EFFECT OF TRANSPARENCY AND ACCOUNTABILITY ON SUSTAINABILITY OF THE BANKING INDUSTRY IN KENYA
Paul Kioko Mbithi - Master of Business Administration, Graduate Business School, School of Business, Catholic University of Eastern Africa, Kenya
Dr. Susan Wasike - Catholic University of Eastern Africa, Kenya
ABSTRACT
The actions of the board, administrators and top management staff are instrumental in developing strategies, objectives and assigning tasks to the implementers. One of the main goals of corporate governance is to increase and sustain shareholder value. It is on the basis of this that it can be urged that corporate governance is a key factor to sustainability of any business operation. The study sought to determine effect of transparency and accountability on banking sector sustainability. The study was guided by the agency theory, stewardship theory and the stakeholders’ theory which all provide key information to corporate governance practices and how interests of different stakeholders are taken care of. The type of design adopted by the study was descriptive design. The target population comprised 495 employees within the banking industry in Kenya. A representative sample of 222 respondents was selected. The study collected both primary and secondary data using a questionnaire and a data schedule. Collected data was analyzed using mean, standard deviation, percentages and frequencies. To present the study findings, tables as well as figures were used. The study established that transparency, accountability, fairness and responsibility all have significant effect on sustainability of the banking industry. The study concludes that transparency and accountability have positive and significant influence on sustainability of the banking industry. The study recommends that the management of all banks in Kenya should strictly enforce transparency in all operations and activities conducted by employees for realization of sustainability. Commercial banks should enforce accountability among all employees for increased sustainability.
