The Effect of women board room representation on profitability of Deposit Taking Saccos in Nairobi, moderated by SACCO size

Abstract

This research sought to determine the effect of women in board and women non-executive representation, and the effect of women's demographic characteristics, on the profitability of deposit-taking SACCOs, and analyze the moderating role of SACCO size in the relationship between boardroom representation and fiscal success of deposit-taking SACCOs in Nairobi. The study conceptualized women boardroom representation as women participation in board membership. The research was anchored on Institutional Theory and supported by Gender Inequality Theory, Group Diversity Theory, and Competency Theory. The research's target population consisted of 36 deposit-taking SACCOs authorized by SASRA to perform front office service activities throughout Nairobi for their fiscal year ending December 31, 2025. The study used an explanatory design and purposive sampling to identify the sample of 36 deposit-taking SACCOs whose headquarters are in Nairobi. These SACCOs served as the foundation for evaluation, while the observational components involved were women in board and women non-executive representation in these SACCOs. The research used primary data gathered by means of interviews, and secondary data. A preliminary research phase was undertaken to evaluate the validity and reliability of the interview questions in gathering the requisite data. A multiple linear regression model was utilized to analyze the secondary data. The study found that women in board and non-executive representation, and women demographic characteristics have a significant relation with profitability in deposit-taking SACCOs in Nairobi, while SACCO size had a significant moderating influence on the relationship between women boardroom representation and profitability. The study recommended that deposit-taking SACCOs should promote the inclusion of women in boardroom leadership, invest in capacity-building initiatives that equip the non-executives with strategic oversight and governance skills, incorporate these attributes into board selection criteria, and develop mentorship programs to prepare women with diverse profiles for leadership roles. The study also recommended research on non-profitability indicators of SACCO success, such as member satisfaction, governance quality, and social impact. This study contributes to academic literature, policy, and practice by providing empirical evidence on the influence of women’s boardroom representation, non-executive participation, and demographic characteristics on the profitability of deposit-taking SACCOs in Nairobi.