NSSF'S IMPROVED GOVERNANCE HAS BEEN THE KEY TO ITS SUCCESS

On Monday, 22 September, the National Social Security Fund will once again announce the interest rate on members’ savings at its annual members’ meeting.

The number will grab the headlines, as it always does, but the real story lies behind the figure—how the Fund has managed to keep growing, the pressures it faces, and whether it can keep faith with the millions of Ugandans who look to it for security in old age.

The growth has been undeniable. From the Sh1 trillion milestone it first crossed in 2011, the Fund has now raced toSh26 trillion in assets under management. That trajectory alone has changed the national financial landscape. 

NSSF is no longer a quiet collector of payroll deductions; it is one of the largest investors in the region, a market mover in bonds, equities, and real estate. For members, that scale should be comforting—proof that their savings are being nurtured. But with size comes new questions about where the Fund is headed, and whether its growth is being matched by the prudence needed to safeguard it.

Much of the Fund’s success has come from its dominance of the domestic bond market. Month after month, NSSF steps into Bank of Uganda auctions and soaks up treasury bills and bonds, securing safe, predictable returns. 

With yields hovering between 14 and 17 percent, members have enjoyed consistent double-digit interest rates, comfortably above the ten-year average inflation rate. The pledge to always deliver at least two percentage points above 10-year average inflation has been kept, and in a country where few investments beat inflation, that is no small feat.

The mid-term access provisions introduced in recent years have tested the Fund’s ability to balance inflows and outflows. Members over 45 with at least ten years of contributions have rushed to withdraw part of their savings. Benefit payouts have at times outstripped contributions, yet the Fund has kept its commitments without losing ground. 

Liquidity has held, investment income has remained strong, and operational efficiency has improved. The turnaround time for processing benefits has been cut to under ten days, while administrative costs have been held below one percent of assets. Members can now track balances and file claims online, a far cry from the opacity of years gone by.

Beyond bonds, the Fund has tiptoed into equities and real estate. Holdings in MTN Uganda and Safaricom offer regional exposure, while projects like Lubowa and Temangalo signal ambition in bricks and mortar. Yet these ventures also raise uncomfortable questions. Housing units priced far above the reach of the average saver suggest a Fund that builds for others, not its own members. Equities provide diversification but remain a small sliver of the portfolio. In truth, the heavy lifting is still done by government debt.

And here lies the danger. Uganda’s domestic debt has ballooned past Sh56 trillion. NSSF is one of its largest creditors. That creates a concentration risk—too many eggs in one basket. A sovereign default is unlikely, but the pressure on government finances is real, and the Fund’s reliance on government paper ties its fortunes to the very borrower it cannot refuse. Members should be clear-eyed about this: the returns have been good, but they rest on an increasingly fragile fiscal foundation.

Governance is the other pressing concern. Over the last two years, the Fund has endured parliamentary probes, wrangles between ministries, and public controversy over management practices and bonuses. These are not trivial squabbles. They are reminders that the biggest risk to the Fund is not inflation or real estate volatility but weak stewardship. The mechanisms for collecting and investing savings are strong. What can undo NSSF is interference, capture, or short-term populism.

Looking ahead, the Fund stands at a crossroads. With Sh26 trillion in assets, it is one of East Africa’s largest pools of long-term capital. Managed wisely, it could finance infrastructure, energy, and regional ventures that transform the economy while earning robust returns for members. It could deepen voluntary savings products to reach the informal sector, giving millions outside formal employment a path to retirement security. It could realign its housing strategy to deliver genuinely affordable units rather than gated enclaves for the few. And it could hardwire transparency into its DNA so that members understand not just the size of their fund, but the risks and choices behind it.

The irony is that the most difficult part has already been done. The savings collection systems are in place, the investment frameworks are tested, and the habit of paying interest reliably has been entrenched. 

The only thing that can fail now is governance. If the Fund falls to politics, insider capture, or weak accountability, then all those trillions will mean nothing. Growth without governance is a mirage.

So as members gather on Monday, they will no doubt cheer the double-digit interest rate that will be announced, if the performance of the Fund and past trends are to go by. But they must also look beyond the number. 

