Building stakeholder trust in regulatory governance: Evidence from Ghana's public utilities regulatory commission

This study examines the determinants of stakeholder trust in the Public Utilities Regulatory Commission (PURC) of Ghana by investigating the influence of five (5) governance constructs (independence, transparency, effectiveness, regulatory responsiveness, and accountability). Drawing on the stakeholder theory and literature on regulatory governance, the study employed cross-sectional data using a sample of 280 stakeholders from various sectors. The findings provide strong empirical support for the hypothesized relationships between stakeholder trust and four of the constructs: independence, transparency, regulatory responsiveness, and effectiveness. However, accountability did not emerge as a statistically significant predictor. Perceived independence and effectiveness consistently demonstrate a statistically significant positive association with stakeholder trust, highlighting the centrality of institutional autonomy and performance in shaping confidence in regulatory institutions. Transparency and responsiveness are also relevant, albeit with relatively smaller effect sizes, indicating that while openness and attentiveness enhance stakeholder confidence, they do not outweigh the foundational importance of independence and institutional effectiveness. Taken together, these results advance both theoretical understanding and practical implications of how regulatory bodies in developing country contexts build and sustain trust among diverse stakeholders. Theoretically, the study contributes to scholarship on governance and stakeholder trust by reinforcing the salience of independence and effectiveness as essential qualities of regulatory legitimacy in developing countries. Practically, these findings carry important implications for regulatory policy and practice in Ghana and similar developing country contexts. PURC must strengthen its institutional independence from political interference and improve the perceived effectiveness of its regulatory mandate to improve stakeholder trust.