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Article
Publication date: 17 November 2021

Asogan Moodley, Barry Ackers and Elza Odendaal

The formal adoption of internal auditing within the South African public sector was made compulsory by the Public Finance Management Act, No. 1 of 1999. Despite internal…

Abstract

Purpose

The formal adoption of internal auditing within the South African public sector was made compulsory by the Public Finance Management Act, No. 1 of 1999. Despite internal auditing’s primary role of adding value and assisting organisations to accomplish pre-defined strategic objectives, the increasing frequency of service delivery protests in South Africa, suggests that mandatory internal auditing may not have contributed to improving public sector performance and enhancing service delivery, as envisaged. This paper aims to identify the factors preventing internal audits from effectively contributing to improved public sector performance and service delivery.

Design/methodology/approach

The study adopted a sequential mixed-methods research approach. Firstly, a survey instrument was used to collect empirical data from survey respondents at South African national government departments. Secondly, semi-structured interviews and focus group discussions were held with a purposively selected sample of participants to explore the observations from the first phase. The observations from the first two phases were validated through an analysis of pertinent documents and records.

Findings

Despite all departments adopting internal auditing, management’s expectations of internal auditing and the services provided by the internal audit function diverged. The results suggest that the emergence of a compliance approach to organisational governance together with poor performance management skills has impaired internal auditing’s ability to effectively contribute to strategic and performance management.

Research limitations/implications

Despite its South African orientation, as internal auditing is a global association and given that service delivery protests continue to occur in several countries around the world, increases the study’s international relevance. Moreover, the mandate of internal auditing requires it to add value to an organisation irrespective of its geographical location.

Originality/value

The study contributes to the existing body of knowledge on internal auditing, particularly its adoption and implementation in the South African public sector. In addition to identifying the factors inhibiting effective internal auditing, the study advances a suggested framework for the future of internal auditing.

Article
Publication date: 2 September 2019

Karina Kenk and Toomas Haldma

The purpose of this paper is to study more deeply the use of performance information (PI) in the context of the administrative-territorial reform, e.g. amalgamation in the local…

Abstract

Purpose

The purpose of this paper is to study more deeply the use of performance information (PI) in the context of the administrative-territorial reform, e.g. amalgamation in the local governments (LG) with an example of Estonian LGs.

Design/methodology/approach

The case study method is adopted, using data from publicly available documents and interviews with the politicians and officials at the five merger cases of Estonian LG units. The data are interpreted and analysed using attribution theory.

Findings

The results show that amalgamation patterns do have an influence on PI use – in particular, the authors see that PI is reported to be used more frequently in cases of voluntary mergers, which may be related to the different motivations to make attributions in cases of voluntary and compulsory mergers.

Originality/value

The study contributes to the debate on the importance and usefulness of different types of PI, as financial as well as non-financial information and for different information users in the light of LG reform in Estonia as being a Central and Eastern European country.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 31 no. 3
Type: Research Article
ISSN: 1096-3367

Keywords

Article
Publication date: 28 November 2023

Hanen Khaireddine, Isabelle Lacombe and Anis Jarboui

Although the association between sustainability assurance (SA) quality and firm value has been examined in previous studies, the moderating relationship is novel in this study and…

Abstract

Purpose

Although the association between sustainability assurance (SA) quality and firm value has been examined in previous studies, the moderating relationship is novel in this study and highlights the effect of corporate environmental sustainability performance (CESP) on the relationship between SA quality and firm value. This study aims to examine whether such an effect is strengthened or weakened by eco-efficiency, as measured by ISO 14001 certification, aggregate CESP score and each individual dimension of CESP (emission reduction [ER], resource reduction [RR] and product innovation [PI]).

Design/methodology/approach

The sample includes 40 companies in Euronext Paris with the largest market capitalisations (the Cotation Assistée en Continu 40 [CAC 40] index) from 2010 to 2020. The authors apply the feasible generalised least squares regression technique to estimate all the regression models. Because observed associations may be biased by reverse causation or self-selection, the authors use the instrumental variable approach and Heckman two-stage estimation.

