Effect of Financial Management Practices on Operational Performance of Waste Management Companies in Nairobi City County; A Case of Taka Taka Solutions

Abstract

Waste management companies in Nairobi County face persistent challenges such as high capital expenditures, weak revenue streams, and fragmented regulations, which threaten their operational sustainability and hinder their contribution to the circular economy. Despite their importance in promoting environmental conservation and urban resilience, limited empirical research has been conducted to establish how financial management practices shape their performance. This study investigated the effect of working capital management, cost management, and capital budgeting on the operational performance of waste management companies, focusing on Taka Taka Solutions, while also examining the moderating influence of environmental regulations. The study adopted a descriptive correlational research design targeting 350 employees, from which a stratified random sample of 203 respondents was drawn across managerial, technical, and support levels. Primary data were collected using structured questionnaires and analyzed through descriptive statistics, correlation, multiple regression, and moderated regression models. The findings established that financial management practices significantly affect operational performance and that the regulatory environment moderates these relationships, either strengthening or constraining their impact. The study concludes that effective financial management practices, when aligned with supportive regulatory frameworks, enhance efficiency, sustainability, and competitiveness of waste management companies. It recommends strengthening working capital systems, institutionalizing rigorous cost management frameworks, and adopting strategic capital budgeting approaches, while policymakers should provide enabling regulations and incentives to improve sectoral performance and sustainability.