The real question is whether NSSF can continue to grow with prudence, resist the pressures of its own success, and remain faithful to the simple promise that matters most: to protect and multiply the hard-earned savings of Ugandans. If it can do that, then the future of the Fund—and of its members—will remain secure.

THE USE'S QUIET BULL: WHERE THE SMART MONEY IS MOVING

The Uganda Securities Exchange is beginning to hum again. August 2025 did not set any records for turnover — in fact, trading volumes eased to sh7.7 billion from July’s  sh10.8 billion. But look closer and you’ll see something more important: both the All Share Index and the Listed Companies Index climbed, 5.6 perspetcive and 6.6 perspective respectively. In other words, prices are rising even as activity slows. That’s not speculation. That’s conviction.

I remember an old hand at the exchange once telling me: “Paul, the USE does not reward noise; it rewards patience.” True to form, the market is now rewarding those who stuck with banks, telecoms, and even a few brave souls who bet on pharmaceuticals. This is not just my reading of the market, but also drawn from the SBG Securities Market Performance Report, August 2025, which has tracked the shifts in liquidity, index movement, and company-specific developments.

Banks: The Bedrock of the USE

Stanbic (SBU) has become the exchange’s workhorse. Up nearly 11 percent in August and 44 percent this year, it’s backed by profit growth of 18 percent and a return on equity north of 26 percent. At a PEG of 0.33 and a dividend yield approaching eight percent, it is almost the definition of growth at a reasonable price.

Bank of Baroda (BOBU), for years the neglected cousin, has come roaring back. Its PEG of 0.04 is absurdly cheap — a sign that the market has still not fully priced in its recovery. Throw in a dividend yield of 6–7 percent and you have an old-school income stock suddenly dressed up as a growth play. DFCU, though still carrying governance baggage, offers a PEG of 0.18 and a dividend that makes it hard to ignore for those who like contrarian bets.

Telecoms: Growth with Cash in Hand

If banks are the USE’s bedrock, the telecoms are its growth engine. Airtel Uganda and MTN Uganda both grew profits at close to 30%, and they reward you with dividends of 5–7 percent. Their PEGs hover around 0.35, telling us their prices are still not running ahead of their growth. Investors holding these two are not just betting on Uganda’s future digital economy — they’re already being paid to wait.

QCIL: The Dark Horse

Quality Chemicals (QCIL) is the quiet revolution. Profits are up more than 80 percent this year, giving it a PEG of 0.13. That’s ridiculously cheap for a company proving it can scale. Dividends are modest for now, but for the patient investor, this is the counter where growth today becomes cash tomorrow.

 

The Stragglers

Umeme’s numbers are what happens when story runs ahead of fundamentals: a P/E of nearly 59, negative profit growth, and no dividend comfort. Uganda Clays and New Vision remain in survival mode — they look cheap but are actually expensive when you measure in opportunity cost.

PEG + Dividend Yield Ranking

Counter	P/E	Profit Growth	PEG	Dividend Yield	Verdict
BOBU	4.70	110%	0.04	~6–7%	Deep Value + Income
QCIL	10.42	82%	0.13	~2–3%	Exceptional Growth Value
DFCU	2.68	15%	0.18	~4–5%	Undervalued
SBU	6.05	18%	0.33	~7–8%	Growth + Income Star
AirtelU	10.10	29%	0.35	~5–6%	Growth + Dividends
MTNU	9.81	28%	0.35	~6–7%	Growth + Dividends
Umeme	58.76	-3.6%	n/a	<2%	Overvalued
UCL	-8.53	Negative	n/a	0%	Loss-Making
NVL	0.20	Negative	n/a	0%	Value Trap

So, How Would One Allocate a Portfolio?

If I had UGX 100 shillings to put to work today on the USE, guided by PEGs and dividends, here’s how I’d spread it:

• Banks (SBU, BOBU, DFCU) – 40 shillings
  The safest balance of income and growth. Stanbic as the anchor, Baroda for value, and a smaller tilt to DFCU for contrarians.
• Telecoms (Airtel, MTN) – 30 shillings
  Both are growth-plus-dividend engines. Split evenly.
• QCIL – 20 shillings
  The growth bet of the next 3–5 years. Modest dividend now, but strong upside.
• Speculative/Opportunistic – 10 shillings
  This is where you tuck away a small stake in laggards (UCL, NVL) if you believe in turnarounds, or simply hold cash for better entry points.

