Guest editorial: The role of accounting and management control systems (MCS) in organisations' sustainability performance

PurposeThe purpose of this study determines how environmental management control system (MCS) packages influence ecological sustainability and sustainable performance through the mediating role of environmental strategies. Furthermore, this applies organizational capabilities as moderating variables between environmental strategies, ecological sustainability and sustainable performance in a sample of 373 construction firms.Design/methodology/approachThe authors apply quantitative questionnaire data from construction firm representatives (from project, sales and construction managers and contract managers, executive directors and engineers) to structural equation modeling and SmartPLS for our analysis.FindingsThe results demonstrate that recourse to environmental MCS packages significantly influence ecological sustainability, sustainable performance and environmental strategies. Additionally, environmental strategies and organizational capabilities significantly influence ecological sustainability and sustainable performance. Moreover, environmental strategies mediate between environmental MCS packages, ecological sustainability and sustainable performance. Organizational capabilities significantly moderate the relationship between ecological sustainability and sustainable performance.Practical implicationsThis research highlights the issue of how the management of construction organizations deploy environmental MCS packages, organizational capabilities and business strategies to measure ecological sustainability and improve their sustainable performance. This study fills a gap in the literature and facilitates the management of construction organizations in strengthening their internal resources in terms of environmental MCS packages, environmental strategies and organizational capabilities able to help improve their ecological sustainability and sustainable performance.Originality/valueThere are few studies building theoretical frameworks for incorporating environmental MCS packages, organizational capabilities, environmental strategies, ecological sustainability and sustainable performance into a single study. Although the influence of various types of intangible resources on ecological sustainability and sustainable performance receive considerable examination in the literature, there is a dearth of attention paid to understanding the role of environmental MCS packages, environmental strategies and organizational capabilities in determining the ecological sustainability and sustainable performance of construction organizations.

The main purpose of the study was to determine the measures for improving management accounting and control system for innovation and performance of manufacturing companies in Nigerisustainablea. The study was guided by three research questions and two null hypotheses. A descriptive survey research design was adopted for the study. The population for the study was 94 accountants working in 53 purposive sampled from manufacturing companies in South-East States of Nigeria. The instrument used for data collection was a 41 item questionnaire grouped into three sections. The instrument was validated and reliability of the instrument was determined using Cronbach Alpha which yielded 0.87. Out of 94 copies of the questionnaire distributed 92 were properly filled and returned representing 97.87% return rate. Mean, standard deviation and t-test statistics were the statistical tools used. From the result of data analysis, the study identified the indicators for improving management accounting and control system for sustainable innovation and performance of manufacturing companies. The findings of the study showed that there is no significant difference in the mean rating of experienced and less experienced on the identified the indicators. Based on the findings, recommendations were made which include; that the business managers and accountants need to understand the relevance of management accounting and control system in achieving sustainable innovation and performance in the organization and the indicators should be used to improve management accounting and control system for sustainable innovation and performance.

Technocracy and management control systems

PurposeThe purpose of this study is to investigate the connections between the regulatory governance, human capital, stakeholder orientation, management control systems (MCSs) and sustainable performance (SP) of power companies. The authors especially looked at how much regulatory governance, human capital, stakeholder orientation and MCSs affect the SP across power companies in Uganda.Design/methodology/approachThis is a cross-sectional and correlational study. Data were collected from 105 power companies using a questionnaire and analysed using SPSS.FindingsStakeholder orientation, MCSs, human capital and regulatory governance significantly predict variances in the SP of power providers in Uganda. Stakeholder orientation is the most important predictor of SP of power companies.Research limitations/implicationsThe absence of validation from important stakeholders and the major reliance on company-provided data in existing research on SP raises the possibility of self-desirability bias. To evaluate and verify the information supplied by firms with external stakeholders, further studies might consider using an explanatory mixed methods technique, in which quantitative data are initially gathered from the managers of power companies and analysed and then validated by interviews with important stakeholders.Originality/valueUsing stakeholder, legitimacy and resource-based theories has provided a better explanation for SP which is a multi-dimensional notion. Moreover, the study adds to the body of perception-based research that offers direct management incentives for SP. The perspectives of managers have been gathered through the use of self-administered questionnaires to gather impressions of managers of businesses, which has helped to tap into all aspects of SP. The study’s results offer, probably for the first time to the best of the authors’ knowledge, evidence of the contextual elements that affect SP in African nations like Uganda particularly in the power sector.

