Board Composition and Performance of Health Sector Non-Governmental Organizations in Nairobi County

Abstract

A firm is as good as its corporate board. The health of an organization is mirrored by the composition of its board of directors. Prior research in corporate governance has shown that well-performing boards coincides with high performing organizations. Health sector non-governmental organizations (NGOs) in Nairobi County play a pivotal role in providing health care services though questions pertaining to their governance, accountability and sustainability have persisted despite their growth and prominence. The study sought to answer the research question what is the relationship between board composition (CEO duality, board independence and gender diversity) and performance of health sector Non-Governmental Organizations in Nairobi County through a self-administered cross-sectional survey using a random sample of 242 CEOs. Correlation and regression analysis techniques were used to analyze the data collected. Result showed CEO duality and gender diversity significantly influenced performance with all board composition variables jointly accounting for 65.5 percent of the variability in performance. These findings suggest that NGOs should combine the roles of the CEOs and chairpersons of boards, appoint more executive board members and increase the number of women board member in order to improve their performance.

Keywords: Board Composition, Performance, Diversity, Independence, Duality, Sustainability