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CIC INSURANCE GROUP LIMITEDCHIEF EXECUTIVE’S STATEMENT continuedof the existing systems infrastructure in meeting the needsof our business• Reviewing and development of an aligned ICT strategyclearly indicating the desired ICT vision, application andinfrastructure landscape for the group• Recommendation of areas of prioritization based on thebest practice and experiences from the financial sector• Assessment of the ICT organization and processes againstbest practices• Development of an implementation roadmap towardsthe realization of the desired ICT vision, indicatingdependencies, priorities, schedules and required resourcesover the short term and long-termThe development of the new ICT strategy will enable us tobe more effective in realizing our short term and long-termstrategic objectives.We are focused to strategically position our group as the bestin the industry and we believe ICT will play a major role inthe achievement of this goal. We are also targeting the Micromarket which is diverse and geographically spread out makingit imperative to employ technology in the tapping the market.The future customer is technology savvy and very demandingon efficient service delivery. Consequently, we must continuallyimplement new ICT initiatives.EMPLOYEE DEVELOPMENTWe recognise that our employees are critical in realizing ourstrategic objectives. We continued to offer specialist trainingand development opportunities to all cadres of employees in abid to equip the group with necessary skills and competencies.As a way of entrenching a performance management systemand culture in the Group, CIC is in the process of adoptingthe Balanced Score Card tool of measuring employeeperformance. The balanced scorecard is a strategic planningand management system that is used to align businessactivities to the vision and strategy of the organization,improve internal and external communications, and monitororganization performance against strategic goals.DIASPORAWe continue to develop products that will meet the needsof Kenyans in the diaspora. Our strategy is to roll out theseproducts in the second quarter of the year after the plotinitiatives that we have had over the last one and a half years.INDUSTRY RECOGNITIONThe group remains dedicated to its customers through offeringinnovative insurance and financial solutions. This has madethe group to be a leading Insurance and Financial servicesprovider in the country. During the year, the Group’s leadershipposition was supported by the awards won during the 2011Annual Insurance awards. The awards include:• Winner – Best Marketing initiative of the year• Winner – Best training initiative of the year• 1st Runner- up – Best composite Insurance company• 2nd Runner –up – Best customer service innovation• 2nd Runner – up – Best insurance company in claimssettlement (Life Business)• 2nd Runner –up – Best insurance company (ICT)• 2nd Runner –up – Best General Business InsuranceCompanyFUTURE OUTLOOKThe Insurance Industry is becoming even more competitivewith a number of new entrants. Given the impact that this islikely to have on our performance, we continue to work extrahard to deliver on the promises we make particularly to ourcustomers and shareholders. We endeavour to achieve greateroperational efficiency so as to improve our bottom-line.Finally, I would like to thank our intermediaries, Co-operativesocieties, customers, management and the Board for playinga significant role in making 2011 a truly successful year.NELSON C KURIA, OGW, MBSGroup Chief Executive OfficerCIC will also adopt the 360 degrees evaluation process. With thisapproach, performance feedback is provided by subordinates,peers, and supervisors. The goal of this participative evaluationis to improve the Company Performance System to supportthe pursuit of overall strategic growth.PAGE 122011 ANNUAL REPORT & FINANCIAL STATEMENTS
CIC INSURANCE GROUP LIMITEDCORPORATE GOVERNANCECIC Insurance Group Limited is committed to the standards of world class corporate governance practice as set by the InsuranceRegulatory Authority, Capital Markets Authority and by itself in accordance with international best practice. The Company hasundergone a separation of the life and general insurance business of CIC Insurance to CIC General Insurance Limited and CICLife Assurance Limited. The Board of Directors is responsible for the long-term strategic direction and for profitable growth ofthe Company whilst being accountable to the shareholders for compliance and maintenance of highest corporate governancestandards and business ethics. The Board formulates policies and strategies that enhance transparency and accountability andaimed at conforming to set guidelines on Corporate Governance practices provided by the Capital Markets Authority and theInsurance Regulatory Authority. The Directors attach great importance to the need to conduct business and operations of thecompany with integrity and in accordance with generally accepted corporate practice and endorse the internationally developedprinciples of good governance. Directors strive to keep up to date with latest developments in corporate governance bestpractice.BOARD OF DIRECTORSThe current board consists of fourteen directors out of whom thirteen are independent non-executive directors including theChairman. The Board composition draws a good mix of skills, experience and competencies in various fields. The non-executivedirectors are appointed by the shareholders on a three-year term and are bound by the Company’s code of conduct.The Directors maintain effective control over strategic, financial, operational, policy and compliance issues. Accurate, appropriateand timely information is provided to the Board to enable it to fulfill this role. The Chairman is responsible for managing the Boardand providing leadership to the company, while the Group Chief Executive Officer is responsible to the Board for running thebusiness in accordance with instructions given by the Board and implementing Board’s decisions. The Board nonetheless retainsresponsibility for establishing and maintaining the company’s overall internal control of financial, operational, and complianceissues so that its objectives for increased growth in profitability and shareholder value are realized.The Company maintains a policy of open communication between the Board and management ensuring the Board is fullyinformed about all major matters concerning the company and the industry. The Board and management interact on a regularbasis allowing the directors to contribute their knowledge particularly relating to the company’s target market into the company’sactivities.BOARD MEETINGSThe Board meets regularly and at least four times a year to, amongst other things, agree on the company’s objectives andstrategies to realize the objectives, review performance against agreed targets, consider and approve the annual and interimfinancial statements. The Board in achieving its mandate is guided by the Board Manual which sets out all matters reserved toit and in this regard all directors.BOARD COMMITTEESThe Board has created three committees which meet regularly under clearly defined and materially delegated terms of referenceset out by the Board. The Committees operate under clearly defined mandates which spell out their responsibilities, scope ofauthority and procedures for reporting to the Board. The Committees have access to company information and are authorized toget independent professional advice of matters within their scope.AUDIT AND RISK COMMITTEEThe Committee main purpose is to assist the board in discharging its duties regarding the safeguarding of assets, the operationof adequate systems, control processes, and the preparation of accurate financial statements and reporting in compliance withall applicable legal requirements and accounting standards.The scope of this committee includes risk management, as well ascompliance with the regulatory requirements. The Committee is guided in its functions by a comprehensive Audit CommitteeCharter and Internal Audit Department Charter. These are designed to provide a comprehensive framework for the audit functionwithin the company.2011 ANNUAL REPORT & FINANCIAL STATEMENTS PAGE 13
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