TERMS OF REFERENCE

CONSULTATION SERVICES TO CONDUCT LIMITED ASSURANCE FOR THE

BANK’S SUSTAINABILITY REPORT.

BACKGROUND.

KCB Group has over the last few years embedded sustainable practices throughout its
operations. We have aligned our actions and business operations towards the UN Global
Sustainable Development Goals. Sustainability has become an increasingly relevant
subject matter for investors and regulators alike. Financial institutions especially are
required to submit reports aligned to international standards such as the TCFD and IFRS.
The Bank released its first sustainability report in 2008, and in 2022, the Central Bank of
Kenya published the Banks climate related financial disclosures, making it a mandate for
all banks in Kenya to adopt their sustainability reporting to this mandate. It is therefore
paramount for the Bank to align to these reporting requirements and ensure that the data
reported provides an accurate representation of the Bank.

Beyond the reporting element, the sustainability report is a crucial source of information
for a multitude of stakeholders. It is equally important for these stakeholders to
understand the Banks sustainability story; and to trust that the story shared is accurate.
Given the significance and impact of this information, and the intense scrutiny it is subject
to, it’s essential that it is relevant, reliable, trustworthy. As a result, assurance of the report
through independent parties, allows the Bank to strengthen transparency, reduce
information risk and gain credibility and build trust in the business and with the
stakeholders.

JUSTIFICATION.

In order to maintain investor confidence and stakeholder’s perception, reporting needs to

be accompanied with comprehensive and factual information. It is important to ensure
that the sustainability reports are backed by full proofed and supported claims. As such,
this activity contributes as part of the key focus areas of the Bank in ensuring the validity
and credibility of its reporting process. An assurance engagement is done by a 3rd party
in an effort to enhance the degree of confidence of the intended users other than the
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responsible party about the outcome of the evaluation or measurement of a subject matter
against criteria.

SCOPE OF WORK.

• KCB seeks a consultant to conduct a limited assurance exercise of its 2023

Sustainability report and thereafter determine areas of noncompliance to the
mandated sustainability reporting standards. The assurance process should also
be aligned to international best practices and cover the below:

• Non-financial information: The assurance process covers information such as

policies and performance covering the environment such as carbon emissions, and
issues touching on the economy, ethics, and the society at large.

• Identification of Key Performance Indicators (KPIs) and Metrics: Clear

identification and evaluation of key performance indicators and sustainability
metrics used by the organization to measure and report its sustainability
performance. Assessment of the relevance, reliability, and consistency of these
KPIs and metrics.

• Recommendations for Improvement: Identification of areas where the organization

can improve its sustainability performance or reporting processes.
Recommendations for enhancements in data collection, measurement
methodologies, or reporting practices to align with best practices or standards.

• Stakeholder Engagement Analysis: An analysis of how the organization engages

with stakeholders in the context of sustainability, including how their feedback is
considered and integrated into the reporting process.

• Compliance with Standards and Regulations: Verification of the organization's

compliance with relevant sustainability standards, frameworks, and regulations.

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THE OVERALL OBJECTIVE.

The objective of the assignment is to:

• Improve quality, reliability and accuracy of data: Providing indications of internal

controls and data reporting gaps to improve.
• Confidence: Increase the confidence of management and the board who will see
that the company is meeting leading sustainability standards.
• Improved management systems and reporting process: Increase confidence in the
reliability and quality of assessment management systems, structures, procedures
• and performance.
• Enhanced credibility: Enhancement of trust and increase in credibility of internal
• and external stakeholders.
• External expertise and experience: Benefit from external expertise and experience
resulting in improved quality of the sustainability report, and consequently, positive
changes within the organization.
• Ensure compliance: Confirmation that the management processes and report fulfill
the GRI guidelines.
• Develop a strategy to align the Banks reporting to internationally acclaimed
standards.

METHODOLOGY.

The consultant is expected to conduct assurance based on ISAE 3000 Assurance

Standards. This establishes basic principles and essential procedures for professional
accountants in public practice (practitioners) for the performance of assurance
engagements other than audits or reviews of historical financial information covered by
International Standards on Auditing (ISAs) or International Standards on Review
Engagements.

