Category Archives: leadership

Shareholders Chat with Mbuvi Ngunze

I had a tea chat with Mbuvi Ngunze former CEO of Kenya Airways (KQ), now advisor to the board on his time at the airline and views for the future. It was with a view from the perspective of retail investors and shareholders who will be affected by a restructuring process that is ongoing.

Excerpts

Assets: The airline now has a lean fleet with three aircraft groups: Embraer 190’s, Boeing 787’s and Boeing 737-800’ s (with some 700’s); while this is thin, this choice decision to stretch the fleet was much better than having idle aircraft sitting around – and they have been able to serve similar passenger numbers with the smaller fleet. He added that the global industry is in a slump with airlines like Emirates and Ethiopian parking aircraft but with KQ did not have that option, and it was perfectly okay to lease out aircraft and get them  back in a few years

Liabilities: They were servicing bank loans, but these unsecured lenders (the local banks) had to be refinanced. While some banks were upset about the deal to take equity in the airlines, and some are less comfortable in taking a hit, he emphasized that KQ had to treat all banks as an asset class equally in the transactions, and could not pick only some the banks.

Could this have been done earlier so the restructuring was not as drastic? He said it had to happen like this, in sequence, and that they had to right-size their operations before they turned to the banks and the balance sheet.

Revenue:   Routes have to make commercial sense to take them on. While there is an expectation to have direct flights to the US start soon, he’d rather get the ability to code-share, sell tickets, and earn revenue by selling tickets from Nairobi to any US city first. KQ can’t do that now, but Kenyan passengers do that with their partner KLM.

Also, there are many aspects to ticket pricing and KQ has to maximize on routes where they can to realize profits for shareholders.

Expenses:  Expensive Advisors? one complaint about the restructuring was the amount going to be paid to deal advisors  –  but he said that was traditional for arranging such deals and the costs were about 5% which as typical

Management: I conveyed a question from blogger/investor Coldtusker – on a perennial problem  at KQ of misaligned interests between board/management and shareholders, – his predecessor famously hinted that he’d rather buy livestock than airlines shares, and Mbuvi said that this was one of the things being addressed in the new equity deals that call for KQ employees to own up to 2% of the airline through an ESOP. He could not say if this is what led to pilots staging a go-slow last week, but he said that he was not involved on a day-to-day business since he had long ago handed over and oriented his successor – but added that performance-based compensation had to happen – however unpopular it was for pilots or shareholders.

Other Chats

  • Expectations: He said, it’s wrong to compare KQ and Ethiopian airlines, as they operate in a totally different airline market. Ethiopia is a closed aviation market, while Kenya is an open market – and Kenya’s open policy means that they control 40% of traffic into Nairobi, while Ethiopia has 80%. At Addis, Emirates flies’ 7 times there, compared to 21  to Nairobi and they also control cargo.
  • London Heathrow sale: a slot is not a building or a desk that was sold – it is the much-coveted right to a time to land and take off from Heathrow
  • The Senate was a circus – one that delayed and disrupted ongoing shareholder discussions, and where wild claims were made before television cameras – such as allegations of secret ownership of aircraft. He said KQ does not need to use intermediaries to talk to Boeing or Embraer.
  • He has no regrets; he came in as CEO at a time when things went wrong at the airline, but he does not feel he was handed a poisoned chalice.
  • Could things have been done differently? Yes, he would have taken Project Mawingu in slower steps.

For shareholders, he said it could have been worse and he says this restructuring is not due to the new companies act – the law was always there. Nationalization was considered, but it was discarded as it would not be good for KQ to operate as a government parastatal.

At the EGM this week, where shareholders will vote on an equity restructuring program, the same board will be there, and he will attend as a board advisor, not the CEO. The board will change after that and he says that going forward, he plans to be a shareholder of the airline.

ALU: Africa’s University of the Future

The African Leadership University (ALU) is a pan-African university, which aims to prepare students for jobs that don’t exist today. Their programs aim to equip students with necessary skills including entrepreneurship, leadership, critical thinking, and project management – right from their first term. They have an intense online engagement process to monitor student performance that starts right from the time students apply and then right through admissions, assignments, courses, exams and assignments.

