CORPORATE GOVERNANCE AND FINANCIAL PERFORMANCE OF QUASI-GOVERNMENT ORGANIZATIONS IN KENYA

Abstract

The purpose of this study was to establish the effect of CG on financial performance of quasi-government organizations in Kenya.  Specifically the study sought to evaluate the effect of board structure, board remuneration, transparency and board independence on financial performance of Quasi-Governmental Organizations in Kenya. In addition, the study sought to establish the moderating effect of firm size on relationship between corporate governance and the financial performance of Quasi-Governmental Organizations in Kenya. The target population comprised of the 187 QGOs over a period of 8 years between 2013 and 2020. The study relied on secondary data which were collected with the aid of a document review guide. Data was analyzed using descriptive analysis, correlation analysis and multiple regression analysis. The study found that board structure had a significant effect on financial performance (p<0.05), board remuneration had a significant effect on financial performance (p<0.05), transparency had a significant effect on financial performance (p<0.05), board independence had a significant effect on financial performance (p<0.05) and lastly firm size had a moderating effect on the relationship between corporate governance and the financial performance (p>0.05). This research confirmed that in separation, CG significantly predicted financial performance. It is recommended that organizations should put in place CG practices that contribute positively towards financial performance.