5th March 2013

To our stakeholders

I am pleased to confirm that Baker Tilly Merali's (BTM) reaffirms its support of the 10 principles of the UN Global Compact in the areas of Human rights, Labour, Environment and Anti Corruption.

in this annual communication of progress we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also seen to integrate the same in our training to staff and share the information with our stakeholders using standard communication channels.

Yours faithfully

Madhav Bhandari
Managing Partner
BTM

We comply with International Standards on Quality Control (ISQC1) for audit firms and part of this policy requires us to address all Human resource policies. All staff are informed on this and all audit work has to be in compliance of ISQC 1. We have a staff handbook which covers office rules and manners in dealing with potential abuses of human rights.

We have a staff administrator who deals with all Human Rights issues. All staff are also appraised by their line managers where they can report any cases of abuse or fears.

The partners also effect salary increases to compensate lower level staff for hardships and inflation increases.

The partners review comments / discussions from staff administrator on any instances in the year and take remedial action to prevent and strengthen BTM HR system. We also engage HR external consultants for advise as required.

Partners and management encourage staff to meet and associate. Partners also meet management on a weekly or monthly basis to discuss labour issues. Partners send out message that BTM must uphold freedom of association and does not allow any forced, compulsory behaviour or child employment. The firm also respects gender bias in recruitment of new staff. It complies with the Employment Act in Kenya which has clear guidelines on labour in line with UN mandate.

As highlighted in our ISQC 1 document staff salaries and descriptions are based on level of seniority of staff. Similar staff earn similar salaries. The staff are aware that any issues can be channeled to the staff administrator if the line managers do not act. The partners invest annually per budget, new work stations and laptops to improve the health of staff in better working conditions. The firm also has 2 cleaners to improve the working conditions and cleanliness. The firm complies with the employment Act and has safeguards for any potential discrimination cases.

Management report to the partners the results of any labour issues, partners then approve changes, salary increases, comparison is done with other firms.
BTM tries to actively recruit women and men, all staff advertisements also state this. No preferential treatment, except as permitted by the Employment Act is given.
In 2012, all employment contracts were given to a lawyer to draft to ensure compliance with Kenyan legislation and best pratice.

BTM appreciates the importance of the environment and staff and partners are encouraged to practice environmentally friendly practices whilst doing their work. The firm is investing in paperless audit software to remove the impact on the environment on printing paper.

BTM continuously communicates to staff and clients the need for paperless documents, the use of email is mandatory, sending reports by email, recycling paper on both sides, use 4 pages per sheet, to reduce the volume paper, control of printing facilities to monitor printing. The firm also has an air-conditioner in the board room, which is only used when clients request for it, other times it is always switched off to save electricity (which BTM doesn't even pay for). The firm does not use any fake, recycled toners. All light switches are turned off at night.

BTM sponsors environmentally friendly football tournaments, where proceeds are used to assist conservation.

Being a small firm, BTM manages all environment issues immediately with good common sense. It complies with all environmental laws, under NEMA. Partners review management report on a regular basis

Being a highly respected audit firm, BTM has a zero tolerance for corruption, bribery and extortion. All staff are required to annually declare any instances of conflict of interest or issues touching on corruption. Staff, as part of the training, are trained how to handle issues of possible corruption. BTM, at all times, safeguards its staff first.

The firm has advised numerous of its clients to implement an anti corruption policy, and in 2013/2014 will also create its own anti -corruption policy.

All staff are trained to handle cases of corruption, even possible directly with the manager and partner involved. The managing partner takes full responsibility of any fraud cases or corruption.

The employee handbook also covers issues of corruption and all staff are required to mandatory attend CPD training.

All audit files are subject to a very robust quality control system where all work done is checked and staff are questioned where management feel findings have been hidden. The firms internal quality system, staff training, on the job supervision ensures that there is zero tolerance on corruption.

In 2014 the firm will create an anti-corruption policy.