The effectiveness of financial governance practices on the environmental performance of the municipalities in developing countries

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Abstract

The paper examines the relationship between municipal financial management practices (MFMPs) and environmental performance (EP) in South African municipalities (SAMs). The need for study is driven by prevailing EP challenges, as exhibited by poor waste management practices in the local municipalities (Bikam & Chakwizira, 2021). To achieve this objective, the study employed robust standard errors to analyse panel data collected by quantitative content analysis from online sources regarding thirty SAMs during the period spanning 2014 and 2023. The study found a positive, insignificant relationship between MFMPs and EP. The study’s findings have crucial implications for many stakeholders, including policymakers, the national government, and local municipalities, as the need to review and enforce compliance with the existing financial management framework remains pertinent to addressing environmental challenges. The study’s findings influence decisions on MFMPs, as a commitment to managing the ecological environment, which presents an additional dimension of addressing waste management challenges. Therefore, future research must aim to broaden this agenda, which remains imperative to promoting sustainable environmental management practices (EMPs) from a financial management perspective.

Keywords: Environmental Performance, Financial Management Practices, Municipalities, Service Delivery, Waste Management

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: G13, Q51, Q53, Q54, Q56

Received: 30.04.2025
Revised: 12.08.2025; 30.01.2026
Accepted: 02.03.2026
Published online: 04.03.2026

How to cite this paper: Mukwarami, S. (2026). The effectiveness of financial governance practices on the environmental performance of the municipalities in developing countries. Journal of Governance and Regulation, 15(2), 69–81. https://doi.org/10.22495/jgrv15i2art6