Transparency, Accountability, and Financial Performance: The Role of Civil Servant Capacity

DOI

10.2991/978-94-6239-709-5_26How to use a DOI?

Keywords

Transparency; Accountability; Financial Performance; Civil Servant Capacity

Abstract

This study examines how transparency and accountability affect the financial performance of local governments in Indonesia, emphasizing civil servant capacity as a moderating influence. Using new public management and principal-agent theories, with institutional theory and resource-based view, we propose a framework suggesting that transparency and accountability directly affect financial outcomes, depending on the local bureaucracy's human capital strength. Our hypotheses are tested using a cross-sectional design that integrates primary survey data from 120 local governments with verified administrative records. The results of the moderated multiple regression analysis show that transparency and accountability significantly enhance financial performance, as measured by budget realization rates, revenue collection efficiency, and fiscal discipline. Importantly, these effects are significantly moderated by civil servant capacity: in high-capacity environments, the link between governance and performance is nearly three times stronger than in low-capacity settings. Simple slope analysis demonstrates that transparency and accountability lead to substantial performance improvements only when the local bureaucracy has adequate professional, technical, and institutional capability. These findings highlight that effective fiscal governance requires adopting the right policies and developing human capital to implement them. We discuss the theoretical implications for public administration scholarship and offer practical recommendations for policymakers in Indonesia and other decentralized democracies. We contend that investing in civil servant capacity building is fundamental to translating good governance principles into tangible outcomes.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Fatmawati Fatmawati
AU  - Arifuddin Arifuddin
PY  - 2026
DA  - 2026/06/20
TI  - Transparency, Accountability, and Financial Performance: The Role of Civil Servant Capacity
BT  - Proceedings of the 10th International Conference on Accounting, Management, and Economics (10th ICAME 2025)
PB  - Atlantis Press
SP  - 361
EP  - 380
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-709-5_26
DO  - 10.2991/978-94-6239-709-5_26
ID  - Fatmawati2026
ER  -