In a dynamic environment marked by significant shifts in production and marketing systems across various industries, companies are compelled to adhere to national and international standards to meet evolving demands from both internal and external stakeholders. These emerging requirements have spurred companies to adopt strategic initiatives, such as emphasizing Corporate Social Responsibility (CSR), as part of their managerial actions. The primary aim is to integrate two key management science themes: indicators derived from management control systems and the management of sustainable performance. Consequently, our focus lies in the socio-economic approach, particularly the socio-economic cost-value of activities, which influences the diversity of indicators on one hand and the management of sustainable performance on the other hand, mediated through their variety. This underscores the importance of managing sustainable performance by utilizing measures and data tied to socio-economic fundamentals, prompting us to formulate our research question as follows: "To what extent does the cost-value of activities impact the management of sustainable performance?" The empirical investigation transitions from simply describing variables within our sample companies to conducting factor analysis via Principal Component Analysis-PCA. This aims to establish a robust factorial structure and subject several constructs to testing, assessing the internal consistency of the model, the quality and reliability of the sample, and the validity of research hypotheses. Our findings align with prior research, indicating that diverse indicators can inform managers about social and environmental practices, fostering positive effects on sustainable firm performance. However, excessive reliance on these indicators may lead to confusion and dispersion within companies. Hence, it's imperative to tailor indicators to the specific context and objectives of each firm, considering industry-specific nuances. Our study demonstrates that leveraging a diverse range of indicators is pivotal for enhancing sustainable performance dimensions and managing socio-economic factors amidst external pressures. Evaluating the measurement model is crucial for validating the reliability and validity of measurement instruments, as well as assessing the structural model's overall quality, which includes tests like coefficient of determination-R², Goodness of fit-GoF, and others. It's important to note that our measurement model encompasses both reflective and formative constructs. The structural model's quality is gauged by its explanatory power, evaluated through R², indicating explained variance in the variables under scrutiny. To address this issue, we chose to examine the connections between key socio-economic factors and the management of sustainable performance in Moroccan companies certified with CSR labels. Through structural equation modeling, we found that effectively managing the cost-value of activities using diverse indicators plays a significant role in enhancing sustainable performance within CSR-certified companies.

Exploring the effect of management control systems on dynamic capabilities and sustainability performance: The role of open innovation strategy amidst COVID-19

Organizational learning and management control systems: responding to environmental change

PurposeThe purpose of this paper is to add to the limited body of interpretive research on integrated reporting by exploring challenges to preparing an integrated report. This is done using an integrated thinking framework which stresses the importance of an interconnection between sustainability performance, proactive sustainability management and integrated reporting.Design/methodology/approachDetailed interviews with 26 preparers at 9 South African-based organisations highlight practical issues encountered when producing an integrated report.FindingsIntegrated reporting is not consistently seen as a natural part of the business process, despite the relevance of multiple types of capital for organisations’ business models. The new report format is imposed on existing internal processes and reporting protocols which precludes a broad understanding of the purpose of integrated reporting and limits the development of management control systems and a supporting accounting infrastructure. In this constrained environment, reporting guidelines are used as disclosure checklists, stakeholder engagement is limited, systems are not always compatible and data analysis is difficult. Preparers are also unconvinced that integrated reports are taken seriously by investors, further limiting the interconnection between sustainability performance and integrated reporting.Research limitations/implicationsThose charged with governance need to ensure that their organisations are identifying so-called non-financial issues as strategically relevant. Sustainability performance targets need to be clearly defined and linked to specific performance indicators. The management control systems and accounting infrastructure must be planned and developed to assist with the monitoring of sustainability performance and, in turn, to inform what information is included in integrated reports.Originality/valueThis study answers the calls for primary evidence on how integrated reports are prepared and the associated challenges. The findings add to the limited body of interpretive research on the functioning of corporate governance and accounting systems and offers practical insights for preparers and academics.

B eing asked to make a short speech as part of accepting the award inevitably leads to some introspection and reflection on major factors that have influenced one’s career, be they events or individuals. Past recipients of the award have been very influential in putting management accounting on the map. Some have been instrumental in developing the way we think about management accounting and teach the subject; some have developed important perspectives such as information economics, combining economics with psychology, the importance of national culture, activity-based cost management, and balanced scorecards. The way these recipients developed their thoughts is well told in their acceptance speeches and collectively provides a wealth of ideas and a historical perspective on the development of our discipline. I commenced my studies in economics, and I maintain a keen interest in economic approaches to management accounting. However, early in my academic career, I was pressed into considering an organizational approach to management accounting, not because it was an easier option; rather it addressed the world of management accounting within which I found myself. In this address, I will share with you some personal reflections on the process of my discoveries in the area of organizational approaches to management accounting from the mid-1960s. The backdrop to this address is that research is something of a growth model. Stage 1: starting from a baseline of skills and knowledge gained at undergraduate studies; stage 2: progressing through refinement of skills with more graduate study; and stage 3: consolidating through work toward publications and other academic outputs. Stages 1 and 2 are somewhat planned and incremental, while stage 3 is more often associated with less ordered processes, often stumbling across potential research areas by way of reading and personal interactions. Research projects can be focused around existing ideas, sometimes being somewhat formulaic, sometimes highly innovative. Often ideas can be serendipitous and develop in unpredictable ways. The key is to recognize when there is a management accounting angle that will relate to an important organizational or social issue.

