Middle-East Journal of Scientific Research 23 (9): 2145-2154, 2015

ISSN 1990-9233
IDOSI Publications, 2015
DOI: 10.5829/idosi.mejsr.2015.23.09.14577

Management Accounting System and Shareholder Versus

Stakeholder-Orientated Managerial Decision-Making

Massoud Alam Dad Mohammadi, Mohd Noor Azli Ali Khan,

Reza Ghasemi and Nor Azmi Mohamad

Faculty of Management, Universiti Teknologi Malaysia,

81310 UTM Johor Bahru, Johor, Malaysia

Abstract: Management accounting system can influence managers decision-making through two methods:
direct effect as input to decisions or indirect effect through influencing the behaviour of managers. In this paper
we try to illustrate how management accounting information supports managerial decision-making in
shareholder and stakeholder value management. Secondly, in this paper we investigate consequences that
result from the conceptions behavior of managerial decision-making for the design of management accounting
system. And discuss about relationships between decision-making managers, management accountants.
Consequently, the results of this research show that management accounting design keep up a correspondence
with shareholder theory. Therefore, management accountants follow the goal of profit maximization for
shareholders and concentrate on the agency relationship between shareholders and managers and
decision-making behavior resulting from that. In consequence, when stakeholder orientation is taken,
different accounting techniques are needed. However, Stakeholder theory is basically different from
shareholder theory, because of different behavioral assumptions, objectives, management philosophy, etc.
For these reasons regarding different managerial decision-making behavior and different requirements,
management accountants need to employ appropriate accounting techniques.

Key words: Management Accounting System (MAS) Decision-Making Managerial Behavior

Stakeholder Theory Shareholder Theory

INTRODUCTION MAS serves the purposes of providing information

Management accounting system (MAS) refers to
the systematic use of management accounting techniques
to achieve organizational goals [1]. One comes across
various definitions of accounting in the textbooks;
however, almost all definitions identify two important
elements of accounting. First, process, where accounting
is said to identify, measure, analyze and report economic
information. Second, purpose, which is stated to be
helping the users of that information make better
decisions. As opposed to financial accounting which
provides economic information from the perspective
of many external users, management accounting
(MA hereafter) focuses mainly upon the needs of internal
managers of an organization [2]. [3] Suggests that
and decision support. Consequently, management
accountants can influence on managerial decision-making
behavior, within providing related information and
technique, for instance throughout providing particular
performance measurements [4]. [5], believes that the
managers often have different and unstable interests
because, decision-making process really is complex as a
result they often have different and unstable interests
and they act from various points of view. Therefore,
[6] suggest that management accountants must not
only be concerned with the pure content of
information but also with decision makers behavior,
including their individual motivational and cognitive
characteristics and, especially, related limitations.
So, between decision-making managers and management

Corresponding Author: Massoud Alam Dad Mohammadi, Faculty of Management, Universiti Teknologi Malaysia,
81310 UTM Johor Bahru, Johor, Malaysia.
2145
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
accountants there is a complicated relationship. [7],
stated that managerial decision-making reasonably
depends on whether shareholder or stakeholder-
orientation predominates among the firms objectives.
Managerial decision-making is affected by information-
information that managers directly consider relevant for
decision-making in the shareholders or the stakeholders
interest and information provided to shareholders and/or
stakeholders about the results of managerial decisions.
Among the information affecting managerial decision-
making accounting numbers play an important role.
According to [8] when the interest of managers and
shareholders is not the same and in this case, the manager
who is responsible for running the firm tend to achieve his
personal goals rather than maximizing returns to the
shareholders, corporate is counted with agency problem.
Therefore, a most important objective of the corporation
is to lessen agency losses. So, [9], states that this is
management accounting duty to lessen or hinder agency
difficulties and opportunistic managerial behavior.
In this paper we try to identify managerial behavior in
decision-making processes in shareholder management
versus stakeholder management. In addition, try to
explain how shareholder and stakeholder theory affect
management accounting systems design and provide
suggestions for management accounting design to
enhance managerial decision-making in shareholder
management versus stakeholder management.
Theoretical Framework
Shareholder and Stakeholder Theory: The relationship
between managers and stakeholders is at the core of the
corporate governance debate. This debate often comes
down to the confrontation between two corporate
ideal types. On one side, the shareholder firm where
internal conflicts are resolved through the concentration
of power in the hands of shareholders and where
managers have little autonomy and, on the other side,
the stakeholder firm where managers have more discretion
and act as mediators between the firms multiple
constituencies [10]. Stakeholder theory is effective in
offering normative and instrumental grounding for
inclusion of stakeholders in managerial decision making.
It contributes to our understanding of the relational
component of a firm and provides a framework for
recognizing relevant constituencies and several logics for
prioritizing and integrating their interests into decision
making. [11] States that Managers as agent are
responsible to spend corporate funds in authorized ways
to maximize interests and benefits of shareholders as
principal.
The pure shareholder theory focuses on the
relationship between managers as agents and
shareholders as principals [12] and Stakeholders are only
regarded as a means to increase the corporations
profitability. Whereas the pure stakeholder theory
concentrate on how managers may balance their
responsibilities to shareholders and other owners who
have a legitimate claim in the firm [13]. In addition,
the logic of shareholder value maximization has been
unwelcoming to the stakeholder view of the firm. In the
other hand, equally beneficial stakeholder relationships
can improve the wealth-creating capacity of the
corporation [14]. In addition, some critics of stakeholder
theory indicate that in stakeholder oriented corporation's
managers have no way to make principled or purposeful
decisions [15]. Moreover, stakeholder theorists,
particularly supporters of normative and instrumental
approaches, often become involved in arid discusses
about the primacy of shareholder wealth maximization in
opposition to a broader conception of business ethics
[16]. In this respect, descriptive stakeholder theory
scholars focus almost exclusively on stakeholder
outcomes in the publicly-held firm where important
corporate decisions are made by professional
managers [17]. By focusing on a single corporate type,
such research essentially holds corporate governance as
a constant. In so doing, significant variation in
stakeholder and organizational outcomes in other systems
of governance are overlooked.
To summarize, theories of corporate governance
typically adopt either a shareholder or a stakeholder
approach in addressing issues of performance and
efficiency [15] [18]. Table 1 shows the main findings and
major differences between both agency/shareholder and
stakeholder/socio-political perspectives. The main
question of this research is about the significance and the
role of management in both theories.
Behavioral Assumptions in Pure Shareholder and
Stakeholder Theory: Theoretically, shareholders of a firm
are the only owners and duty of top managers is to
manage the company in such a way that maximizes
returns to shareholders [19]. However, [20] argued that
managers do not always try to maximize returns to the
shareholders. Such behavior is identified as opportunism.
2146
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015

