
guaranteed.
d) A re-joining fee may be charged in addition to the normal entrance fee and as may be
prescribed in the Membership Policy for anyone wishing to re-join membership after
cessation.
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22. NOMINEE
a) Every member shall nominate in writing one or more persons as nominee(s). The
nomination shall be attested to by at least two witnesses who are members of the Sacco
society.
b) The names of such nominee(s) shall be entered in the nominee register.
c) Provided that a member shall have the right to change his/her nominee(s) in writing in
the presence of at least two attesting witnesses who are members of the Sacco society.
23. PAYMENT TO NOMINEE
On the notification to the Sacco society of the death of a member, the nominee(s) or in his
absence, the legally appointed personal representative, shall be paid the value of the deceased
member`s deposits, interest, dividends and payments from Risk management or any approved
insuring programme within 30 days upon receiving official notice of death of the member
subject to:-
a) Submission of the deceased member`s burial permit, original and copy of death certificate,
copy of national identification from the employer where applicable
b) Recovery of all outstanding debts not covered under any insurance programme.
c) Provision of valid legal succession documents in accordance with the applicable law(s).
24. SHARES
a) The nominal value of each share shall be Kshs.100/= and every member is required to
purchase the minimum number of shares as prescribed in the Membership policy. No
member shall hold more than one-fifth of the total shares in the Sacco Society.
b) The purchase of shares shall be done in accordance to the prescribed Share policy.
c) Transfer of shares shall be in accordance with the prescribed Share policy.
d) Registration and transfer charges shall be guided by the Share Policy.
e) Shares shall be transferable and not withdrawable.
25. DEPOSITS
a) The Sacco Society shall have a documented Savings and deposit policy.
b) The amount accumulated in the deposit accounts may be used as collateral against
borrowings and shall be refunded only when a member withdraws from membership
provided the member has fully repaid all his/her debts and obligations, and is free from
any guarantor-ship.
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c) A member may be refunded the amount saved in his deposit account within 60 days
after giving a written notification, or refunded within 2 Days after paying a prescribed
fee as per the deposit policy.
d) Deposits shall attract interest at a rate to be determined by the Sacco Society and as
dictated by external market forces or internal funding needs.
26. LIABILITY OF MEMBERS
a) The liability of a member shall be limited to the nominal value of the shares held by the
member.
b) In the event of liquidation, where available funds are insufficient to pay the full nominal
value of the shares held by the members, the funds shall be distributed pro rata among
the shareholders according to the amount of shares held by each.
c) In addition to above, members shall be compensated by the Deposit Guarantee Fund as
provided in the Regulations.
27. FUNDS OF THE SACCO SOCIETY
27.1 The funds of the Sacco Society shall consist of:
Core Capital
(i) Paid up members’ shares
(ii) Retained Earnings
(iii) Disclosed Reserves
(iv) Grants and Donations
Income
(i) Interest, fees and charges, penalties, and commissions
(ii) Entrance fee
(iii) Any donations, grants or gifts from other bodies, organizations or individuals
(iv) Funds obtained from other lawful miscellaneous sources
a) Liabilities, which include deposits from members and borrowings from other sources as may
be prescribed by the Authority.
b) Funds obtained from lawful miscellaneous sources.
27.2 Capital Adequacy
The Sacco Society shall at all times maintain:-
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(i) Core Capital of not less than 10 million Kenya shillings
(ii) Core capital of not less than 10% of total assets
(iii) Core capital of not less than 8% of total deposits
(iv) Institutional capital of not less than 8% of total assets
27.3 The funds of the Sacco society shall only be applied for the promotion of the stated objects
of the Sacco society as set forth in these By laws and or in the Investment Policy of the Society
and shall be invested in:
(i) Securities issued or guaranteed by the government or any agency of the government.
(ii) Deposits, obligations or other accounts of deposit taking institutions under the Banking Act
(iii) Shares, stocks, deposits in, loans to or other obligations to any Sacco Society or Co-
operative Society.
(iv) Loans to members.
(v) Properties and Equipment for purposes of Sacco society business
27.4 Investments under above shall not in the aggregate, exceed such proportion of total assets,
core capital and deposits of the Sacco Society as prescribed in the Regulations
28. POWER TO BORROW
a) Loans may be obtained from non-members subject to the maximum amount approved by
the General Meeting provided the total external borrowing by the Sacco Society does
not exceed the limit prescribed in the regulations.
b) For the securing of any loans accepted by the Sacco Society under by-law 27(1), the
Sacco society may grant a charge over its assets. The authority to grant such a charge
shall be reserved to the General Meeting.
c) The rate of interest on loans shall not exceed the current market rate.
29. RECEIPTING FOR MONEY
Money received on account of shares, deposits, Loans, interest, fees or fines shall be recorded
and evidenced as provided in the approved policies and procedure manuals.
30. PAYMENTS AND DISBURSMENTS
Payments made by the Sacco society shall be recorded and evidenced as provided for in the
approved policy and procedure manual.
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31. GENERAL MEETING
31.1 The supreme authority of the Sacco society shall be vested in a properly constituted
General Meeting.
31.2 The General Meeting shall be convened within four months after the end of the Sacco
society’s financial year.
31.3 A special general meeting of the Sacco society may be held when convened by the:-
(i) Board.
(ii) Commissioner.
