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THE EFFECT OF CORPORATE GOVERNANCE STRUCTURES ON THE PERFORMANCE OF EAST AFRICA AIRLINE INDUSTRY

 

Evans Areba Oyugi

Masters Student, Jomo Kenyatta University of Agriculture and Technology, Kenya

Dr. Makori Moronge

Lecturer, Jomo Kenyatta University of Agriculture and Technology, Kenya

 

ABSTRACT

The East African Airlines are facing a stiff competition from the already established airlines such as Emirates, Qatar Airways, and British Airways among others. One of the major challenges that are facing the East African Airline industry is the issue of Corporate Governance, which contributes greatly to the slow growth of this industry in this region. All the airlines in East Africa were entirely run by the governments. This research sought to study the effect of the corporate Governance structures on the performance of the East Africa Airline. The study was guided by owners/stakeholders, Board establishment and functions, Management and Regulatory Framework, The research design was descriptive and the study used exploratory approach. A self administered pre-tested questionnaire was used to collect primary data. A pilot study was conducted to test the reliability and validity of the questionnaires. From the entire sample of 10 respondents, a response rate of 60% was achieved. Using statistical package for social science (SPSS) the appropriate quantitative and qualitative techniques were used to analyze the data. The research findings established owners/stakeholders; Board establishment and functions, Management and Regulatory Framework, as independent variables for corporate performance influence the performance of East Africa Airlines Industry with 83.3% of the respondents indicated that they adhered to national guidelines for service delivery. Another 83.3% of them indicated that they annually filed their returns including audits to the relevant authorities. 67.5% of the respondents also indicated that their organizations notified relevant authorities of changes in addresses, board, name, constitution etc. and another 33.3% of them were of the opinion that their tax exemptions were processed from nonprofit status. Also the majority of the respondents unanimously mentioned that the various management aspects had influenced corporate governance structures in their respective organizations with the program managers job description, formal performance evaluation, program manager implementation, and handling of queries by the program manager scoring high. The research findings will be used by the East African Airlines, aviation consultant and also to add to the existing body of knowledge.


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