Understanding How Incentive Contracts and Non-financial Performance Measures Impact Cost Control

Abstract

The study endeavours to ascertain whether, when incentivized, managers prefer cost prioritization (CP) over other choices, during times of external volatility (EV). The study probed the mechanism through which such CP choices are legitimized by the managers (agents) in the setting of an emerging market (EM). Primary data were collected through a questionnaire-based survey of 126 divisional managers who were the units of analysis for the study. The quantitative data were analyzed using the partial least squares structural equation modelling (PLS-SEM) method. The study found that non-financial performance measures (NFPMs) mediated the linkage between incentive contracting and managerial CP choice of the managers. It was also observed that during times of high EV, divisional managers, when incentivized, followed the CP agenda by legitimizing their operational choices, citing the firm’s non-financial performance indicators. The study makes three distinct contributions. First, the study establishes the role of incentive contracts (ICs) in shaping managerial choices. Second, the study contributes to the understanding of the mechanism through which managerial choices are legitimized. Finally, the mediating role of the NFPMs is confirmed.

Keywords

Non-financial performance measures incentive contracts volatility cost control

Get full access to this article

View all access options for this article.

References

Abernethy

M. A.

, Bouwens

, Hofmann

, & van Lent

(2023). Altruism, social norms, and incentive contract design. Review of Accounting Studies, 28(2), 570–614.

Abernethy

M. A.

, Bouwens

, & Van Lent

V. L.

(2004). Determinants of control system design in divisionalized firms. The Accounting Review , 79(3), 545–570.

Abernethy

M. A.

, & Brownell

(1997). Management control systems in research and development organizations: The role of accounting, behavior and personnel controls. Accounting, Organizations and Society , 22(3–4), 233–248. https://doi.org/10.1016/s0361-3682(96)00038-4

Abernethy

M. A.

, Dekker

, & Schulz

(2015). Are employee selection and incentive contracts complements or substitutes? Journal of Accounting Research , 53(4), 633–668. https://doi.org/10.1111/1475-679x.12090

Ahmadi

, & O’Cass

(2016). The role of entrepreneurial marketing in new technology ventures first product commercialisation. Journal of Strategic Marketing , 24(1), 47–60. https://doi.org/10.1080/0965254X.2015.1035039

Akerlof

G. A.

, & Kranton

R. E.

(2005). Identity and the economics of organizations. Journal of Economic Perspectives , 19, 9–32. https://doi.org/10.1257/0895330053147930

Alves

, & Lourenço

S. M.

(2022). The use of non-financial performance measures for managerial compensation: Evidence from SMEs. Journal of Management Control, 33(2), 151–187. https://doi.org/10.1007/s00187-022-00337-8

Aranda

, Arellano

, & Davila

(2019). Subjective bonuses and target setting in budget-based incentive contracts. Management Accounting Research , 43, 45–60. https://doi.org/10.1016/j.mar.2018.07.003

Ararat

, Claessens

, & Yurtoglu

B. B.

(2021). Corporate governance in emerging markets: A selective review and an agenda for future research. Emerging Markets Review , 48, 100767. https://doi.org/10.1016/j.ememar.2020.100767

10.

Armstrong

J. S.

, & Overton

T. S.

(1977). Estimating nonresponse bias in mail surveys. Journal of Marketing Research , 14(3), 396–402.

11.

Ashton

R. H.

(1990). Pressure and performance in accounting decision settings: Paradoxical effects of incentives, feedback, and justification. Journal of Accounting Research , 28, 148. https://doi.org/10.2307/2491253

12.

Astrachan

C. B.

, Patel

V. K.

, & Wanzenried

(2014). A comparative study of CB-SEM and PLS-SEM for theory development in family firm research. Journal of Family Business Strategy , 5(1), 116–128.

13.

Ballas

, Naoum

V. C.

, & Vlismas

(2020). The effect of strategy on the asymmetric cost behavior of SG&A expenses. European Accounting Review , 31(2), 409–447. https://doi.org/10.1080/09638180.2020.1813601

14.

