Management Control Systems, Multi-Stakeholder Approach and Organisation Sustainability in Times of Crisis

This paper investigates the effectiveness of management control systems (MCSs) and a multi-stakeholder approach used by nonprofit organisations (NPOs) in responding to the impact of major crises and in achieving organisational sustainability. Utilising data obtained from an online survey questionnaire forwarded to NPOs in the Australasian region, we consider MCS as a package and measure organisational tendency in employing five types of controls: planning, cybernetic, reward, administrative and culture, and in applying a multi-stakeholder approach. We document that the impacts of major crises, including COVID19, on financial performance, service performance, operation efficiency and stakeholder satisfaction varied in response to organisational control mechanisms. Further analysis reveals a significant impact caused by the relationship between MCSs and a multi-stakeholder approach in driving organisational change in crisis management strategy, human resource management, operation and technology and innovation. Extending our analyses to organisational sustainability, we show the outcomes of the above strategic crisis responses on financial sustainability, service sustainability, operational sustainability and sustainable stakeholder satisfaction. This study provides evidence relating to effective designs of MSCs and governance, thereby providing insights to policy makers, regulators and managers when responding to public scrutiny and social pressure on organisational resilience during a crisis.