nfluence of Management Style on Financial Performance of Saccos in Kisumu County, Kenya

Abstract

In Kenya Saccos contribute 45% of the country’s gross domestic product (GDP), the sector has effectively mobilized deposits and assets totaling kshs 200 billion and 210 billion respectively. However, the successes and rapid growth of Saccos reveals a number of basic flaws in the products they offer. Liquidity problems of many Saccos has led to raising of additional voluntary Savings from members and non-members in Front Office Saving Activities (FOSAs). Further, the Poor financial performance of Saccos has caused Saccos not to achieve their desired objectives of corporations and stakeholders. This research was aimed at assessing the influence of corporate governance practices on financial performance of Saccos in Kisumu County. The specific objectives is to determine the influence of management styles on financial performance. A correlational survey research design was employed, the data was collected by use of interview schedules, Questionnaires and document analysis. The targeted respondents were finance officers, credit officers, administrative officers and shareholders from each Sacco. The target population was 5 Sacco’s and sample size was 20 respondents. The data was analyzed using descriptive statistics and presented by use of tables. Reliable coefficient was calculated by use of Cronbach’s formula and a value of 0.795 was obtained. Karl Pearson’s coefficient of correlation was used to establish the relationships between variables of the study and the correlation coefficient between Management styles and financial performance r = 0.936. The study realized that corporate governance is key in the financial health of Saccos and firms in general. The Research showed that the firms’ performance was dependent on management styles.