Banker

R. D.

, Lee

S. Y.

, Potter

, & Srinivasan

(2001). An empirical analysis of continuing improvements following the implementation of a performance-based compensation plan. Journal of Accounting and Economics , 30, 315–350. https://doi.org/10.1016/S0165-4101(01)00016-7

15.

Basu

(1997). The conservatism principle and the asymmetric timeliness of earnings. Journal of Accounting and Economics , 24(1), 3–37. https://doi.org/10.1016/S0165-4101(97)00014-1

16.

Bebchuk

, & Stole

(1993). Do short-term managerial objectives lead to under- or over-investment in long-term projects? Journal of Finance , 48, 719–729. https://doi.org/10.1111/j.1540-6261.1993.tb04735.x

17.

Birnberg

J. G.

, & Snodgrass

(1988). Culture and control: A field study. Accounting, Organizations and Society , 13(5), 447–464.

18.

Bisbe

, & Malagueno

(2009). The choice of interactive control system under different innovation management modes. European Accounting Review , 18(2), 371–405. https://doi.org/10.1080/09638180902863803

19.

Black

B. S.

, & Khanna

(2007). Can corporate governance reforms increase firms’ market values? Event study evidence from India. Journal of Empirical Legal Studies , 4, 749–796. https://doi.org/10.1111/j.1740-1461.2007.00106.x

20.

Bonner

S. E.

, & Sprinkle

G. B.

(1999). Propositions about the effects of performance-contingent monetary incentives on task performance (Working Paper). University of Southern California and Indiana University.

21.

Brashear

T. G.

, Manolis

, & Brooks

C. M.

(2005). The effects of control, trust, and justice on salesperson turnover. Journal of Business Research , 58, 241–249. https://doi.org/10.1016/s0148-2963(03)00134-6

22.

Buccieri

, Javalgi

R. G.

, & Gross

(2021). Innovation and differentiation of emerging market international new ventures the role of entrepreneurial marketing. Journal of Strategic Marketing , 31(3), 549–577. https://doi.org/10.1080/0965254X.2021.1952293

23.

Buckley

M. R.

, Cote

J. A.

, & Comstock

S. M.

(1990). Measurement errors in the behavioral sciences: The case of personality/attitude research. Educational and Psychological Measurement , 50(3), 447–474.

24.

Burgess

S. M.

, & Steenkamp

J. B. E.

(2006). Marketing renaissance: How research in emerging markets advances marketing science and practice. International Journal of Research in Marketing , 23(4), 337–356.

25.

Cadsby

C. B.

, Song

, & Tapon

(2007). Sorting and incentive effects of pay for performance: An experimental investigation. Academy of Management Journal , 50, 387–405. https://doi.org/10.5465/amj.2007.24634448

26.

Cheng

(2004). R&D expenditures and CEO compensation. The Accounting Review , 79(2), 305–328. https://doi.org/10.2308/accr.2004.79.2.305

27.

Chenhall

, & Langfield-Smith

(1998). The relationship between strategic priorities, management accounting techniques and management accounting: An empirical investigation using a systems approach. Accounting, Organizations and Society , 23(3), 243–264. https://doi.org/10.1016/S0361-3682(97)00024-X

28.

Chiang

F. F. T.

, & Birtch

T. A.

(2006). An empirical examination of reward preferences within and across national settings. Management International Review , 46(5), 573–596. https://doi.org/10.1007/s11575-006-0116-4

29.

Chin

W. W.

(1998). The partial least squares approach to structural equation modelling. Modern Methods for Business Research , 295(2), 295–336.

30.

Chin

W. W.

, & Newsted

P. R.

(1999). Structural equation modeling analysis with small samples using partial least squares. Statistical Strategies for Small Sample Research , 1(1), 307–341.

31.

Chin

W. W.

, Thatcher

J. B.

, & Wright

R. T.

(2012). Assessing common method bias: Problems with the ULMC technique. MIS Quarterly , 36(3), 1003–1019.

32.