(iii) Board within 15 days of receipt of a written request by at least ¼ of the total registered
members provided the request is deposited by registered mail at the Sacco society’s address or
delivered to the Chief Executive Officer at the Sacco society’s offices within normal working
hours.
31.4 Members in (31.1) above, if the Board fails to convene a meeting within fifteen days of
receiving notice under the Co-operative Societies Act (CAP 490). The members shall give
notice to the other members of the Sacco society, stating the object and reasons for the meeting
and the fact that the board has failed to convene the meeting.
31.5 Any business not completed at the General Meeting, may be taken up at a subsequent
special General Meeting of the Sacco society.
32. TRANSITION INTO A DELEGATES SYSTEM
The Sacco society shall adopt the delegates system for the purposes of member representation.
A delegate to represent a department/station/branch/affiliate organization shall be elected in
accordance with the Delegate’s Policy to be developed by the board.
33. NOTICE OF MEETINGS
33.1 The general meeting shall be convened by giving at least 15 days written notice to the
members of the Sacco society.
33.2 The board secretary shall take all usual steps to publish the notice of the meeting in
accordance with applicable laws.
33.3 All notices shall include a statement of the business to be dealt with.
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34. QUORUM
Except when convened by the Commissioner, the presence of at least a 100 or a quarter (¼) of
the total number of members, whichever is lower shall constitute a quorum for the conduct of
business at an Annual General Meeting. When a quorum is not attained, the Chairman shall
adjourn the meeting, which shall be advertised as prescribed in these by-laws. If at such a
meeting, a quorum is again not attained, the Chairman shall declare the meeting open with those
present, one-half of an hour (30 minutes) after the advertised time of the meeting.
35. REQUIRED MAJORITY
a) A motion to remove a member of the Board whose term of office has not expired as a
result of a vote of no confidence must be supported by at least two thirds of the total
number of the members in the meeting, present and voting.
b) Amendments of these By-laws shall be made by a resolution of majority of members
present and/ or voting at the Meeting.
c) A resolution to charge any property of the society shall be supported by a two-thirds
majority of the members at the meeting, present and voting.
d) Any other motion shall be approved by a simple majority of votes.
36. ENFORCEMENT OF DECISION
A decision taken by the General Meeting shall be binding to all members present, absent and
objecting.
37. CHAIRMAN AT MEETINGS
The Chairman or in his absence the Vice-Chairman shall preside at every General Meeting. In
their absence, any board member appointed by the majority of the Board members shall preside.
38. IDENTIFICATION OF MEMBERS
Before they may attend or vote at a General Meeting, members shall be required to produce
evidence of their membership.
39. POWERS AND DUTIES OF ANNUAL GENERAL MEETING
The General Meeting shall have the powers and duties prescribed in the Act, Regulations, Co-
operative Societies Act (CAP 490), Rules and these by-laws. It shall:
a) Consider and confirm the minutes of the previous meeting.
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b) Consider reports of the Board, Supervisory Committee, the Commissioner or his
representative and the audited accounts on the Sacco society’s performance
during the past financial year.
c) Consider the Annual reports and accounts and the auditor’s report on the
activities of the Sacco Society during the past financial year.
d) Subject to these By-laws, decide the disposal of the net surplus resulting from
operations of the Sacco Society during the past financial year.
e) Consider appeals against the expulsion of members and refusals of membership
by the Board of Directors;
f) Elect, suspend or remove members of the Board of Directors and the Supervisory
Committee subject to the Act, Rules, Regulations and these by-laws.
g) Fix the maximum liability, which the Sacco Society may incur in loans
(maximum borrowing powers)
h) Appoint the Sacco Society’s Auditors.
i) Approve the estimates of expenditure for the next financial year
j) Fix and approve the honoraria and bonus respectively if any for officers and
employees of the Sacco society based on the governance policy and employee
reward system.
k) Fix indemnity for the elected Board of Directors and Supervisory Committee.
l) Transact any other business of the Society for which 21 days’ notice shall have
been given prior to the meeting.
40. RECORD OF BUSINESS
a) All business discussed at the annual general meeting shall be recorded in a Minute Book
which within 14 days of the meeting, shall be signed by the chairman of the meeting and
at least one Board member who was present at the meeting to verify that in their opinion
the minutes are a true and complete record of all matters which were discussed or
decided at the meeting.
b) At the next general meeting, after approving any alterations or variations, which shall be
written immediately below the above signatures and not as alterations to the original
record, the meeting shall by resolution, authorize its chairman to sign and date the final
record.
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41. ELECTIONS
a) Nomination and Electoral Process
i. The Sacco society’s elections shall be conducted annually and in accordance
with the Act, Rules, By-laws, UN-SACCO Electoral Policy and any other
prescribed laws.
ii. The conduct of the elections shall entail nomination and the election processes as
shall be provided in the Electoral policy which may be reviewed periodically.
b) Nomination Committee
(i) The Board shall on a regular 3 year basis appoint a Nomination Committee that shall vet
all candidates seeking to be considered for election to the Board or Supervisory
committee.
(ii) The Nomination committee shall comprise of five members; composed of two
representatives from the Ministry in charge of Co-operatives serving as Chairman and
member respectively and the Chief Executive Officer as secretary. There shall be one
management staff and a person from a recognized and relevant professional association,
both of whom shall serve as members to the committee.
