Abstract:
In recent years, management literature has increasingly investigated organizational sustainability as an important antecedent to firm survival and performance. Some recent studies indicate that Management Control Systems (MCS) may be able to foster organizational sustainability when coupled with other factors such as remuneration. Empirical research studies that use contingency approaches and a case study of the Social Islami Bank Ltd (SIBL), a leading Bank in Bangladesh are examined with a focus on the relationship between MCS and organizational sustainability. Given that top level management take up the bulk of salaries, existing remuneration plans for executive management still focus largely on financial performance and do not necessarily promote sustainable value creation for their firms. In response to this reality, a growing number of academics and practitioners acknowledge the need for the inclusion of sustainability targets in executive remuneration. This research paper therefore aims to examine the relationship between management control systems and remuneration and how these affect the sustainability of organisations. The aim is to enrich the academic body of knowledge given that data on the relationship between MCS and remuneration is currently limited, and thereby providing considerable scope for further research. A series of future research questions will be presented. The study will offer illustrations of organisations that have applied management control mechanisms and how reward systems are being applied. Given the changing environment especially with the COVID 19 pandemic and travel restrictions in place, this study will employ an exploratory research design and make use of both primary and secondary data in attaining the research objectives. The results of this study aim to provide a basis for enhanced corporate governance with a focus on the remuneration excesses that may exist especially during times of economic meltdown. Other areas of study include risk and challenges of management control and rewards systems. The study seeks to conclude with a set of best practices for combining MCS and remuneration in achieving organisational sustainability.
