Although over 60 companies are listed on the Nairobi Securities Exchange (NSE), most investors struggle to track the companies' earnings calendars and key activities. This challenge stems from persistent underinvestment in Investor Relations (IR), which is often viewed as a minor, reactive function within Finance.
Consequently, market activity is concentrated in a few blue-chip stocks, such as Safaricom and banks like Equity, which account for over 70 percent of daily trade turnover, leaving many other listed firms invisible, illiquid, and unable to attract the global capital needed for NSE’s strategic growth.
A stock that trades only once a week isn’t “fundamentally weak,” it is simply invisible. A market with dozens of invisible companies isn’t “small,” it is underdeveloped, and cannot attract global capital.
This lack of professional transparency has led to tangible consequences. The market is currently experiencing a historic withdrawal of international capital, with foreign participation in equity turnover averaging just 30.12 percent in Q3 of this year, a 15-year low. This retreat resulted in a net portfolio outflow of Sh 3.84 billion for the quarter.
Foreign investors are not leaving Kenya because companies are fundamentally flawed. They are reallocating due to inadequate communication.
When investors cannot reliably know “when earnings will be released, whether guidance is coming, how management interprets quarterly performance,” they do not invest. They wait, and prolonged uncertainty leads them to exit the market.
Also, retail investors are projected to increase with NSE targeting 9 million participants by 2029 through the introduction of fractional share purchases. If listed companies do not provide effective IR, they create information asymmetry, discouraging this growing retail base from sustained, informed participation.
Addressing the lack of mandated professional investor communication structures is no longer optional. A world-class market cannot be built on silence and spreadsheets alone.
However, recognition without action is insufficient. IR is a strategic communication tool that creates value through transparency. It bridges management’s vision and market confidence, and serves as an investment that improves valuation, attracts capital, and drives liquidity.
The solution is for listed companies to urgently elevate the IR function from a compliance checklist item to a strategic, board-level priority. To beat this crisis, listed companies must take specific, non-negotiable actions.
First, they must announce and strictly adhere to an annual IR calendar, clearly outlining the dates for earnings releases, dividend declarations, and Annual General Meetings at the start of every fiscal year.
They should also appoint and empower a single, named point of contact for investors on the company website, with dedicated phone and email channels, replacing the current fragmented approach.
Third, listed companies must exceed minimum legal disclosure by adopting Integrated Reporting and ESG (Environmental, Social, and Governance) disclosure guidelines. This approach communicates the company’s holistic value creation strategy to socially conscious investors, both global and local.
Fourth, the Capital Markets Authority(CMA) should mandate annual Board review of the IR strategy and link senior management compensation (CEOs/CFOs) directly to performance on key IR metrics, such as investor satisfaction scores and stock liquidity. This ensures IR is treated as a profit driver rather than a compliance cost.
For the Kenyan retail investor, always demand transparency.
Use your vote at Annual General Meetings (AGMs) to challenge boards on their lack of professional IR, disclosure standards, and the allocation of resources to this critical function. Stop accepting the bare minimum. Only by holding boards accountable for their silence will the market's basement issues be truly fixed.
Mukami is a Public and Investor Relations Consultant working as a Senior Client Manager at Hudson Sandler