(c) Duties of the Nomination committee
(i) To receive and examine the duly filled applications for nomination forms.
(ii) To accept/reject the application for nomination request based on these by-laws and Fit &
Proper Test criteria as per SASRA regulations.
(iii) To issue a nomination certificate that shall be for a specific post within the Board or
Supervisory Committee.
(iv) To keep a record of its deliberations.
d) Election Process
The elections shall be conducted by a returning officer who shall be any authorized official from
the Ministry in charge of Co-operatives and whose duties shall be to:
i. Declare the seat vacant.
ii. Initiate the process of elections.
iii. Receive the nomination certificate(s) from the duly nominated candidate(s).
iv. Ensure a smooth conduct of the election.
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v. Declare the winner and ensure the acceptance form is signed.
e) In all the Sacco Society’s elections;
i. Nomination of candidates shall be from successful vetted applicants who showed their
interest within the notice period.
ii. All elections shall either be by show of hands, or any other method approved by the
preceding general meeting.
iii. There shall be no voting by proxy.
iv. Each member shall have no more than one vote irrespective of the number of shares held
by him.
v. The elections results will be announced immediately by the returning officer on the floor
of the general meeting.
vi. Within fourteen (14) days of the elections, the Chief Executive Officer shall forward to
the Commissioner and the Authority the names and addresses of all persons elected.
vii. Election petitions shall be filed to the returning officers within 96 hours from the date of
the elections.
42. BOARD OF DIRECTORS
a) The Board of Directors shall be the governing body of the Sacco society elected from
the general membership and shall consist of nine (9) members. It shall include the
Chairman, Vice Chairman, Treasurer and Honorary Secretary and five (5) other Board
members or as per the rules, regulations and any other applicable law.
b) The members of the Board shall be elected for a term of three years provided that, 1/3 of
the Board members shall retire annually but will be eligible for re-election. For the
purposes of operationalizing of this clause, special consideration shall be made in cases
where all directors are elected in the same year in order to ensure continuity in the Board
as per (d) below.
c) Where the membership of the Board falls below five (5), the Board shall co-opt
qualified member(s) into the Board until the next General meeting.
d) Where all members of the Board are elected in the same year, the members shall
determine by lot who is to retire at the end of first year, second year and third year of the
original election year.
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43. ELIGIBILITY FOR MEMBERSHIP TO THE BOARD
43.1 Qualifications and Eligibility Criteria of the Board
No member shall be eligible for membership to the Board unless he:-
i. Has been a member in good standing of the Society for not less than two years
ii. Has met the criteria set by the nominating committee from time to time
iii. Has attained a minimum of bachelor’s degree from a recognised university or is
a member of a registered professional organisation.
iv. Is above 21 years old.
v. Has at least 5 years of relevant experience.
vi. Is not a Board member in other Sacco Societies with similar objectives
vii. Has never been convicted of any offence involving dishonesty or is sentenced to
imprisonment for a term exceeding three months
viii. Has not been convicted of any offence under the Co-operatives Societies Act
Cap 490, SASRA rules and regulations.
ix. Has no uncleared or overdue debt owing to the Sacco society at the end of its
financial year other than in respect of a loan(s) granted
x. Has a favourable listing status with a licenced credit reference bureau
xi. Does not lend money on own account.
xii. Is of sound mind.
xiii. Has filled the fit and proper test form, indemnity and wealth declaration forms
within the stipulated period.
xiv. Is un-discharged bankrupt.
xv. He has not been adversely named by the Commissioner or Authority in an
Inquiry Report for mismanagement or corrupt practices while a member of a
Board of any Sacco society.
xvi. Is a former director having previously served in the UnSacco Society board,
[xvii.] Is a former staff member of the Sacco Society who has completed not less than 6
months one year from the last date of employment to the date of the general
meeting in which the election is to be held.
43.2 Other Provisions
a) The elected Board members shall comply with the Board Charter and Code of Conduct
which shall define roles and functions of the board, conduct, qualifications and
experience of members of the Board and Board Committees.
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b) A director shall attend board meetings regularly and shall automatically cease to hold
office if he or she fails to attend three consecutive meetings without permission or
reasonable cause from the Chairman.
c) A person elected into a Board of a Co-operative Union or Apex Society on the basis of
his/her elected position shall cease to be a member of the Apex Society or Union upon
ceasing to be a Board member of the Sacco society.
44. DUTIES AND POWERS OF THE BOARD
The board of the Sacco society shall subject to any directions from the General Meeting
generally direct the affairs of the Sacco society. Its procedures, powers and duties shall be as
prescribed by the Regulations, Co-operative societies Act CAP 490 and Rules and these by-
laws. In particular, it shall:
a) Observe in all its transactions the Regulations, Co-operative Societies Act and the Rules,
these by-laws and prudent business practices.
b) Establish and approve appropriate policies including human resource management,
savings, liquidity, investment, dividend, risk management, membership administration,
cash handling and information management and preservation.
c) Ensure that the management maintains proper and accurate records that reflect the true
and fair position of the Sacco society’s financial condition.
d) Prepare and develop business plans and annual budgets for presentation at the General
Meeting;
e) Formulate the Electoral Policy to guide in the nomination and election process
f) Propose to the general meeting the amount and kind of indemnity or other security
which shall be given by the member of the board or supervisory committee.
