Audit Committee Attributes and Corporate Governance in State Corporations under the National Treasury in Kenya
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Date
2025-06
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International Academic Journal of Economics and Finance (IAJEF)
Abstract
The role of state corporations in national
economies is pivotal, given their mandate to
implement government policy, provide
essential services, and drive socioeconomic development. In Kenya, state
corporations under the National Treasury
have historically faced scrutiny over
governance failures, marked by rising
complaints of administrative malpractice
and corruption. Despite the establishment
of corporate governance frameworks such
as the Mwongozo Code and the formation
of audit committees intended to enhance
oversight, concerns over political
interference, weak supervision, and
inadequate financial management
structures persist. This study sought to
analyze the effects of audit committee
attributes on corporate governance among
state corporations overseen by the National
Treasury. The target population comprised
136 respondents from 34 public institutions
under the National Treasury. Due to the
relatively small population, the study
employed a census approach, ensuring that
all 136 respondents within these
corporations participated. Data were
primarily collected using a structured
questionnaire. Quantitative data analysis
involved statistical methods, including the
calculation of means and standard
deviations, while qualitative data was
analyzed thematically and descriptively.
Additionally, an empirical analysis was
conducted to assess the effects of audit
committee attributes on the governance of
state-owned enterprises. The data were
subjected to heteroscedasticity,
multicollinearity, and normality tests to
validate the reliability of the multiple
regression model. The analysis showed that
all four audit committee attributes had
significant positive effects on corporate
governance. Audit committee
independence enhanced objectivity and
accountability; committee size contributed
to workload distribution and governance
coverage; diversity promoted inclusive and
balanced decision-making; and expertise
had the greatest impact, enabling informed
oversight and risk management. The study
concluded that audit committee attributes
are critical determinants of good
governance in state corporations. It
recommends strengthening appointment
policies to preserve independence, ensuring
optimal committee size, promoting
diversity, and enhancing technical capacity
through professional development. These
findings contribute to the discourse on
public sector governance reform and offer
practical insights for policy
implementation. Further research is
encouraged to explore contextual
moderators influencing effectiveness of the
committee such as institutional culture and
regulatory environments.
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Citation
Chepngetich, R., Musau, S. (2025). Audit committee attributes and corporate governance in state corporations under the national treasury in Kenya. International Academic Journal of Economics and Finance (IAJEF) | ISSN 2518-2366, 5(1), 19-48.