Table 1: Difference between shareholder and stakeholder perspectives

Shareholder perspective Stakeholder perspective
Stakeholder outcome Singular: specific Shareholder returns Multiple: holistic Distribution to all stakeholders
Purpose of firm An instrument for shareholder wealth Maximization A locus in relation to wider external stakeholders interests
Theoretical Underpinnings Transaction cost economics; Agency theory: System theory, Stakeholder theory
managerial agency principalprincipal agency
Key assumption Dispersed shareholders as rightful owners All stakeholders have equitable Rights
Interaction Antagonistic; Arms length Relational
Nature of stakeholder Conflict Dyadic: Ownermanager Ownerowner Inter-related
Examples of intra-stakeholder Owners vs. managers Voting rights vs. cash flow rights Differing perspectives of multiple stakeholders
conflicts Debt vs. equity holders Intra-ownership type conflicts Unmonitored and unaccountable managers
Long-term vs. short-term investors
Primary Stakeholder Shareholder No specific stakeholder group(s)
Secondary stakeholder Managers No specific stakeholder group(s)
Authority Managers for dispersed shareholder Network
Contracting mode Formal, arms length Relational contracting
Governance focus Mitigating agency cost Minimizing transaction cost Identifying and resolving stakeholder concerns
Governance Mechanism Managerial monitoring Alignment of incentives Network; control embedded in lasting relationships
Contributions Ease of modeling Clear quantifiable outcome Realistic Includes all possible factors
Limitations Ignores most external factors Complexity in modeling Unclear, emergent outcome

Opportunistic managers actively follow their self-interests
[21]. In some research (for instance [22-25] opportunism
are often discussed in related to shareholder value.
So, Opportunism steams from shareholder theory:
the association between shareholders (as a principal)
and managers (as an agent) [20]. According to [20] it is
not possible for the shareholders (principal) and managers
(agent) to make sure at zero cost that the managers
decisions maximize the shareholders interests. So,
there will constantly be agency costs resulting from
monitoring and bonding. Because of this reason,
shareholder oriented corporations are identified by
pure agency relationship between shareholders and
management [26]. Stakeholder value is formed by a
stakeholder sensitive management and a fundamental
concept in economic based stakeholder theory, which is
that such management, would cause a competitive
advantage allowing a superior level of value creation [27].
Hence, the main challenges concerning management
decision-making in pure stakeholder oriented corporate
result from complex, dynamic and reciprocal relationship
between managers and stakeholders [28]. As a result,
in pure shareholder Orientated corporate managers try to
maximize shareholder utility and in pure stakeholder
orientated corporate managers concentrate to achieve
goals of all stakeholders. In contrast, there are two
corresponding theories that are seriously argued and
frequently criticized: Stewardship theory and Stakeholder
agency theory. Stewardship has been suggested as a
substitute to agency theory, while it is also subject to
criticism because it is based on some assumptions that are
intense and unrealistic [29].
According to stewardship theory, the principal aim to
maximize shareholder value in the company as in
shareholder theory. However, the steward-managers are
not presumed to be firmly self-interested they want to
protect the corporate assets and are different from
opportunistic managers [30]. Hence, [31], believe that
managerial stewards are loyal, reliable, hard-working and
dependable in protecting and advancing shareholder
interests. When stakeholder interests are not same with
shareholder interests, steward-managers are motivated to
make decisions that maximize interest of all groups.
Because of this, stewardship theory seems to be alike to
stakeholder theory seeing that like in stakeholder theory,
moral stewards do not consider stakeholder interests as
ends but rather regard the interests of stakeholders only
in an influential sense to achieve the objective of
shareholder value maximization [31]. There are no agency
conflicts similar to agency difficulty in the pure
shareholder theory thanks to steward-managers individual
characteristics who do not necessarily act as
Opportunistic managers but they show a wide range of
behavior.

