The relationship between corporate governance Practices and the growth of SACCOs in Nairobi County

Abstract

The study sought to examine the relationship between corporate governance practices and the growth of SACCOs in Nairobi County. The study targeted active SACCOs operating in Nairobi County as at 31 st December, 2012. The corporate governance practices and the growth of SACCOs in Nairobi c ounty study is expected to influence the Kenyan government decision in SACCOs supervision. This is because the SACCOs growth creates jobs in the Country. A total of 38 SACCOs operating in Nairobi County for the period January 2008 to December 2012 were stu died and descriptive statistics such as percentages, frequencies and tables were used to analyze the data. Statistical package for social sciences (SPSS) was also used to aid in analysis. The regression model was used to study the relationship between corp orate governance practices and the growth of SACCOs. Four dimensions of corporate governance practices i.e. Board composition (gender diversity), Education level of the board members , CEO duality and number of the board members were used as independent variables and percentage of annual net change s in loan divided by total loans as growth measurement which is the dependent variable in study. The overall findings confirmed that there is no relationship between corporate governance practices and the growt h of SACCOs in Nairobi County . There is a possibility of other multiple variables influencing the growth of SACCOs in Nairobi County that should be incorporated in the regression model to ascertain all the influential factors.