| dc.description.abstract | Corporate governance which involves a set of relationships between a firm's management, board, shareholders and other stakeholders has lately generated a lot of debate all over the world, especially following the various corporate failures as well as the recent financial crisis. The current economic situation has also raised the profile of the debates regarding corporate governance while also highlighting deficiencies in corporate governance as well as the importance of stakeholder relations. In Kenya, like in any other part of the world, the improvement of corporate governance practices is widely recognized as one of the essential elements in strengthening the foundation for long term economic performance of country and corporations.
Further, Companies around the world are increasingly recognizing that their sustained growth requires cooperation of all stakeholders, which requires adherence to the best corporate governance practices. It has emerged that laws, rules, regulations and codes of conduct do not ensure, by themselves, good corporate behavior. Good corporate governance behavior is more likely to occur when companies and stakeholders realize that it is in their own best interests to act according to sound governance practices.
The twin research objectives of this study focused on determining the corporate governance practices among investment banks and stockbrokerage firms in Kenya and establishing the relationship, if any, between client base and corporate governance practices among these firms. To achieve these objectives, questionnaires were distributed to all the 25 firms to obtain pertinent primary data. 16 firms responded to the study were, representing 64% response rate. Secondary data on the other hand, was collected from current capital market publications, specifically from Capital Markets Authority. The data collected was analyzed through frequencies and percentages and presented through tables.
The results of the study indicate that the various aspects of corporate governance are widely practiced by investment banks and stockbrokerage firms operating in Kenya. The results however, reveal that there is no clear correlation between client base and the extent of corporate governance among these firms. There is therefore a strong case for heightened investor education to be conducted by the relevant capital markets players. Whereas other factors which may influence the client base of these firms were not considered in the current study, the research objectives of this study were fully met. | en_US |
