Effects of Machiavellianism, Organizational Commitment and Personnel Controls on Budget Slack

Abstract

The study aims to analyze the effects of Machiavellianism, organizational commitment, and personnel control on budgetary slack. The research sample was formed of 150 publicly traded Brazilian companies that participated in a survey. The hypotheses were analyzed through structural equation modeling (SEM). The results show that managers with high scores for Machiavellianism create budgetary slack. The findings also show that managers with Machiavellian traits tend to adopt personnel controls, according to their preferences. Furthermore, the results reveal that there is a partial mediation of personnel controls in the relationship between Machiavellianism and budgetary slack. The study contributes to the practice of organizations by suggesting that it is necessary to hire individuals with personality traits that adhere to the company's preferences, in order to have employees committed to the organization and less likely to create budgetary slack. This proposal advances in relation to previous studies by introducing the interface between the personality characteristics of managers and personnel controls as predictors of budgetary slack. This study responds to research demands to understand how manipulative behaviors can affect the adoption of management control.