Every year, thousands of Sacco members gather in auditoriums, halls, and stadiums across the country, flipping through reports, asking questions, and casting votes. For outsiders, it may look like another routine meeting. But for those who understand the heartbeat of a cooperative, the Annual General Meeting (AGM) is the most important event on a Sacco’s calendar. It is the moment where democracy, accountability, transparency, strategy, and community converge, where members are reminded that their SACCO is not just a financial institution, but their own business, owned by them, for them.
AGMs are not held because of tradition alone. They are a legal, strategic, and emotional necessity. They ensure that members’ voices are heard, investments are tracked, leadership is held accountable, and the Sacco’s direction aligns with collective goals. But it’s not only the members who benefit from this annual gathering. The leadership, board members, and management teams gain equally from the structured, formal dialogue that AGMs provide.
The AGM as the Supreme Authority of a Sacco
At the core of cooperative governance is the fact that a Sacco belongs to its members, and that authority rests with them collectively, as opposed to a small group of executives. In many cooperative legal frameworks, including Kenya’s, the general meeting is explicitly defined as the body with supreme authority, the ultimate decision‑making forum where members’ voices are heard, recorded, and acted upon.
This democratic foundation means that during the AGM , members review, question, and adopt audited financial statements for the past year. These reports provide transparency into the Sacco’s income, expenditures, assets, liabilities, and overall financial health. Additionally, members approve the budget and financial plan for the ensuing year, including how surplus funds, reserves, and dividends will be applied or distributed. They also elect or re‑elect board members, supervisory committee members, and sometimes auditors, ensuring that leadership reflects their interests, values, and confidence.
In the same vein, the AGM provides an opportunity to consider changes to bylaws, the internal rules that govern how the Sacco operates, including member rights, meeting procedures, and organizational structure. This structured authority ensures that major decisions are not made behind closed doors, but in the full view of members who have a stake in the Sacco’s success.
Transparency, accountability and member confidence
One of the principal motives for an AGM is transparency. In a cooperative, members have a right to understand how their savings are managed, how strategic decisions are made, and the risks the Sacco faces. By reviewing audited accounts and management reports, members get direct insight into operational and leadership performance.
Accountability flows from this transparency. When leadership presents results (good or bad), members can raise questions, seek clarifications, and demand changes. This shared accountability strengthens trust in the institution and aligns management’s actions with members’ expectations and interests.
Importantly, members’ rights to information, decision‑making, and electing representatives are not optional perk. They are legal rights embedded within the co- operative law. These rights give members leverage and voice. They also ensure that a Sacco remains true to its purpose of serving its own members rather than maximizing profit for a few.
Why AGMs matter for the leadership and management
For the Sacco boards and executives, AGMs are far more than a formality—they are a litmus test for governance, strategic clarity, and stakeholder trust. To start with, AGMs validate leadership and strategy. The AGM is the forum where board decisions, policies, and strategic plans are presented to the ultimate authority(the members). It allows leaders to explain performance outcomes, investment strategies, dividend policies, and risk management frameworks. When executives present audited financial statements, budgets, and projections, they are not just fulfilling compliance—they are building credibility and confidence in their leadership.
Secondly, it is an opportunity for the leadership to receive direct feedback and insight. While internal meetings and reports give a leadership team a sense of operational progress, nothing compares to hearing directly from members. AGMs allow the board to listen to the members’ concerns, suggestions, and aspirations in real time. This feedback is invaluable: it highlights gaps in service, product demand, and members’ expectations that might not appear in formal reports. A single pointed question from a member can spark a strategy rethink or operational improvement.
An AGM also strengthening accountability and transparency. By reporting outcomes, explaining decisions, and fielding questions, the board demonstrates that accountability is not optional, it is core to cooperative principles. AGMs reinforce that leadership exists to serve members, not the other way round. This transparency reduces conflicts, builds trust, and empowers the board to make more informed decisions in future.
It is also an opportunity for strategic communication. An AGM allow the leadership to communicate major initiatives, upcoming products, new branches, and investment opportunities. It’s also a chance to showcase achievements and celebrate milestones, reminding members why their savings and participation matter. For executives, this is not mere showmanship; it is strategic engagement, ensuring that every member understands the Sacco’s vision and feels part of its journey.
AGMs often include the election or re-election of board members and committee officials. This formal endorsement from members legitimizes the leadership and strengthens their mandate to implement strategic plans. Without AGMs, boards would lack a transparent mechanism for renewal and confirmation, which could weaken governance credibility.
During AGMs, questions from members and discussions often reveal emerging trends, risks, and opportunities. For instance, concerns about loan accessibility or dividend distribution can prompt the board to review policies, while feedback about desired services can inspire innovation. This makes the AGM a dual-purpose tool: both a checkpoint and a catalyst for growth.
Education, engagement and community building
The modern day Sacco AGMs are more than boardroom presentations. They are events where members gather not just to pass resolutions, but to learn and build community. Educational sessions on financial literacy, responsible borrowing, and investment strategies are increasingly part of AGM agendas. These sessions equip members with knowledge that enhances their individual financial decision‑making. In turn, this strengthens the SACCO as a whole.
