The main purpose of this study was to examine the association of good governance practice with financial performance (ROA) of Nepalese savings and credit cooperatives of Kathmandu district under province number three. This research is a mixed method (explanatory sequential design) using survey questionnaire to collect quantitative data from the representatives of 353 primary cooperatives, and in-depth interview to collect qualitative data from the representatives of 10 primary cooperatives. The association of good governance with financial performance has been carried out by testing one main hypothesis and five sub-hypotheses using linear regression to analyze the data. The research findings showed that 1) Good governance has a statistically significant and positive association with financial performance (ROA) of savings and credit cooperatives in the area of study. 2) Participation has not only a statistically significant but also positive relationship with financial performance of savings and credit cooperatives. 3) Accountability has not only a statistically significant but also positive association with financial performance of savings and credit cooperatives. 4) There is a statistically significant and positive relationship between transparency and financial performance of savings and credit cooperatives. The research findings from qualitative data revealed that there is lack of cooperative friendly policies, act and regulations in Nepal in the context of legitimacy. Similarly, professionalization does not work well due to nepotism, favoritism and political pressure. It is concluded that the cooperatives should enhance participation, accountability and transparency if they want to increase their performance because they are not only significant but also positive panacea for the performance (ROA).
