The Controller as Choice Architect

Management accountants are choice architects: they provide information that is used in managerial decision making and they have considerable influence on the monetary and non-monetary incentives that drive managers’ decision-making processes. Over the past two decades, our knowledge of how people make economic decisions has increased tremendously. However, this has had only very little impact on the design of management accounting and control systems in organizations. Consequently, management accounting is (again) at risk of becoming irrelevant. To secure its relevance, management accountants need to become aware of their role as choice architects and need to develop into professionals whose core competence is to provide insight into quantitative information as a product of human decision making and, vice versa, to explain and predict decision-making behavior as a response to quantitative information. Academic management accounting research should facilitate this development. How this can be done is illustrated using three examples of practically relevant research areas: subjective performance evaluation, internal transparency and the design of the control function in organizations.

Victor Maas is professor of management accounting at the Erasmus School of Economics (ESE). He holds a Chair endowed by the Erasmus University Trust Fund. His research interests include the design of incentive and reward systems, performance measurement and evaluation processes, and the role of the controllership function in organizations. He has published in several national and international journals including The Accounting Review, Accounting and Business Research, Behavioral Research in Accounting, European Accounting Review, British Journal of Management and Journal of Business Ethics. Victor Maas received his PhD in business economics from the University of Amsterdam. Before joining Erasmus School of Economics as associate professor in March 2011, he worked as assistant professor at the Amsterdam Business School.