Final Word

The USE in 2025 is no longer a market of sleepy counters. It is quietly rewarding those who study not just prices but growth, dividends, and valuations in tandem. PEG ratios show us clearly where value still lies — in banks, telecoms, and QCIL. The rest, for now, are lessons in patience or caution.

DISCLAIMER: The author owns shares on the USE. Analysis based on the SBG Securities Market Performance Report – August 2025, Crested Towers, Kampala.

ESG: WHY THE BIGGEST BUSINESSES THINK LONG TERM

The biggest, richest businesses in the world are those that serve the most people.

From Amazon and Apple in the West, to Safaricom and Dangote here in Africa, their wealth comes not from catering to a narrow elite, but from embedding themselves into the daily lives of millions. The lesson is simple: scale matters. And scale only endures when companies manage resources wisely, serve society’s needs, and govern themselves responsibly.

That is precisely what the ESG (Environmental, Social, and Governance) agenda captures. ESG is not a donor invention or a compliance tick-box. It is the recognition that businesses which serve the most people must also ensure the sustainable use of resources, fairness in society, and ethical conduct if they are to remain relevant tomorrow. It is the formula for longevity...

Globally, this logic is already reshaping markets. Investors are steering trillions of dollars into companies with credible ESG plans. Consumers are rewarding brands that align with their values. Employees, especially the younger generation, prefer to work for firms that show purpose beyond profit.

Down history profitability without responsibility is short-lived.

Consider climate change. Companies that fail to adapt face rising costs, stranded assets, and reputational damage. Those that invest in renewables and efficiency today will save money tomorrow while attracting investors who demand climate alignment. Or take governance: scandals have destroyed billion-dollar corporations overnight. Strong governance is not bureaucracy, it is insurance for long-term survival.

In this sense, ESG is the logical extension of the old business truth: the more people you serve, the more you must act responsibly. Without sustainability, the very scale that makes businesses rich will become their downfall...

Uganda is slowly waking up to this reality, led by the best multinationals among us.

MTN Uganda’s inaugural sustainability report released last month, provides an example of how ESG and business growth intertwine.

Through “Project Zero,” MTN has cut emissions by switching to renewable energy, lowering both its carbon footprint and operating costs. Its MoMo platform now underpins financial inclusion, disbursing about sh1.5trillion in loans through MoKash and facilitating 4.3 billion transactions in 2024 alone. The company also invested sh418 billion in infrastructure expansion and contributed sh1.3 trillion in taxes, cementing its position as the largest corporate taxpayer in Uganda.

MTN, meanwhile is only one of two companies two make revenues of more than three trillion a year – the other is National Social Security Fund (NSSF), and  inching determinedly towards ringing in a billion dollars in annual revenues.

At the same time, digital literacy projects are creating future-ready citizens who will, in turn, become more capable customers. None of this is philanthropy. It is smart business. MTN’s ability to serve 22 million Ugandans rests not just on network towers but on building trust, reducing costs, and ensuring communities see value in its presence. Its longevity depends on embedding ESG in its operations.

But telecoms are not alone.

Banks that finance green projects and SMEs are diversifying their portfolios and unlocking new sources of growth. Agribusinesses that invest in sustainable farming are stabilising supply chains and winning export markets. Energy firms that embrace renewables will not only lower exposure to fuel price shocks but also qualify for global climate finance. ESG is a growth multiplier across sectors.

Uganda’s private sector faces unique pressures: climate vulnerability, a youthful population demanding jobs, infrastructure deficits, and an increasingly discerning investment community. ESG provides a framework to turn these pressures into opportunities.

Environmental commitments reduce costs and attract capital. Social investments expand the market by lifting people into the economy. Governance reduces risks and builds trust with partners.

Most importantly, ESG makes business sense. It ensures the sustainable use of resources, energy, capital, and human talent while laying the foundation for longevity. Companies that waste resources, pollute their environments, or lose public trust are writing their own obituaries. Those that embrace sustainability embed efficiency, resilience, and relevance into their DNA.

This is not theoretical. The companies that dominate globally, those serving hundreds of millions invest heavily in sustainability, diversity, and governance. They know that ignoring these priorities would erode trust and shrink their markets. For Uganda’s firms, the same principle holds. If you want to grow big by serving many, you must adopt ESG to protect resources, society, and your own future.

