Effect of Leadership Structure on the Financial Performance of Seventh day Adventist Church Ventures in Kenya

Abstract

Purpose: The study examined the effect of leadership structure on the financial performance of Seventh-day Adventist (SDA) Church ventures in Kenya. Specifically, it assessed whether the way authority, responsibilities, supervision, accountability, and decision-making processes are structured within SDA ventures influences their financial performance. Methodology: The study was guided by agency theory and stewardship theory and adopted a quantitative cross-sectional research design. Data were collected from 97 respondents drawn from SDA-affiliated ventures operating in the health, education, publishing, and hospitality sectors in Kenya. Leadership structure was assessed in terms of supervisory arrangements, separation of powers, role clarity, leadership effectiveness, participatory decision-making, openness to innovation, and ethical leadership. Data were analyzed using descriptive statistics, Pearson correlation, and simple linear regression. Findings: The findings revealed a moderate positive and statistically significant relationship between leadership structure and financial performance (r = .494, p < .01). Regression analysis showed that leadership structure explained 24.4% of the variance in financial performance (R² = .244, adjusted R² = .236). The regression model was statistically significant, F(1, 94) = 30.357, p < .001. Leadership structure had a positive and statistically significant effect on financial performance (B = .578, β = .494, t = 5.510, p < .001). The null hypothesis that leadership structure has no statistically significant effect on financial performance was therefore rejected. Unique Contribution to Theory, Practice and Policy: The study recommends that SDA Church ventures strengthen leadership structures by clearly defining governance and managerial responsibilities, enhancing separation of authority, strengthening supervisory and accountability mechanisms, and promoting participatory decision-making. Leadership capacity development should also be prioritized to enhance effective resource management, innovation, accountability, and long-term financial sustainability.