Group policies and subsidiary financial performance of Multinational Corporations in Uganda: A case study of SGS Uganda Limited

Abstract

The study was about group policies and subsidiary financial performance of multinational corporations in Uganda with a focus on SGS Uganda Limited. The purpose of the study was to establish the effect of group policies on the subsidiary financial performance, a case study of SGS Uganda Limited. The following objectives guided the study: 1) To examine the effect of group control policy on the subsidiary financial performance, 2) To examine the effect of group risk management policy on the subsidiary financial performance and 3) To establish the effect of group shared cost policy on the subsidiary financial performance. Thus, the following research questions were answered: 1) What is the effect of group control policy on the subsidiary financial performance? 2) What is the effect of group risk management policy on the subsidiary financial performance? 3) What is the effect of group shared cost policy on the subsidiary financial performance? The research design was a case study of SGS Uganda Limited. The sample size that was selected was 68 but the response was 61. Analysis involved descriptive statistics (frequencies and percentages) and the second included inferential statistics (correlations and coefficient of determination). Findings revealed a weak negative relationship (rho = -.292) between group control policy and subsidiary financial performance, a weak negative relationship (r = -.287) between group risk management policy and subsidiary financial performance and a weak negative relationship (r = -.396) between group shared cost policy and subsidiary financial performance. Thus, it was concluded that group policies significantly affected subsidiary financial performance. It is recommended that SGS SA give more autonomy to SGS Uganda Limited’s group control policy, group risk management policy and group shared cost policy for SGS Uganda Limited’s to improve on its financial performance.