Board Structure, CEO Tenure, Firms' Characteristics and Performance

The corporate scene has witnessed boardroom tussles and corporate collapses around the globe. No country has been spared and some firms that have been affected in Kenya include Imperial Bank, Chase Bank, Dubai Bank and National Bank of Kenya. The underlying thesis is that a crisis of governance is basically a crisis of board of directors. The decline in shareholders¿ wealth and most of these firm failures has been linked to the board of directors. It is against this backdrop that this book provides the effect of board structure on performance of financial institutions in Kenya. Further, it specifically shows the intervening influence of CEO tenure and moderating influence of firm characteristics on the association between board structure and performance. The results show that, overall, board structure had an independent significant influence on performance of financial institutions. Board activity, operationalized as the number of board meeting in a year, had the strongest independent influence on performance of financial institutions followed by board type. The results are in support of the agency theory and the convergence-of-interests theory.