2147
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
Stewardship theory concentrates on the two-sided
relationship between shareholders and managers without
identifying agency problems. But stakeholder agency
theory concentrates on a nexus of contracts between
different stakeholders as identifying a wide range of
agency-relationships [12] [32]. [33], argues that each
stakeholder group adds critical resources to the corporate
and consecutively is expecting its utilities to be
maximized, accordingly, the corporations aim is to
provide stakeholders interests and maximize their value.
Reference [34] states that the difference between the
interests that stakeholders attain if management act in the
best interests of stakeholders and the utility that is
attained if management act in the best interests of its own
there will be a utility loss. Thus, the purpose of
stakeholder agency theory is to maximize the entire
corporations value and to respect reasonable claims of all
stakeholders.
Implications for Management Accounting System
Design: One of the objectives of management accounting
is to provide relevant information for internal decision
making. For regular or short-term decisions management
accountants can use cost-volume-profit analysis,
product profitability analysis and stock control models.
For capital investment decisions management
accountants can produce accounting rates of return
and payback periods as well as more complex signals
based on discounted cash flow. Also information on
non-financial factors, such as quality of output,
flexibility of processes and lead-times could affect
capital investment projects [35]. According to [36 and 37]
management accounting systems herein have two
important roles within decision-making:
Decision-facilitating role
Decision-influencing role
Decision-facilitating information is intended to
decrease the pre-decision uncertainty of the decision-
maker and, thereby, enhance the probability. Therefore,
decision-facilitating information aimed to decrease the
pre-decision uncertainty in decision-making and is
supposed to enhance the knowledge and prospects of the
decision-maker to make better decisions regarding the
desired aims [38]. Decision-facilitating information
supports decision-making when more than one actor is
engaged and there are objective conflicts and information
asymmetries. Therefore, in the corporate ownership is
2148
separate from decision-making management and when
the power of decision-making is decentralized [29] [39].
In such a condition management accounting system is
expected to motivate individuals and moderate the conflict
of interests and objectives and, therefore, to support in
achieving the basic goals of the corporate [4] [36] [40].
In this research, we assume that the basic missions of
the corporation are shareholder value maximization and
value maximization for all stakeholders. We aim to
consider which one of the decision-facilitating role or
decision-influencing role of management accounting is
required against the different behavioral assumptions and
corporate objectives. In each of the four behavioral
assumptions there is clearly more than one actor. For
instance in the shareholder value oriented corporate there
are shareholders as principals and decision making
management as agents. In this condition, management
accounting systems role is decision-facilitating and
particularly decision-influencing because, aligns interests
and limits managers opportunistic behavior. In
stewardship theory stewards aims and objectives are
always aligned with the relevant corporate goal which is
the shareholder value maximization. In addition stewards
act just in the best interests of shareholders and do not
intentionally pursue subjective preferences, as a result,
objective conflicts between shareholder and
management need not be taken into account. The reason
for this is that stewards goals and objectives are
always aligned with the relevant corporate purpose
which is shareholder value maximization [30].
Consequently, when designing management accounting
systems in stewardship theory the focus must be on the
decision facilitation instead of the decision influence of
information.
In stakeholder value orientated corporate there is
more than one actor, managers as agents and
shareholders as principals and other stakeholders with
different aims and goals who have legal claims on the
corporation [13]. [41] State that in stakeholder agency
theory when designing management accounting systems
decision facilitation as well as decision influence of
information must be considered. The significance of the
decision facilitation of information steams from the wide
range of interdependencies and links which concern
resources, risks, performance etc. The decision influence
of information must be paid particular attention.
Because managers have a central position in this nexus of
stakeholder groups and therefore likely obtain more
information than any other stakeholder groups.
Consequently, an information irregularity there is between
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
managers and stakeholders [34]. So management
accounting systems must be designed to direct
