Influence of Endowment Funds Mobilization On Financial Sustainability of Universities in Kenya

Abstract

Public and private higher education institutions in Kenya have increasingly faced challenges of financial unsustainability in recent years. Achieving financial sustainability requires institutions to secure regular and reliable internally generated funds to support their operations. In the context of dwindling government funding, escalating operational costs, rising debts, and deteriorating infrastructure, universities are under mounting pressure to identify and implement alternative income-generating strategies while preserving academic quality and institutional viability.This study evaluated the influence of financial resource mobilization strategies on the financial sustainability of universities in Kenya. Specifically, the research examined the impact of Endowment funds mobilization on financial sustainability. The study was supported and anchored on Resource Mobilization Theory. A sample of 64 universities comprising 34 public and 30 private institutions was drawn from a population of 76 chartered universities in Kenya as of December 31, 2022, using Yamane’s formula. Stratified sampling ensured proportional representation. Primary data were collected from 290 senior university officers through structured, self-administered questionnaires. Instrument reliability was confirmed with a Cronbach’s alpha coefficient exceeding 0.9, surpassing the 0.7 threshold. Secondary data were obtained from university reports and audited financial statements covering the period 2018–2022.Data analysis involved descriptive and inferential statistics, with hypothesis testing conducted using binary logistic regression at a 95% confidence level (α = 0.05).Chi-square analysis was used to determine the association between endowment funds mobilization and financial sustainability in the Kenyan Universities The study found a significant association between endowment funds mobilization and financial sustainability in the Kenyan Universities at the 5% level (P < 0.05).As shown by the Nagelkerke R Square percentages, Endowment funds mobilization account for 68.5% of the variation, confirming its importance as a long-term funding mechanism.From the findings of multivariate regression analysis, it was clear that endowment funds mobilization is significantly associated with financial sustainability (P = 0.004). If endowment funds are mobilized, universities in Kenya are 2.900 times more likely to achieve financial sustainability (OR = 2.900) compared to those that do not implement such strategies