dc.description.abstract | The Capital Markets Authority published “code of corporate Governance Practices “for
public listed companies in Kenya which was Gazetted on 4th March,2016.The new code of
governance is based on apply or explain principle which requires companies to follow set out
corporate governance codes. The country having experienced corporate malpractices like the
CMC ,Imperial Bank, Uchumi, Mumias, Kenya Airways, Transcentury which were very
costly to public investors needed to take immediate action to prevent a corporate crises.
The study investigates the relationship between corporate governance and the performance of
Top 100 SMES in Kenya. It adopts descriptive research methodological framework through
which the secondary data collected were analyzed using both Regression analysis and Karl
Pearson’s correlation techniques to find the relationship between corporate governance and
organizational performance on one hand and the degree of relationship between corporate
governance and organizational performance. The findings shows that the Number of board of
directors, percentage of inside ownership, number of board meetings are positively correlated
to improved organizational performance while Number of board committees percentage of
outside directors CEO duality was negatively correlated to organizational performance .
Organizations are encouraged to adopt good corporate governance practices to improve their
performance and also to protect the interest of the shareholders. Most importantly the
regulatory authorities must ensure compliance with good governance and apply appropriate
sanctions for non-compliance to help the growth and development of industries in the
country. The main contribution of the study to knowledge lies in its effort in strengthening
corporate governance beyond the rights and responsibilities of different stakeholders in the
management of an organization into areas involving the relationship between finance
providers and an organization, compliance with legal, ethical and environmental needs of the
society, among others. This contribution has in no small measure enhanced our understanding
about the interpretations which have shaped corporate governance in relation to
organizational performance both in theory and practice. | en_US |