Influence of Corporate Governance on the Performance of Container Freight Stations in Mombasa County, Kenya

Abstract

Corporate governance has logically turned out to be critical for enterprises in developing and developed nations around the globe. Compelling corporate governance has been distinguished to be basic to fiscal exchanges particularly in developing and progress economies. The purpose of the study was to determine the influence of corporate governance on the performance of Container Freight Stations. The study sought to establish the influence of corporate governance on the performance in container freight station in Mombasa County, Kenya. The study made use of cross-sectional survey design to be able to address the objective. A semi-structure questionnaire distributed to 14 container freight stations to collect primary data on corporate governance practices. Data collected from the directors, senior management and supervisors analyzed using frequencies, means, percentages and SD, which displayed using figures and tables. Multiple regression was adapted to quantify the relation Corporate governance and organizational performance. The study observed that number of committees influenced the performance of Container Freight Stations in County Government of Mombasa however; the study showed that corporate governance committee in existence enhances organizational performance. The study further showed that the size of the board had no direct impact on organizational performance however, Expertise, experience certain in larger boards, and increase in resource availability impacted on the performance of Container Freight Stations. The study also established that boards that have more executive than non-executive directors’ benefit to the firms’ performance. The study concluded that there is a strong relation between corporate governance and Organizational Performance of Container Freight Stations s in County Government Mombasa where the regression analysis showed that there is a strong correlation (0.838) between corporate governance and organizational performance in Container Freight Stations and corporate governance accounts for 62.2% of organizational performance of Container Freight Stations. This study suggests that shareholders should encourage the implementation for board committees, Board diversity, Board Independence and Board Education as these translate to improved organizational performance. Accuracy of the results depended entirely on the respondent and their attitude and understanding of the subject matter, unwillingness for respondents to share their sentiments. Time and finances were a major drawback in the study, which resulted in delays. The study focused on the Influence of Corporate governance on organizational performance through the Value of Return on assets, future studies can be done to assess the influence of corporate governance on the performance of Container Freight Stations using other measures such as ROI, Market share and customer retention ratio.