The risk is clear: if Ugandan companies ignore ESG, they risk exclusion from investment flows and export markets where sustainability standards are non-negotiable. The reward is equally clear: those that adopt ESG early will attract long-term investors, retain the best talent, and win the trust of customers.

The future of business lies not in squeezing profits from a narrow base, but in serving more people better, and doing so responsibly. That is what ESG offers: a way to scale while safeguarding resources, strengthening society, and ensuring businesses endure.

Uganda’s business leaders should see ESG not as charity or compliance, but as the only route to sustainable growth. It is the recognition that to serve millions today, you must plan for millions tomorrow. ESG makes business sense.

WHEN POLITICS BECOMES THE RICHEST GAME IN TOWN

They say politics is a calling, but in Uganda it is clearly a business. The most lucrative one in town.

The just-concluded NRM primaries have reminded us, yet again, that this is not about service or sacrifice. It is about access to a salary of nearly thirty million shillings a month, before allowances, before mileage, before committee perks.

In a country where the majority scrape by on a few hundred thousand shillings a month, an MP sits in the top percentile of the top percentile of earners. It is no wonder, then, that contests for the party flag in the last three editions, look less like elections and more like battles for survival...

The stories that filtered out were not those of rallies and manifestos. They were tales of slaps — allegedly landing on no less than the Prime Minister Robinah Nabanja herself and the open defiance of the party’s Central Executive Committee.

It is tempting to dismiss this as political theatrics. But when you follow the money, it all makes sense. This is not about principle. It is about who gets to eat, and who must wait another five years outside the banquet hall.

Ugandans are too jaded to believe their politicians sacrifice for the good of the people.

And the spending is staggering. Rumour has it that some candidates for the NRM Central Executive Committee splashed billions on their campaigns.

One cannot help but wonder: what if those billions were spent on production instead of posters, handouts and hired crowds? A billion shillings properly invested in agro-processing could transform the fortunes of an entire county. It could build a small factory, employ hundreds, buy produce from farmers who today rot in poverty, and generate tax revenues for years to come. Instead, the billions vanish in days, leaving nothing behind but bitterness and unpaid debts. In Uganda’s political economy, money is not invested; it is burnt in the bonfire of ambition.

A back-of-the-envelope calculation suggest if you took a billion shillings and point it at maize processing. Assume sh300m buys a modest 1–2 tonne/hour mill (crusher, de-huller, sifters) and sh100m sorts site works, a transformer and basic handling gear. Put sh300m into revolving working capital to buy grain. Keep sh200m as six months’ operating float (wages, power, transport) and sh100m as contingency.

Run 200 tonnes/month through the plant. Even at a conservative 15 percent value-add on raw maize (from flour + bran), that’s roughly sh36m in gross value created each month. Payroll, power and logistics might eat sh30m, still leaving a thin operating surplus of sh6m/month — and the kicker is elsewhere: the revolving working capital puts sh2.5–3.0 billion a year into farmers’ pockets as you buy and turn stock; the plant sustains 25–40 direct jobs and steadies prices for hundreds of smallholders.

Push to a double-shift (300 tonnes/month) or add a simple packing line and the surplus thickens, the wage bill supports more households, and local tax flows become real — every single year. That is what one campaign-day’s burn can seed in one county.

The extractive nature of our politics means institutions that should broaden opportunity have become toll gates for privilege...

When last year Parliament proposed to hold sittings around the country at five billion shillings a day, it is sold as inclusion, but in reality it is nothing more than a show at the taxpayer’s expense. When MPs defend their emoluments more fiercely than they do their constituents’ needs, it is clear where their priorities lie. The system works, yes, but not for the many. It works brilliantly for the few who can grab a seat inside.

The violence and defiance in the primaries are not aberrations; they are the logical outcome of a politics where the rewards are grotesquely outsized. The slope we are sliding down is steep and getting steeper.

Daron Acemoglu and James Robinson in their book Why Nations Fail remind us that countries thrive when they build inclusive institutions. They fail when their institutions become extractive, enriching a narrow elite at the expense of the majority. Uganda today increasingly resembles the latter.

