Corruption, the Giant Threat to Kenyan Businesses
It has been revealed that corruption has been the core cause of many businesses collapsing or facing difficulties when trying to expand.
In a recent report by the Kenya Private Sector Alliance (Kepsa), out of every 100 companies, 85 have undergone corruption experiences.
According to the report, corruption has affected over 400,000 companies in the private sector in one way or the other.
With the much manifestation of the vice in the companies has seen service delivery being on the low, and the growth of the companies being eroded to a large extent, hence contributing very little to the country’s economy.
The “Corruption Risk Mapping-in Kenya’s private sector” report released in Nairobi yesterday, indicates that 85 per cent of businesses have been affected by the vice, with the highest risk being reported among small businesses (of between 10 and 50 employees) compared to medium-sized and large businesses.
“Unchecked systemic corruption and bribery increase the cost of doing business, creates unfair competition and curtails efforts towards efficiency-improvement and innovation that is critical for economic profitability and sustainability,” the study conducted in November last year states.
The list was released during the Kepsa annual general meeting, in which unfavorable tax rates and regulation, business regulatory environment, access to finance especially for micro, small and medium-sized enterprises (MSME) and security were also cited in the report
Fraud in businesses has also been playing a key role in the prevention of businesses from netting profits as it possesses a big challenge of 83 percent of affected businesses.
Bribery has seen 78 percent of investments being negatively affected in the country. The list revealed that professional services, finance and insurance, hospitality, accommodation and food services to be most corrupt with 90 percent prevalence across board.
Previously, the government has been making promises that it is geared towards ensuring corruption is a thing of the past, but still much needs to be done as none has been put behind bars for committing the offense yet.
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