Chong

V. K.

, Mia

, Sands

, & Wang

Z. A.

(2023). The effect of nonfinancial performance measures, absorptive capacity, and organizational learning on innovation performance. Journal of Management Control , 34(2), 201–233.

33.

Chow

C. W.

, Kato

, & Shields

M. D.

(1994). National culture and the preference for management controls: An exploratory study of the firm-labor market interface. Accounting, Organizations and Society , 19(4–5), 381–400. https://doi.org/10.1016/0361-3682(94)90003-5

34.

Core

J. E.

, Guay

W. R.

, & Verrecchia

R. E.

(2003). Price versus non-price performance measures in optimal CEO compensation contracts. The Accounting Review , 78, 957–981. https://doi.org/10.2308/accr.2003.78.4.957

35.

Cuervo-Cazurra

, & Rui

(2017). Barriers to absorptive capacity in emerging market firms. Journal of World Business , 52(6), 727–742. https://doi.org/10.1016/j.jwb.2017.06.004

36.

Dechow

, & Sloan

(1991). Executive incentives and the horizon problem: An empirical investigation. Journal of Accounting and Economics , 14(1), 51–89. https://doi.org/10.1016/0167-7187(91)90058-S

37.

DeVellis

R. F.

(2016). Scale development: Theory and applications (Vol. 26). Sage Publications.

38.

Dong

, Cao

, Dickinson

, & Feng

(2024). Do cash-flow performance metrics in CEOs’ compensation contracts enhance firm innovation? Journal of Management Accounting Research , 1–24. https://doi.org/10.2308/JMAR-2022-083

39.

Feltham

G. A.

, & Xie

(1994). Performance measure congruity and diversity in multitask principal, agent relations. The Accounting Review , 69(3), 429–453. https://www.jstor.org/stable/248233

40.

Fornell

, & Larcker

D. F.

(1981). Structural equation models with unobservable variables and measurement error: Algebra and statistics. Journal of Marketing Research , 18(3), 328–388.

41.

Franco-Santos

, Lucianetti

, & Bourne

(2012). Contemporary performance measurement systems: A review of their consequences and a framework for research. Management Accounting Research , 23(2), 79–119. https://doi.org/10.1016/j.mar.2012.04.001

42.

Gan

, Park

M. S.

, & Suh

(2020). Non-financial performance measures, CEO compensation, and firms’ future value. Journal of Business Research , 110, 213–227. https://doi.org/10.1016/j.jbusres.2020.01.002

43.

Glover

, & Xue

(2022). Accounting conservatism and relational contracting. Journal of Accounting and Economics , 76(1), 101571. https://doi.org/10.1016/j.jacceco.2022.101571

44.

Grabner

, & Moers

(2013a). Managers’ choices of performance measures in promotion decisions: An analysis of alternative job assignments. Journal of Accounting Research , 51, 1187–1220. https://doi.org/10.1111/1475-679x.12027

45.

Grabner

, & Moers

(2013b). Management control as a system or a package? Conceptual and empirical issues. Accounting, Organizations and Society , 38(6–7), 407–419. https://doi.org/10.1016/j.aos.2013.09.002

46.

Graham

, Harvey

, & Rajgopal

(2005). The economic implications of corporate financial reporting. Journal of Accounting and Economics , 40(1–3), 3–73. https://doi.org/10.1016/j.jacceco.2005.01.002

47.

, Nagarajan

N. J.

, & Sayrak

(2024). US airline responses to mandated disclosure of non-financial performance. Journal of Contemporary Accounting & Economics , 20(1), 100394. https://doi.org/10.1016/j.jcae.2023.100394

48.

Guiso

, Sapienza

, & Zingales

(2015). The value of corporate culture. Journal of Financial Economics , 117(1), 60–76. https://doi.org/10.1016/j.jfineco.2014.05.010

49.

Hair

, Halle

, Terry-Humen

, Lavelle

, & Calkins

(2006). Children’s school readiness in the ECLS-K: Predictions to academic, health, and social outcomes in first grade. Early Childhood Research Quarterly , 21(4), 431–454.