Their current degrees on offer at their Mauritius campus are Computing (Bsc), Business Management (BA), Social Sciences (BA) and Psychology (Bsc). It opened in September 2015 and has over 200 students from over 30 African countries.  Every year, students can get up to 4  months of internship at one of the ALU partner organizations which include Cellulant, Coca-Cola, McKinsey, Tiger, IBM, PWC, Thomson Reuters,  Pernod Ricard and Swiss Re. The partners also help subsidize the cost of education at ALU where a year of tuition and accommodation is about $7,000 – a modest amount compared to the cost of university education in many countries.

They also have a study abroad program that takes 4-12 months and ALU will have an MBA program at a new campus that will soon open in Rwanda, and for which they are already accepting applications. ALU is part of the Africa Leadership Group, and has founders including Fred Swaniker, Graca Machel and Donald Kaberuka. Eventually, they plan to have  25 campuses across Africa that can host 10,000 students a year.

ALU teams are currently on road shows to promote the university in Accra, Nairobi, Johannesburg, and Lagos. They have workshops, schools visits, and other events this month as they promote the university, and they are accepting applications up to a deadline on June 5.

Namibia President wins Mo Ibrahim Prize

President Hifikepunye Pohamba was today announced as the winner of the 2014 Ibrahim Prize for Achievement in African Leadership. The award

Earlier, there was some speculation or expectation, with the announcement being made in Nairobi, that Kenya’s former president Mwai Kibaki might be this year’s winner. The prize panel comprising Salim Ahmed Salim, Martti Ahtisaari  Aïcha Bah Diallo, Mohamed ElBaradei, and Graça Machel addressed that in a  Q&A session after the announcement was made by Salim

He said President Pohamba made a mark in terms of reconciliation, cohesion, and respect for the constitution. He had offered sound leadership while remaining humble. His achievements were seen in gender equality (48% of parliamentarians are women) a focus on health (80% of HIV cases receive therapy and transmission rates are falling) and education, tackling poverty (social safety nets and disability grants) while grappling with challenges like the widening inequality.

  • Questioned on the criteria, Baradei said the awards are not given in a vacuum – and this is measured by improvements in governance and leadership. Presidents have to do the right things amid challenges and create a cohesive society in which citizens can work together. Aicha mentioned his acceptance of political parties  and consultation with opposition leaders.  Graca said the achievements in his country were done in a very short period of time.
  • Are all winners from the Southern Africa region? Machel said that was not true and they analyze every case regardless of region. She said that while three winners are from Southern Africa, the SADC regional also had some bad (young) countries
  • Does it create encouragement? Has the prize had an impact in Africa and is it work all that money? Yes!, they said. Salim said they would rather go a few years without an award, than give an award for no reason. There has been no winner for three years, and that may happen again in future. Ultimately, the answers lie in numbers derived from the Foundation’s Index of African Governance.
  • The MC read out a tweet from a Kenyan newspaper that ‘Kibaki lost to the prize to Pohamba’ – and Salim said that it was an assumption that they had considered Kibaki for the prize.Mo Ibrahim at the 2014 Prize announcement
  • Chris Kirubi compared giving a prize to wealthy retired presidents to putting water back into the river. Mo Ibrahim stood and disagreed with that generalization, saying it was detrimental  to make. He said this was due to Africans relying on foreign media  and only knowing a few continental leaders like Mandela and then the infamous ones – and asked how many in the room knew the past winners like presidents’ Festus Mogae  or Pedro Rodrigues Pires or Pohamba (before today)? He appealed to the media to report properly on Africa by knowing the 54 presidents, some of who were wealthy, but others who lived humble lives, and find more heroes, beyond Mandela. He said Pires, a former liberation leader who became president, called a taxi and went to live with his mother after he lost the election. He also cited Botswana’s former President Masire who once traveled to  a meeting in Addis where he was overlooked by VIP protocol as they didn’t know he was traveling in economy class (to set an example).
  • ElBaradei said the fact that they don’t have a winner every year is also a message. They would like to see 2 or 3 qualified ex-presidents every year but Africa is still facing challenges of transiting to democracy and good governance.
  • The award, which is a $5 million prize paid over 10 years, followed by $200,000 annually for life thereafter, remains open to any president who has left office in the previous three years. It affords winners a chance to have dignified years in retirement and invest or fund activities they believe in.

