Corporate Governance Practices: A Catalyst for Effective Financial Management In Public Secondary Schools In Kenya

Abstract

Corporate governance and financial management are essential components of effective educational institutions, with growing recognition of their significance globally. In Kenya, as in many other countries, the issue of corporate governance and financial management in secondary schools is of paramount importance. This desktop review assessed the effectiveness of current corporate governance practices, exploring the influence of corporate governance practices on effective financial transparency, accountability, and stakeholder engagement and identifying key barriers to the implementation of effective corporate governance and financial management practices in public secondary schools in Kenya. An extensive review of existing research findings and reports on corporate governance practices and financial management was done to provide insights into the practices in public secondary schools in Kenya. By analyzing the effectiveness of current practices, identifying areas for improvement, and exploring the interplay between governance structures and financial management, this study aims to contribute to the development of more robust governance frameworks and financial management systems within the Kenyan education sector. The review adopted the Agency Theory as its theoretical framework to analyze the relationship between governance structures and financial practices. Findings from the review suggest that the composition and skills of the Board of management significantly influence financial decision-making, with schools benefiting from individuals with financial expertise within their governance structures. Moreover, strong governance frameworks and stakeholder engagement mechanisms contribute to higher levels of financial transparency and accountability. Challenges such as limited awareness and resource constraints highlight the need for enhanced public participation and regulatory compliance. The study recommends building capacity of Boards of Management, enhancing transparency and accountability, addressing resource constraints, strengthening regulatory frameworks, enhancing stakeholder engagement and promoting ethical leadership to ensure efficient financial management and ultimately enhance educational outcomes for learners in public secondary schools in Kenya.