Administration and Management of Co-operative Societies

General meetings

The supreme authority of a co-operative society is vested in the general meeting at which members have the right to attend, participate and vote on all matters.

A co-operative society shall hold an annual general meeting within four months after the end of each financial year.

The First General Meeting

In the first year after registration, the co-operative society shall hold the general meeting not later than one month after receipt of the certificate of registration of the co-operative society.

During such meeting, the members shall:

  • elect the co-operative society’s office bearers for the ensuing year
  • determine the maximum borrowing powers of the co-operative society
  • consider and approve estimates of income and expenditure for the ensuing financial year or part thereof
  • appoint the co-operative society’s bankers and auditors; and
  • receive reports and decide upon such other matters as may be necessary for the conduct of the co-operative society’s business.

A general meeting of a co-operative society shall be convened by giving at least fifteen days written notice to the members.

The Annual General Meeting

The annual general meeting is a meeting held once a year where members are provided information on the society’s activities over the last 12 months.  It is an open meeting and any member can attend.

At the annual general meeting of a co-operative, society the members shall:

  • consider and confirm the minutes of the last general meeting
  • consider any reports of the Committee or the Commissioner
  • consider and adopt audited accounts
  • determine the manner in which any available surplus is to be distributed or invested
  • elect the co-operative society’s office bearers for the ensuing year
  • determine, where necessary, the maximum borrowing power of the society
  • appoint an auditor for the ensuing year; and
  • transact any other general business of the co-operative society of which notice has been given to members in the manner prescribed in the by-laws of the co-operative society.

Special General Meeting

A special general meeting of a co-operative society may be convened:

  1. by the Committee for the purpose of approving annual estimates or discussing any urgent matter which in the Committee’s opinion is in the interest of the co-operative society; or
  2. on receipt of a written notice for such meeting signed by such number of the members of the co-operative society as may be prescribed in the rules and stating the objects and reasons for calling the meeting.

If the Committee fails to convene a meeting within fifteen days of receiving the notice, the members demanding the meeting may themselves convene the meeting by giving notice to the other members of the co-operative society, stating the objectives and reasons for the meeting and the fact that the Committee has failed to convene the meeting.

The Commissioner may preside and convene a special general meeting of a society at which he may direct the matters to be discussed at the meeting.

The chairman or in his absence the vice-chairman or such other person as may be prescribed in the by-laws of the co-operative society shall preside at a general meeting of a co-operative society.

There is no fixed number of special general meetings to be held in a year.  the number will depend on the frequency at which urgent issues arise.

Membership and Powers of the Committee

Co-operative society members elect a committee to run the affairs of the society on their behalf.

Membership

Every co-operative society shall have a Committee consisting of not less than five and not more than nine members.

The members of the Committee shall elect a chairman and a vice-chairman from among their number.

The Committee shall be the governing body of the society and shall direct the affairs of the co-operative society, subject to any direction from a general meeting or the by-laws of the co-operative society.

Powers of the Committee

The Committee has powers to:

  1. Enter into contracts
  2. Institute and defend suits and other legal proceedings brought in the name of or against the co-operative society; and
  3. Do all other things necessary to achieve the objectives of the co-operative society in accordance with its by-laws.

Committee Meetings

In order to carry out duties entrusted by the general meetings, the committee members hold regular meetings at which the following is done:

  • The minutes of previous meetings are considered and confirmed
  • The accounts of the society are checked, discussed and observation recorded in the minutes
  • The discussion of product and service development
  • Any loans due and owing to the society are considered and any action considered necessary in respect of such loans is authorized and recorded in the minutes
  • The receiving and discussion of various reports of the society
  • To discuss membership growth, withdrawal and staff matters
  •  Discuss any other matter that affects the running of the society

The frequency of the committee meetings depends on the business of the society, but they should normally be held monthly and at least quarterly.

Qualifications to be a Member of the Committee

A person cannot be a member of a Committee if he:

  • is not a member of the co-operative society
  • is under eighteen years of age
  • is unable to read and write
  • receives any remuneration, salary or other payment from the co-operative society save in accordance with this Act
  • is a committee member in two other co-operative societies
  • being a member of a co-operative society that lends money to its members, lends money on his own account
  • being a member of a co-operative society which trades in goods or produce, trades either on his own account or some other person’s account in the same type of goods or produce
  • has not, within thirty days of being appointed, declared his wealth to the Commissioner in the prescribed manner
  • is an undischarged bankrupt
  • is of unsound mind
  • has been adversely named by the Commissioner in an inquiry report adopted by a general meeting for mismanagement or corrupt practices while a member of the Committee
  • has been convicted of any offence involving dishonesty or is sentenced to imprisonment for a term exceeding three months
  • has been convicted of any offence under the Act or rules made thereunder
  • has any uncleared debt owing to a co-operative society at the end of its financial year other than in respect of a loan under the provision of any rules made under the Act
  • is a person against whom any amount of money is due under a decree, decision or order or is pending recovery under the Act.

The Committee may delegate any of its duties to an officer or officers of the co-operative society but such delegation shall not absolve the Committee from its responsibility to run the affairs of the co-operative society in a proper and businesslike manner.

In the conduct of the affairs of a co-operative society the Committee shall exercise the prudence and diligence of ordinary men of business and the members shall be held, jointly and severally liable for any losses sustained through any of their acts which are contrary to the Act, rules, by-laws or the directions of any general meeting of the co-operative society.

The Commissioner may suspend from duty any Committee member charged in a court of law with an offence involving fraud or dishonesty pending the determination of the matter.

You may also want to read: The Formation and Registration of Co-operative Societies in Kenya

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