Dissolution or Dismissal of Board of Directors of Associations Upon Confirmation of Serious Financial and Administrative Violations

Deputy Undersecretary for Financial and Administrative Affairs and Cooperation, Dr. Sayed Eissa, stated that the ministry, under the directives of the political leadership, the Minister of Social Affairs, Family and Childhood Affairs, and the Undersecretary of the Ministry, has embarked on a reform and corrective process for the cooperative societies, following practices in the sector over the past decades that deviated it from its cooperative path.

He emphasized that the dissolution or dismissal of cooperative society boards of directors occurs only upon the establishment of serious financial and administrative violations, clarifying that addressing the consequences of these violations requires comprehensive financial, administrative, and commercial procedures that cannot be completed in a short period.

He noted that reports submitted by appointed administrations showed the correction of most observations and the implementation of recommendations from audit and investigation committees, affirming the ministry’s continued monitoring of the implementation of reform measures.

He pointed out that some cooperatives previously suffered from arbitrary appointments linked to electoral interests, which imposed functional burdens on their budgets disproportionate to their actual needs, explaining that cooperatives are subject to the Civil Service Law in personnel matters, given their nature combines private sector activity with government oversight.

Regarding the future organization of cooperative society boards of directors, Eissa clarified that there are several proposals concerning the mechanism for forming boards of directors within the draft new law, which remain under study by the Fatwa and Legislation Department, in cooperation with relevant departments within the ministry.