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The EER assurance project aims to revive the application of ISAE 3000. This guidance
will clarify matters that are not addressed in ISAE 3000, for example the materiality
process. This framework provides guidance on non-financial auditing, including
sustainability assurance.

CONSULTANT’S DELIVERABLE/OUTPUT

Upon selection and contracting, the consultancy is expected to deliver at a minimum the
following:

• An independent assurance conclusion and elaborating recommendations for the

organization and management.
• Assurance Statement or Report: A formal document provided by the assurance
provider that communicates the scope of the engagement, the criteria used for
assessment, and the findings of the assurance process. The assurance statement
or report may also include the conclusions and any limitations or qualifications
related to the assurance engagement.
• Documentation of Procedures and Evidence: Clear documentation of the
procedures followed during the assurance engagement, including the methods
used to collect and assess evidence. Compilation of relevant evidence supporting
the conclusions reached during the assurance process.
• Continuous Improvement Framework: Development or enhancement of a
continuous improvement framework to help the organization strengthen its
sustainability performance and reporting in subsequent periods.
• Independent Assurance Mark or Seal: A mark or seal that the organization can use
to signify that its sustainability reports have undergone independent verification.

CONSULTANCY TIMELINES/DOCUMENT OWNERSHIP

• The consultancy is expected to take a maximum of 3 months.

• There will be provision for discussion of the implementation plan and minimum
requirements for this assignment/validation of findings with the KCB team and
inclusion of comments where applicable.

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• Any reports or other materials prepared by the consultant under this Agreement shall
belong to and remain the property of the Bank.

RELEVANT QUALIFICATIONS
The consultancy is open to registered firms or teams of individuals. The consultancy
assignment requires, at the very least, a team composed of experts who have at least 10
years of experience in;
• Audit and quality assurance of Sustainability reports.
• High standards of professionalism and ability to work independently.
• Strong interpersonal and communication skills.
• Demonstrated knowledge, skills, and experience in using IFRS S1&S2, GRI and
TCFD methodologies.

LOGISTICS
• While undertaking this assignment, the KCB will facilitate all logistics and related
support necessary for the consultant to undertake assignments.

EXPRESSION OF INTEREST
• Commitment for availability for the assignment, and capacity to undertake the
assignment.
• 2 recommendations from referees/organizations worked for within the past years.
• Detailed statement on the study, stating study methodology and data collection
methods.
• Detailed financial proposal, specifying consultant fee rates.
• Detailed work schedule for the audit indicating activity timeline.

EVALUATION CRITERIA
A two‐stage procedure is utilized in evaluating the proposals, with evaluation of the
technical proposal being completed prior to any financial proposal being opened and
compared. The financial proposal of the proposals will be opened only for submissions
that passed the minimum technical score of 70% of the obtainable score of 100 points in
the evaluation of the technical proposals. The technical proposal is evaluated on the basis
of its responsiveness to the Term of Reference. In the Second Stage, the financial

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proposal of all bidders, who have attained minimum 70% score in the technical evaluation,
will be compared. The short‐listed bidding agencies/consultants may be asked for a
presentation prior to the final selection. The contract will be awarded to the successful
bidder following completion of all evaluation including negotiation (only in exceptional
cases).

1. Technical Evaluation Criteria

Criteria, sub-criteria
Demonstrated understanding of sustainability assurance based on international
standards and policies relating to reporting assurance.
Methodology and implementation:
- Detailed implementation plan aligned to the ISAE 3000 Assurance standards.
- Clearly outlined methodology for implementing the assignment.
- Detailed time frame of the assurance process.
Proposed team:
- Detailed CVs of all team members involved highlighting their experience and
qualifications indicating at least 10 years’ experience.
Organization
- Clearly indicated experience working on report assurance or similar projects
- Additional resources required to carryout the assessment.

SUBMISSION TIMELINES

Deadline for submissions of proposals is 5th March 2024 at 3.00pm

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