The Effect of Board Effectiveness, Risk Management Practice and Leadership Qualities on Non-Financial Listed Companies’ Accountability : the Mediating Role of Performance Measurement System

Yeap, Yee Shun (2021) The Effect of Board Effectiveness, Risk Management Practice and Leadership Qualities on Non-Financial Listed Companies’ Accountability : the Mediating Role of Performance Measurement System. Masters thesis, Tunku Abdul Rahman University College.

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Abstract

Over the decades, in business world, the concept of accountability has been increasingly important, and no matter in which type of industry, organisation, or sector it has become a significant behaviour to possess and practice. In other terms, accountability is defined as being one of the golden values that nobody could oppose or disagree with it. The issue of accountability and corruption has been sadly connected when it is about governance practice. Thus, there is a necessity to understand the internal forces that contribute to this reality. Performance measurement system has been widely used by the corporate world such as non-profit and financial type organisation. But there are lack of studies to adopt performance measurement system as a tool to measure the accountability level of non-financial listed companies. This paper aims to understand whether accountability obligation in the adoption of performance measurement system correspond to a higher degree of accountability for key personnel (Board of Director and senior level of management) and organisation. Besides, numerous studies practised internal control system rather than practising risk management. Thus, this paper examines whether the risk management practice carried out in non-financial listed companies is able to achieve overall organisation accountability. A survey conducted by structured questionnaire which involved 172 accountants who have the basic knowledge of accountability. The data collected are then analysed using PLS-SEM and SPSS. This study shows whether it is feasible to achieve overall accountability in non-financial listed companies in Malaysia, with the implementation of performance measurement system is able to determine the influence on board effectiveness, leadership qualities and risk management practice respectively. This research resulted that, there are significant effects on measuring the performance measurement system mediating the relationship between board effectiveness, risk management practice, leadership qualities towards accountability. From practical perspectives, the research findings have highlighted the importance of regulatory body, employers and organisation to revisit their policies in the workplace, and the customisation of employees’ on accountability obligation via performance measurement system.