Management accounting: a stage for conglomerates’ governance. The role of economic calculations in organized action

Citation

(2012), "Management accounting: a stage for conglomerates’ governance. The role of economic calculations in organized action", Journal of Accounting & Organizational Change, Vol. 8 No. 2. https://doi.org/10.1108/jaoc.2012.31508baa.002

Management accounting: a stage for conglomerates’ governance. The role of economic calculations in organized action

Article Type: Doctoral research abstracts From: Journal of Accounting & Organizational Change, Volume 8, Issue 2

Purpose – The dissertation grasps the particular dynamics of conglomerates’ internal governance mechanisms via a study of management accounting practices. It sheds light on MA practices which create arenas for deliberation and coordination between managers of parent companies and of subsidiaries.

Design/methodology/approach – Ten relationships between parent companies and subsidiaries, divided into four subsets belonging to different conglomerates, are studied. In every field studies, interviews were conducted with operational managers, directors, and management accountants from the various managerial levels.

Findings – MA is neither mainly an instrument of surveillance, nor just a mechanism to reduce asymmetries of information. The individuals’ room for manoeuvre pervades the technical and formal MA mechanisms. MA practices create a social and political space where questions of governance are settled. Management accounting’s essential contribution to business group governance is thus to lay the foundation for a game of three players (parent company managers, subsidiary directors, controllers) blending confidence and control. Each actor engages in power relations that are asymmetric but with limited room for opportunistic behaviour because of their repetitive, procedural and collective nature.

Research limitations/implications – This study encourages further research into mechanisms of horizontal coordination. Observing management accounting within conglomerates is most fruitful when it is not confined to the study of its role in orienting decisions towards market signals. The present contribution would nevertheless benefit from complementary observations based on research strategies focusing on entire actor-networks and/or longitudinal case studies in addition to interviews.

Practical implications – MA diffuses economic calculations everywhere without for all that reducing everything to economics. For example, MA reporting constitutes a space which multiplies learning opportunities via cooperation, negotiation, and confrontation provided managers in conglomerates preserve opportunities for face-to-face encounters between interlocutors of parent companies and subsidiaries.

Originality/value – This work testifies to the persistence of intermediary centres of governance within conglomerates. Strategies of collaboration and opposition around MA figures are the cement of many social interactions which contribute to the actual governance practices within diversified conglomerates. The thesis shows that management accountants collectively constitute a hardcore of employees whose strategies for reconciling the interests of the owners’ (in the parent companies) with the ones of managers (in subsidiaries) give substance to conglomerates as collective actors.

Discipline Sociology

Awarding Institution: Sciences-Po Paris

Supervisor: Denis Segrestin

Jury: Franck Cochoy,; Pierre-Yves Gomez;, Paolo Quattrone,; Denis Segrestin, & Christian Thuderoz

Author details: François-Régis Puyou – frpuyou@audencia.com