Organizational Structure and Financial Performance of Insurance Companies Listed at Nairobi Securities Exchange, Kenya
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Date
2025-01-21
Journal Title
Journal ISSN
Volume Title
Publisher
International Research Journal of Economics and Finance
Abstract
In Kenya, insurance companies have been experiencing a decline in their financial performance
assessed by ROE. In the turbulent and competitive business environment, firm characteristics
have been playing a vital role in shaping overall financial performance and market
competitiveness. The general aim of this study was to establish the interplay between
organizational structure and financial performance of listed insurance companies listed at the
NSE in Kenya. This research was guided by the growth of the firm theory. This research applied
descriptive research methodology. The target population of this research was 6 firmslisted at the
NSE. The period under study spanned from 2018 to 2022. A Census ofthe 6 listed insurersin the
NSE in Kenya was performed. This study utilized secondary data, extracted using a data
extraction tool. Descriptive and inferential statistics were utilized in data analysis. Descriptive
statistics comprised of standard deviation, mean, minimum and maximum. The relationship
between independent and dependent variables was established using inferential statistics such as
multiple regression and correlation analysis. The study found that organizational structure
positively and significantly influences the financial performance of insurance companies listed at
the NSE in Kenya. The study recommends that regulatory bodies, like the Insurance Regulatory
Authority (IRA), encourage insurance companies to adopt organizational structures that improve
decision-making, efficiency, and accountability, alongside supporting training and performance
evaluations. It also suggests a decentralized approach to organizational restructuring,
empowering lower-level employees, to enhance operational efficiency, innovation, and overall
financial performance
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Citation
Robin, K. M., & Kimutai, C. (2025). Organizational structure and financial performance of insurance companies listed at Nairobi Securities Exchange, Kenya. International Research Journal, 7(1), 1–12. International Research Journal Publishers.