decision-making manager to maximize the stakeholders
interests.
In pure stakeholder theory managers always make
decisions in the best interest of all stakeholders and they
do not exclusively seek individual interests therefore pure
stakeholder theory ignores agency relationships. Because
of this no decision influencing of information is
necessary. [42], argues that because these managers are
assumed to be moral in nature they will neither exploit
any stakeholder group nor take advantage of any
information asymmetries that likely exist due the
managers central position. Therefore, [43] concludes that
in pure stakeholder theory when designing management
accounting systems the focus must be on decision
facilitating of information with the key tasks of
cooperation, coordination and resolution of conflicts
among stakeholder groups.
Implications for the Decision-facilitating Role of
Management Accounting Systems: In The
decision-facilitating role, management accountants
provide information for supporting decision-making of
managers and reduce pre-decision uncertainty of
decision-makers in a particular decision context
[44 and 45]. According to [41] the purpose of
decision-facilitating role is to develop the knowledge of
managers and employees and to improve their ability
for decision-making and desirable judgment. [46],
states that if there is a balance between decision-makers
needs and demands for information and the supply
of information by management accountants,
the decision-facilitating role is optimally performed.
In consequence, it is discussed that what implications
for management accounting systems designing regarding
their decision-facilitating role can be assumed from the
different behavioral assumptions and corporate
objectives.
In pure shareholder theory management accounting
information is assumed to be concerned about economic
value, profitability maximization, shareholder value,
financial performance and quantifiable outcomes. Hence,
traditional management accounting information has been
financial [47] and no other information is needed because
corporate philosophy concentrates on profitability and
shareholders value maximization [10] [48]. In contrast,
objectives concerned with environmental, social, ethical
and religious issues etc. are relatively ignored when the
corporations aim is shareholder value maximization [48].
2149
Thus, management accounting systems had best
not concentrated completely on managers demand of
information, but rather ensure high transparency
throughout the corporate and supply information as
absolutely as possible. According to [47] management
accounting system is basically aimed toward internal
constituencies for instance managers, executives and
employees. It must consider providing information to
shareholders beyond providing financial accounting
information to internal actors. When corporation
aimed to value maximization for all stakeholders,
same considerations can be made. Though,
opportunistic managers will not seriously try to
maximize stakeholders interest, consequently,
management accounting system have to provide
complete information as well as possible. [49], argues that
in corporation which aimed to value maximization for
all stakeholders since there are different stakeholder
groups with various interests and characteristics,
decision facilitation of information can be more complex.
Consequently, a wide range of information concerning
different type and quality is necessary and type and
quality of information provided by management
accountants depends on the variety of interests,
objectives and legal claims. Thus, [43] believe that
management accounting systems counter with the
challenge to record, measure and present various and
mainly qualitative information. According to [40] some
researchers believe that a superior amount of detailed and
correct information always results in better decisions
provided information costs are ignored. However, in pure
shareholder theory and stakeholder agency theory,
opportunistic managers likely use extra information not
only for decision making to maximize the stakeholders
interests, but also to maximize their personal interests.
Therefore, with decision-makers as opportunistic
managers, additional and various information leads to a
rise of information asymmetry which result in typical
agency conflicts. Consequently, in spite of the goals of
the corporation management accounting systems must be
aware of the high risk to encourage self-seeking behavior
when providing information [50 and 51].
In stewardship theory since decision-making
managers have only fiduciary tasks towards shareholders
and they are moral in nature and truthful, necessities
placed on management accounting systems keep on
largely manageable. So, they are alleged to use only
related information to meet shareholder interests.
In addition, high quality management accounting
information leads to better decision. Consequently,
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
management accountants are able to make a greater
contribution when they offer adequate information to
stewardship managers and support making powerful
