The Debate for and Against State Regulation of Churches in Kenya
Employee bonus schemes have been a predominant methodology used by most Kenyan banks to motivate the performance of their employees. True to the idea, banks have continued to report strong growths in their earnings, beating tough economic times and stringent regulations that have characterized the past decade. The objective of this study was to establish the effect of employee bonus payments on the stock returns of the listed banks in Kenya. An event study that focused on the five bonus payment events between 2011 and 2015 was conducted, analyzing the consequential effects of the event on the stock returns for the respective banks as per their historical stock prices data and comparing it to the market returns in the same period to establish whether any abnormal returns were earned. The study however found that employee bonus payments have a weak negative effect on the stock returns of the listed banks. The study further recommends that managers and human resource practitioners need to formulate other performance measures that can directly be linked to shareholder returns in order to enhance total employee commitment towards maximizing shareholder value.
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