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Parliament Puts WPP Scangroup On The Spot Over Racial Discrimination

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4 years ago

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The ill feted communications firm WPP-SCANGROUP continues to wallow in problems even when the previous region’s giant struggles to rise from the shambles.

Just after posting bad records on their financial accounts, the firm found itself in the middle of the house. Dagoretti South Member of Parliament  John Kiarie had put the Cabinet Secretary for Labour Simon Chelugui to task over findings at the firm that needed to be addressed. Obviously coming from the insiders from the Nairobi Securities Exchange-listed firm, the MP had sought for the following;

  1. Could the Cabinet Secretary confirm whether M/s. WPP Scan group Company PLC, which is a full-service creative transformation company engaged in marketing, communication, brand stewardship, media investment management and consumer research complies with labour laws and regulations in its operations?
  2. Could the Cabinet Secretary explain why the Company has been replacing majority of Kenya’s top creative staff and replacing them with foreign personnel from an Indian-based firm known as Mystic Monks since the onset of the COVID-19 Pandemic?
  3. What measures is the Ministry taking against the leadership of the firm for the injustices against the affected Kenyan personnel?
  4. Could the Cabinet Secretary explain why the said publicly listed company has been allowed to fraudulently engage and retain foreigners for decades to undertake work that can effectively be handled by Kenyan professionals, while at the same time placing its local staff under strenuous and inhumane working conditions including working overnight without compensation?

Scangroup reported a net profit of Sh469.2 million in the year ended December 2020, an 8.6 percent rise from Sh431.9 million the year before. The performance was largely derived from a Sh2.2 billion net gain from the disposal of the subsidiary Kantar Africa.

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Excluding that transaction, Scangroup would have made a loss as indicated by a Sh1.7 billion loss from continuing operations. The company did not declare a dividend. It had made a record payout of Sh8 per share for the previous year.

In February, WPP-Scangroup Plc board of directors suspended the Chief Executive Officer, Mr Bharat Thakrar and the Chief Finance Officer, Mr Satyabrata to allow for an investigation into allegations of gross misconduct and possible offences in their capacity as senior executives and employees of the Company.

WPP Group investigations revealed that the CEO Bharat Thakrar was in the habit of luring female staff with treats through expensive business trips, but forces them to sleep with him and pays them for their silence.

The investigations had alleged that Thakrar has also created numerous dummy PR agencies that he uses to steal funds from WPP ScanGroup by invoicing for non-existent works.

However, in September, WPP Scangroup closed an investigation against its former chief executive, Bharat Thakrar, without finding incriminating evidence, raising questions about the reliability of the information it used to push out the company’s founder.

The Nairobi Securities Exchange-listed firm now says that nothing substantial was uncovered in the probe.

“The investigation did not identify items of a material nature that required adjustment to the results of the company or the group for the year ended December 31, 2020 or to the balance sheet at that date,” the company said in a statement.

Meanwhile, the pertinent questions raised raised by the MP above, clearly have violated the corporate governance guidelines for issuers of securities and listed companies by CMA.

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