Governance Determinants and Their Influence on Performance of Farmer Cooperatives in Trans Nzoia and Bungoma Counties, Kenya

Abstract

In Kenya, cooperatives are faced with numerous challenges, including bad governance. These challenges affect the implementation of projects such as Mount Elgon Livelihood Project. This study sought to identify critical governance factors that determines performance of farmer cooperatives in the two counties which Vi Agroforestry and Brookside have targeted to within Mount Elgon Livelihood Project. The main objective of the research was to identify main governance practices determining performance of farmer cooperatives implementing Mount Elgon Livelihood Project in Trans Nzoia and Bungoma Counties. A sample size of 179 respondents comprising members from fifteen primary cooperatives implementing Mount Elgon Livelihood Project, leaders and county government cooperative officers was taken through proportionate random and purposive sampling techniques. Data was collected using semi structured questionnaires and interview schedules. The collected data was analyzed using both descriptive and inferential statistics involving mean, standard deviation and correlation analysis using SPSS (version 20). The study applied stakeholders theory to cooperative governance. The results have been presented in tables and bar graphs. The first objective was to establish governance practices applied in cooperatives in the study area. The study established that the respondents disagreed that accountability, transparency and cost effectiveness with means 2.0577, 2.1009, 2.0270 respectively are governance practices applied in cooperatives in the study area. However they agreed that rule of law, participation and equity with means 3.774, 4.198 and 4.342 respectively are governance practices applied in cooperatives in the study area. The smaller and respective standard deviations imply that there is no significant difference between the sample means and the population mean. The respondents rated governance in cooperatives a follows; very good were 7(4%), good 26(15%), fair (35%), poor 107(61%). The second objective of the study was to assess the level of awareness among the cooperative members on good governance practices. The study established that majority 136(78%) of the respondents felt members were not aware of the highest decision making organ and felt the level of a awareness on cooperative governance was either low or very low. The study established that only 65(37%) were aware of their cooperative values and principles while the majority 110(63%) were not aware. The study also established that board members were aware of their duties and responsibilities as indicated by 82(47%) of the respondent while 93(53%) indicated that they were not aware. Also 43(33%) of the respondents indicated that the members were aware of their duties and responsibilities, 72(55%) indicated they were not aware while 16( 12%) had no idea. The third objective of the study was to examine the impact of such governance practices on the performance of the cooperatives. The study established that non adherence to good governance practices negatively and significantly influenced the performance of cooperatives contributing 75.9% variability to performance of the cooperatives when other factors are held constant. On the fouth objective, the study established that factors that hinder good governance were; lack of member participation, lack of accountability by the board, lack of transparency, corruption, literacy levet, poor responsiveness, poor sense of ownership by members, lack of cooperative democracy, lack of consensus, term and tenure of the board, poor decision making and government bureaucratic hindered good governance practices in cooperative that had extraction value of more >.05. In addition members through interviews revealed that egoism, selfishness, nepotism, tribalism, corruption , untrained leadership, political instability in areas like Mt Elgon, lack of infrastructure i.e. poor roads, lack of gender equity, lack of accountability had also hindered application of good governance practices in cooperatives It's therefore recommended to strengthen structures and systems within the cooperatives for efficient and effective service delivery to members.