Corporate Governance Practices in Insurance Companies in Kenya.

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dc.contributor.author Githaibi, Moses Miringa
dc.date.accessioned 2015-11-12T11:23:09Z
dc.date.available 2015-11-12T11:23:09Z
dc.date.issued 2015
dc.identifier.uri http://erepo.usiu.ac.ke/11732/1475
dc.description A Project Report by Githaibi Moses Miringa Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the Degree of Masters in Business Administration(MBA). en_US
dc.description.abstract The purpose of this study was to examine and evaluate the corporate governance practices in insurance companies in Kenya. The accompanying research question guided the study: How are insurance companies in Kenya responding to the insurance corporate governance guidelines set by the Insurance Regulatory Authority (IRA)? What are the factors influencing implementation of corporate governance within the insurance industry in Kenya? And finally what impact does insurance corporate governance have on the performance of the insurance companies in Kenya. The study assumed a descriptive research method. A sample of 12 insurance companies was selected from which 60 respondents were randomly sampled. This technique was the most appropriate in this study because it offered everyone in the population an equal chance of being selected. The bestfavored tool for collecting datawas the questionnaires. Data was coded, sorted in order to ensure effective and efficient data analysis.Analysis was carried out using descriptive analysis where frequencies and percentages tables were obtained and correlation to establish the relationship between the factors. Tables and figures were used for presentation of the results and findings for easy understanding. The Statistical Package for Social Sciences (SPSS) was employed for analysis. Descriptive research design wasusedin this study. The study employed theuse questionnaires for data collection. The design of the questionnaires was as per the research questions. A pilot study on 15 respondents was carried out to ascertain the suitability and the ease of the questionnaires and amendments was made to make them suitable and precise to the study. The study gathered data from all the insurance companies in Kenya and focused in headquarters since that was easy and saved time since most of the headquarters are located in Nairobi area. The sampling technique used in this study was the simple random sampling wherea sample size of 60 staffs of the insurance companies in Kenya was sampled. Responses to vital factors related to the insurance companies and the insurance corporate governance guidelines were graded from “strongly agree”, “agree”, “neutral”, “disagree” and “strongly disagree”. The larger part of the respondents considered strategies and methods to be not so sufficiently much to suspect each circumstance, Loads up of chiefs need to practice viable control over senior governance, and non-official executives commit neither adequate assets nor time to the satisfaction of their obligations as the exceedingly critical elements. On factors influencing implementation of corporate governance within the insurance industry, the vast majority of respondents considered moves by national regulators to introduce their own market-specific requirements, diverse customer needs, buying behaviors, and product preferences, abuse of the top leadership positions of public companies, corporate ethics, and executive compensation, role of good corporate governance in customer satisfaction, and supervision and the need for improvements in risk oversight as the highly significant factors. The next factors applied to the impact of corporate governance on the performance of insurance companies. The major trend here was that the highly significant factors were: contribution of good corporate governance to employee’s motivation and employee’s morale, employee’s productivity and good corporate governance, good governance does Pay, returns for firms with good corporate governance is high and finally corporate governance in Kenya is still in a young and developing stage and that the investment decisions of Kenyan investors are volatile It is this study’s conclusion that the highly significant factors on the insurance companies and insurance corporate governance guidelines were; policies and procedures are not necessarily enough to anticipate every situation, Boards of directors need to exercise effective control over senior management, non-executive directors, devote neither sufficient resources nor time to the fulfillment of their duties and finally establishment of an appropriate legal, economic and institutional environment. Secondly, it’s the study’s conclusion that diverse customer needs, buying behaviors, and product preferences complicating business models. The study also concluded that: good corporate governance has contributed to employee’s motivation, employee’s morale has increased due to good corporate governance in the company and employee representatives on the supervisory board provide a counterweight to shareholders in the appointment of management. The study recommends that the insurance companies’ management should also take initiative to educate their employees on the importance of the corporate governance and the benefits that comes with these corporate governance guidelines. The study also recommends that the supervision of the insurance companies emphasize the need for improvements in risk oversight. The study recommends that communication channels should be created so that all the benefits that come with the adoption of corporate governance are clearly communicated to the employee for easy adoption. en_US
dc.publisher United States International University - Africa en_US
dc.subject Corporate Governance Practices en_US
dc.subject Insurance Companies en_US
dc.subject Kenya en_US
dc.title Corporate Governance Practices in Insurance Companies in Kenya. en_US
dc.type Thesis en_US

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