Corporate Governance Practices and Performance of Kenya Forest Service in Nairobi City County

Abstract

In the recent past, the Kenya Forest Service has experienced managerial challenges, which lower its efficiency and performance in promoting sustainable management of forest and natural resources. The organization has adopted the concept of corporate governance in its management structure and systems, but existence of leadership wrangles coupled with relational conflicts between the various levels of governance influence its performance. This survey sought to examine the icorporate igovernance influence ion iorganizational iperformance in corporations owned by the state. The specific objectives of the study were: to establish the influence of board composition on the organizational performance at Kenya Forest Service, to explore the effect of board independence on the organizational performance at Kenya Forest Service, to determine the impact of board size on the organizational performance at Kenya Forest Service and to evaluate the influence of board audit committee on organizational performance at Kenya Forest Service. Agency, expectancy, and resource dependency theories were adopted and formed the basis for exploration of the research objectives and research questions. The descriptive survey research design was used. The survey adopted stratified sampling and employed structured questionnaires to collect data from a sample of 166 managerial level staff working at the Kenya Forest Service Headquarters’ Office at Karura in Nairobi City County. Descriptive and inferential statistical models were employed to analyze, describe, and infer deduction and conclusion from the research findings. Correlation matrix and regressions models were employed to analyze data collected, and describe the research findings in reference to the variables under examination. The researcher ascertained contents validitys of the researchs instruments bysdiscussings abouts thes questionnairess items withs thes supervisors, and other research experts within the faculty. On the other hand, reliability of the research instrument was determined using the Cronbach Alpha. The study findings showed that board composition, board independence, board size and board audit committee have an advantageous and significant influence on the performance of an organization. It was also concluded that gender diversity in the board enhances organizational performance. Moreover it was concluded that a board that constitutes of members of different age groups, cultural orientation, ethnic groups and diverse professional skills enhances organizational performance. The study also concluded that having a board with internal and external members in an organization enhances performance. Furthermore, it was concluded that exempting board members from the organizational contracts enhances organizational performance. The research findings established that, a board comprised of board members with non-executive status and externally appointed influence organization performance positively. On this subject, the study recommends that, qthe q Kenya Forest Service qmanagement should qensure more qboard members are qappointed externally to enhance board efficiency and organization performance. Additionally, Kenya Forest Service management should increase the number of board members with non-executive status to increase board independence within the organization. The survey findings established that, small boards are preferable to large boards in influencing organization performance positively. The study recommends that, s Kenya Forest Service management should design an effective system to identify its ideal board size to promote