governance structures and mechanisms. In pure
stakeholder theory there exist two basic challenges
imposed on management accounting systems. Firstly,
since in stakeholder oriented corporate responsibility for
all stakeholders is a basic duty of management and
collective-serving managers are careful about this
corporate objective, management accounting systems
only must concentrate on multiple values and explicitly on
social framework. However, because of various
stakeholders with multiple and maybe changing
characteristics, interests and claims, there are high
difficulty and multiple interdependencies. In this
condition a broader scope of information is needed
to increase transparency for non-decision-making
stakeholders and also to directly support decision-making
managers [49]. The second challenge is related to the
resolving conflicts between multiple stakeholders
and, therefore, balancing divergent interests.
Collective-serving managers try to balance stakeholder
interests and maximize their value thus, a process of
measuring, assessing and addressing the rivalling
stakeholder claims is needed [52]. [53], argue that an
important task for management accounting and
management is formalizing stakeholder relationships
and goal Conflicts. Other researchers for instance [54],
believe that managers should stop waiting for some kind
of invisible hand and rather concentrate their attention
on resolving conflict between stakeholder groups with
ethical judgment and choice. management accounting
system has to provide complete information as well as
possible accordingly, having little access to suitable
information restricts the ability to make desirable
judgments and decisions in organization and managers
cannot fulfill the companys overall objectives
because they dont have required and sufficient
information. Thus, stakeholders and shareholders may
take advantage of the collective-serving but
under-informed decision-maker and abuse management
accounting information to maximize their own interests
and influence decisions in their own utilities [42].
Implications for the Decision-influencing Role of
Management Accounting Systems: According to [41] the
decision-influencing role of management accounting
systems influence managerial decision-making behavior
through the special effects that monitoring, measuring,
evaluating and rewarding actions and performance have
on motivation. The aim of decision-influencing is to
make parallel interests between legitimate claims of a
corporation and decision-making managers and to make
sure that all activities and decisions supply the
corporations objectives [40] [55].
When there are not agency-conflicts no inherent
problems of executive motivation there are and, hence,
no decision influence of information is needed in pure
stakeholder theory and stewardship theory. Accordingly,
only pre-decision information is needed. In contrast,
when managers are self-seeking, management
accountants are faced with agency-relationship between
shareholders and managers in pure shareholder theory,
or with different agency-relationships among the
various stakeholders in stakeholder agency theory,
the consequential concern is related to checking
managerial opportunism [43].
According to [56] If management accounting system
dont provide criteria or evaluations for performance and
dont monitor and control mechanisms, in stakeholder
orientated corporation self-interested managers act for
their individual interests even more than in
shareholder oriented corporation. [40], states that when
decision-making managers are self-interested and
opportunistic, individual values and social norms for
instance honesty or work-ethic are impossible to resolve
agency-difficulty and to absolutely reduce opportunistic
behaviors. It is assumed that managers have a tendency
to be individualists and opportunistic and show only
low value commitment. Consequently, management
accountants try to tie management to the firms objectives
as well as achievable. Ref. [9], states that in motivational
form of control the achievement desired results are related
with rewards and penalties that are considered for
managers. Since this incentive system focuses on results
instead of actions it is indirect, but sometimes rather more
practical and less costly than direct monitoring managers
acts. Which motivations effectively encourage and lead
to desirable behavioral patterns, cannot be usually
assumed, but depends on the condition, individual
values, motivation and tendency to take risks [57]. [48]
[58] believe that in shareholder oriented firms Due to the
underlying assumptions of incentive and interests
motivation systems are claimed to focus entirely or at
least basically on the capital markets and financial
performance. Thus, motivation schemes are generally
financial concerning the basis of evaluation, rewards and
penalties [59]. Furthermore According to [60] researchers
suggest implementing standard models from
principal-agency theory to coordinate interests of
2150
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
management and shareholders. In addition, like pure
shareholder theory there are some similar assumptions in
stakeholder agency theory which concerns the
