Sampaul Nakhaima:
There is a rising concern over the collapse of enterprises in Uganda with many owners attributing the trend to unfavorable competition and unfair taxation regime. Business leaders, however, disagree with this. Their view is that weak leadership, poor governance structures and the failure of boards to execute their oversight mandate effectively play a major role in the collapse of businesses.
Speaking during the 2026 Corporate Governance Conference at the Skyz Hotel in Kampala on May 22, 2026, Ahmed Mukasa, a partner at the Crane Associated Advocates, challenged the common narrative that government policies and market competition are solely responsible for business failure. To him, companies do not fail; Boards fail, and then they shift the blame to government policies, tax regimes and competition.
“Many businesses, especially family-owned enterprises, collapse because they operate without independent governance structures and clear leadership systems” he said, adding that businesses without proper leadership eventually go under, particularly when families replace boards.
“You need independent eyes when decisions are being made,” he emphasized.
Mukasa noted that many small and medium enterprises in Uganda suffer from concentration of power, where one individual attempts to play every role in the organization, from director and chairman to accountant and operations manager.
He noted that the situation worsens when family members are appointed into sensitive decision-making positions without the competence and independence required for corporate oversight.
He further cited governance conflicts where directors become suppliers to their own companies, take loans they never repay and deliberately ignore the advice of auditors.
His remarks were reinforced by the Insurance Regulatory Authority of Uganda (IRA), Chief Executive Officer, Alhaj Dr. Kaddunabbi Ibrahim Lubega, who said governance today must be understood beyond the existence of policy manuals and compliance paperwork.
“Governance is not measured by the elegance of policy documents. It is measured by institutional behaviour under pressure”, Alhaj Dr. Kaddunabbi said.
To him, institutions reveal their true governance strength during moments of crisis, financial strain or public scrutiny. He argued that when governance succeeds, markets become stable, investment grows and institutions earn legitimacy.
He warned that governance failures carry devastating consequences that extend far beyond financial losses.
“When governance fails, trust erodes, confidence collapses, institutions weaken and rebuilding public confidence becomes extraordinarily difficult,” he said.
The business leaders unanimously argued that the future sustainability of businesses will depend less on market survival tactics and more on the organizations’ ability to build credible governance systems anchored on transparency, accountability, independence and professional leadership.