For board members and staff, the AGM is also an opportunity to connect personally with members; hearing their concerns, aspirations, and feedback in real time. This direct engagement builds emotional investment and reinforces why members chose to be part of a cooperative in the first place.
AGMs and the shift to delegate system
As co-operatives grow, with membership sometimes exceeding tens of thousands, the traditional AGM, where most members physically attend, has become increasingly difficult to manage. Reports of overcrowding, long queues, logistical challenges, and even delayed decision-making have prompted regulators to rethink how members participate in governance.
Therefore, last year in June, the Ministry of Cooperatives and MSMEs issued a directive to co-operatives with more than 5,000 members to adopt a delegate system. Under this model, instead of every member attending a general meeting, a representative subset of elected delegates will attend and vote on behalf of the wider membership. These delegates, chosen democratically, are entrusted with the authority to deliberate on key issues, approve financial statements, vote on leadership elections, and make strategic decisions that reflect the collective will of the co-operative.
The directive specifies that the number of delegates should be no fewer than one hundred and fifty , and no more than five hundred, striking a balance between representation and manageability. It also requires the co-operatives to update their bylaws to formally embed the delegate system, ensuring that every aspect of this new governance model is legally anchored. Importantly, this change is time-bound, with co-operatives expected to implement the system within six months of the directive.
The shift is about more than just logistics; it’s a strategic response to the growing trust and confidence that members now place in Saccos. As more people invest, save, and borrow through these institutions, Saccos face heightened expectations for transparency, efficiency, and accountability. The delegate system ensures that even as membership grows, every voice is still represented, and decisions remain democratic, while meetings are more structured, focused, and actionable.
For Saccos, the transition also presents an opportunity to professionalize governance and member engagement. Delegates are often trained to understand financial reports, lending policies, and investment decisions before attending the meeting. This ensures that discussions are informed, resolutions are well-considered, and the AGM, or now, Annual Delegates Meeting (ADM), becomes not just a procedural requirement but a high-impact forum for strategic decision-making.
In essence, the delegate system is a modern evolution of the AGM. It preserves the democratic foundation of cooperative governance, while addressing the realities of scale, efficiency, and members’ expectations. Members continue to hold ultimate authority through their elected representatives, and Sacco leadership benefits from a streamlined, well-organized platform to present strategies, seek approvals, and maintain accountability.
This change signals a maturing cooperative sector, one that is responsive to regulatory guidance, members’ needs, and the practicalities of growth. While the method of participation evolves, the purpose remains unchanged: to ensure members are heard, interests are protected, and the Sacco continues to grow in a transparent, democratic, and inclusive manner.
The AGM as a shared platform for growth
While members attend AGMs to track their deposits, understand dividends, and participate in elections, leadership attends to validate strategy, build trust, and gather intelligence for better decision-making. The meeting is a two-way street: members gain clarity and confidence, while executives gain legitimacy, insights, and an opportunity to shape the Sacco’s future collaboratively.
This mutual benefit is why Saccos, despite evolving regulatory frameworks and discussions about shifting to delegate systems, continue to prioritize AGMs. Even as Kenya’s Ministry of Cooperatives and MSMEs Development encourages Saccos to explore representative delegate programmes for efficiency, the AGM remains an unmatched space for direct engagement, democratic accountability, and transparent governance.
In essence, the AGM is where a Sacco’s values, strategy, and community intersect. It’s where members see their money at work, where leadership is tested, and where both sides leave empowered members with confidence in their investment, and leaders with a clear mandate to grow and protect it. Without it, a Sacco risks becoming a distant institution. With an AGM, it thrives as a living, accountable, and member-owned cooperative.
Tradition versus innovation
As Saccos grow and regulations encourage the shift to the delegate system, one question lingers: do AGMs still hold their place in cooperative life? The answer, unequivocally, is yes. While the delegate system promises efficiency, scale, and manageable decision-making, the spirit of the AGM; the gathering of members to see, question, and influence the future of their Sacco, remains irreplaceable. Tradition and innovation, in this case, are not enemies but partners.
For members, the AGM is a reminder that their voice matters. It is the forum where their savings, aspirations, and trust are reflected in tangible decisions, from financial reporting and dividend allocation to leadership elections and strategic direction. Even when represented by a delegate, the power they exercise originates here. Every resolution passed is a testament to collective ownership, accountability, and shared purpose.
For the Sacco leadership, AGMsserve as a mirror, reflecting the organization’s strengths, weaknesses, and potential. They provide insight into the members’ priorities, highlight emerging opportunities, and ensure that governance is anchored in transparency and trust. The meeting becomes more than a compliance exercise; it is a strategic touchpoint where leaders connect with the very people their decisions affect.
Ultimately, the question is not whether AGMs should evolve, but how they can continue to serve their fundamental purpose: fostering engagement, building trust, and sustaining democratic governance. In balancing tradition with transformation, Saccos signal to their members that growth and inclusivity can coexist. The AGM, whether attended by hundreds or represented by a council of delegates, remains the heartbeat of the cooperative: a place where ownership, voice, and vision converge.
So, as we step into this new era of Sacco governance, the AGM asks us all: can we honour the past while embracing the future? And the answer is clear: yes, we can. And we must!