agency-relationship between management and
stakeholder group. [43] Argues that motivation systems
in stakeholder agency theory might be contained
long-term motivation plans and stock options to
encourage managers to try to maximize shareholder value.
However, because of various interdependencies,
different interests and divergent claims difficulty increase
and conversely transparency and the effectiveness of
alignment mechanisms reduce due to incomplete or
unsuitable motivations. Because stakeholder agency
theory enforces even higher demands on management
accounting system and other groups in the corporation
than shareholder theory, management accounting system
is called upon to structure relationships as well as
possible, to thoroughly govern any business process and
allow only limited scope to decision-makers.
In shareholder theory it is clearly obvious that
shareholders, because of their large and risky stake,
have a strong motivation to monitor managers closely.
The number of large block shareholders and the total
percentage of shares they own define Ownership
concentration. High levels of ownership concentration
provide high monitoring of decision-makers and cause
managers decisions are intended to maximize shareholder
wealth [61].
If stakeholder groups become tightly linked together,
communicate effectively and act towards communal
goals, they will be able to avoid the issue of self-seeking
managers [34]. If management accounting systems
supply information to stakeholder groups,
encourage inter-stakeholder-communication and
lessen information asymmetry, high degree of
stakeholder concentration might be provided.
This fact that decision-making managers are
self-interested and seek their own interests,
management accountants oppose with some challenges
to persuade managers, to respect and consider
information in relation to all stakeholder groups and
financial as well as nonfinancial information. For this aim,
management accountants sometimes use intermediaries
such as other managers or superior employees who may
motivate decision-making managers to act in the best
value of stakeholder and to control the opportunistic
behaviors [59]. Therefore, management accountants
through task controls and result may be ensure that tasks
are completed in a predetermined way and motivate
employees and managers to pursue the corporations
2151
goals [47]. Restrictions to managerial behavior and
accuracy of managerial accounting mechanisms increase
the chance that managers do not act opportunistically
[62]. Boards of directors are another governance
mechanism to monitor and control managerial
decision-making, recommended originally for shareholder
oriented companies. Boards of directors fulfil reviews and
performance evaluation, penalties and reward for
managers, decrease managerial discretion and evaluate
decision-makers [29] [63] [43]. But, according to [61] the
effectiveness of controlling activities performed by
boards of directors similar to management accounting
systems depend on the board's composition. If actors of
corporation such as CEOs and other top-level managers
are board members, they may use their organizational
power to enforce opportunistic behavior. In this case,
management accounting systems by providing particular
information and techniques can influence decision-making
behavior [64].
CONCLUSION
In this research it is mentioned that shareholder
groups and managers have different interests and
managers as decision makers are presumed to be
opportunistic and self-interested.
Management accounting systems main role is to
align values and interests and resolve agency-difficulties
for maximizing shareholders value. In stakeholder theory,
managers are claimed to be collective-serving decision
makers who want to maximize stakeholders value.
This approach proposes a trust-based and not particularly
restrictive design of management accounting which
balances divergent interests of stakeholder. However,
both shareholder and stakeholder theory make a mistake
that lump a diversity of human behavior in a particular
narrow assumption. In this paper we considered
perspectives of decision-making behavior and show that
behavioral assumptions in stakeholder theory and
shareholder theory are also introduce new approaches like
stakeholder agency theory and stewardship theory for
designing management accounting structure. As a result
implications for design of management accounting are
argued and developed. Although, further research is
needed to investigate about how to deal with particular
behavioral patterns in management accounting`s design.
First of all, empirical assessment of behavioral
assumptions is needed, particularly regarding the
behavior of stakeholder agency theory and stewardship
theory.
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
Secondly, empirical evaluation is necessary to
assume the effects of management accounting systems on
decision-maker`s behavior. Because in reality it is hard for
stakeholders and management accountants to recognize
if managers as decision-makers is a self-seeking,
a collective serving steward or, utility maximizing
opportunist, it must be asked what results there are from
