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An Assessment on the Influence of Corporate Governance on Financial Performance of Micro-Financing Institutes (MFIs): A Zambian Case Study

Author

Listed:
  • Temwani Zulu

    (Ministry of Education, Zimba. Zambia.)

  • Prudence Mumba

    (Accountant Cotton Board of Zambia P.O Box 33734, Lusaka Zambia)

Abstract

The purpose of the study was to assess the influence of on financial performance of MFIs in Zambia. The main objective of the study was to investigate the influence of Corporate Governance on financial performance of Micro Financing institutes in Zambia. The study used descriptive approach, where a total of 57 MFI’s representing 94 % participated in the study. Questionnaires were purposively administered to the participants. Data analysis was done through the statistical package for social science (SPSS V26), presented using descriptive and inferential statistic. The findings of the study indicate that: MFIs’ in Zambia are mostly private and equity owned, and they adhere to Corporate Governance policies and have structures which support corporate governance; MFIs’ have a small Board Size, in which the Chief Executive Officer (CEO) and Chief Financial Controller (CFO) are appointed by the board; most MFIs’ financial statements are not audited but the Corporate Governance in place enhances quality of service, building of trust and confidence to shareholders; all MFI business dealing are legitimate and they operate within the confines of the law. MFIs’ have independent committees which operate with levels of autonomy; MFI in Zambia also have advisory groups in place that are skillful, resourced autonomous, monetary educated, satisfactory and appropriate redressed. The study tested a regression of p= 0.035

Suggested Citation

  • Temwani Zulu & Prudence Mumba, 2024. "An Assessment on the Influence of Corporate Governance on Financial Performance of Micro-Financing Institutes (MFIs): A Zambian Case Study," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(10), pages 31-54, October.
    • Handle: RePEc:bcp:journl:v:8:y:2024:i:10:p:31-54
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    References listed on IDEAS

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    1. Wajdi Affes & Anis Jarboui, 2023. "The impact of corporate governance on financial performance: a cross-sector study," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 20(4), pages 374-394, December.
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    3. Baysinger, Barry D & Butler, Henry N, 1985. "Corporate Governance and the Board of Directors: Performance Effects of Changes in Board Composition," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 1(1), pages 101-124, Spring.
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