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Beekun, R. I., Stedham, Y., & Young, G. J. (1998). Board characteristics, managerial controls and corporate strategy: A Study of U.S. Hospitals. Journal of Management, 24(1), 3-19.

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Article

Diversity and Inclusion in Institutional Governance: The Role of Demographic Heterogeneity of Boards and Executive Committees in Organizational Effectiveness

1Adventist University of Africa (AUA), Nairobi – Kenya

2ADRA Country Director, Harare - Zimbabwe


Journal of Business and Management Sciences. 2024, Vol. 12 No. 3, 111-118
DOI: 10.12691/jbms-12-3-1
Copyright © 2024 Science and Education Publishing

Cite this paper:
Dennis John Rabson Matekenya PhD, Judith Musvosvi PhD Candidate. Diversity and Inclusion in Institutional Governance: The Role of Demographic Heterogeneity of Boards and Executive Committees in Organizational Effectiveness. Journal of Business and Management Sciences. 2024; 12(3):111-118. doi: 10.12691/jbms-12-3-1.

Correspondence to: Dennis  John Rabson Matekenya PhD, Adventist University of Africa (AUA), Nairobi – Kenya. Email: matekenyad@aua.ac.ke

Abstract

The issues of governance diversity have taken center stage with many organizations seeking to be compliant to regulatory requirements and reaching the diversity thresholds set up by different frameworks. The composition of any institutional board should be taken seriously as the board has the mandate to oversee the management decisions in taking the organization forward. Most diversity studies look at gender diversity, age diversity, ethnic diversity and educational diversity. However, it appears the conclusions stop at determining their role in creating organizational effectiveness. This study set out to achieve two things as guided by the research questions. First was to determine the nature, strength, and statistical significance of the relationship between independent variables (gender diversity, age diversity, ethnic diversity and educational diversity) and the dependent variable (Board Effectiveness). Second was to identify principal determinant among the independent variables to the board effectiveness. This study found that all listed independent variables have a linear and positive correlation which is statistically significant. Results showed relationship between independent variables and dependent variable board effectiveness to be positive and statistically significant (education diversity r = .419; p=<.001; age diversity r=.183, p=<.05; gender diversity r=.172, p=<.05; ethnic diversity r=.345, p=<.001). However, in identifying the principal determinant of board effectiveness, it was found that education diversity on the board had the highest coefficient which was also statistically significant (standardized beta .318 and p-values <.05) while the ethnic diversity was .244, and p-value <.05 with age diversity at .183 and p-value <.05. It has also been found that gender diversity contributes weakly to the variability in board effectiveness, which is not statistically significant, standardized beta .061, p-value >.05. Therefore, it can be said that the best way to increase gender participation at the governance levels is through development of experience, expertise and higher education. In this study n=160; Cronbach’s Alpha=.687; KMO=.698 and Bartlett’s Test of Sphericity =<.001.

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