unsuitable behavioral assumptions. Finally, for answering
the question whether there are differences in efficacy
and effectiveness of management accounting systems in
shareholder companies with stakeholder-orientated
companies, more empirical investigations are
necessary. These approaches would take into account
the appropriate management accounting system`s
design via more sensitivity concerning decision-maker`s
behavior, even though some uncertainty in relation to
human behavior will still remain.
REFERENCES
1. Rasid, S.Z.A., A.R.A. Rahman and W.K.W. Ismail,
2011. Management accounting systems in Islamic
and conventional financial institutions in Malaysia,
Journal of Islamic Accounting and Business
Research.
2. Shah, H., A. Malik and M.S. Malik, 2011.
Sstrategic management accounting-a messiah for
management accounting?. Australian Journal of
Business and Management Research, 1(4): 1-7.
3. Brandau, M., R. Trapp and E. Weffort, 2012.
In search of identitiy - contingencies and
instituational pressures on management accounting
in brazil and germany. International Journal of
Business Research, 2012, 12(2): 44-61.
4. Hansen, D.R. and M.M. Mowen, 1994.
Management accounting. South-Western Publishing,
Cincinnati.
5. Freeman, E.R. and R.A. Phillips, 2002. Stakeholder
theory: a libertarian defense. Bus Ethics Q, 2002,
12(3): 331-349.
6. Weber, J., B. Hirsch, S. Linder and E. Zayer, 2003.
Verhaltensorientiertes controlling: Der Mensch im
Mittelpunkt. Wiley, Vallendar.
7. Wall, F. and D. Greiling, 2001. Accounting
information for managerial decision-making in
shareholder management versus stakeholder
management. Rev Manag Sci, 5: 91-135.
8. Roshan, B., 2009. Capital Structure and Ownership
Structure: A Review of Literature. The Journal of
Online Education, New York, January, pp: 1-8.
2152
9. Emmanuel, C., D. Otley and K. Merchant, 1990.
Accounting for management control. Chapman and
Hall, London.
10. Vilanova, L., 2007. Neither shareholder nor
stakeholder management. What happens when firms
are run for their short-therm salient stakeholder?
Eur. Manage J., 2007, 25(2): 146-162.
11. Crane, A. and T. Ruebottom, 2011. Stakeholder
Theory and Social Identity: Rethinking Stakeholder
Identification. J. Bus Ethics, 102: 77-87.
12. Ru hli E. and S. Sachs, 2003. Der Stakeholder
Ansatz. Ein umfassendes framework des
strategischen managements. In: Matzler K.,
Pechlaner H, Renzl B (eds) Werte schaffen.
Perspektiven einer stakeholderorientierten
Unternehmensfu hrung. Gabler Verlag, Wiesbaden,
pp: 49-71.
13. Friedman, A.L. and S. Miles, 2002. Developing
stakeholder theory. J. Manage Stud., 39(1): 1-21.
14. Post, J.E., L.E. Preston and S. Sachs, 2002.
Redefining the corporation. Stakeholder
Management and Organizational Wealth.
Stanford University Press, Stanford.
15. Jensen, M.C., 2002. Value maximization, stakeholder
theory and the corporate objective function.
Business Ethics Quarterly, 12(2): 235-256.
16. Sundaram, A.K. and A.C. Inkpen, 2004.
The corporate objective revisited. Organ. Sci.,
15(3): 350-363.
17. Jones T.W. and A.C. Wicks, 1999.
Convergent stakeholder theory. Acad. Manage Rev.,
24: 206-221.
18. Fligstein, N., 2001. The architecture of markets: An
economic sociology of twenty-first century capitalist
societies. Princeton, NJ, Princeton University Press.
19. Elliot, B. and J. Elliot, 2002. Financial Accounting and
Reporting. 12th ed. London: Prentice Hall/Financial
Times, 2002.
20. Jensen, M.C. and W.H. Meckling, 1676. Theory
of the firm: managerial behavior, agency costs and
ownership structure. J Finan Econ, 3(4): 305-360.
21. Eigler, J., 2004. Controlling, anreizsysteme und
verhaltenswissenschaften. In: Scherm E, Pietsch G
(eds) Controlling. Theorien und Konzeptionen.
Verlag Franz Vahlen, Mu nchen, pp: 665-690.
22. Davis, J.H., D.F. Schoorman and L. Donaldson, 1997.
Toward a stewardship theory of management. Acad
Manage Rev, 22(1): 20-47.
23. Quinn, D.P. andT.M. Jones, 1995. An agent morality
view of business policy. Acad Manage Rev,
20: 22-42.
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
24. Smith, J.H., 2003. The shareholder vs. stakeholder
debate. MIT Sloan Manage Rev, 44: 85-90.
25. Grundei, J., 2008. Are managers agents or stewards
of their principals? Logic, critique and reconciliation
of two conflicting theories of corporate governance.
J Betriebswirt, 58: 141-166.
26. Eisenhardt, K.M., 1989. Agency theory: an
assessment and review. Acad Manage Rev,
14(1): 57-74.
27. Agle, B.R. and R.K. Mitchell, 2008. Introduction:
recent research and new questions. Bus Ethics Q,
18(2): 153-159.
28. Scott, S.G. and V.R. Lane, 2000. A stakeholder
approach to organizational identity. Acad Manage
Rev, 25(1): 43-62.
29. Grundei, J., 2008. Are managers agents or stewards
of their principals? Logic, critique and reconciliation
of two conflicting theories of corporate governance.
J Betriebswirt, 58: 141-166.
30. Donaldson, L. andJ.H. Davis, 1991. Stewardship
theory and agency theory: CEO governance and
shareholder returns. Aust J Manage, 16(1): 49-64.
31. Jones, T.M., W. Felps and G.A. Bigley, 2007. Ethical
theory and stakeholder-related decisions: the role of
stakeholder culture. Acad Manage Rev,
