CORPORATE GOVERNANCE PRACTICES AND FIRM PERFORMANCE IN SAVINGS AND CREDIT COOPERATIVE SOCIETIES IN NAIROBI COUNTY, KENYA
Abstract
This study examined the effect of corporate governance practices on firm performance in savings and credit cooperative societies in Nairobi County, Kenya. The study utilized the cross-sectional survey for the collection of primary data and the correlational research design for testing non causal relationships among variables. The unit of analysis was the savings and credit cooperative society, while the unit of inquiry was the chief executive officer/ secretary to board of the savings and credit cooperative society. The collected data was processed and entered into the statistical package for social sciences (SPSS) version 26 to create a data sheet to be used for statistical analysis. Data was analyzed using descriptive and inferential statistics. The Pearson’s product moment correlation analysis was performed to confirm or deny the relationship between the study variables. The correlation results showed that board meetings, board composition, and board size had strong positive significant relationship with firm performance. Interestingly, board independence had moderate strong negative significant relationship with firm performance. A standard multiple linear regression analysis was performed with firm performance as the dependent variable and board meetings, board independence, board composition, and board sizeas the predictor variables. The regression results indicated that board meetings, board independence, board composition, and board size had a positive and significant effect on the firm performance. Interestingly, board independence had negative significant relationship with firm performance in savings and credit cooperative societies in Nairobi County, Kenya. The moderated multiple regression results showed that board gender diversity had a positive significant moderating effect on the relationship between corporate governance and firm performance in savings and credit cooperative societies in Nairobi County, Kenya. The findings provide managers with useful insights and serve as an underpinning for the policy regulatory efforts aimed at strengthening the corporate governance practices and the performance savings and credit cooperative societies, Kenya. Future researchers might examine governance practices and firm performance in other sectors.
Key Words: Board Meetings, Board Independence, Board Composition, Board Size
CITATION: Mwajedi, A., Kising’u, T., & Gichinga, L. (2022). Corporate governance practices and firm performance in savings and credit cooperative societies in Nairobi County, Kenya. The Strategic Journal of Business & Change Management, 9 (4), 899 – 927.
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DOI: http://dx.doi.org/10.61426/sjbcm.v9i4.2460
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