Corporate governance practices and Performance of Afya sacco society limited
The aim of this study was to determine the relationship between corporate governance practices and performance of Afya Sacco Limited. The study was a case study and considered Afya Sacco Limited as the unit of analysis. Performance measures used were taken from the WOCCU’s PEARLS performance analysis system under the subheading of ‘rates of return and costs’ and included the gross margin as a percentage of average total assets and net income as a percentage of average total assets (ROA). Corporate governance scores were generated from the WOCCU’s worldwide accepted governance monitoring tool (GMT) by keying corporate governance practices related information into the GMT which using predetermined formulae impended in the tool computed the governance scores. The period of the study was ten years from 1999 to 2008. The study used secondary data which was obtained from the annual reports for the study period, AGM’s minute books, board’s attendance registers and employees’ master roll. Data was analyzed using linear regression analysis technique and was aided by entering the data into SPSS. Corporate governance was found to be positively related to performance. The study recommended that Afya Sacco should strive to improve on its corporate governance practices by constantly benchmarking itself against the WOCCU’s ‘GMT’ with a view to taking improvement measures on those areas it is not doing good enough, which in turn will have a positive impact on its performance. The rest of the paper is organized as follows: chapter one covers introduction to the study by addressing issues related to background to the study, statement of the problem, study objective and the significance of the study; chapter two focuses on literature review; chapter three is about the research methodology; chapter four covers data analysis, presentation and discussion of findings; and lastly chapter five addresses conclusion, recommendation, limitation of the study and suggestions for future research.