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

Temwani Zulu and Prudence Mumba
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Temwani Zulu: Ministry of Education, Zimba. Zambia.
Prudence Mumba: Accountant Cotton Board of Zambia P.O Box 33734, Lusaka Zambia

International Journal of Research and Innovation in Social Science, 2024, vol. 8, issue 10, 31-54

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

Date: 2024
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