Purpose This paper aims to investigate the relationship between management control (MC) systems (MCS) and strategy processes within the context of the Dutch central government. By examining types of organisational learning, it seeks to explain the role of MC practices in the implementation and/or development of policy strategies by the Dutch ministries. Design/methodology/approach A multiple case study was conducted to gain in-depth understanding of the design and use of MCS within ministries of the Dutch central government. Using the analytical framework of Pfister et al. (2023) and Simons’ (1995) levers of control MC framework, three research questions were defined, corresponding to three analytical levels, including the descriptive, analytical and explanatory levels. Findings The results show that MCS were mainly used to control the implementation of organisational strategy. This mainly involved the use of feedback mechanisms to facilitate single-loop learning, which offered limited space for the development of strategies. Originality/value This paper contributes to the MC literature by increasing the conceptual understanding of the relationship between MCS and strategy in the public sector in general and in the public policy context in particular. Ministries are responsible for policy and legislation that affect citizens and organisations, making research into strategy implementation and development both practically and academically important.

In the management accounting literature increased dynamics has been emphasized for a long time. The message is that the world is changing, so management control systems (which encompass cost management systems) also have to change. In 1987 the US professors Thomas Johnson and Robert Kaplan wrote the book Relevance Lost – the Rise and Fall of Management Accounting. The book was a critique of how management accounting was taught in business schools, researched in academia and used in practice. The main point made by the authors was that the world had changed, but not the management control systems.

Management Accounting and Control Systems and Earnings Management: Effects on Future Firm Performance

The Role of Institutional Pressures on the Adoption of Sustainability Management Control Systems from an Accounting Perspective and their Effect on Sustainable Performance: A Field Study of Egyptian Firms ملخص البحث1 Abstract هدف البحث إلى بيان أثر الضغوط المؤسسية على تطبيق الشركات لنظم الرقابة الإدارية الرسمية للاستدامة وتأثير ذلك على الأداء المستدام. وقد تم تجميع البيانات باستخدام أسلوب الاستقصاء لعينة مكونة من 96 شركة صناعية وغير صناعية عاملة في مصر، وتم تحليل البيانات باستخدام أسلوب نمذجة المعادلات الهيكلية بالاعتماد على البرنامج الإحصائي .Smart PLSوتوصل البحث إلى أن تطبيق نظم الرقابة الإدارية الرسمية للاستدامة يتأثر إيجابا بكل من الضغوط القهرية، والضغوط المعيارية، ولا يتأثر بضغوط المحاكاة. كما توصل إلى وجود تأثير إيجابي لتطبيق نظم الرقابة الإدارية الرسمية للاستدامة على الأداء البيئي والأداء الاجتماعي واللذان بدورهما يؤثران إيجابا على الأداء الاقتصادي. الكلمات المفتاحية: الضغوط المؤسسية، نظم الرقابة الإدارية الرسمية للاستدامة، الأداء المستدام The purpose of this study is to co-nduct an empirical analysis among Egy-ptian firms to enhance the understandi-ng of the impact of institutional pressu-res on the application of sustainability formal management control systems an-d their effect on firm’s sustainable perf-ormance. Data were collected based on a survey from a sample of 96 manufact-uring and non-manufacturing Egyptian firms, and analysed using Partial Least Squares (PLS) Structural Equation Mo-deling. The study finds that coercive pr-essures and normative pressures are as-sociated with application of sustainabil-ity formal management control systems, whereas mimetic pressures do not repr-esent a significant determinant of such use. The use of sustainability formal m-anagement control systems, in turn, is f-ound to directly influence a firm's both environmental and social performance and indirectly its economic performan-ce. Keywords: Institutional Pressures; S-ustainability Management Control Syst-ems; Sustainable Performance

Bourdieu's Logic of Practice Theory: Possibilities for Research on Management Accounting and Control

Management control systems may differ markedly from organization to organization. However, the trend within many of today's organizations is to include new perspectives in their formal management control and accounting systems. This ongoing transformation of management control systems is partly driven by the notion that intangibles play an increasingly important role in an organization's value creation process and thereby has to be visualized to a greater extent than hitherto. Nowadays, customers, suppliers and other stakeholders are frequently incorporated into the value creation process of organizations. Together with the growing importance of other intangible resources, such as leadership, employee competence and internal business processes, this approach promotes a highly complex picture of the organizational value creation process. The aim of this paper is to analyze organizational value creation from a management control perspective and, based on a longitudinal case study of a Swedish bank, discuss possible key features of a management control system that enables organizations to understand and allocate attention to the value creation of the firm.