The Relationship Between Management Control System on Corporate Sustainability in the Construction Industry

Corporate Sustainability (CS) involves an organisation to obey the principles of sustainable development that evolved from the corporate management paradigm, which is used deliberately as an alternative to the traditional growth and profit-maximization model. The construction industry has an important role in the economy of the country. This paper aims to investigate the relationships between MCS and CS in the construction industry. The study focused on the central and southern region of Peninsular Malaysia which comprises 726 companies listed in Real Estate Housing Development Association (REHDA) and 77 companies listed on Bursa Malaysia. Management Control System (MCS) is defined as the process by which managers assure that resources are obtained and used effectively and efficiently in the accomplishment of the organisation's objectives and organisation success. In this study, simple random sampling was used in the data collection. The sample size was determined by using G-power software and the respondents of the study are 84 in total. Structural Equation Model of Partial Least Square (SEM-PLS) software in SmartPLS 3.2.9 was used to examine the relationship between CS and MCS. The adapted questionnaire was based on two established questionnaire. The results of the study suggest that MCS has a positive impact on CS of the construction industry. The result is consistent with previous studies looking at the relationship between MCS and CS. In conclusion, from the result of this study, the housing development contractors are highly encouraged to implement MCS in increasing their CS because organization with high level of control systems have a higher level of sustainability in the industry. As this is considered to be a pioneer study, the finding of this study has laid a foundation for future directions and exploration in the context of MCS and CS of organisations