Findings

The results show that SA quality had a positive and significant effect on firm value. Second, the authors demonstrate that CESP, as assessed by ISO 14001 certification, has a stronger interaction with assurance quality and acting as a moderator variable. Using the ASSET4 scores, an alternative proxy for CESP, the authors find inconsistent evidence regarding the impact of CESP attributes. The CESP and ER scores are homogeneous and have a positive effect on firm value. However, the PI and RR CESP attributes are not homogenous and do not have the same interactive effect on firm value. The results are robust to the use of an instrumental variable approach and the Heckman two-stage estimation procedure.

Research limitations/implications

Policy implications: Regulators may be interested in the findings when considering current and future assurance requirements for sustainability reporting, and shareholders when considering SA as an investment choice criterion. The insights into and enhanced understanding of the incentives for obtaining high SA quality can help policymakers develop effective policies and initiatives for SA. Considering the possible improvements in sustainability performance when obtaining a high level of sustainability verification, governments need to consider mandating SA.

Practical implications

Firms receive clear confirmation of the importance of investing in SA quality. Financial markets do not evaluate SA dichotomously but reward companies with higher SA quality because of the greater credibility it provides. Firms should allocate a significant percentage of their annual budgets and other relevant resources to environmental training and development programmes to improve and maintain environmental performance. If they care about environmental issues, they must announce this by issuing sustainability reports and seeking assurance of the information disclosed. High-quality assurance not only has a significant effect on investors’ investment reliability judgements but also the perceived credibility of environmental performance fully moderates the effect of assurance on these judgements.

Social implications

This study has social implications; the authors find that the French market rewards firms that provide a high-quality assurance to guarantee the integrity of their sustainability reports. Therefore, by incorporating environmental sustainability into their financial goals, a better assurance ultimately will urge firms to move from green washing to strategic goals, which is beneficial for society. Further, firms that focus on sustainability as part of their business strategy may attract employees who engage in green behaviours at work and create a friendlier and productive environment because it gives meaning to the work they do and keeps them engaged to the level needed to perform their jobs capably.

Originality/value

This study contributes to the literature by re-examining the relationship between SA quality and firm value. It also provides new evidence on the moderating effect of CESP on the SA quality–firm value nexus. Specifically, it explores the joint effect of credibility and eco-efficiency on market confidence in sustainability information.

Details

Sustainability Accounting, Management and Policy Journal, vol. 15 no. 2
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 5 August 2014

Aki Jääskeläinen and Juho-Matias Roitto

– The purpose of this paper is to identify the drivers of personnel satisfaction towards performance information (PI) usage in the local public administration context.

Abstract

Purpose

The purpose of this paper is to identify the drivers of personnel satisfaction towards performance information (PI) usage in the local public administration context.

Design/methodology/approach

The study utilizes both quantitative and qualitative research approach. Data are gathered with a survey receiving 194 responses from the departments of six different municipalities that all belong to the group of largest municipalities in Finland. Regression and variance analysis, as well as analysis of open-ended comments are utilized.

Findings

A key observation is that high maturity level of performance measurement or information systems do not guarantee personnel satisfaction. Three main perspectives are found to positively affect satisfaction: use of PI in strategic planning, inter-administrative management with PI and communication of measurement information.

Research limitations/implications

Common limitations of survey studies apply. The quantitative data set could have been wider and it should be complemented with more qualitative data. Also the survey itself has limitations due to its generic nature.

Practical implications

The results indicate that managerial purpose of measurement needs to be better clarified. Greatest need for development is found in utilizing PI in resource sharing and in the analysis of current situation supportive to strategic planning.

Originality/value

The efficient use of performance measurement is a commonly acknowledged challenge. Even though PI usage has been increasingly studied, the focus has often been in separate managerial tasks. Wider approach towards performance measurement and management practices has gained less attention. This study is one of the first attempts to apply private sector originating performance measurement maturity discussion in the public sector context.

Details

International Journal of Public Sector Management, vol. 27 no. 6
Type: Research Article
ISSN: 0951-3558

Keywords

Open Access
Article
Publication date: 21 May 2021

Tomi Rajala and Lotta-Maria Sinervo

Although politicians' use of performance information affects political decisions and, through them, the well-being of society, there is a lack of studies exploring what contextual…

1049

Abstract

Purpose

Although politicians' use of performance information affects political decisions and, through them, the well-being of society, there is a lack of studies exploring what contextual factors are associated with annual active performance information use among politicians. Furthermore, past studies on this subject have been cross-sectional rather than longitudinal.