To put it bluntly the primaries are not a democratic exercise; they are an auction of access to state resources. The slap in the face of the Prime Minister was symbolic. The bigger slap is the one delivered daily to citizens whose schools remain unstaffed, whose hospitals remain under-equipped, and whose farms remain unfunded, while billions are blown on campaigns and salaries...

Already young Ugandans believe the only path to wealth is not through innovation or entrepreneurship but through joining the scramble for office. That is tragic. When politics becomes the business, the economy is relegated to the feeding trough.

This trajectory cannot end well. History is littered with countries that ignored the early warning signs, only to stumble into disorder and collapse. If campaign budgets run into billions while factories rust and farms wither, if parliamentary salaries soar while public service decays, if violence replaces debate even in internal contests, then the end is clear.

The NRM primaries should not be dismissed as an internal matter. They are a mirror held up to our political soul. What it reflects is not confidence but desperation, not service but self-interest, not inclusion but exclusion. Unless we confront this extractive logic  by trimming the perks of office, redirecting campaign billions into production, and making politics less about paychecks and more about service, we are condemning ourselves to a slope that leads nowhere but down...

And at the bottom, it will not just be the politicians who pay the price. It will be all of us.

THE UGANDA ECONOMY: INEQUALITY IN A SUIT

Jack a SACCO member from Soroti, remains unimpressed by the latest lofty figures issued by the finance ministry.

“GDP grew by 6.3 percent… the shilling is the most stable in Africa… we’ve climbed two places on the Human Development Index…”.

 Jack, who runs a small grain aggregation business and is still paying interest on his loan, just shook his head. “Sounds nice,” he muttered, “but who’s this economy working for?”

The Minister’s statement was full of shiny numbers.

"The economy’s size has grown to Sh226 trillion. Per capita income is up. Inflation is low at 3.8 percent. Exports have surged by 64 percent. Uganda’s HDI has improved farom 0.550 to 0.582, pushing us up from 159th to 157th globally. Life expectancy is now nearly 69. And fewer Ugandans are officially poor. On paper, we are making progress.

But for many ordinary Ugandans, that progress feels like it’s passing them by.

To paraphrase the Bible, man was not made for the economy, but the economy was made for man

. If rising GDP doesn’t translate into shorter clinic queues, more school meals, working street lights and clean water in Kyenjojo or Bukedea, then the numbers are just decoration. The true test of an economy isn’t how much it grows but who it lifts.

Uganda’s economy is rising, yes. But it is also concentrating. Growth is increasingly captured by the urban elite, the formal sector, and those already connected. Meanwhile, the boda rider in Kamwenge still can’t get a working health centre. The teacher in Adjumani still spends half her salary on rent and sugar. The graduate in Nebbi is still unemployed three years on.

The Minister pointed to falling income inequality—measured by a drop in the Gini coefficient from 0.413 to 0.382. But inequality has a way of hiding in plain sight. We see it in who gets government contracts. Who lives near a tarmacked road. Who has electricity. Who qualifies for financing without collateral.

And inequality isn’t just an unfortunate side effect—it is an indictment. An indictment of a government that still collects too little revenue, misallocates too many resources, and often fails to deliver value for money.

It is one thing to secure credit for roads, dams and hospitals. It is quite another to ensure those roads are pothole-free, the dams functional, and the hospitals staffed. Better distribution of the benefits of growth will only come when government projects are implemented more efficiently—by minimising corruption, for one, and prioritising actual delivery of public goods.

You see the disconnect in credit. Yes, private sector lending has grown to nearly Sh24 trillion. But ask a cassava farmer in Kumi how many banks are competing to finance her operations. Most of that credit flows to the same old sectors: real estate in Najeera, trade in Bugolobi, construction deals in Nakasero. The new economy is expanding, but too many are still locked out of it.

Even the celebrated fall in poverty—from 20.3 percent to 16.1 percent needs context. One bad harvest, one illness, one funeral, and a household can slip back. Development isn’t just about moving people above the poverty line, it’s about building buffers so they stay there. And that requires investment in things like universal healthcare, decent education, rural roads, and low-cost electricity not just GDP growth.

The diaspora sent back $1.4 billion last year. A lifesaver. But it’s also a warning sign. If the economy is rising, why are so many Ugandans still fleeing to wash dishes in Dubai or guard malls in Doha? Remittances are helpful, but they should be a complement—not a crutch.

