Analysing corporate governance and accountability practices from an African neo-patrimonialism perspective: Insights from Kenya

Kimani, Danson; Ullah, Subhan; Kodwani, Devendra; Akhtar, Pervaiz

Abstract

This paper examines corporate governance (CG) and corporate accountability practices in the African context, by focusing on the case of Kenya. Our data comprises a combination of 29 semi-structured interviews, field observations and archival evidence. We reveal how western-originated CG and accountability reforms are constrained or subverted by a vigorous neo-patrimonial regime. The Kenyan corporate sector has well defined legal-rational structures, including an elaborate corporate sector regulatory framework, professionals (i.e. accountants and auditors) and corporate boards. In contrast, however, informal and patronage networks interfere with the nomination and work of non-executive board members, thereby hindering the possibility of an independent monitoring of executive management. A conflictual and inadequately resourced regulatory framework plays a more symbolic than an effective regulative role in enforcing CG and accountability practices. We also find a widespread rent-seeking culture that significantly hinders the exercise of corporate accountability. Furthermore, external auditor independence is problematic due to conflicts of interests and the auditors' dependence on advisory fees, thereby favouring a clientelist association with auditee firms. Overall, our findings reveal that CG and accountability practices, while ostensibly present in Kenya, are largely ineffective due to the influence of neo-patrimonial realities on the mind-set and actions of corporate actors.

Citation

Kimani, D., Ullah, S., Kodwani, D., & Akhtar, P. (2021). Analysing corporate governance and accountability practices from an African neo-patrimonialism perspective: Insights from Kenya. Critical Perspectives On Accounting, 78, Article 102260. https://doi.org/10.1016/j.cpa.2020.102260

• Journal Article Type: Article
• Acceptance Date: Oct 8, 2020
• Online Publication Date: Nov 21, 2020
• Publication Date: 2021-07
• Deposit Date: Nov 25, 2020
• Publicly Available Date: May 22, 2022
• Journal: Critical Perspectives on Accounting
• Print ISSN: 1045-2354
• Electronic ISSN: 1095-9955
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 78
• Article Number: 102260
• DOI: https://doi.org/10.1016/j.cpa.2020.102260
• Keywords: Accounting, Corporate governance, Financial transparency, Neo-patrimonialism, Africa, less developed countries
• Public URL: https://nottingham-repository.worktribe.com/output/5069936
• Publisher URL: https://www.sciencedirect.com/science/article/abs/pii/S1045235420301088
• Additional Information: This article is maintained by: Elsevier; Article Title: Analysing corporate governance and accountability practices from an African neo-patrimonialism perspective: Insights from Kenya; Journal Title: Critical Perspectives on Accounting; CrossRef DOI link to publisher maintained version: https://doi.org/10.1016/j.cpa.2020.102260; Content Type: article; Copyright: © 2020 Elsevier Ltd. All rights reserved.