Financial governance and subcontracting in US defence firms: a predictive model for public accountability
Year: 2025
Type: article
Abstract: IMPACTThis study provides defence procurement managers, government auditors, and public financial controllers with a practical tool to anticipate subcontracting risks before they escalate into compliance issues. By applying an interpretable decision tree model to 10 years of US Department of Defense contracting data, it identifies cost-accounting and governance indicators that reliably predict when prime contractors are likely to outsource excessively. The framework translates complex financial and environmental, social and governance (ESG) information into simple, auditable rules that can be integrated into contract oversight dashboards or predictive audit systems. Practitioners at the strategic and operational levels—particularly those working in defence acquisition, financial governance, and risk-based auditing—can use these insights to focus monitoring resources where vulnerabilities are greatest. In a context of tightening defence budgets and increasing ESG scrutiny, the model supports earlier, data-driven intervention and more consistent accountability across the defence industrial base.
Source: Public Money & Management
Institutions: Universidad Politécnica de Cartagena, Universidad de Granada
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W4415733171