TENDERING PROCESS, CORPORATE GOVERNANCE PRACTICES, STAKEHOLDERS ENGAGEMENT, AND PERFORMANCE OF COUNTY GOVERNMENT WATER PROJECTS IN SEKEB REGION, KENYA

Abstract

Access to reliable water infrastructure remains a significant challenge in Kenya, particularly within devolved county governments, where performance inconsistencies hinder project success. Despite established bidding processes and regulatory frameworks in Kitui, Makueni, and Machakos counties, the performance of water projects has remained suboptimal due to factors such as inadequate stakeholder participation, opaque procurement methods, and weak governance structures. This study examined the effects of stakeholder engagement, corporate governance practices, and the tendering process on the performance of water projects in the South Eastern Kenya Economic Bloc (SEKEB). The research investigated the direct impact of the tendering process, the moderating role of stakeholder involvement, and the mediating influence of corporate governance on project outcomes. The study used Tendering Theory, Agency Theory, and Stakeholder Theory as its theoretical framework. A mixed-methods approach was employed, with data collected from 764 stakeholders involved in water project development through a cross-sectional survey. Stratified random sampling yielded a sample of 263 respondents, with 213 completed responses. Quantitative data were analyzed using descriptive statistics, Pearson correlations, and regression models, while qualitative data were analyzed using thematic analysis. The findings revealed a statistically significant positive impact of the tendering process on project performance (β = 0.487, p < 0.001). Corporate governance practices were found to partially mediate this relationship (indirect effect β = 0.211), while stakeholder engagement significantly moderated the effect (interaction β = 0.172, p = 0.018). The moderated mediation model confirmed that the relationship between tendering and performance, through corporate governance, was significantly influenced by stakeholder engagement; moderated mediation index = 0.069, 95% CI [0.018, 0.124]. In conclusion, transparent and efficient tendering processes, supported by strong governance structures and active stakeholder engagement, can greatly enhance water project performance. The study recommends institutionalizing participatory tendering audits, implementing regular capacity building for procurement officers, and integrating stakeholder consultation throughout the project lifecycle to improve governance and sustainability in Kenya’s devolved water service delivery system.