Does government policy matter? Factors influencing contractors' risk attitudes in the Malaysian construction industry: A structural equation modelling analysis

One of the critical factors responsible for the successful management of construction projects is individual factors. These factors play a significant role in the decision-makers' attitudes towards risks management. Many previous studies regarding the management of construction projects have focused on the factors contributing to the success of risk management. However, little attention has been given to factors severely affecting the decision-makers' risk attitudes with particular reference to an individual's risk factors in the construction industry. Therefore, this study aims to identify the factors affecting contractors' risk attitudes and then determine its relationship with government policy. Theories of planned behaviour and organisational control were used to develop the theoretical framework that investigated G-7 contractors in the Kuantan Pahang, Malaysian construction industry. A review of relevant literature and questionnaire was employed to identify the factors affecting contractors' risk attitudes (personal factors). 112 copies of a structured questionnaire were analysed with a response rate of 80%. Structural Equation Modelling SEM was utilised to test the hypotheses developed for the study. The results of this study, through SEM, proved that personal factors (working experience, professional competence and physical health) have a significant influence on contractor risk attitudes in the Malaysian construction industry. The findings of this research also confirm that government policy (rules and regulations) plays a moderating role in enhancing the relationship of personal factors affecting contractors’ risk attitudes in construction companies in Malaysia. The findings of the study provide more understanding of the personal factors that affect contractors' risk attitudes to facilitate contractors' decision-making process and serve as a useful reference for further studies in the field of construction project management