Performance of manufacturing and allied firms listed at the Nairobi Securities Exchange, Kenya: The role of corporate governance
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Date
2024-08-24
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INTERNATIONAL JOURNAL OF RESEARCH IN BUSINESS AND SOCIAL SCIENCE
Abstract
The Kenyan government has implemented numerous reforms, including the inclusion of the
manufacturing sector as one of the government's four major agendas for revitalizing the sector. Despite
these reforms, statistics show that over the last ten years, manufacturing industries in Kenya listed on
the Nairobi Securities Exchange have experienced stagnation and declining profits, slowing growth,
and declining market share, necessitating the establishment and execution of effective corporate
governance. Therefore, the current study investigated the effects of corporate governance on
performance of manufacturing and allied firms listed at Nairobi Security Exchange, Kenya. The study
specifically investigated the effects of board composition, board size, board independence and board
diversity on performance of manufacturing and allied firms. Agency theory, RBV and stakeholder’s
theory anchor the study. Descriptive research design was used. Stratified random sampling technique
was used as a sampling technique. A self-administered semi-structured questionnaire was used to
collect primary data from a population of four hundred and thirty-nine manufacturing and allied firms.
Two hundred and nine corporate managers from these manufacturing companies were sampled. A pilot
test of twenty-nine respondents was conducted. Collected data was coded, cleaned, and analyzed. Data
analysis included the creation and interpretation of descriptive means, percentages, and standard
deviations, which was presented in the form of tables, charts, and graphs. The results of regression
analysis established that board composition, board size, board independence and board diversity
significant influenced firm performance of manufacturing and Allied Firms listed at the Nairobi
Securities Exchange, Kenya
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Citation
Murithi, L. K., & Muthimi, J. (2024). Performance of manufacturing and allied firms listed at the Nairobi Securities Exchange, Kenya: The role of corporate governance. International Journal of Research in Business and Social Science, 13(6), 164-175.