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Stakeholder pressure as a driver of risk management practices in public administrations

Fabienne-Sophie Schäfer (Institute of Management Accounting, Universität der Bundeswehr München, Neubiberg, Germany)
Bernhard Hirsch (Institute of Management Accounting, Universität der Bundeswehr München, Neubiberg, Germany)
Christian Nitzl (Center for Ingelligence and Security Studies (CISS), Universität der Bundeswehr München, Neubiberg, Germany)

Journal of Accounting & Organizational Change

ISSN: 1832-5912

Article publication date: 24 September 2021

Issue publication date: 12 January 2022

652

Abstract

Purpose

Drawing upon new institutional theory and blame avoidance theory, this paper aims to examine how stakeholder pressure has an impact on the implementation and use of risk management practices in public administrations. Furthermore, this paper investigates whether top management support mediates this proposed relationship.

Design/methodology/approach

This paper is based on a survey among public financial managers of German municipalities and federal agencies. Data from 136 questionnaires were used to evaluate the model.

Findings

The results indicate that top management support fully mediates the relationship between stakeholder pressure and risk management practices. This finding suggests that top management support is crucial for the successful implementation of accounting techniques, such as risk management, in public administrations.

Research limitations/implications

This study is based on subjective answers by public financial managers. Moreover, this study is based solely on German data. Hence, future research could use a mixed-method approach and data from other countries.

Originality/value

This paper examines whether stakeholder pressure exerts an impact on the sophistication of public risk management practices.

Keywords

Acknowledgements

This paper is based on the first author’s doctoral thesis, submitted at the Bundeswehr Universität München, Germany. The first author received a scholarship from Hanns-Seidel-Stiftung e.V., which was funded by the German Federal Ministry of Education and Research (BMBF). The author would like to thank the Hanns-Seidel-Stiftung for supporting her doctoral thesis and the respective paper.

The authors would like to thank Julia Thaler (Universität der Bundeswehr München) for valuable feedback throughout the process of development of the paper. A previous version of this paper was presented at the 8th Annual Conference Risk Governance, 18th Annual Conference for Management Accounting Research and 1st EAA Virtual Annual Congress. The authors would like to thank the conference participants, the guest editor, Martin Hiebl, and two anonymous reviewers for their valuable comments, which have helped to improve the paper.

Citation

Schäfer, F.-S., Hirsch, B. and Nitzl, C. (2022), "Stakeholder pressure as a driver of risk management practices in public administrations", Journal of Accounting & Organizational Change, Vol. 18 No. 1, pp. 33-56. https://doi.org/10.1108/JAOC-11-2020-0188

Publisher

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Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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