g) Appoint such number of board committees as maybe necessary to effectively discharge
its functions;
h) Approve interest rates on loans, the maximum maturities and terms of payment or
amortization of loans from time to time and the maximum amounts that may be loaned
with or without security to any member as recommended by the Sacco society’s
management;
i) Cause the audited accounts to be displayed in a conspicuous place at its registered office
and branches at least two weeks before presentation of accounts to its members at the
general meeting;
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j) Lay before the General Meeting audited accounts, together with proposals for the
disposal of net surplus, if any;
k) Recommend to the General Meeting the dividend rate to be paid on shares, if any, and
interest to be paid on non-withdraw able deposits;
l) Fill through co–option, vacancies occurring in the board between General Meetings;
m) Authorize the conveyance of properties;
n) Authorize borrowing by the Sacco society in accordance with the law.
o) Approve and review lending policies of the Sacco society to ensure compliance with the
Law.
p) Approve or ratify all loans to directors and employees of the Sacco society;
q) Approve interest rates on loans to members as recommended by the Finance &
Administration committee,
r) Designate a depository or depositories for the funds of the Sacco society;
s) Prepare and approve a code of conduct in the form set out in the third schedule of the
Regulations;
t) Employ and fix the remuneration of the employees including the appointment of chief
executive officer in accordance with the approved human resource policy;
u) Report within 15 days the appointment, resignation or removal of the chief executive to
the Authority;
v) Impose fines as provided for under these by-laws;
w) Ensure that the Sacco Society pays its statutory levies to the Authority as and when they
fall due;
x) Ensure adequate provisions for known and probable losses and recommend to the
General Meeting the write-off of bad debts.
y) Perform or authorize any actions consistent with the Act, the Regulations and these by-
laws, unless specifically reserved for the General Meeting;
z) To provide adequate budget for education and training of members and the capacity
development of the board, supervisory committee and staff.
aa) Receive and consider reports from the established Board committees.
bb) Perform such other duties as the general meeting may from time to time direct.
cc) Act upon all applications for membership.
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45 LEGAL STANDARD OF CARE
In the conduct of the affairs of the Sacco Society, members of the Board of Directors shall
exercise the prudence and diligence of ordinary men of business and shall be held, jointly
and severally liable for any losses occasioned through any of their acts which are contrary
to the Act, Rules the By-laws of the Society and any other applicable law or directions of
any General meeting.
46. INDEMNITY AND DECLARATION OF WEALTH
i) Every Board member shall, pursuant to Co-operative societies Act CAP 490 file an
indemnity, whose amount the General Meeting shall determine and which shall be
lodged with the Commissioner within fourteen (14) days of his/her election to the Board
and also deliver a copy of the said indemnity to the Sacco Society within the same
period.
ii) The Board of Directors shall indemnify the society to the extent to which the general
meeting may determine.
iii) Every Board member and Supervisory committee member shall within thirty (30) days
of being elected, declare their wealth to the Commissioner in accordance with the
applicable law.
47 CODE OF CONDUCT
a) The Sacco Society shall prepare a Code of Conduct as set out in the regulations to be
approved by the Authority.
b) Any Officer who violates the Sacco Society’s Code of conduct commits an offence and the
Board shall take the necessary action in line with the provisions of the Regulations.
48 CONFLICT OF INTEREST
a) Every Board member and employee of the Sacco Society shall be required, before taking
part in any business transaction which the Sacco Society may be about to discuss, or initiate
to disclose any personal interest in the matter and shall not take part in any discussion or
vote upon that item of business.
b) The Board member or employee shall physically absent himself/herself from the discussion
unless it is determined that the individual has relevant information to provide. Failure to
divulge this information shall result in removal from office or termination of employment.
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49 CONFIDENTIALITY BY OFFICERS OF THE SOCIETY
a) The Chief Executive Officer, members of the Board of Directors, members of the
Supervisory Committee and Employees of the Sacco Society shall hold in the strictest
confidence all transactions of the Sacco Society, with its members, and all information
respecting their personal affairs.
b) In case of breach of confidentiality, besides the resulting action for damages, the responsible
party shall be removed from the office or their employment terminated.
50 DELEGATION OF DUTIES BY THE BOARD OF DIRECTORS
a) The Board may delegate in writing to an Officer, Board committee or employee of the
Sacco Society such of its duties, as it may deem necessary.
b) Nothing in (a) above shall absolve the Board from its responsibility of running the affairs of
the Sacco Society in proper and business-like manner.
51 RECORD OF BUSINESS OF BOARD MEETINGS
51.1 All business discussed or decided at the Board Meeting shall be recorded without erasures
and corrections in a Minute Book, which within one week of the meeting, shall be signed by the
Chairman of the meeting and at least one other board member who was present at the meeting,
to indicate that in their opinion the minutes are a true and complete record of all matters
discussed or decided at the meeting.
51.2 At the next meeting, after approving any alterations or variations, which shall be written
below the above signatures and not as alterations to the original record, the meeting shall, by
resolution, authorize its Chairman to sign and date the final record.
52 BOARD AND BOARD COMMITTEES
a) The Board may appoint and delegate to the Board Committees such of its powers and duties
under these By-laws, as it deems fit and proper, provided that the Board remains
responsible. The Board Committees shall consist of persons drawn from among the Board
members of the Sacco Society.
