| dc.description.abstract | Cooperatives play significant role in national economy and socio-economic development in
Kenya. Savings and Credit Cooperative Societies (SACCOs) in Kenya not only provide loans
to their members, but they also offer investment opportunities, agricultural facilities for
farmers, create employment, housing solutions, and much more. In the recent one decade,
SACCOs in Kenya have been experiencing challenges in financial performance. The return
on assets among SACCOs in Nairobi County in the year 2018 was 14.53%, which decreased
to 14.13% in the year 2019, 13.82% in 2020 and 13.75% in 2021. The main objective of the
study was to examine the influence of corporate governance dimensions on SACCOs’
financial performance in Nairobi County. Specifically, the study sought to determine the
effect of board independence, board accountability, audit committee and financial disclosure
on financial performance of SACCOS in Nairobi County. The study was anchored on agency,
stewardship, and stakeholder theories. This research used descriptive survey design. The
target population was the heads of finance and administration in all the 43 SACCOs in
Nairobi County. Pre-testing of research instruments was carried out among SACCOs in
Kiambu County. The researcher used census methodology to collect data. Secondary data on
return on assets, total deposits, total assets and non-performing loans was collected from the
annual reports of the SACCOs. Primary data was collected using semi-structured
questionnaires. Content analysis was used to analyze qualitative data and the results were
presented in a narrative form. Quantitative data was then analyzed using inferential
and descriptive statistics with the help of statistical software known as Statistical Package for
Social Sciences version 22. Descriptive statistics comprised of mean, frequencies, standard
deviation, and percentages. Regression and correlation analysis were examples of inferential
statistics used. The study's findings were represented using both tables and figures. The study
found that board independence has a positive and significant effect on the financial
performance of SACCOs in Nairobi County. In addition, board accountability has a positive
and significant effect on the financial performance of SACCOs in Nairobi County. The study
also found that the audit committee has a positive and significant effect on the financial
performance of SACCOs in Nairobi County. The study established that financial disclosure
has a positive and insignificant effect on the financial performance of SACCOs in Nairobi
County. The study recommends that SACCOs should select independent members of the
boards to help the societies run honestly and efficiently since they are not under the influence
of the management teams. In addition, SACCOs should make sure that the board of directors
actively oversees and holds management accountable for financial decisions, risk
management, and strategic planning. They should select the audit committee to monitor
financial reporting, audit process, internal control system of the organization, and legal and
regulatory conformity. They should also clearly define the roles and responsibilities of the
audit committee in the SACCO's bylaws. Further, SACCOs should also establish a system for
regular reporting to the board on financial performance, risk exposure, and compliance with
financial policies and regulations. | en_US |
