Management control systems in response to social and environmental risk in large Nordic companies

AbstractThis empirical study investigates the relationships between management control systems and social and environmental risks. Building on Simons’ Levers of Control conceptual framework, this study proposes that companies facing social and environmental risks will enhance the quality of their management control systems by integrating social and environmental elements into management control systems in order to manage the related risks. The study uses a longitudinal dataset of the 1179 largest listed Nordic companies for the period 2014–2018. The multivariate regression confirms a negative relationship between the social and environmental integration and social and environmental risks. The results indicate that the social and environmental integrated performance measurement system and strategy implementation are not congruent with the social and environmental risks that the companies face. Nordic companies have not adopted the social and environmental integrated measurement system and strategy in response to social and environmental risks. When the number of social and environmental incidents increase and companies meet high levels of social and environmental risks, their management control systems do not match the related risks. Such social and environmental integration should be improved in order to prevent wider negative implications of the incidents on the natural environment and society in large.

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The social construction of management control systems

Accounting Organizations and Society ◽

10.1016/0361-3682(86)90008-5 ◽

1986 ◽

Vol 11 (4-5) ◽

pp. 369-395 ◽

Cited By ~ 96

Author(s):

Marilyn Neimark ◽

Tony Tinker

Keyword(s):

Social Construction ◽

Control Systems ◽

Management Control ◽

Management Control Systems ◽

The Social

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The Indicators of the Corporate Social Responsibility

International Journal of Service Science Management Engineering and Technology ◽

10.4018/ijssmet.2019010105 ◽

2019 ◽

Vol 10 (1) ◽

pp. 62-76

Author(s):

Abdelkarim Asdiou ◽

Bouchaib Mokhtari

Keyword(s):

Control Systems ◽

Qualitative Methodology ◽

Institutional Environment ◽

Management Control ◽

Management Control Systems ◽

Theoretical Frameworks ◽

Institutional Perspective ◽

Future Studies ◽

The Social ◽

Corporate Social

The objective of the present paper is to propose an explanatory model identifying the determinants of the recourse to the CSR indicators and spotting the real motivation of companies to use them: for efficiency or a concern for legitimacy towards stakeholders? To carry out this research, the researchers have chosen a qualitative methodology by analysing eight cases of companies labelled CSR. The researchers try to show that the use of CSR indicators obeys to two different but complementary theoretical frameworks. The contingent theory explains the architecture of management control systems according to the “technical environment” of the company that seeks greater efficiency. Whereas in the neo-institutional perspective, the use of CSR indicators can be explained by the “social and institutional environment” in which the enterprise, seeking greater legitimacy, evolves. Through the combination of these two theoretical frameworks, this paper provides an academic basis for future studies which envisage testing the model through a quantitative study.

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