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b) The Quorum of the Board and board Committee meetings shall be two thirds of the
members of the Board or board Committee.
c) The Chief Executive Officer shall sit in all Board and Board committee meetings together
with other Management staff as may be appointed to facilitate effective deliberations. In
order to preserve the independence of the Board Audit Committee, attendance to its
meetings shall be on invitation only.
d) The board committees :-
i) Shall keep minutes of their work at all times.
ii) May delegate to the management any of their functions but shall ultimately bear
responsibility
iii) Shall convene as directed by the board.
53 SUSPENSION FROM THE BOARD
a) The Authority may suspend from duty any Board Member charged in a court of law
with an offence involving fraud or dishonesty pending the determination of the matter.
b) The majority of the Board Members may suspend a Board Member and accordingly
inform the Authority subject to ratification by the general meeting for;
i. Failure to disclose vested interests.
ii. Any other good cause.
54 REMOVAL OF A BOARD MEMBER FROM OFFICE
A member of the board shall cease to hold office if he/she:
(i) Ceases to hold qualifications of a Board of Director as specified in the Act, Regulations and
these by–laws;
(ii) Is removed by the Authority under the provisions of the Act and Regulations;
(iii) Is voted out by two-thirds majority of members present and voting at the General Meeting.
(iv) Is removed by the Commissioner under the provisions of Co-operative Act and the Rules.
55. BOARD ELECTIONS
The Chairman, Vice-Chairman, Treasurer and Secretary shall be elected at a meeting of the
Board to be held within 7 days after each Annual General Meeting, in accordance with these
by-laws. The chairman shall serve for a term of 3 years subject to the rotational election as a
director. However the board may by resolution of 2/3 replace the chairman with one of their
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own.
56. BOARD CHAIRMAN AND VICE CHAIRMAN
56.1 The board chairman shall:
(i) Preside at general meetings, board meetings and joint meetings with the Supervisory
Committee.
(ii) Perform such other duties as may be directed by the board, not inconsistent with provisions
of the Act, the Regulations applicable laws and these by-laws.
56.2 No person shall serve as a chairman for more than two consecutive terms and no person
who has held office for two consecutive terms shall be eligible as chairman for a period of three
years from the date of vacation of office.
56.3 The vice chairman shall perform the duties of the Chairman during his/her absence and
such other duties as the board may direct.
57 HONORARY SECRETARY
The duties of the Honorary Secretary are to:
a) Cause minutes of the General Meetings, Board meetings, and Joint meetings with the
Supervisory Committee to be recorded.
b) Ensure that notices of the meetings are prepared and sent out.
c) Ensure that the Sacco society’s correspondence is promptly and correctly attended
to.
d) Perform such other duties as may be directed by the Board.
58. BOARD COMMITTEES
58.1 FINANCE AND ADMINISTRATION COMMITTEE
58.1.1 The finance & administration committee shall consist of three members from the board
including the Treasurer who shall serve as its Chairman. Its duties shall be to:
(i) Review and make recommendations to the board on the financial plans of the Sacco society
ensuring its adequacy and soundness in providing for the Sacco Society’s current operations and
long term stability.
(ii) Review, discuss and make recommendations to the board concerning significant financial
planning, management and reporting issues of the Sacco society.
(iii) Review periodic financial statements of the Sacco society before submission to the board.
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(iv) Consider and advise the board on investments and borrowings.
(v) Make recommendations to the board on capital expenditure projects.
(vi) Ensure all expenditure of the Sacco society is within the approved budgets
(vii) Monitor the management’s adherence to the procurement plans as approved by the board
(viii) Review and make recommendation on finance related policies including ICT, investments,
capital adequacy and financial performance monitoring.
(ix) Ensure that the Sacco society has liquidity management policies as prescribed in the
Regulations.
(x) Review loan interest rates and other levies proposed by the management and make
recommendations to the board for approval.
(xi) Review and make recommendations on appropriate Human Resource Policies,
(xii) Review the organizational structure of the Sacco Society and ensure it is manned by staff
with relevant skills and experience.
(xiii) Ensure that periodic reviews of staff performance are conducted.
(xiv) Examine and recommend Human Resource expenditure for approval by the board.
(xv) Ensure establishment of management succession plan in the Sacco society.
(xvi) Ensure the management adheres to the approved human resource and related policies.
58.2 CREDIT COMMITTEE
The credit committee shall consist of three members of the Board whose chairman shall be the
board vice chairman. Its duties among others shall be to:-
a) Review and oversee the overall lending policy of the Sacco society
b) Review lending by the Management Credit Risk Committee including a periodic sampling of
processed loan applications to satisfy itself that management is adhering to the lending policies
of the Sacco society;
c) Ensure that there are effective procedures and resources to identify and manage irregular
problem credits, minimize credit loss and maximize recoveries;
d) Direct, monitor, review and consider all issues that may materially impact on the present and
future quality of the institution's credit risk management: and
e) Delegate and review lending limits to the sanctioning arms of the institution;
f) Assist the board with discharging its responsibility to review the quality of the Sacco’s
loan portfolio and ensuring adequate provisions for bad and doubtful debts in compliance with
requirements of the prudential guidelines;
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(g) Ensure that the credit policy and risk lending limits are reviewed at least on an annual basis
and as and when the environment so dictates.