32(1): 137-155.
32. Jost, P.J., 2001. Die prinzipal-agent-theorie im
unternehmenskontext. In: Jost P-J (ed) Die prinzipal-
agent-theorie in der betriebswirtschaftslehre. Scha
ffer-Poeschel, Stuttgart, pp: 11-43.
33. March, J.G. and H.A. Simon, Organizations. Wiley,
New York, 1958.
34. Hill, C.W.L. and T.M. Jones, 1992. Stakeholder-
agency theory. J. Manage Stud, 29(2): 131-154.
35. Naco, M., H. Cela and P. Dollani, 2010. The Ma na ge
ment Ac co un ting Prac ti ces in Al ba nia in the
Context of Globalization. WSPCZESNA
EKONOMIA Nr, 2010, 3/2010(15).
36. Zimmerman, J.L., 2009. Accounting for decision
making and control. The McGraw-Hill Companies
Inc., New York.
37. Lambert, R.A., 2001. Contracting theory and
accounting. J Account Econ, 32: 3-87.
38. Baiman, S., 1982. Agency research in managerial
accounting: a survey. J. Acc Lit, 1: 154213.
39. Wall, F., 2009. Stakeholder-orientiertes Controlling
als Koordination bei mehrfacher Zielsetzung. In: Wall
F, Schro der R (eds) Controlling zwischen
shareholder value und stakeholder value. Neue
Anforderungen, Konzepte und Instrumente.
Oldenburg Verlag, Mu nchen, pp: 345-363.
2153
40. Sprinkle, G.B., 2003. Perspectives on experimental
research in managerial accounting. Account Org Soc,
28(23): 287-318.
41. Ewert, R. and A. Wagenhofer, 2008. Interne
Unternehmensrechnung, 7th edn. Springer, Berlin,
42. Rowley, T.J., 1997. Moving beyond dyadic ties: a
network theory of stakeholder influences. Acad
Manage Rev, 22(4): 887-910.
43. Carney, M., E. Gedajlovic and S. Sur, 2010. Corporate
governance and stakeholder conflict. J Manage Gov,
14: 010-9135-4.
44. Chong, V.K., 1996. Management accounting systems,
task uncertainty and managerial performance: a
research note. Account Org Soc, 21(5): 415-421.
45. Horngren, C.T., S.M. Datar and G. Foster, 2006.
Cost accounting: a managerial emphasis, 12th edn.
Verlag Pearson/Prentice Hall Upper Saddle River, NJ,
46. Gladen, W., 2008. Performance measurement.
Controlling mit kennzahlen, 4th edn. Gabler Verlag,
Wiesbaden,
47. Atkinson, A.A., R.D. Banker, R.S. Kaplan and
M.S. Young, 1995. Management accounting. 2nd
edn. A Simon and Schuster Company, New Jersey.
48. Weienberger, B.E., 2009. Shareholder Value und
finanzielle Zielvorgaben im Unternehmen. In: Wall F,
Schro der R (eds) Controlling zwischen Shareholder
Value und Stakeholder Value. Neue Anforderungen,
Konzepte und Instrumente. Oldenburg Verlag, Mu
nchen, pp: 39-60.
49. Chong, V.K. and I.R.C. Eggleton, 2003. The decision-
facilitating role of management accounting systems
on managerial performance: the influence of locus of
control and task uncertainty. Adv Account,
20: 165-197.
50. Wall, F., 2006. Informationsmanagement. Verlag Franz
Vahlen, Mu nchen,
51. Schiller, U., 2001. Vom Nutzen (un-)informierter
Agenten: Eine informationso konomische
Betrachtung des Controllings. Z Betrieb Forsch,
53: 3-19.
52. Reynolds, S.J., F.C. Schultz and D.R. Hekman, 2006.
Stakeholder theory and managerial decision-making:
constraints and implications of balancing stakeholder
interests. J Bus Ethics, 64: 285-301.
53. Littkemann, J. and K. Derfu, 2009. Corporate
governance-gestaltung mithilfe des controllings?
Eine konflikttheoretische analyse. In: Wall F, Schro
der R (eds) Controlling zwischen shareholder
value und stakeholder value. Neue Anforderungen,
Konzepte und Instrumente. Oldenbourg Verlag, Mu
nchen, pp: 61-79.
 Middle-East J. Sci. Res., 23 (9): 2145-2154, 2015
54. Clarkson, M.E., 1995. A stakeholder framework for
analyzing and evaluating corporate social
performance. Acad Manage Rev, 22(1): 92-117.
55. Lambert, R.A., 2001. Contracting theory and
accounting. J Account Econ, 32: 3-87.
56. Jensen, M.C., Value maximization, stakeholder theory
and the corporate objective function. Eur Financ
Manag, 7(3): 297-317.
57. Weber, J., U. Bramsemann, C. Heineke and B. Hirsch,
2004. Wertorientierte Unternehmenssteuerung.
Konzepte Implementierung Praxisstatements.
Gabler Verlag, Wiesbaden,
58. Volkart, R., 1998. Shareholder value and corporate
valuation. Finanziele Wertorientierung im Wandel,
Versus, Zu rich,
59. Oviatt, B.M., 1988. Agency and transaction cost
perspectives on the managers-shareholder
relationship: incentives for congruent interests. Acad
Manage Rev, 13(2): 214-225.
60. Witt, P., 2001. Corporate governance. In: Jost P-J
(ed) Die prinzipal-agent-theorie in der bet-
riebswirtschaftslehre. Scha ffer-Poeschel Verlag,
Stuttgart, pp: 85-115.
2154
61. Hitt, M.A., D. Ireland and R. Hoskisson, 2005.
Strategic management: competitiveness and
globalization. Concepts and cases, 6th edn.
Thomson, Mason,
62. Schredelseker, K., 2003. Zwo lf Missversta ndnisse
zum Shareholder Value aus finanzwirtschaftlicher
Sicht. In: Matzler K, Pechlaner H, Renzl B (eds) Werte
schaffen. Perspektiven einer stakehold-erorientierten
Unternehmensfu hrung. Gabler Verlag, Wiesbaden,
pp: 102-123.
63. Demsetz, H. and K. Lehn, 1985. The structure of
corporate ownership: causes and consequences. J.
Polit Econ, 93(6): 1155.
64. Dominiak, G.F. and J.G. Louderback, 1991.
Managerial accounting. PWS-Kent Publishing,
Boston Donaldson L (1990). The ethereal hand:
organizational economics and management theory.
Acad Manage Rev, 15(3): 369-381.