50.

Harrison

G. L.

, McKinnon

J. L.

, Panchapakesan

, & Leung

(1994). The influence of culture on organizational design and planning and control in Australia and the United States compared with Singapore and Hong Kong. Journal of International Financial Management & Accounting , 5(3), 242–261. https://doi.org/10.1111/j.1467-646X.1994.tb00045.x

51.

HassabElnaby

H. R.

, Said

A. A.

, & Wier

(2005). The retention of nonfinancial performance measures in compensation contracts. Journal of Management Accounting Research , 17(1), 23–42. https://doi.org/10.2308/jmar.2005.17.1.23

52.

Hayes

R. H.

, & Garvin

D. A.

(1982). Managing as if tomorrow mattered. Harvard Business Review , 60(3), 70–79.

53.

Healy

P. M.

(1985). The effect of bonus schemes on accounting decisions. Journal of Accounting and Economics , 7(1–3), 85–107. https://doi.org/10.1016/0165-4101(85)90029-1

54.

Henri

J.-F.

, & Wouters

(2020). Interdependence of management control practices for product innovation: The influence of environmental unpredictability. Accounting, Organizations and Society , 86, 101073. https://doi.org/10.1016/j.aos.2019.101073

55.

Hirst

M. K.

(1981). Accounting information and the evaluation of subordinate performance: A situational approach. The Accounting Review , 56(4), 771–784.

56.

Hirst

M. K.

(1983). Reliance on accounting performance measures, task uncertainty and dysfunctional behavior: Some extensions. Journal of Accounting Research , 21(2) 596–605. https://doi.org/10.2307/2490793

57.

Hogarth

R. M.

, Gibbs

B. J.

, McKenzie

C. R.

, & Marquis

M. A.

(1991). Learning from feedback: Exactingness and incentives. Journal of Experimental Psychology: Learning, Memory, and Cognition , 17(4), 734–752. https://doi.org/10.1037/0278-7393.17.4.734

58.

Holmstrom

, & Milgrom

(1991). Multitask principal–agent analyses: Incentive contracts, asset ownership, and job design. Journal of Law, Economics and Organization , 7, 24–52. https://doi.org/10.1093/jleo/7.special_issue.24

59.

Holstrom

(1979). Moral hazard and observability. Bell Journal of Economics , 10, 74–91. https://doi.org/10.2307/3003320

60.

Holthausen

, Larcker

, & Sloan

(1995). Annual bonus schemes and the manipulation of earnings. Journal of Accounting and Economics , 19(1), 29–74. https://doi.org/10.1016/0165-4101(94)00376-G

61.

Hoque

(2005). Linking environmental uncertainty to non-financial performance measures and performance: A research note. British Accounting Review , 37(4), 471–481. https://doi.org/10.1016/j.bar.2005.08.003

62.

Horngren

C. T.

, Foster

, & Datar

S. M.

(2000). Cost accounting: A managerial emphasis . Prentice Hall, Inc.

63.

Huidrom

, Ayhan Kose

, Matsuoka

, & Ohnsorge

F. L.

(2019). How important are spillovers from major emerging markets? International Finance , 23(1), 47–63. https://doi.org/10.1111/infi.12350

64.

Husain

, Sohag

, & Wu

(2024). The responsiveness of renewable energy production to geopolitical risks, oil market instability and economic policy uncertainty: Evidence from United States. Journal of Environmental Management , 350, 119647. https://doi.org/10.1016/j.jenvman.2023.119647

65.

Hwang

, Erkens

D. H.

, & Evans

J. H.

(2009). Knowledge sharing and incentive design in production environments: Theory and evidence. The Accounting Review , 84, 1145–1170. https://doi.org/10.2308/accr.2009.84.4.1145

66.

Hyvönen

(2007). Strategy, performance measurement techniques and information technology of the firm and their links to organizational performance. Management Accounting Research , 18(3), 343–366. https://doi.org/10.1016/j.mar.2007.02.001

67.