Idea Exchange: Scholarships, Fellowships to Apply For

Applications are open for Chevening Scholarships  2015/2016. The Scholarships offers the opportunity to study for a one-year Master’s degree at leading UK universities and are awarded to outstanding established or emerging leaders across a wide range of fields: including Public Policy/Governance, International Law, Energy/Environment, Human Rights and Journalism. The deadline is 15 November.

EDIT CGI U 2015 Application Now Open. The eighth Clinton Global Initiative (CGI) U meeting takes place between March 6-8 2015, at the University of Miami, and will bring together more than 1,000 innovative student leaders to make Commitments to Action that address some of the world’s most pressing challenges. More than $500,000 in funding will be available to select CGI U 2015 students to help them turn their ideas into action. If you are 18 years or older and enrolled in an institution of higher education, Apply Now to be one as the early decision and travel assistance deadline is October 17, 2014, and the final application deadline is December 1, 2014.

The Deloitte Technology Fast50 Africa Programme is the region’s most objective industry-ranking to focus on the technology field, recognising technology companies that have achieved the fastest rates of revenue growth in Africa over the past five years. The deadline is 29 August.

The International Reporting Project (IRP) has a Health reporting trip that sends journalists to Mozambique (new media journalists are encouraged to apply) for an all-expense-paid, two-week reporting trip this fall. Interested applicants must be citizens of France, Germany, India, Japan, South Africa, the United Kingdom or the United States. Deadline is Sept. 2.

Five  (5) Journalism (5) opportunities to apply for in August include:

  • AJ+ offers reporting fellowship. Deadline was Aug. 1
  • Free online course in slideshow storytelling Starts Aug. 4
  • ICFJ, UN Climate Change Fellowship Deadline Aug. 12
  • Knight-Mozilla OpenNews Fellowship Deadline Aug. 16
  • Thomson Foundation hosts journalism competition Deadline Aug. 29

Apply to become a 2015 Knight-Mozilla Fellow  which comes with an opportunity to work with various leading news organizations. The deadline for applications is August 16.

Kenya’s Maktaba Award (Library of the Year Award) 2014 will be awarded in September. The Award, modeled on the German Library of the Year Award, aims to recognize excellence in the provision of library and information services in Kenya. Read More

The 2014 Mo Ibrahim Foundation Leadership Fellowships Programme is now accepting applications and those selected will receive mentoring from leaders at key multilateral institutions, namely the African Development Bank (AfDB), the International Trade Centre (ITC), and the United Nations Economic Commission for Africa (UNECA). To apply for this fellowship you must be a national of an African country,  have 7-10 years of relevant work experience, have a Master’s Degree, be under the age of 40 (or 45 for women with children) and the  deadline for submissions is 12 September.

The newly launched  Open and Collaborative Science in Development Network (OCSDNet) will provide funding support (of $50,000 to $80,000 CAD) to up to 15 case studies from eligible countries, mainly to researchers and practitioners affiliated with organizations based in countries that are eligible for support by the IDRC (these include within the Global South (Latin America, Middle East and North Africa, East and South Asia, and Sub-Saharan Africa). The deadline for submissions is September 8.

The Orange African Social Venture Prize  2014 aims to promote social innovation by supporting development through information and communication technologies (ICT). In addition to funding of up to 25,000 euros, Orange will provide support to three projects for six months from its local subsidiaries as well as expert advice from business and telecoms professionals, and the winner will benefit from a patent application that will be submitted and paid by Orange. Also, a special prize of 10,000 euros will be awarded to a project which has used an Orange API. Deadline is September 19.

Pivot East’s Mobile Impact Ventures Program (“MIVP”). The Mlab, East Africa’s accelerator program for impact ventures with innovative solutions in agriculture, health & water and education, is currently seeking applications for its second cohort. The program is backed by the Rockefeller and Tony Elumelu Foundations, through the Global Impact Investment Network’s (“GIIN”) Africa Impact Economy Innovations Fund (“IEIF”). The deadline is 27 August.

The Safaricom Journalism Fellowship Program at Strathmore University is designed to provide skills which combine technology literacy with business literacy for journalists engaged in business writing across the media houses in Kenya. The program will admit 15 of the most promising candidates in the first year.

StyledByAfrica seeks a Kenyan designer who will have a chance to feature at Berlin’s Fashion Week 2015. Young African designers based in Kenya are encouraged to apply by submitting a portfolio of their work to FA254′s official website. The deadline is August 20.