58.3. AUDIT AND RISK COMMITTEE
a) The provisions of the Sacco Societies Act, 2008 and Regulations provides for
establishment of the Audit committee. An Audit Committee shall be duly constituted by
The Board to review the financial conditions of the Sacco Society, its internal controls,
performance and findings of the internal auditor and to recommend remedial actions
regularly and at least once in every three months. The Audit Committee may have its
mandate expanded to include oversight on the Sacco society’s risk management.
b) The Committee shall consist of at least three members appointed from the board and one
of whom shall be conversant with financial and accounting matters. The chairman of the
Board shall not be a member of the audit committee.
The primary responsibility of the audit committee shall include but not be limited to the
following:-
58.3.1 Audit Tasks
a) Ensuring that internal controls are established and effectively maintained to achieve the
Sacco society’s financial reporting objectives.
b) Reviewing internal controls including the scope of the internal audit program, the
internal audit findings, and recommend action to be taken by management;
c) Reviewing internal audit reports and their overall effectiveness, the scope and depth of
audit coverage, reports on internal controls and any recommendations and confirm that
appropriate action has been taken;
d) Ensuring that accounting records and financial reports are promptly prepared to
accurately reflect operations and result;
e) Reviewing co-ordination between the internal and external audit functions as well as
monitor the external auditor’s independence and objectivity taking into consideration
relevant professional and regulatory requirements;
f) Nominating names of external auditors from a list gazetted by the commissioner of Co-
operatives for appointment by the Annual General Meeting;
g) Reviewing with external auditors the scope of their annual audit plan, systems of
internal audit reported, assistance given by management to the auditors and any findings
and actions taken, and recommend the auditor’s remuneration to the Board;
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h) Reviewing management reports and reports from the internal and external auditors
concerning deviations and weaknesses in accounting and operational controls;
i) Reviewing the Sacco Society’s internal audit plan, with specific reference to the
procedures for identifying regulatory risks and controlling the impacts on the Sacco
Society, including receiving correspondence from the Authority and management’s
responses;
j) Monitoring the ethical conduct of the Sacco Society and consider the development of
ethical standards and requirements, including effectiveness of procedures for handling
and reporting complaints;
k) Reviewing any related party transactions that may arise within the Sacco Society;
l) Ensuring that relevant plans, policies, and control procedures are established and
properly administered;
m) Ensuring that policies and control procedures are sufficient to safeguard against error,
carelessness, conflict of interest, self-dealing and fraud;
n) Investigating members’ complaints;
o) Keeping minutes of their work;
p) Considering any matter of significance raised at the Annual General meeting.
58.3.2 Risk Management Tasks
a) The committee shall review and assess the integrity of the risk control systems and
ensure that the risk policies and strategies are effectively managed.
b) The committee shall set out the nature, role, responsibility and authority of the risk
management function with the Sacco society and outline the scope of risk management
work.
c) The committee shall monitor external developments connected to accountability of
Saccos and the reporting of associated risk, including emerging and prospective impact
and in doing so will take into account concerns raised by management in the Audit
Committee and also issues relating to asset liability management, Sacco finances and
business and strategic risk.
d) The committee, in carrying out its task under these terms of reference, may obtain such
outside or other independent professional advice as it considers necessary to carry out its
duties.
e) The risk management function shall have access to any information it needs to fulfill its
responsibilities.
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The Committee shall report to the Sacco Society Board of directors on measures taken to
implement recommendations and corrections of finding reported.
58.4 BUSINESS DEVELOPMENT, EDUCATION AND GOVERNANCE COMMITTEE
This Committee shall be responsible for carrying out the role of providing education to the
members, staff, management and the board as well as ensuring that the Sacco society is
governed in accordance with its code of corporate governance and all other relevant guidelines.
58.4.1 Co-operative Education and Training Tasks:
The Committee is expected to perform the following duties:-
a) Identification and determination of education needs to the members, the board,
employees and of the potential members, in the principles and techniques of
cooperativeness, both economic and democratic.
b) Evaluating training activities due to:
Limited supply of resources.
Feedback obtained during evaluation is intended for use in correction measures.
Feedback obtained from evaluation activities motivated those implementing and
those benefiting;
c) To create good relations between the Board, staff, members, other cooperative suppliers,
business and public at large for increased productivity of the Sacco society;
d) To acquire literature on behalf of the Sacco society, with a view to setting up a well-
stocked library. This could comprise of the Cooperative Societies Act (CAP 490), Rules
and By-laws, policies, cooperative texts and journals;
e) To arrange for education and tours in liaison with other members of the board;
f) To advice the board and members in general on matters within their jurisdiction, such as
in event of any changes in the policies and legislation;
g) Ensuring that adequate funds have been allocated for education purposes and utilized
properly, for the benefit of the whole Sacco society;
h) To represent the Sacco society in other bodies carrying educational functions;
i) Preparation of educational reports on a fortnightly basis, monthly, quarterly, half –yearly
or annually, depending on the needs of the Sacco society.
j) Identification, collection and preparation of co-operative news on behalf of the Sacco
society. Annual general meetings minutes authorized visits and interviews could
constitute news.
