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The ethics of management control systems


  • Rosanas, Josep M.

    () (IESE Business School)

  • Velilla, Manuel

    (IESE Business School)


In this paper we review the conventional analyses of management control systems, to conclude, first, that the "illusion of control" can mislead managers into believing that everything can be controlled and monitored, and , second, that no incentive system based only on extrinsic rewards can motivate individuals properly. Then, we investigate the philosophical foundations of the basic assumptions that, implicitly or explicitly, are made about the nature of the acting person. Based on personalist phenomenology, we show how the development of technical and moral values is crucial to the long-run survival of organizations. We end by offering some guidelines as to what control systems should be like in order to be compatible with the nature of human persons.

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  • Rosanas, Josep M. & Velilla, Manuel, 2004. "The ethics of management control systems," IESE Research Papers D/563, IESE Business School.
  • Handle: RePEc:ebg:iesewp:d-0563

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    References listed on IDEAS

    1. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-795, December.
    2. Birnberg, Jacob G. & Turopolec, Lawrence & Young, S. Mark, 1983. "The organizational context of accounting," Accounting, Organizations and Society, Elsevier, vol. 8(2-3), pages 111-129, May.
    3. James A. Brickley & Clifford W. Smith & Jerold L. Zimmerman, 2003. "Corporate Governance, Ethics, And Organizational Architecture," Journal of Applied Corporate Finance, Morgan Stanley, vol. 15(3), pages 34-45, March.
    4. Hofstede, Geert, 1981. "Management control of public and not-for-profit activities," Accounting, Organizations and Society, Elsevier, vol. 6(3), pages 193-211, July.
    5. Argyris, Chris, 1990. "The dilemma of implementing controls: The case of managerial accounting," Accounting, Organizations and Society, Elsevier, vol. 15(6), pages 503-511.
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    business ethics; ethical foundations organization; incentives; management control systems; values;

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