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Chartered Management Accountant (CMA) Journal

VOL: 34.3 | MAY-JUN 2025

THEME:

Challenges to Business Sustainability in Pakistan

Category: Focus Section

Corruption and the Rising Cost of Business Operations

Authored by: Muhammad Moin Ahmed, ACMA

Keywords: Resource Misallocation, Anti-Corruption, Economic Growth

Summary

The article highlights the critical importance of Cost Control for Businesses and governments, noting that financial losses occur when expenses exceed revenues. Corruption, through bribery, favoritism, and misappropriation, significantly inflates operational costs, thereby reducing efficiency and public trust while hindering economic growth. The article emphasizes that for businesses, operational costs encompass expenses necessary for normal functioning, such as payroll and rent, while governments manage costs related to public services. Moreover, corruption compounds these issues by increasing business expenses and government expenditure through unjust practices and unlawful payments. The article concludes that the persistent corruption discourages investment and undermines economic stability. To mitigate these challenges, the article calls for strengthened anti-corruption institutions, enhanced transparency, and public awareness efforts for accountability and supporting sustainable economic growth.

Research & Publications Department