The Effect of Governance on the Growth of Collective Entrepreneurship in the Coffee Sector in Kenya

Abstract

The study investigated the effect of governance on the growth of collective entrepreneurship in the Agricultural Sector in Kenya in Kenya with evidence from the Coffee Sector in Kenya. Entrepreneur cooperatives are volatile in adopting the best practices of governance. Organization growth being a focus associated with entrepreneurship and governance, Agricultural Sector in Kenya have yet to execute its basic principles of transparency, equity, responsibility, and accountability. A myriad of hitches including mismanagement, financial scandals and failure of innovation have occurred in different entrepreneur cooperatives raising questions about the quality of governance. The concern being the legitimacy of management committee members, the low levels of member participation, effectiveness and inadequate expertise of senior managers in supervising, ensuring and protecting the interests of members and stakeholders. The producer owned agriculture cooperatives a practical example of collective entrepreneurship because their joint ownership by multiple producers has not yet given much attention to entrepreneurship as an important factor for economic development. The general objective of the study was to investigate the effects of governance on the growth of collective entrepreneurship in the Agricultural Sector in Kenya in Kenya. The study used a descriptive research where the population was all Agricultural Sector in Kenya championing coffee. The sample frame was a list obtained from the Kenya National Bureau of Statistics. The accessible population was 202 entrepreneur Coffee co-operatives. By a multi-stage sampling, 137 coffee cooperatives in Kenya was the sample size. A questionnaire was the instrument for data collection. The secondary data was from existing reports, publications and the internet. Both qualitative and quantitative analysis was done using SPSS version 21 and Analysis of Moment Structures (AMOS) as an add-on module as a tool for analysis. The study established that financial management systems, organization demography and Human Resource Management positively influence the growth of collective entrepreneurship. The influence increases more whenever policy was introduced as a moderator. The study concluded that Agricultural Sector in Kenya did not have appropriate functional financial management systems to ensure consistent sound business practices and principles. The management committee members’ members and their top management were rated moderately low in designing and diffusion of technologies. Majority did not have innovative products to sustain positions in the market. The key aspects of organization demography such as size, age and managerial tenure distribution had a significant bearing and affected the growth of collective entrepreneurship in the sector. The human resource had not adequately developed and maintained competencies to acquire competitive position in the evolving market. Majority had inadequate skills or capacities required to embrace new ideas, change, innovation and teamwork where majority had not employed the right people. The study recommends implementation of complete and accurate accounting systems and internal control to ensure productivity. The management tenure or length of service by the top management should enhance innovative products and value addition. They should practice strategic Human Resource Management to support organization change rather than functional focusing on individual performance and turnover. The taxation and infrastructure policies that impede the growth of Agricultural Sector in Kenya be reviewed. The Coffee Sector in Kenya should organize and intensify access to markets through collective entrepreneurship. The study recommends further study on factors that inhibit Agricultural Sector in Kenya from branding and quality strategies for differentiated products.