THE IMPACT OF ETHICAL LEADERSHIP ON INTERNAL CONTROL SYSTEMS

  • Afzal Izzaz Zahari School of Management, Universiti Sains Malaysia, 11800, Penang, Malaysia
  • Sharifah Norzehan Syed Yusuf Accounting Research Institute, University Technology MARA, 40450, Shah Alam, Malaysia
  • Jamaliah Said Accounting Research Institute, University Technology MARA, 40450, Shah Alam, Malaysia
  • Dewi Izzwi Abdul Manan Universiti Poly-Tech Malaysia, Taman Shamelin Perkasa, 56100, Wilayah Persekutuan, Kuala Lumpur, Malaysia
  • Hirnissa Mohd Tahir Universiti Poly-Tech Malaysia, Taman Shamelin Perkasa, 56100, Wilayah Persekutuan, Kuala Lumpur, Malaysia

Abstract

Purpose: The paper aims to investigate the impacts of ethical leadership on the effectiveness of internal control systems in government departments

 

Design/methodology/approach: The investigation is based on 182 distributed survey questionnaires provided to government department employees in managerial positions. The questionnaire items relating to ethical leadership are based on the components of role-modelling, strictness and openness. Internal control systems were evaluated based on the COSO framework, and the hypotheses were tested using regression models on the correlation between ethical leadership and internal control systems.

 

Findings: The major conclusion of the study is that there is a significantly positive correlation between ethical leadership and internal control systems. The study points out the importance of ethical leadership in ensuring the effectiveness of internal control systems.

 

Contribution: The results provide insight and information on how to enhance internal control systems through ethical leadership. The study also contributes to internal control systems literature by providing empirical evidence on the causal effect that a leader has on systems effectiveness.

Keywords: Ethics, government, internal control, leadership, public sector.

 

Cite as: Zahari, A. I., Syed Yusuf, S. N., Said, J., Abdul Manan, D. I., & Mohd Tahir, H. (2023). The impact of ethical leadership on internal control systems. Journal of Nusantara Studies, 8(TI), 1-25. http://dx.doi.org/10.24200/jonus.vol8issTIpp1-25

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Published
2023-09-30
How to Cite
Zahari, A. I., Syed Yusuf, S. N., Said, J., Abdul Manan, D. I., & Mohd Tahir, H. (2023). THE IMPACT OF ETHICAL LEADERSHIP ON INTERNAL CONTROL SYSTEMS. Journal of Nusantara Studies (JONUS), 8(3), 1-25. https://doi.org/10.24200/jonus.vol8iss3pp1-25