Abstract: Board diversity is very important to the creation of new ideas and knowledge necessary to enhance firm performance. As such many companies have taken measures to diversify their boards by having best mix of culture, professional skills, among other characteristics in order to build their capacity and to make them effective. Therefore, this study seeks to investigate the effect of board diversity effectiveness on financial performance of firm listed at NSE, Kenya. The study was conducted using explanatory research design. All the non-financial firms listed at NSE with full data for the period between 2012 and 2017 were selected purposively. This procedure resulted into the selection of 33 out of 40 firms. Secondary data was analyzed using descriptive statistics such as means, minimum, maximum, and standard deviation. Regression analysis was used to establish the effect of board diversity on firm performance. The study revealed that there exist a strong positive and significant correlation between board diversity and firm performance that is increase in diversity resulted in higher sales turnover. The study also established a statistically significant effect of board diversity on firm performance. This implied that board diversity not only influences firm performance but also brought on board various skills, experience and deeper insight into the firms operations owing to their background and recommends that shareholders of listed companies in Kenya shoulder consider board skills, nationality, and tenure among other attributes when appointing board member. Moreover, the findings of this study forms a basis for future research in this area by interested researchers.
Keywords: companies, professional skills, shareholders, nationality, firm performance.
Title: EFFECT OF BOARD NATIONALITY, SKILLS AND TENURE ON PERFORMANCE OF NON-FINANCIAL FIRMS LISTED AT NAIROBI SECURITIES EXCHANGE, KENYA
Author: Mr. Musina O. Nobert, Mr. Nyongesa S. Andrew, Dr. Miroga. J
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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