Idnani

, Adil

M. H.

, Mal

, & Kolte

(2023). Economic policy uncertainty and investors’ sentiment—An Indian perspective. International Journal of Emerging Markets , 18(10), 3462–3485. https://doi.org/10.1108/IJOEM-04-2021-0567

68.

Indjejikian

R. J.

(1999). Performance evaluation and compensation research: An agency perspective. Accounting Horizons , 13, 147–157. https://doi.org/10.2308/acch.1999.13.2.147

69.

Indjejikian

R. J.

, & Matejka

(2012). Accounting decentralization and performance evaluation of business unit managers. The Accounting Review , 87(1), 261–290. https://doi.org/10.2308/accr-10168

70.

Ittner

C. D.

, & Larcker

D. F.

(1998). Innovations in performance measurement: Trends and research implications. Journal of Management Accounting Research , 10(2), 205–238.

71.

Ittner

C. D.

, & Larcker

D. F.

(2001). Assessing empirical research in managerial accounting: A value-based management perspective. Journal of Accounting and Economics , 32, 349–410. https://doi.org/10.1016/s01654101(01)00026-x

72.

Ittner

C. D.

, Larcker

D. F.

, & Meyer

M. W.

(2003). Subjectivity and the weighting of performance measures: Evidence from a balanced scorecard. The Accounting Review , 78(3), 725–758. https://doi.org/10.2308/accr.2003.78.3.725

73.

Ittner

C. D.

, Larcker

D. F.

, & Randall

(2003). Performance implications of strategic performance measurement in financial services firms. Accounting, Organizations and Society , 28(7–8), 715–741. https://doi.org/10.1016/s0361-3682(03)00033-3

74.

Izzeldin

, Muradoğlu

Y. G.

, Pappas

, Petropoulou

, & Sivaprasad

(2023). The impact of the Russian-Ukrainian war on global financial markets. International Review of Financial Analysis , 87, 102598. https://doi.org/10.1016/j.irfa.2023.102598

75.

Jaworski

B. J.

, & Kohli

A. K.

(1993). Market orientation: Antecedents and consequences. Journal of Marketing , 57, 53–70. https://doi.org/10.1177/002224299305700304

76.

Jensen

M. C.

, & Meckling

(1992). Specific and general knowledge, and organizational structure. In Werin

& Wijkander

(Eds.), Contract economics (pp. 251–274). Blackwell.

77.

Kaplan

R. S.

, & Norton

D. P.

(1996). The balanced scorecard: Translating strategy into action . Harvard Business School Publishing.

78.

Khanna

, & Palepu

(2000). The future of business groups in emerging markets: Long-run evidence from Chile. Academy of Management Journal , 43(3), 268–285. https://doi.org/10.5465/1556395

79.

Kohn

(1993). Why incentive plans cannot work. Harvard Business Review , 71, 54–63.

80.

Kumar

, Sunder

, & Leone

R. P.

(2014). Measuring and managing a salesperson’s future value to the firm. Journal of Marketing Research , 51, 591–608. https://doi.org/10.1509/jmr.13.0198

81.

Lambert

R. A.

(2001). Contracting theory and accounting. Journal of Accounting and Economics , 31, 3–87. https://doi.org/10.1016/s0165-4101(01)00037-4

82.

Lawrence

P. R.

, & Lorsch

J. W.

(1967). Organization and environment: Managing differentiation and integration . Division of Research, Harvard Business School.

83.

Levy

F. K.

(1965). Adaptation in the production process. Management Science , 11, B136–B154. https://doi.org/10.1287/mnsc.11.6.b136

84.

, Tong

W. H.

, & Cheng

(2019). Changes in the incentive contracts of takeover targets after merger failures. Journal of Accounting, Auditing & Finance , 37(1), 143–172. https://doi.org/10.1177/0148558X19832484

85.

Lisi

I. E.

(2018). Determinants and performance effects of social performance measurement systems. Journal of Business Ethics , 152(1), 225–225. https://doi.org/10.1007/s10551-016-3287-3

86.

