Browsing by Author "Bach, Ivy Njoki"

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    Corporate Governance Practices and Financial Performance of Commercial Banks Listed at the Nairobi Securities Exchange in Kenya
    (Kenyatta University, 2024) Bach, Ivy Njoki
    Commercial banks listed at the Nairobi Securities Exchange play a crucial role in the local economy of Kenya as they serve as key intermediaries between savers and borrowers, facilitating the flow of funds in the economy through various financial services such as lending, deposit-taking, and investment activities. The financial performance of commercial banks listed at the Nairobi Securities Exchange has generally shown resilience and improvement despite challenges such as regulatory changes, economic fluctuations, and the impact of global events like the COVID-19 pandemic. The study established the relationship between corporate governance and financial performance of commercial banks listed at the Nairobi Stock Exchange. The research specifically sought to ascertain the how the board size, gender diversity, frequency of board meetings and board share ownership are related to the financial performance of commercial banks. The study was anchored on stakeholders, stewardship, agency and modern portfolio theory. Descriptive research design was adopted. The target population was commercial banks listed in Nairobi Securities Exchange during years 2016 to 2020. A census approach was used where the entire target population was involved in the study. The study used secondary data obtained from the listed commercial banks published in Kenyan Investors website, Capital Markets Authority Library, Nairobi Securities Exchange websites, and their websites. Inferential and descriptive statistics were utilized in data analysis. Panel Data Regression Model was analyzed using Stata 16. Tables and figures were used in data presentation. From the findings the average board size was 12 in 2016, 10 in 2017, 8 in 2018, 11 in 2019 and 9 in 2020. Average gender diversity in favour of women was 24% in 2016, 28% in 2017, 26% in 2018, 32% in 2019 and 30% in 2020. Average annual number of board meetings were 14 in 2016, 16 in 2017, 18 in 2018, 20 in 2019 and 22 in 2020. Board share ownership was 2.10% in 2016, 2.32% in 2017, 2.61% in 2018, 2.92% in 2019 and 3.12% in 2020. Correlation results showed that board size, frequency of board meetings and board share ownership were positively and significantly correlated to the financial performance while gender diversity was positively and insignificantly correlated. Additionally, regression results showed that board size, frequency of board meetings and board share ownership were positively and significantly related with financial performance while gender diversity was positively and insignificantly related. The study concludes that corporate governance practices, including board size, gender diversity, frequency of board meetings, and board share ownership are important in shaping the financial performance of commercial banks listed at the Nairobi Securities Exchange. It is recommended that commercial banks listed at the Nairobi Securities Exchange consider optimizing corporate governance structures by carefully assessing board size, enhancing gender diversity, ensuring adequate frequency of board meetings, and aligning board share ownership with the aim of improving financial performance and sustaining long-term value creation.