TRANSFORMATIONAL LEADERSHIP, REGULATORY FRAMEWORK, INSTITUTIONAL CULTURE AND ORGANIZATIONAL PERFORMANCE OF PRIVATE FAITH-BASED HIGHER LEARNING INSTITUTIONS IN KENYA

Author: Dr Ellen Waithira Karuga

ABSTRACT

This study examined the extent to which transformational leadership, regulatory framework, and institutional culture affect organizational performance within private faith-based higher learning institutions in Kenya. Four specific objectives guided the study: to establish the direct effect of transformational leadership on organizational performance; to investigate the moderating effect of regulatory framework on the relationship between transformational leadership and organizational performance; to determine the mediating effect of institutional culture on that relationship; and to evaluate the moderated-mediated effect of regulatory framework and institutional culture on the relationship between transformational leadership and organizational performance. Data were collected from 312 respondents in private faith-based higher learning institutions, an 85.24% response rate, and analyzed using correlation and hierarchical multiple regression. Diagnostic tests confirmed that the assumptions of homoscedasticity, independence of residuals, normality, and absence of problematic multicollinearity were satisfied. Transformational leadership alone significantly predicted organizational performance (R² = .431, F = 276.193, p < .001). Regulatory framework significantly moderated this relationship, explaining 52.7% of the variance in organizational performance on its own (R² = .527, F = 404.995, p < .001). Institutional culture significantly mediated the relationship, improving model fit from R² = .712 to R² = .792 (F change = 34.571, p < .001) when introduced alongside the other predictors. Finally, the combined moderated-mediated effect of regulatory framework and institutional culture significantly enhanced the explanatory power of the overall model, from R² = .768 to R² = .811 (F change = 82.804, p < .001), with all four predictors – transformational leadership, regulatory framework, institutional culture, and the moderated-mediated index – contributing significantly. All four null hypotheses were rejected. The study concludes that organizational performance in private faith-based higher learning institutions in Kenya is best understood not as a simple product of transformational leadership acting alone, but as an outcome shaped jointly by leadership, the regulatory environment, and institutional culture. The study recommends that leaders of these institutions pursue transformational leadership practices in tandem with deliberate attention to regulatory compliance and culture-building, rather than treating any one of the three as sufficient on its own.

Keywords: Transformational leadership; regulatory framework; institutional culture; organizational performance; mediation; moderation; faith-based higher education; Kenya

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