Financial sector liberalization in Kenya and the far world has created an enormous spectrum from which Savings and Credit Cooperative Societies (Saccos) can raise finances from. This has coincided with a period of good performances for a number of Saccos. However, there is no certain indication of a link between the good performance and the financing diversification; it is not clear whether those Saccos who have diverse financing sources perform any better than those who rely on their members savings. This paper therefore sought to establish the effect of financing diversification on the performance of Saccos by answering the question; does financing diversification affect the performance of a Sacco? The study used a descriptive correlational design with the study population being all Kenya Union of Savings and Credit Cooperatives (KUSCCO) member Saccos registered in Kakamega County. Data was collected from a key informant in every Sacco using a questionnaire and analysed using both descriptive and inferential statistics. Descriptive analysis was done to identify any trends and dispersions in the data while Karl Pearsons zero order coefficient of correlation was used to determine the nature of relationship between financing diversification and Sacco performance. Regression analysis was done to model the relationship between financing diversification and Sacco performance. The study found out that financing diversification had a significant positive effect on Sacco performance. The study has, however, recommended further researches to establish the risk implications of financing diversification on Saccos.
The last two decades has seen a lot of creativity and diversity in the funding strategies pursued by credit unions as a result of financial sector liberalization and competitive pressure in the financial system. Research has shown that this diversification is both beneficial and hurting at the same time. However, firm characteristics have not mostly been factored in the diversification – performance analysis though studies in other sectors underline their importance. This therefore prompted this study to analyze the moderation effect that firm characteristics – specifically age, size, members’ occupation and management structure of credit unions – could have on the relationship between diversification and performance of credit unions in Kenya. The study used a correlation analysis approach on a data set of sixteen credit unions in Kakamega County and found that whereas financing diversification had a significantly positive relationship with credit union performance; credit union size and members’ occupation significantly improved this relationship while age and management structure significant suppressed the relationship.
The Influence of Corporate Governance Practices on FinancialDistress of Firms Listed at the Nairobi Securities Exchange: Moderating Influence of Financial Leverage IntroductionThere has been an increasing interest in corporate governance over the last three decades to the extent that it has become a global phenomenon. The main driver of evolution of corporate governance has been corporate failures, (Martin, 2017). According to Alexandru and Iulia (2011) most corporations in the world have collapsed because of poor governance practices such as inflated earnings, expenses booked as capital expenditure, looting by management and improper share deals.The collapse of large and trusted corporations like Enron (2001),Worldcom (2002), Parmalat (2003), Global Crossing Limited (2002) and Tyco International Limited (2002) provide evidence of the consequences of weak corporate governance structures, (Victor, 2014).Corporate governance refers to the process and structure used to direct and manage the business and affairs of a firm towards enhancing prosperity and corporate accountability with the ultimate objective of realizing the long term value of shareholders while taking into account the interest of other stakeholders, (The Capital Markets Authority, 2018). The main concern in the corporate governance framework is the accountability of key persons in corporations, (Abdullah, Muhammad and Karren, 2016). A good system of corporate governance guarantees that corporate activities and management policies are in line with the interest of shareholders and all stakeholders in general, (Bernard, 2003;Shleifer and Vishny, 1997). It concerns itself with the appropriate board structure, processes and values to cope with the ever increasing demands of stakeholders, (Alexandru and Iulia, 2011). Essentially, all firms need good governance to ensure that they are run well and that their managers are responsible and accountable, (Youssef and Bayoumi, 2015). However, bad corporate governance practices may results in firms experiencing the detrimental impact of financial distress.Financial distress is a global problem that has afflicted both developed and developing economies, (Baimwera and Muriuki, 2014). Financial distress refers to a situation when a company is experiencing failure and in which the rate of return is less than the cost of capital, (Lakshan and Wijekoon, 2012). It refers to a state of affairs when a company's cash flows are not sufficient to repay principal and interest of debt and may occur when the firm's equity becomes negative,
The Influence of Feature-Oriented Framework on Employee's Commitment in Migori County Government, Kenya 1. Background of the study For an organization, the value of employees can never be understated. This is because employees are the most valuable assets both in private and public organizations; employees and their behavior are at the center of business success or failure (Wachira, 2013). The employee engagement dynamics and resultant human capital interventions and outcomes vary significantly depending on the industry or region of the model of operation. This has led to growing interests from policymakers and practitioners on how public service employees are managed. The psychological contract in many cases is considered an individual's beliefs of the reciprocal exchange agreement between the employee and the entities or organization that employs them. Hence, a psychological contract is created when one party believes that future rewards have been promised, that he/she has made the relevant contributions, and as a consequence, the other party is obligated to provide the promised benefits in return (Rousseau in Alcove et al., 2017). The psychological contract can be analyzed based on an evaluation-oriented framework, content-oriented and feature-oriented framework (Hofmans & Vantilborgh, 2019). These form the foundation of the focus of this study. In Europe, according to Jacobson (2018), recruitment and induction processes are considered by employees as active influencers when it comes to commitment, and that these processes' individual steps might seem positively influential to any employee while at the same time causing the opposite result to another employee. Mentoring, successful communication, information, pre-existing knowledge of the organization, being welcomed and support into a new workplace are relevant; and help employer brand arise above others. In Australia, De Nobile (2016) found a correlation between increased amounts of open and accessible levels and models of communication for employees and levels of reported job satisfaction and commitment with an emphasis on the significance of asserting support. According to Zhou, Plant, Zheng and Bernard (2014), in the Chinese companies; psychological contract satisfaction for knowledge workers increases their commitment in the organization thus influencing the employees to realize increased work satisfaction. Psychological contract commitment levels by such employees are very high which leads to fulfilment of work requirements as they perceive the psychological and physical incentives. Applying the principle of mutual benefit as a basis, knowledge workers therefore enhance commitment to their organizations, and as a result, boost their work satisfaction (Zhou et al., 2014). Antonaki and Trivellas (2014), in a study on the Greek banking sector noted that positive perceptions regarding employees' psychological contract yield more satisfied workers especially with positive evaluations about their relationships and their work content, leading, in turn, to more...
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