Financial Support Mechanisms, Regulatory Governance and Firm Performance: A Case of Clean Energy Firms in Central Uganda.
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Date
2025-12-18
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Makerere University Business School
Abstract
This study examined the influence of financial support mechanisms and regulatory governance on the performance of clean energy firms in Uganda. Motivated by persistent underperformance in the sector where only 19% of firms achieve profitability within five years and 40% of hydropower capacity remains underutilized the research examined how access to finance, policy coherence, and regulatory efficiency affect firm outcomes. Anchored in Institutional Theory, the study adopted a cross-sectional survey design, collecting data from 106 licensed clean energy firms. Quantitative analyses, including Pearson correlation and multiple regression, revealed a strong positive correlation between financial support mechanisms and firm performance (r = 0.604, p < 0.01), and a very strong correlation for regulatory governance (r = 0.726, p < 0.01). Regression results showed that financial support mechanisms and regulatory governance jointly explained 56.3% of the variance in firm performance (R = 0.750, R² = 0.563), with regulatory governance exerting the stronger influence (β = 0.572, p < 0.001). Findings indicate that while financial instruments such as concessional loans, subsidies, and public–private partnerships enhance innovation, revenue growth, and operational efficiency, their impact is maximized when aligned with transparent and streamlined regulatory frameworks. The study concludes that integrated financial and regulatory reforms are critical to improving firm profitability, generation capacity, and innovation, thereby accelerating Uganda’s clean energy transition. Recommendations include adopting blended financing strategies, streamlining licensing procedures, harmonizing incentives, and promoting community engagement to enhance sectoral resilience and inclusive development.
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This is a master's thesis.
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Citation
Cheptang, M .S. (2025). Financial Support Mechanisms, Regulatory Governance and Firm Performance: A Case of Clean Energy Firms in Central Uganda. (unpublished master's dissertation). Makerere University Business School, Kampala, Uganda.