Design/methodology/approach

In this qualitative case study, triangulation of observations and 10 semi-structured interviews were used to ensure the robustness of findings. The study was conducted in a Finnish municipality known as Kangasala.

Findings

A dialogue culture, constructive political climate, trusted information sources and high-quality information attained via accessible information channels explained the high information use in primarily unfavorable conditions to such use. The authors’ findings contradict many prior interview and survey studies that did not recognize the simultaneous contributions of the information provider, channel and quality, along with organizational and environmental factors to high performance information use. The results contradict to some extent the findings from other countries as these studies have explained high levels of use with unique combinations of drivers, whereas we identify common attributes of these combinations and talk about their meaning in the success of Kangasala's public financial management. However, the findings of this case study cannot be generalized.

Originality/value

This study describes a case organization that created a supportive environment for politicians' frequent performance information use that contributed to improvements. Past studies provide little knowledge about establishing sustained high levels of information use among politicians, so the case offers ideas and inspiration for improving this use.

Details

International Journal of Public Sector Management, vol. 34 no. 4
Type: Research Article
ISSN: 0951-3558

Keywords

Article
Publication date: 31 October 2018

Dorota Dobija, Anna Maria Górska and Anna Pikos

The purpose of this paper is to extend the understanding of how internal organisational processes change in response to external demands, by investigating the changes undertaken…

Abstract

Purpose

The purpose of this paper is to extend the understanding of how internal organisational processes change in response to external demands, by investigating the changes undertaken by two Polish business schools (b-schools) in anticipation of and in response to the demands of accreditation agencies (AAs) and other powerful stakeholders. Specifically, it examines the internal research-related performance measurement (PM) system and changes in the use of performance information (PI).

Design/methodology/approach

The case study method is adopted, using data from publicly available documents and interviews with the faculty and management at the two schools. The data are interpreted and analysed using the neo-institutional theory.

Findings

Powerful stakeholders are the primary reason for changes in PM systems and the manner in which PI is used. Specifically, AAs reflect an additional layer in the PM system, allowing for a downward cascading PI effect. This also leads to a wider use of PI across different organisational levels.

Research limitations/implications

This study focusses on two case studies in a region still undergoing transition. Thus, this analysis could be reinforced through additional cases, different data collection methods and cross-country and between-country comparative analyses.

Originality/value

The changes in PM systems and particularly the use of PI are discussed in the context of Polish higher education (HE) and, more broadly, the entire Central and Eastern Europe (CEE) region. Moreover, the consideration of two b-school cases facilitates a comparative analysis of the differences in PM systems and the use of PI in the context of stakeholders’ PI needs.

Details

Baltic Journal of Management, vol. 14 no. 1
Type: Research Article
ISSN: 1746-5265

Keywords

Article
Publication date: 11 May 2015

Dorothea Greiling, Albert Anton Traxler and Sandra Stötzer

The purpose of this paper is to investigate to what extent public sector entities in Austria, Germany and Switzerland apply sustainability reporting (SR) guidelines in line with…

3029

Abstract

Purpose

The purpose of this paper is to investigate to what extent public sector entities in Austria, Germany and Switzerland apply sustainability reporting (SR) guidelines in line with the global reporting initiative (GRI) to respond to societal pressure. It further assesses the kind of data reported in order to illuminate whether well-balanced share of economic, environmental and social information are provided.

Design/methodology/approach

This study provides an empirical analysis of SR based on a documentary analysis of external reports by public sector organisations (PSO) included in the GRI’s database for the years 2012-2014.

Findings

PSO applying the GRI guidelines comply to a relatively great extent but show considerable variations and a clear imbalance of information reported concerning the three pillars of sustainable development.

Originality/value

The paper offers insight into GRI reporting practices by PSO in Austria, Germany and Switzerland. Additionally, a country and sector comparison was conducted. As previous studies mostly focus on SR in private corporations, the results contribute to advancing research on SR in the public sector where PSO increasingly have to demonstrate their (sustainable) contributions to the public benefit.