The Minister did mention the Parish Development Model, Emyooga, Uganda Development Bank (UDB) and other wealth creation funds. Good tools in theory. But ask a youth group in Nwoya how long it took to get the money. Ask a SACCO in Pallisa how many times they were sent back for new documentation. For these programmes to work, they need to be streamlined, depoliticised, and corruption-proofed. Implementation is not a footnote. It is the difference between transformation and tokenism.

The macro numbers may be humming, but the micro reality is often grim.

Of course, we should be proud of our achievements. Uganda is growing. But growth without equity is a recipe for disillusionment, social strife and political instability. If we want a $500 billion economy by 2040, we must build it on a foundation of inclusion—where prosperity isn’t gated in Munyonyo but visible in Masindi, Kabale and Kitgum.

Because in the end, economic growth that fails to reduce injustice is simply inequality in a suit.

 

AIRTEL VS MTN: EFFICIENCY, GROWTH AND RETURNS IN H1 2025

When Uganda’s two telecom giants released their half-year numbers to June 2025, the story was not just about profits and dividends, but about how differently each is growing – and what that says about their business models.

Topline Growth

MTN posted 13.3% revenue growth to UGX 1.7 trillion, fuelled by a 31.3% surge in data and 18.6% growth in fintech revenues. Airtel actually outpaced MTN in percentage terms, with 17.9% growth in overall revenue to UGX 1.48 trillion【image】. However, MTN’s bigger base and diversification make its growth more sustainable.

Efficiency in Execution

The efficiency gap shows up in the EBITDA line. MTN expanded its margin to 53.7%, compared to Airtel’s 39.7%. That’s a clear sign of stronger cost discipline and better network economics for MTN. Airtel is still delivering, with UGX 590 billion in EBITDA, but its business runs heavier.

Bottom Line Strength

Airtel’s profit after tax came in at UGX 197.4 billion, while MTN reported UGX 267.0 billion. Once you adjust for MTN’s one-off tax settlement, profits rise to UGX 377.9 billion, making Airtel look modest by comparison.

Returns on Equity (ROE)

Airtel’s lean balance sheet magnifies its profits, giving it an extraordinary ROE of 117%, compared to MTN’s 42% (which itself is still robust). Investors should note, though, that Airtel’s high return comes with higher leverage and thinner equity buffers.

Returns on Invested Capital (ROIC)

Airtel also edges MTN on ROIC, at 26% versus 20%. Again, this is more structural than operational. Airtel’s smaller balance sheet makes its capital sweat harder. MTN’s heavier investments in fibre, towers, and spectrum weigh on ROIC now, but they underpin future dominance.

Comparative Table – H1 2025

Metric (H1 2025)	Airtel Uganda	MTN Uganda
Revenue (UGX)	1.48 trillion	1.72 trillion
Revenue Growth	+17.9%	+13.3%
EBITDA (UGX)	589.6 billion	924.2 billion
EBITDA Margin	39.7%	53.7%
PAT (UGX)	197.4 billion	267.0 billion (377.9b adj.)
PAT Margin	13.3%	15.5% (21.9% adj.)
ROE	117%	42%
ROIC	26%	20%

The Investor’s Lens

If you’re looking for efficiency and scale, MTN is ahead: stronger EBITDA margins, more diversified growth engines, and a larger profit base. But if you want spectacular returns on capital, Airtel dazzles with triple-digit ROE and higher ROIC, though on a thinner, riskier base.

In the end, the numbers tell two stories: MTN is the heavyweight building steady muscle, while Airtel is the nimble sprinter – lean, fast, and highly geared.

PAY ATTENTION TO THE FAMILY BUSINESS, IT IS UGANDA’S LIFE LINE

When Kenya supermarket chain Tusky’s collapsed, it was like watching a comet streak across the sky only to crash into the earth.

For years, the Kago family had built one of East Africa’s most beloved retail brands, expanding from a modest shop in Nakuru into a regional chain with more than sixty outlets in Kenya and Uganda.

The problem was never the customers, nor the competition, but the family itself. Boardroom quarrels turned into court battles, succession became a blood sport, and the absence of proper governance left the business vulnerable. In the end, what destroyed Tusky’s was not the market but the household quarrels that spilled into the marketplace.

