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RESEARCH PRODUCT

How Pioneering Managers Strive to Integrate Social Risk Management in Government Debt Collection

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This study explores risk management issues in local government-owned enterprises in accordance to the third wave of governance, organization and management logics of Public Administration: the Public Value approach. However, the coexistence between the emerging Public Value approach and the more traditional and consolidated ones is often difficult, also because of the resistance of shareholders who may not consider the management of system-level risks as a priority mission for their company. For this reason, we have analysed the strengths and weaknesses of the Traditional Approach and the New Public Management approach in the public sector management. The case study presented reveals some interesting critical factors influencing the transition towards a new model that incorporates a Public Value approach and reconciles it with the other, complementary logics, through the concrete efforts of implementing formal practices of social risk management. The paper is structured through the qualitative analysis of a debt collection company located in northern Italy, which can be a good example of how these tensions between the public and the private logic co-exist. Indeed, on one hand, while it cannot be allowed that unlawful conducts go unpunished, it is necessary to formally recognize the impact that a sensitive activity such as the debt collection can have on potentially fragile subjects. In other words, a social and a reputational risk have to be correctly managed. On the other hand, internal risks need to be monitored and the manager needs to keep the company in a profitable condition, ensuring the right balance between the used resources and the obtained results.