EDIT

Acumen:The Acumen East Africa Fellows Program is a one-year, fully-funded leadership development program that gives 20 individuals from across East Africa the training they need to accelerate their social impact and leadership potential. Applications are open until September 8.

Google RISE Awards are grants for organizations across the globe that promote Computer Science (CS) education or run initiatives that reach girls, underrepresented minorities, and students facing socio-economic barriers under age 18. Grants range from $15,000 to $50,000.

 Innovation Prize for Africa aims at mobilising leaders from all sectors to fuel African innovation in key sectors such as science, technology and engineering which contribute towards the sustainability of Africa. The IPA is becoming integral to facilitating ground-breaking thinking, creativity and driving awareness to the outstanding work being done in Africa by Africans. Entries for the Innovation Prize for Africa (IPA) 2015 are now open and the deadline for entries is 31 October 2014.  Note the IPA 2013 winner, AgriProtein went on to raise $11 million to build its first two commercial farms in Cape Town, South Africa.

Morland Writing Scholarships  are available for published works of between 2,000 to 5,000 words from anyone who has been born in Africa or both of whose parents were born in Africa. They are worth £18,000 and the application deadline is October 31.

TED Fellows: Apply now to be a 2015 TED Fellow. Deadline is September 21.

We look for different applicants than many other leadership-oriented programs. Instead of business people, professionals, policy wonks and government officials, the TED Fellows program focuses on doers, makers, inventors, advocates, filmmakers and photographers, musicians and artists, scientists, entrepreneurs, NGO heads, and human rights activists.

The inaugural East Africa Property Awards seek to bring together pioneers and leaders in real estate to showcase their products and who will be celebrated at a gala in Nairobi on November 27. There are 21 categories categories spanning across developers, real estate agents, interior design, telecommunications service providers and media. Apply before 11 November.

#TurnthePageonHateSpeech photo contest Are you a Journalist? Photographer? Filmmaker? Writer? Blogger? Cartoonist? Poet? Social Activist? Or simply an Engaged Citizen? Tell us What Hate Speech Means To You for a chance to win a free trip to the African Media Leaders’ Forum in Johannesburg! Deadline, October 15.

Ushahidi is launching a campaign dubbed Translators Power Ushahidi to help get 15 new languages translated to more than 80% completion by the end of 2014! Goodies and Schwag up for grabs.

See another EXTENSIVE list of online opportunities from Advance Africa.

What other opportunities are there for readers to apply for?

YALI 2014

The Young African Leaders Initiative 2014 – #YALI2014 kicked off this week in Washington DC. Speaking at a meeting with 500 of the first class of YALI fellows, President Obama said that it will be renamed the Mandela Washington Fellowship (& doubled to have 1,000 fellows by 2016) and that four regional leadership centers would set up in Africa.

The regional leadership centers will be established in Senegal, Ghana, South Africa and Kenya and will offer courses on leadership, support for entrepreneurs through mentoring and access to capital and a networking forum. 

The Center in Kenya will have a robust training curriculum with direction from a partnership that brings together Deloitte’s global management and strategy skills, the established curriculum and capacity of Kenyatta University, the public administration training of the Kenya School of Government, and Africa Nazarene University’s youth engagement and outreach.

USAID is investing $38 million in the new YALI centers with support from the MasterCard Foundation ($10 million), Microsoft ($12.5 million), Intel ($5million) and Dow Chemical ($4 million). Others are McKinsey, IBM, General Electric, Procter​ & ​​G​amble and the Mara Foundation. (More at the YALI site). 

In a Q&A session, Obama also spoke about AGOA and the on-going  for renewal of the trade partnership between the US & Africa; He said, they have learnt lessons from the previous phase of the partnership and will work to lower other export barriers (such as transport & trade finance), and, starting with Uganda, Kenya and Tanzania, take steps to see how AGOA can work with effective trading bloc for intra-Africa trade.​​

The YALI Summit events will lead up to the first US-Africa Leaders Summit, which, with over 50 presidents & prime ministers expected, is the largest gathering of African Leaders ever hosted by a US president.

Kenya’s President Kenyatta is to participate in two events next week – a doing business in East Africa session and a presidential dinner, both organized by the Corporate Council on Africa (CCA) who have events for several other African leaders and nations like Ethiopia, South Africa, Ghana Liberia Congo  Mozambique and Tanzania among others.