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58.4 .2The Governance Tasks:
a) To review annually, for board approval, a board manual outlining the policies and
procedures by which the board shall operate, and the terms of reference for the board,
the chairman and board committees.
b) To determine the performance measures to be deployed in assessing the performance of
the business, the CEO, Chairman, individual directors and the board as a collective
entity.
c) To recommend to the board and implement each year, an appropriate evaluation process
for the board , the chairman, individual board members and the chief executive officer;
d) To develop recommendations regarding the essential and desired experiences, skills and
competencies for board members of the Sacco society;
e) To review monitor and make recommendations regarding the induction and
development of new board members;
f) To lead annual performance review for the chief executive officer and his direct reports,
g) To receive annual declarations on the fit and proper criteria for onward transmission to
SASRA.
h) To recommend to the board the selection and appointment of the CEO.
i) At the request of the board, undertake such other corporate governance initiatives as
may be necessary or desirable.
j) To supervise and monitor matters reported using the Sacco society’s whistle blowing or
other confidential mechanisms for employees and third parties to report ethical and
compliance concerns or potential breaches or violations;
k) To investigate all allegations of violations of the Sacco society’s Code of Conduct by
directors and to recommend appropriate sanctions to the board.
59. SUPERVISORY COMMITTEE
59.1 The Sacco society shall have a supervisory committee consisting of three members each
elected at the General Meeting for a period of three years and one member of the supervisory
committee shall retire annually. Supervisory committee shall not be eligible for membership of
the Board within one (1) years preceding the date of the anticipated election.
59.2 The committee shall:
(i) Have qualifications similar to those of members of the Board.
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(ii) Be required to have at least some knowledge of accounts.
(iii) Be removed by a resolution of the general meeting.
(iv) Comply with the clauses on legal standards of care, indemnity and declaration of
wealth, code of conduct, conflict of interest and confidentiality as stipulated in these by- laws
(v)Co-opt qualified members as provided in these by-laws to fill temporal vacancy(s) in
the Committee to ensure the committee membership does not fall below three.
59.3 The Supervisory committee shall hold their meetings in accordance with the relevant
policy save for joint meetings between its members and those of the Board.
59.4. Duties of the Supervisory committee
The duties of the supervisory committee shall include:
i. Counterchecking, the effectiveness of the society’s internal control systems through:-
a) Verification of all transactions of the Sacco society
b) Writing periodic reports to be tabled at board meetings
c) Submission of its reports to the commissioner
d) Presenting its reports to the general meeting.
ii. The Supervisory committee shall not perform the duties or exercise any of the powers of
the board
iii. The Supervisory committee shall be held liable for any loss incurred due to their
negligence in performing their duties.
60 THE CHIEF EXECUTIVE OFFICER
60.1 The chief executive officer shall be appointed by the board and shall be responsible for the
day to day operations of the Sacco society and in particular ensure;
i. The implementation of and adherence to the policies, procedures and standards;
ii. Systems have been established to facilitate efficient operations and
communication are followed;
iii. The planning process that has been developed to facilitate achievement of targets
and objective is adhered to.
iv. All staff matters, particularly human resource development and training are
attended to;
v. Adherence to the established code of conduct;
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vi. Compliance with the Regulations, Co-operative Act, Rules these by laws and any
other applicable laws.
60.2 The Chief executive officer shall ensure that the board is frequently and adequately
appraised on the operations of the Sacco society through presentation of relevant reports which
shall cover, but not limited to the following:-
i. Financial statements (monthly, quarterly and annual) showing current compared with
past period actual performance, the budget compared with the actual and with
explanations for any variances;
ii. Capital structure and adequacy;
iii. Delinquent loan list, and in particular growth in loans, loan losses, recoveries and
provisioning;
iv. Statement of comprehensive income (monthly, quarterly and annual) and a comparison
with budgeted against actual;
v. Sources and application of savings and deposits.
vi. All insider lending and non-performing insider loans if any.
vii. Violation of the Act, these regulations and any other applicable law, and remedial
actions taken to comply;
viii. Large risk exposures;
ix. Investment portfolio;
60.3 The Chief executive officer shall;
i. Attend all board and general meetings as an ex-officio member.
ii. Be a signatory to the Sacco society cheques, contracts and other documents as may be
necessary.
iii. Perform such other duties as may be assigned by the board.
60.4 The Chief Executive Officer shall appoint a tender committee in accordance with the
provisions of the Public Procurement and Disposal Act and Regulations.
61. BOOKS OF ACCOUNTS AND RECORDS
61.1 The Sacco society shall keep up to date and in a proper businesslike manner, electronic or
otherwise, such books of accounts and records as stipulated in the Co-operative Societies Act
and Rules, and in particular:-
a) A register of members showing in respect of each member:
i. Name, age, date of application for membership, address and
occupation;
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ii. Date of admission to membership;
iii. Date of cessation of membership,
iv. Name and particulars of nominees,
v. Any other information as may be required by the Sacco society
from time to time, and
vi. Number and Value of shares held
b) Minute books giving details of proceedings of board, Board committees, joint
board and Supervisory Committee, Supervisory Committee meetings and all
other committee meetings held in accordance with these by-laws.
c) Minute book giving details of proceedings at the General Meetings.
d) A cashbook showing the details of all monies received or paid out by the Sacco
society.
e) A general ledger containing such accounts as is necessary to accurately reflect
the business of the Sacco society.
f) A personal ledger for each member showing his/her transactions with the Sacco
society.
g) A register of assets and property.
h) A register of loans to members showing in respect of each loan; the loan number,
name of the borrower, the amount borrowed, the purpose of the loan, security,
the due date of repayments and the date repayments were completed.
i) Such other books and records as the board or the Authority may decide or
prescribe.
