A model for effective board governance in Uganda’s services sector firms
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Date
2013
Journal Title
Journal ISSN
Volume Title
Publisher
Journal of Accounting in Emerging Economies
Abstract
The present study was carried out with the purpose of establishing a model of effective
board governance in Uganda’s service sector firms.
Design/methodology/approach – This study is cross-sectional. The analysis was conducted using
Analysis of Moment Structures (AMOS) software on a sample of 128 service firms in Uganda. The
perceived effective board governance in Uganda was measured by the perceptions of 128 respondents
who are managers or directors in each of those service firms. Three confirmatory factor analysis
models were tested and fitted.
Findings – The three-dimensional model of effective board governance in Uganda – consisting of
control and meetings’ organization, board activity and effective communication – was determined to
be the best fitting model. Evidence in support of relevant theories of board governance was adduced.
Research limitations/implications – Although plenty of literature on corporate governance exists,
there is scarce literature on effective board governance conceptualization and this together with imprecise
terminology regarding this area may have affected the authors’ conceptualization of the study. The
authors’ study was limited to the service sector firms registered and operating in Kampala, Uganda and it
is possible that their results are only applicable to this sector in Uganda. Nevertheless, policy makers of
Uganda dealing with financial markets, academicians, company directors, company owners and even
general readers interested in the area of effective board governance might find this paper handy.
Practical implications – The authors believe that application of their model should improve the
quality of board governance in Uganda and can also apply to other sectors of Uganda’s firms to help
avert the problem of ineffective boards as evidenced by consistent firm failures in Uganda. By
improving the quality of board governance, Ugandan boards will demonstrate their relevance in
company direction and improvement of company value to the benefit of all stakeholders.
Originality/value – The present study provides one of the few studies that have analysed with
confirmatory factor analysis (CFA) using AMOS to test effective board governance measurement model
and provides a benchmark for Uganda’s service firms yearning to leverage the use of their boards.
Description
Keywords
Board governance, Service firms, AMOS, Uganda, Boards
Citation
Nkundabanyanga, SK, Ahiauzu, A., Sejjaaka, SK, & Ntayi, JM (2013). A model for effective board governance in Uganda's services sector firms. Journal of Accounting in Emerging Economies . DOI 10.1108/20421161311288857