Abstract: Stakeholder participation is widely recognized as a critical determinant of project success. However, its specific influence within self-help groups (SHGs) remains underexplored. This study examines the relationship between stakeholder engagement and project performance in SHGs in lower Eastern Kenya, with implications for sustainable community development. Employing a quantitative research design, data were collected through structured questionnaires from 169 SHG members across financial, social, and mixedpurpose groups. A stratified random sampling method ensured representativeness, yielding an 84.5% response rate. Findings reveal that group members are the primary stakeholders (95.9%) and actively participate in decision-making (90.5%). However, the correlation between stakeholder engagement and project performance is minimal (r = 0.0003), suggesting the presence of additional influencing factors. Regular information sharing (88.1%) and targeted training (90.7%) enhance decision-making capacity and accountability. The study recommends capacity-building programs, inclusive governance frameworks, and policy interventions that integrate stakeholder feedback. By providing empirical evidence on stakeholder engagement in grassroots initiatives, this study contributes to participatory project management literature and informs strategies for enhancing SHG-driven development. Future research should adopt longitudinal and comparative approaches to explore the intersection of stakeholder dynamics, socio-economic factors, and project success.

Keywords: Stakeholder Engagement, Project Performance, Self-help Groups, Community Development, Sustainable Development, Participatory Governance