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Cross-functional budget governance as a mechanism for enhancing organizational cost control
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Thyago Macedo Lopes de Lima 
This work is licensed under a Creative Commons Attribution 4.0 International License.
Abstract
Organizations operating in decentralized and multi-departmental structures frequently face persistent challenges related to budgetary slack and limited independent scrutiny in budgeting processes. This study develops a conceptual framework to examine how accountability architecture redesign can enhance internal cost governance. Adopting a deductive conceptual research methodology grounded in agency theory, behavioral decision research, and responsibility accounting literature, the paper proposes the constructive organizational friction (COF) model and formalizes the cross-functional budget governance mechanism (CFBGM). Although the study does not rely on empirical sampling, it systematically synthesizes established theoretical perspectives to construct testable propositions. The findings suggest that structural redistribution of evaluative authority may reduce confirmation bias, mitigate informational asymmetry, and strengthen cost scrutiny within recurring budgeting cycles. The model contributes to corporate governance scholarship by conceptualizing friction as an architectural governance mechanism capable of reinforcing sustained cost discipline without intensifying hierarchical monitoring.
Keywords: Budget Governance, Cost Control, Cross-Functional Accountability, Management Control Systems, Internal Governance, Organizational Budgeting
Authors’ individual contribution: The Author is responsible for all the contributions to the paper according to CRediT (Contributor Roles Taxonomy) standards.
Declaration of conflicting interests: The Author declares that there is no conflict of interest.
JEL Classification: D23, G34, L20, M40, M41
Received: 20.02.2026
Revised: 09.04.2026; 22.04.2026
Accepted: 28.04.2026
Published online: 29.04.2026
How to cite this paper: Lopes de Lima, T. M. (2026). Cross-functional budget governance as a mechanism for enhancing organizational cost control. Corporate Ownership & Control, 23(2), 18–27. https://doi.org/10.22495/cocv23i2art2