It is easy to dismiss Tusky’s as a Kenyan misfortune, but a new study of East African family businesses suggests it is part of a regional story.

The East Africa Family Business Landmark Study carried out by the Musizi SustainableBusiness Institute, surveyed 40 familybusinesses in East AFrica and uncovered familiar patterns—enterprises born from grit and risk-taking founders that stumble when it comes time to hand over the keys.

The importance of the study cannot be overstated: more than nine in ten businesses in Uganda are family businesses. That means when we talk about family enterprises, we are not discussing a niche but the mainstream. And here’s the simplest definition you will ever hear: if your business affairs, when you eventually pass, will have a bearing on your family, then it is a family business. It doesn’t matter whether you run a village shop, a farm, or a portfolio of shares, the overlap between ownership, family, and livelihood makes it one.

The pioneers who built these businesses—men and women like the founders of Tusky’s were survivors first, entrepreneurs second. They mortgaged land, dipped into meagre savings, and worked with grit where others saw nothing. They knew hardship and endurance, and they were deeply rooted in their communities. Their children, by contrast, inherit a different reality. They face markets that are saturated and complex, with razor-thin margins and customers who demand more. Success today requires professionalism, strategy, and innovation rather than sheer willpower. The baton may be handed over, but the conditions of the race have changed.

That handover is where the trouble begins. Succession is rarely planned; it is left unspoken until the last minute. Death is taboo, elders are shielded from questioning, and the family fortune is often cloaked in secrecy. This means heirs are thrown into leadership unprepared, sometimes unwilling, with little guidance and less unity. Tusky’s lived this nightmare, and many other families stand on the same precipice. The Musizi Sustainable Business Institute, at its conclave in Kampala, put it bluntly: succession must be seen as a process, not an event. Children must be raised with “batteries included,” grounded in family values, prepared with gratitude rather than entitlement, and trained to take over long before crisis forces their hand. Otherwise, the comet burns too brightly, too quickly, before fizzling out.

Governance is another missing piece. Family businesses often assume that kinship is enough, but as enterprises scale, trust without structure becomes fragile. Shareholder agreements, family councils, independent boards—these are not luxuries but lifelines. The study pointed out how few advisors are available in Africa, less than one percent of global family business specialists, which leaves families improvising with outdated systems to run modern enterprises. Tusky’s is a textbook case: siblings pulling in different directions, decisions taken on whims, and no neutral body to enforce discipline.

The mismatch between global education and local realities compounds the problem. Sending heirs to prestigious schools abroad looks like prudent investment, but they return—or sometimes do not return at all, ill-prepared for African realities.

In London or Boston, they learn about stable currencies, enforceable contracts, and sophisticated markets. At home, they find volatility, political risk, and fragile purchasing power. Some heirs never come back, preferring to blend into the economies where they studied. Those who do often struggle with reverse culture shock, unable to reconcile textbook theory with gritty pragmatism.

The Musizi conversation offered a remedy: education must be contextual, teaching heirs to speak both global and local, and giving them room to experiment without jeopardizing the family enterprise.

And then there is inheritance itself, described in the study as both a gift and a burden—a comet, dazzling but potentially destructive. Heirs inherit not only assets but also liabilities, resentments, and heavy expectations.

If inheritance is treated as merely a transfer of property, it becomes a scramble for spoils. But when it is understood more holistically—spiritual capital, intellectual capital, social ties alongside financial wealth, then it can be the glue that binds generations. The Musizi framework insists that gratitude is the antidote to entitlement, that children who understand where they come from will value stewardship over plunder.

Still, there are families that get it right. Those who treat continuity as a project, not an assumption. Those who welcome innovation, formalize governance, and balance their legacy with openness to change. These are the businesses that endure, because they understand that family enterprise is not a private matter but a public good—an employer of thousands, a stabilizer of communities, a custodian of capital across generations. When such businesses fail, the shockwaves ripple far beyond the family.

Tusky’s should therefore be remembered not only as a cautionary tale but as a lesson. It tells us that succession delayed is succession denied, that governance ignored is conflict invited, that education without context is disconnection, and that inheritance without gratitude is poison.