The term ESG was mainstreamed in 2004 in a report UN Global Compact called “Who Cares Wins” which encouraged business stakeholders to measure the environmental and social impact of their corporate footprint. Referring to the environmental, social and governance impact of businesses, ESG has elevated the standard against which corporate bodies are measured for their impact beyond just profit by assessing how they treat their people and their impact on the planet. The social pillar of ESG requires that employee wellbeing is prioritized and labor standards meet or exceed regulatory requirements.

Earlier this month, we saw two European companies putting their mouth where their ESG money is. On the 1^st of July 2024, the Chief Supply Chain Officer of Amsterdam based Lipton Teas and Infusions, wrote to the (now former) Cabinet Secretary for Agriculture Mithika Linturi and told him that as the largest buyer of Kenyan tea, they were dismayed to see an alleged sexual predator elected to the board of Tegat/Toror Tea Factory two days before on June 29^th. The tea factory is one of the 54 factories managed by the Kenya Tea Development Agency (KTDA) who were also put in copy in the letter. The man had been filmed in a 2023 BBC Panorama exposé nauseatingly requesting for sexual favors in exchange for a job. Lipton concluded the letter by stating that they had immediately stopped purchasing tea from the  Tegat/Toror factory and had urged their industry partners to do the same.

No sooner had the email ping sounded in the soon-to-be sacked Cabinet Secretary’s computer, another letter arrived into the email inbox of KTDA officials from UK-based James Finlay, another large tea producer and buyer. The BBC exposé had filmed the amorous fellow when he was still a long standing employee of one of Finlay’s farms. Following the publication of the exposé, the wild buck’s employment had been promptly neutered and a report made to the local police.

The first sentence of the Finlay’s missive was unequivocal: Randy Director Must Go! The last sentence reiterated their reiteration: Finlays would no longer purchase tea from Toror for having a terror on its board. Meanwhile, as all this was going on, six non-government organisations had filed a petition in a Kericho court to stop the wild buck from taking up his board role. Six other organizations including the Law Society of Kenya appended themselves to the petition as interested parties. The Toror Terror had to have asked himself why he wasn’t being allowed to just sit in a board meeting and enjoy the samosas peacefully without all these Johhny-come-latelies spoiling the tea party.

Having felt the heat two days after the emails, KTDA issued a public statement worthy of Pontius Pilate. They washed their hands of the whole matter and said their work was to simply manage the factories, elections are done by shareholders after candidate vetting is done by the Independent Electoral & Boundaries Commission (IEBC).

Let’s take a pause here from the context setting. Board directors of limited liability companies are not appointed by anyone. They are elected by shareholders. This is undertaken under an election which, in the case of Tegat/Toror factories, was run under the keen and (hopefully) non-aligned oversight of the IEBC. The shareholders voluntarily chose this fellow. His name had been publicized following the BBC exposé that in fact brought to full (and, I reiterate, nauseating) view as he breathlessly pawed at and salivated over the undercover journalist in a seedy hotel room. Anyone with 20MB of data could watch that horrific exposé and be left with no doubt as to who they were voluntarily electing.

KTDA may have a point here, by washing their hands of the director’s election. After all, the shareholders had spoken. The shareholders chose their director. The shareholders were comfortable with this caliber of person representing their interests. The Toror Terror is a reflection of the people’s will and not that of KTDA, who recently are keen to demonstrate that they do not interfere in the tea factory elections.

In keeping with the public interest over the matter, the High Court in Kericho stopped the shareholders from confirming the man as a director at the annual general meeting that was to be held three days later on July 18^th, pending the substantive hearing of the case next month. But the damage has already been done with the stoppage of tea purchases by the global buyers.

The key lesson for all of us is that bad corporate governance doesn’t  start at the board. No, it actually starts at the source: the owners of the company. And in today’s world, profit for those owners cannot be made without taking into account the people and the wider planet in the company’s footprint.

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Twitter/X:@carolmusyoka