61.2 The accounts and the financial records of the Sacco society shall be denominated in Kenya
shillings and shall comply with international financial reporting standards and any reporting
requirements prescribed by the Authority.
62. POLICIES AND PROCEDURES
61.1 The board shall make and approve such policies and procedures as prescribed in the
Regulations and as they may deem necessary for the conduct of the Sacco society’s business.
Any such policies and procedures shall be recorded in the minute book.
63. AUTHORIZATION TO SIGN DOCUMENTS
63.1 All commitment or contractual documents shall be signed on behalf of the society by the
C.E.O and any three of the following;
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i) Chairman
ii) Vice chairman
iii) Treasurer
iv) Honorary secretary
63.2 The Board may authorize any other designated officer to sign the society's documents.
Unless otherwise provided, the documents of the Sacco Society shall be deemed official
provided they carry the official stamp and designated signatures referred to above.
64. COMMON SEAL
The Sacco society shall adopt and use a common seal. The seal shall have an imprint bearing
the words “seal of United Nations Savings and Credit Co-operative Society Limited”
which shall be different from the ordinary name-stamp of the Sacco society.
i. The seal shall be kept securely under lock and key by the chief executive officer and
shall be used only in the presence of the officers authorized to sign documents on behalf
of the Sacco society.
ii. Where the common seal is used in any document it shall be authenticated by the
signature of the board chairman, the Secretary, the Treasurer and the chief executive
officer or any other officer authorized by the board of the Sacco society.
65. INSPECTION OF DOCUMENTS
65.1 All books of accounts and other records shall at all times be available for inspection by the
Authority, the supervisory committee and the members. However members need to provide an
appropriate notice to access the books of accounts and other records.
65.2 The By-laws of the Sacco society and the registration certificate shall at all times be
available for inspection by the Authority and the Commissioner.
65.3 A list of members (excluding details of nominees and shareholdings, deposits and their
loans) shall be available for inspection by any member upon payment of a prescribed fee.
66. MISCELLANEOUS
66.1 A member of the board of directors or Supervisory Committee member shall not receive
remuneration in form of salary for services rendered to the Sacco society but may be reimbursed
for necessary expenses incurred in course of discharging lawful duties to the benefit of the
Sacco society and all other allowances as may be prescribed while working on the Sacco
Society business.
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66.2 The board and supervisory committee members, and employees of the Sacco society shall
hold in the strictest confidence all transactions of the Sacco society with its members.
66.3 No member of the board or supervisory committee shall in any manner participate in the
deliberations and determination of any question affecting his/her financial interest. In the event
of any disqualification, the remaining qualified board or committee members present at the
meeting, if constituting a quorum with the disqualified person may exercise, with respect to the
matter, all powers of the board or committee.
66.4 A copy of these by-laws shall be furnished to every member who joins the Sacco society or
on request upon payment of a fee not exceeding its actual cost to the Sacco society.
67. FINANCIAL YEAR
The Financial Year of the Sacco Society shall be the same as the Calendar Year (from 1st
January to 31st December).
68. DISTRIBUTION OF SURPLUS FUNDS
68.1 Subject to the Act, Regulations and approval by the General Meeting, the net surplus
resulting from operations of the Sacco society during any financial year may be disposed of as
follows:
a) Credited to the Reserve Fund.
b) Disposed of as decided by the General Meeting for:
i. Paying dividends on shares
ii. Being forwarded to any other fund or funds of the Sacco society including the
appropriations.
iii. Paying honorarium to Board members and bonus to staff.
iv. In any other way recommended by the board and approved by the General
Meeting.
69. DISSOLUTION
69.1 The Sacco society shall be dissolved in accordance with the procedures set forth in the Co-
operative Societies Act (Cap 490) and the Sacco Societies Act 2008.
70. DISPUTES
70.1 If any dispute concerning the business of the Sacco society arises: -
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i. Among members, past members and persons claiming through members, past members
and deceased members; or
ii. Between members, past members or deceased members, and the Sacco society, its
committee or any officer of the Sacco society; or
iii. Between the Sacco society and any other co–operative society;
iv. Between the Sacco society and the Authority, which cannot be determined by the board
(or General Meeting), then it shall be referred to the Tribunal. Appeals shall be taken to
the High Court.
71. AMENDMENT OF BY-LAWS
These by-laws shall be amended in accordance with the Cooperative Societies Act (Cap 490)
and the Sacco societies Act 2008 but no amendment shall become effective until it is approved
and registered by the Commissioner.
72. ACCEPTANCE
We the undersigned Board Members of United Nations Savings and Credit Co-operative
Society Limited named herein do hereby accept these by- laws for and on behalf of the Sacco
Society.
TITLE NAME ID. NO. SIGNATURE
CHAIRMAN
VICE CHAIRMAN
HON. SECRETARY
TREASURER
OFFICIAL CERTIFICATION
I CERTIFY that the foregoing by-laws of the ……………………………….Savings and Credit
Co-operative Society Limited have been approved and duly registered. Given under my hand at
Nairobi this …………………… Day of ……………. 20…..
COMMISSIONER FOR CO-OPERATIVE DEVELOPMENT
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