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Why business unit controllers create budget slack: Involvement in management, social pressure, and Machiavellianism

By F.G.H. Hartmann and V.S. Maas

Abstract

This paper investigates business unit (BU) controllers’ inclination to engage in the creation of budgetary slack. In particular, we explore whether controllers who are involved in BU decision making are more susceptible to social pressure to engage in slack creation than controllers who are not. We expect, and find, a crucial role of the controller’s personality. Results from an experiment among 136 management accountants suggest that the personality construct Machiavellianism interacts with involvement to explain controllers’ responses to social pressure to create budgetary slack. Controllers scoring high on Machiavellianism are more likely to give in to pressure by BU management to create budgetary slack when they have been involved in decision making. In contrast, controllers scoring low on Machiavellianism are less likely to give in to pressure to create slack when they have been involved in decision making

Topics: class eco B
Year: 2010
DOI identifier: 10.2308/bria.2010.22.2.27
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Provided by: NARCIS
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