Details

International Journal of Public Sector Management, vol. 28 no. 4/5
Type: Research Article
ISSN: 0951-3558

Keywords

Article
Publication date: 1 March 2007

Natalia Buchanan and Donald E. Klingner

This paper evaluates an Air Force performance-based service contract against the contracts that were prescriptive in the past. Department of Defense mandated that all service…

Abstract

This paper evaluates an Air Force performance-based service contract against the contracts that were prescriptive in the past. Department of Defense mandated that all service contracts be performance-based by 2005. The goal of the paper is to determine whether this contract, after becoming performance-based, is achieving greater cost savings and better outcomes for government, contractor, and taxpayers. The paper assesses the contract performance standards and how they are measured. The authors analyze the language of the Statement of Work (SOW) before and after it became performance-based. The contractor’s performance is evaluated. Positive incentives are identified and described. Finally, the paper addresses risk assessment issues.

Details

Journal of Public Procurement, vol. 7 no. 3
Type: Research Article
ISSN: 1535-0118

Article
Publication date: 14 November 2019

Lauren Ellul and Ron Hodges

The purpose of this paper is to analyse the pre-adoption phase of budgetary reform. Perspectives on the introduction and use of performance information in budgeting are obtained…

Abstract

Purpose

The purpose of this paper is to analyse the pre-adoption phase of budgetary reform. Perspectives on the introduction and use of performance information in budgeting are obtained through interviews with current and former senior politicians and civil servants in Malta. Institutional theories are used to analyse the pressures that are perceived as promoting or inhibiting reforms.

Design/methodology/approach

The research followed a qualitative approach, using data gathered from documentary sources and empirical evidence collected from semi-structured interviews. Documentary sources were used to provide knowledge, obtaining an understanding of budgeting processes in the Maltese central government. Two categories of interviewee are identified in the analysis: political interviewees, consisting of 7 politicians; and administrative interviewees consisting of 13 senior civil servants.

Findings

The authors find that the current line-item budgeting system is deeply embedded into government practices. Malta’s membership of the European Union and its adoption of the Euro support coercive pressures for reductions in fiscal deficits. Normative pressures appear to be significant and may have a longer-term impact in promoting budgeting reform.

Originality/value

This paper contributes to existing performance-based budgeting literature by studying the pre-adoption phase which has rarely been the focus of previous studies. The study delves into the interaction between institutional and economic forces, an aspect which has been inadequately studied. The access to current and former Prime Ministers and other Ministers of State in this study is unusual. As such, the researchers have been able to obtain the perceptions of political decision makers in a way that might be more difficult to do in larger countries.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 31 no. 4
Type: Research Article
ISSN: 1096-3367

Keywords

Article
Publication date: 6 November 2023

Hanene Kheireddine, Isabelle Lacombe and Anis Jarboui

This study elucidates the interactive relationship of sustainability assurance (SA) quality with corporate environmental sustainability performance (CESP) and firm value and…

Abstract

Purpose

This study elucidates the interactive relationship of sustainability assurance (SA) quality with corporate environmental sustainability performance (CESP) and firm value and explores the moderating impact of CESP on the SA quality–firm value relationship.

Design/methodology/approach

The sample comprises 320 firm-year observations of 40 companies listed on the Cotation Assistée en Continu (CAC 40) from 2010 to 2019. The authors use the simultaneous equations model to capture the CESP and SA quality–firm value relationship and apply the three-stage regression and generalised method of moments approaches to address possible endogeneity.

Findings

The results show that CESP, as assessed by International Organisation for Standardisation (ISO) 14001 certification, has a significant positive effect on firm value, the relevance of which implies that in the case of good environmental performance, society's perception of a firm is much more favourable; consequently, the firm is likely to be rewarded with a premium value in capital markets. In addition, environmental performance has a stronger interaction with SA quality, acting as a moderator variable; thus, greater SA quality signals credibility owing to increased eco-efficiency. The authors interpret their findings within a multi-theoretical framework that draws insights from legitimacy, stakeholders and signalling theoretical perspectives.

Originality/value

This study contributes to the literature by re-examining the relationship between SA quality and firm value. It also provides new evidence of the moderating effect of CESP on the SA quality–firm value nexus. Specifically, this study explores the joint effects of credibility and eco-efficiency on market confidence in sustainability information. The authors use a simultaneous equation model to capture the reciprocal association between SA quality and firm value, whereas prior studies on SA quality and market performance have frequently used single-equation regression. The authors also find that CESP positively moderates the relationship between SA quality and firm value. Including CESP and exploring the moderating impact of eco-efficiency on the SA quality–firm value relationship is a novel approach.

Details

Benchmarking: An International Journal, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1463-5771

Keywords

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