The purpose of this study was to analyze the effect of corporate governance practices on financial performance of Saccos; a case of KITE Sacco society in Kisumu city. The specific objectives of the study were to: assess the effects of board composition, establish the effects of number of non-executive directors and determine the influence of SACCO leadership on the financial performance of KITE SACCO society. The study was guided by a self-conceptualized framework with corporate governance practices as independent variables and financial performance of Saccos as the dependent variable. It adopted causal research design with all the 19 targeted staff members of the Sacco forming the sample size. The study used both primary and secondary data. A semi-structured self-administered questionnaire to the Board of the Sacco, and staff members was used to collect primary data. Secondary data was collected through content analysis. Validity and reliability of the instrument was checked using expert reviews. Descriptive statistics such as mean and standard deviation was employed to analyze the data and inferential statistics such as Pearson’s correlation. Presentation was done by the use of tables and charts. The study revealed that board composition is the most prevailing factor that affects financial performance at KITE Sacco (0.658, p< 0.05) and strongly affects Sacco leadership (0.789, p<0.001). Also realized was that Sacco Leadership strongly affects financial performance at KITE (0.835, p<0.01). Besides, the study evidenced that existence of non-executive directors positively affects financial performance (0.381, p<0.05), weakly affects board composition (0.436, p>0.01) and strongly affects Sacco leadership (0.053, p<0.05). The study concludes that board composition is the most prevailing factor that affects financial performance at KITE Sacco and as well affects the Sacco leadership. Also, the study showed that existence of non-executive directors within the Sacco positively affects financial performance but weakly affects board composition and strongly affects KITE Sacco leadership. These findings may assist KITE Sacco leadership identify how various aspects of corporate governance practices (board composition, existence of non-executive directors) affect their operations as well as ensure that the breakdown of spending across projects is clear, and accounting records properly maintained. Further, the study may provide information to potential and current scholars in regard to the relationship between corporate governance and financial performance of SACCO societies.

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