Lowe

, Nama

, Bryer

, Chabrak

, Dambrin

, Jeacle

, Lind

, Lorino

, Robson

, Bottausci

, Spence

, Carter

, & Svetlova

(2020). Problematizing profit and profitability: Discussions. Accounting, Auditing & Accountability Journal , 1233(4), 753–793. https://doi.org/10.1108/AAAJ-10-2019-4223

87.

Luft

J. L.

, & Shields

M. D.

(2000). The effects of financial and nonfinancial performance measures of judgment and decision performance (Unpublished Working Paper). Michigan State University.

88.

Luft

, & Shields

M. D.

(2003). Mapping management accounting: Graphics and guidelines for theory-consistent empirical research. Accounting, Organizations and Society , 28, 169–249. https://doi.org/10.1016/S0361-3682(02)00026-0

89.

Malmi

, Bedford

D. S.

, Brühl

, Dergård

, Hoozée

, Janschek

, Willert

, Ax

, Bednarek

, Gosselin

, Hanzlick

, Israelsen

, Johanson

, Madsen

D. Ø.

, Rohde

, Sandelin

, Strömsten

, & Toldbod

(2020). Culture and management control interdependence: An analysis of control choices that complement the delegation of authority in Western cultural regions. Accounting, Organizations and Society , 86, 101116. https://doi.org/10.1016/j.aos.2020.101116

90.

Marano

, Tashman

, & Kostova

(2017). Escaping the iron cage: Liabilities of origin and CSR reporting of emerging market multinational enterprises. Journal of International Business Studies , 48(3), 386–408. https://doi.org/10.1057/jibs.2016.17

91.

March

J. G.

, & Simon

H. A.

(1958). Organizations . John Wiley & Sons.

92.

McIntosh

C. N.

, Edwards

J. R.

, & Antonakis

(2014). Reflections on partial least squares path modelling. Organizational Research Methods , 17(2), 210–251.

93.

Merchant

K. A.

(1985). Control in business organizations . Ballinger.

94.

Merchant

K. A.

(1990). The effects of financial controls on data manipulation and management Myopia. Accounting, Organizations and Society , 15(4), 297–313. https://doi.org/10.1016/0361-3682(90)90021-l

95.

Merchant

K. A.

, & Van der Stede

W. A.

(2007). Management control systems: Performance measurement, evaluation and incentives (2nd ed.). Pearson Education Limited.

96.

Merchant

K. A.

, Van der Stede

W. A.

, Lin

T. W.

, & Yu

(2011). Performance measurement and incentive compensation: An empirical analysis and comparison of Chinese and Western firms’ practices. European Accounting Review , 20(4), 639–667. https://doi.org/10.1080/09638180.2011.593293

97.

Miles

, & Snow

(1978). Organizational strategy, structure, and process . McGraw-Hill.

98.

Nunnally

J. C.

, & Bernstein

(1978). Psychometric theory . MacGraw-Hill.

99.

Ojha

P. N.

, & Ingilizian

(2019). How India will consume in 2030: 10 mega trends . www.weforum.org/agenda/2019/01/10-mega-trends-for-india-in-2030-the-future-of-consumption-in-one-of-the-fastest-growing-consumer-markets/

100.

Pavia

T. M.

(1995). Profit maximizing cost allocation for firms using cost-based pricing. Management Science , 41(6), 1060–1072.

101.

Pennings

J. M.

(1993). Executive reward systems: A cross-national comparison. Journal of Management Studies , 30(2), 261–280. https://doi.org/10.1111/j.1467-6486.1993.tb00304.x

102.

Perera

, Harrison

, & Poole

(1997). Customer-focused manufacturing strategy and the use of operations-based non-financial performance measures: A research note. Accounting Organizations and Society, 22(6), 557–572. https://doi.org/10.1016/S0361-3682(96)00048-7

103.

Podsakoff

P. M.

, MacKenzie

S. B.

, Lee

J. Y.

, & Podsakoff

N. P.

(2003). Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology , 88(5), 879.

104.

