BOARD COMPOSITION AND ORGANIZATIONAL PERFORMANCE OF STATE-OWNED ENTERPRISES IN KENYA: A CASE OF KENYA POWER AND LIGHTING COMPANY

Abstract

This study explored the impact of board composition on the organizational performance of Kenya Power and Lighting Company (KPLC). The main objective of the research was to assess the effect of board composition practices on KPLC's performance. Specifically, the study aimed to investigate how board composition affected KPLC's organizational performance. The study was anchored on agency theory. The research employed a descriptive design, targeting all managers within KPLC. A census sampling technique was utilized to determine the sample size, and data were gathered through questionnaires. Both descriptive and inferential analyses were conducted to assess the impact of corporate governance on the study's objectives. The findings revealed a significant relationship between board composition and organizational performance, with factors such as size, independence, and diversity influencing decision-making. Strong correlations were found between board composition and performance. The study recommended that KPLC enhance board effectiveness through regular evaluations, refine executive compensation structures for better alignment with performance metrics, strengthen transparency practices in financial reporting, and improve communication mechanisms to foster stakeholder engagement. Additionally, cultivating a culture of continuous improvement in governance practices was deemed essential.