Abstract
The performance measurement system (PMS) in the public sector has attracted the attention of many researchers around the world. Drawing on institutional theories, especially neo-institutional sociology, this study examines the mediating role of public accountability in the relationship between PMS and organizational performance in Vietnam’s public sector. The research model and hypotheses were tested by SmartPLS3 software with 214 survey samples from accountants and managers working in public organizations in Vietnam. The results show that public accountability fully mediates the relationship between PMS and organizational performance. These results provide some theoretical and administrative implications for public organizations in Vietnam in applying PMS to improve public accountability and organizational performance.
Highlights
In recent years, public sector reforms have focused primarily on the design and implementation of performance measurement systems (PMS) (Cavalluzzo & Ittner, 2004; Modell, 2001, 2004, 2009)
Many studies have used neo-institutional sociology to clarify public organizations’ PMS application largely because they have been under pressure from stake holders (Brignall & Modell, 2000; Modell, 2001, 2009); performance information needs to be provided for public accountability evaluation and performance management (Halachmi, 2002; Kloot, 1999)
The results show that public accountability is most affected by PMS (f2 = 0.803), and organizational performance is most affected by public accountability (f2 = 0.119)
Summary
Public sector reforms have focused primarily on the design and implementation of performance measurement systems (PMS) (Cavalluzzo & Ittner, 2004; Modell, 2001, 2004, 2009). The role of performance measurement has been one of the most widely studied topics in public accounting literature in the past decades (Broadbent & Guthrie, 2008) It is receiving increasing attention as public organizations try to implement new measurement systems to support their goals (Cavalluzzo & Ittner, 2004). This study is expected to contribute to the public management accounting literature and provide evidence of the relevance of neo-institutional sociology (DiMaggio & Powell, 1983) in the context of public finance reform in a developing country. This study will provide useful governance implications to help managers in organizations recognize the positive impact of adopting and implementing the appropriate PMS to improve public accountability and organizational performance. Part 5 provides the theoretical and management implications as well as the limitations of the study and proposes an orientation for future research
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