Porter

M. E.

(1980). Competitive strategy: Techniques for analyzing industries and competitors . Free Press.

105.

Porter

M. E.

(1985). Competitive advantage . Free Press.

106.

Preacher

K. J.

, & Hayes

A. F.

(2008). Asymptotic and resampling strategies for assessing and comparing indirect effects in multiple mediator models. Behavior Research Methods , 40(3), 879–891.

107.

Prendergast

(2002). The tenuous trade-off between risk and incentives. Journal of Political Economy , 110(5), 1071–1102. https://doi.org/10.1086/341874

108.

Rabbani

M. R.

(2024). Impact of digital advancements on accounting, auditing and reporting literature: Insights, practice implications and future research directions. Journal of Accounting & Organizational Change . https://doi.org/10.1108/JAOC-01-2024-0028

109.

Raith

(2008). Specific knowledge and performance measurement. The RAND Journal of Economics , 39, 1059–1079. https://doi.org/10.1111/j.1756-2171.2008.00050.x

110.

Ringle

C. M.

, Wende

, & Becker

J.-M.

(2015). SmartPLS 3 . SmartPLS GmbH. http://www.smartpls.com

111.

Roberts

(2010). Designing incentives in organizations. Journal of Institutional Economics , 6, 125–132. https://doi.org/10.1017/S1744137409990221

112.

Rust

R. T.

, Moorman

, & Dickson

P. R.

(2002). Getting return on quality: Revenue expansion, cost reduction, or both? Journal of Marketing , 66, 7–24. https://doi.org/10.1509/jmkg.66.4.7.18515

113.

Sandstrom

, & Toivanen

(2002). The problem of managing product development engineers: Can the balanced scorecard be an answer? International Journal of Production Economics , 78(1), 79–90. https://doi.org/10.1016/s0925-5273(01)00199-2

114.

Schiehll

, & Bellavance

(2009). Boards of directors, CEO ownership, and the use of non-financial performance measures in the CEO bonus plan. Corporate Governance: An International Review , 17(1), 90–106. https://doi.org/10.1111/j.1467-8683.2008.00723.x

115.

Shirodkar

, & Shete

(2021). The impact of domestic CSR on the internationalisation of emerging-market multinational enterprises: Evidence from India. Management International Review , 61(6), 799–829. https://doi.org/10.1007/s11575-021-00455-w

116.

Shleifer

, & Vishny

(1997). A survey of corporate governance. Journal of Finance , 52, 737–783. https://doi.org/10.1111/j.1540-6261.1997.tb04820.x

117.

Simons

(1990). The role of management accounting systems in creating competitive advantage: New perspectives. Accounting Organization and Society , 15, 127–143. https://doi.org/10.1016/0361-3682(90)90018-P

118.

Skiba

, Saini

, & Friend

S. B.

(2016). The effect of managerial cost prioritization on sales force turnover. Journal of Business Research , 69(12), 5917–5924. https://doi.org/10.1016/j.jbusres.2016.05.004

119.

Slater

S. F.

, & Narver

J. C.

(1998). Customer-led and market-oriented—Let’s not confuse the two. Strategic Management Journal , 19(10), 1001–1006. https://doi.org/10.1002/(SICI)1097-0266(199810)19:10<1001::AID-SMJ996>3.0.CO;2-4

120.

Slater

S. F.

, & Olson

E. M.

(2000). Strategy type and performance: The influence of sales force management. Strategic Management Journal , 21, 813–829. https://doi.org/10.1002/1097-0266(200008)21:8<813::AID-SMJ122>3.0.CO;2-G

121.

Snell

S. A.

(1992). Control theory in strategic human resource management: The mediating effect of administrative information. Academy of Management Journal , 35, 292–327. https://doi.org/10.2307/256375

122.

Sprinkle

G. B.

(2000). The effect of incentive contracts on learning and performance. The Accounting Review , 75(3), 299–326. https://doi.org/10.2308/accr.2000.75.3.299

123.

