COMMUNITY COMMITMENT AND FINANCIAL PERFORMANCE OF SELECTED NON-BANKING FINANCIAL INSTITUTIONS IN KIAMBU COUNTY, KENYA
Patrick Mungai Ndungu - Master of Business Administration Candidate, Department of Accounting and Finance, Kenyatta University, Kenya
Dr. John Mungai Njangiru - Lecturer, Department of Accounting and Finance, Kenyatta University, Kenya
ABSTRACT
The objective of the study was to determine the effect of community commitment on financial performance of non-banking financial institutions. A descriptive survey research approach was adopted while the target population comprised of 60 Non-Banking Financial institutions in Kiambu County, Kenya. The sample size was computed using the formula by Hosmer, Lemeshow and May (2008) and Shirgaonkar, Maclver and Patankar (2008) and yielded a convenient sample size of 38 Non-Banking Financial Institutions in Kiambu County Kenya. Quantitative and qualitative data was collected by use of a semi-structured questionnaire that was administered using the drop and pick later method. The collected data was analyzed using descriptive as well as inferential statistics. The multiple regression analysis was applied to determine the effect of community commitment on financial performance. On financial performance, findings demonstrated that the profitability of the non-bank financial institutions as reflected in their return on assets was fairly good. Nonetheless, the study indicated that some firms could be struggling with poor financial performance condition while others performed exemplary well. Multiple linear regression analysis results indicated that community commitment was a positive and statistically significant determinant of financial performance. Recommendations were made that the underperforming non-bank financial institutions to consider benchmarking on other players to learn ways to build their capacity to deliver better financial results. The study also makes recommendations on need to improve the practice of preserving organizational knowledge and sharing the same with other members of the organisation, which was found to be deficient in the firms.
