Integrated Post-Award Governance for Reducing Financial Leakages: A Financial Criminology Perspective

Financial leakages in public sector projects continue to undermine fiscal sustainability, public trust, and the effective utilisation of debt-financed public investments. Despite extensive research on procurement and project management, limited attention has been given to post-award governance as a preventive mechanism for reducing financial leakages from a Financial Criminology perspective. This study examines the influence of Comprehensive Accountability Structure (CAS) on the Reduction of Financial Leakages (RFL) through the mediating role of Change and Risk Management (CRM) within Malaysian public sector projects. Drawing upon Open Systems Theory as the primary theoretical framework and Transaction Cost Economics as a complementary perspective, the study proposes an integrated post-award governance model. Data were collected from 462 officers across 28 Federal Ministries in Malaysia and analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM). The findings reveal that Comprehensive Accountability Structure has a significant positive effect on Change and Risk Management (β = 0.697, p < 0.001), while Change and Risk Management significantly reduces Financial Leakages (β = 0.700, p < 0.001). Furthermore, Change and Risk Management significantly mediates the relationship between Comprehensive Accountability Structure and the Reduction of Financial Leakages (β = 0.488, p < 0.001). These findings demonstrate that effective post-award governance strengthens accountability, enhances organisational resilience, and reduces governance vulnerabilities that may create opportunities for financial misconduct and inefficient public resource utilisation. This study contributes to both the public governance and Financial Criminology literature by extending the application of Open Systems Theory to post-award public project governance while illustrating how governance mechanisms can function as preventive safeguards against financial leakages. The proposed integrated governance framework offers practical guidance for policymakers seeking to strengthen public financial management, improve value for money, and reinforce fiscal sustainability in debt-financed public investment programmes.