Tahir

, Ibrahim

, & Nurullah

(2019). Getting compensation right—The choice of performance measures in CEO bonus contracts and earnings management. The British Accounting Review , 51(2), 148–169. https://doi.org/10.1016/j.bar.2018.09.004

124.

United Nationals Conference on Trade and Development (UNCTAD). (2019). World Investment Report . United Nations.

125.

Vancil

R. F.

(1979). Decentralization: Managerial ambiguity by design . Dow Jones Irwin.

126.

Van den Steen

(2013). A formal theory of strategy [Working Paper No. 14-058]. Harvard Business School. http://web.mit.edu/evds/www/research/pdf/WP13HBS1312TheoryStrategy.pdf, https://doi.org/10.2139/ssrn.2383981

127.

Van der Stede

W. A.

(2000). The relationship between two consequences of budgetary controls: Budgetary slack creation and managerial short-term orientation. Accounting, Organizations and Society , 25(6), 609–622. https://doi.org/10.1016/s0361-3682(99)00058-6

128.

Van der Stede

W. A.

, Young

S. M.

, & Chen

C. X.

(2005). Assessing the quality of evidence in empirical management accounting research: The case of survey studies. Accounting, Organizations and Society , 30, 655–684. https://doi.org/10.1016/j.aos.2005.01.003

129.

Varma

, & Khan

(2023). Simons levers of control disentangled: A quasi-experiment into the competitiveness of hybrid firms. Management Control , 2, 19–41. https://doi.org/10.3280/MACO2023-002008

130.

Varma

, Lamboglia

, & Mancini

(2021). What motivates the accountants’ awareness of their impact on corporate reputation? International Journal of Management and Decision Making , 20(1), 88–111.

131.

Varma

, & Malhotra

(2022). Establishing the antecedents of accountant’s job satisfaction in an emerging market. Journal of Financial Reporting and Accounting , 20(1), 5–23. https://doi.org/10.1108/JFRA-03-2020-0052

132.

Varma

, Mancini

, Dalela

A. A.

, & Varma

(2022). Online accounting courses: Digital loyalty for an inclusive and open society. Journal of Information, Communication and Ethics in Society , 21(3), 221–242.

133.

Varma

, Mancini

, & Kaushik

(2023). Professional skepticism for green reputation clients: A mixed method study of technology enabled audits. The International Journal of Digital Accounting Research , 23(6), 137–179.

134.

Varma

, Mancini

, & Kaushik

(2024). Sustainability reporting: How consistency and interdependence in financial and managerial accounting enhance eco-controls. Journal of Public Affairs , 24(1), 2910. https://doi.org/10.1002/pa.2910

135.

Varma

, & Sharma

(2024). Assessing the impact of accounting analytic capabilities on firm performance. Journal of Computer Information Systems . https://doi.org/10.1080/08874417.2024.2329137

136.

Varma

, Sharma

, & Khan

(2025). Accounting-analytic capabilities’ impact on management controls and performance. Journal of Computer Information Systems , 1–16. https://doi.org/10.1080/08874417.2024.2441770

137.

Whalen

, Uslay

, Pascal

V. J.

, Omura

, McAuley

, Kasouf

C. J.

, Jones

, Hultman

C. M.

, Hills

G. E.

, Hansen

D. J.

, Gilmore

, Giglierano

, Eggers

, & Deacon

(2016). Anatomy of competitive advantage: Towards a contingency theory of entrepreneurial marketing. Journal of Strategic Marketing , 24(1), 5–19. https://doi.org/10.1080/0965254X.2015.1035036

138.

Widener

S. K.

(2004). An empirical investigation of the relation between the use of strategic human capital and the design of the management control system. Accounting, organizations and society , 29(3–4), 377–399. https://doi.org/10.1016/S0361-3682(03)00046-1

139.

Zarzycka

, & Krasodomska

(2022). Non-financial key performance indicators: What determines the differences in the quality and quantity of the disclosures? Journal of Applied Accounting Research , 23(1), 139–162. https://doi.org/10.1108/JAAR-02-2021-0036