Identifying Corruption Hotspots in Subsidiary Companies of Public Non-Governmental Institutions: A Study Based on a Three-Dimensional Model

Purpose:



Administrative and economic corruption in subsidiary companies of public non-governmental institutions constitutes one of the most complex forms of organizational corruption within governance systems. Owing to their hybrid nature, these companies operate at the intersection of the state and the market, enjoy access to public resources, and yet remain weakly accountable to public opinion. This structural ambiguity exposes them to heightened corruption risks. Given their substantial share in the national economy and their involvement in large-scale infrastructure projects and public service provision, corruption within these companies generates consequences that extend far beyond the organizational level, potentially undermining public trust and the overall effectiveness of economic governance. The primary objective of this study is to identify and conceptualize corruption hotspots in subsidiary companies of public non-governmental institutions and to develop a coherent analytical framework based on a three-dimensional model encompassing structural, behavioral, and contextual dimensions. This framework seeks to move beyond the identification of isolated corrupt practices and instead focuses on the underlying mechanisms that enable the emergence, persistence, and institutionalization of corruption in this sector.



Design / Methodology / Approach:



This research is applied in purpose and adopts a qualitative and exploratory methodological approach. The chosen research strategy is thematic analysis. Data were collected through semi-structured interviews with 14 academic and executive experts selected via purposive sampling. Participants possessed substantial managerial, supervisory, or scholarly experience related to subsidiary companies of public non-governmental institutions, pension funds, and the fields of transparency and administrative integrity. The data analysis process followed the systematic stages of thematic analysis, including initial coding, identification of basic themes, development of organizing themes, and abstraction into overarching themes. Drawing on these analytical stages, the final conceptual framework was developed based on a three-dimensional model, explicitly articulating the interrelationships among structural, behavioral, and contextual factors. The inclusion of both academic and practitioner perspectives enabled the integration of theoretical insight with practical experience in identifying corruption hotspots.



Findings:



The findings demonstrate that corruption hotspots in subsidiary companies of public non-governmental institutions can be classified into three principal and interrelated categories. At the structural level, corruption-prone transaction systems, inefficient budgeting processes, and weak corporate governance were identified as the most critical bottlenecks. Concrete manifestations include fictitious transactions, stock price manipulation, opaque reallocation of budgetary resources, unrealistic financial reporting, and ambiguity in ownership and oversight structures. At the behavioral level, managerial politicization, the granting of exclusive and preferential privileges, unregulated transfers of public assets, and rent-seeking and collusive practices in tenders and contracts emerged as key behaviors that undermine transparency. These behaviors are largely institutionalized within environments characterized by weak accountability mechanisms, persistent conflicts of interest, and ineffective incentive and sanction systems. At the contextual level, frequent regulatory and legal changes, international sanctions, macroeconomic instability, and relationship-oriented organizational culture were found to create a favorable environment for the continuation and reproduction of corruption. The results clearly indicate that weak corporate governance plays a foundational and amplifying role in the corruption process; without comprehensive institutional redesign, isolated behavioral or cultural reforms are unlikely to yield sustainable outcomes. Accordingly, corruption in these companies should be understood not as sporadic misconduct but as a systemic consequence of dysfunctional institutional and managerial arrangements.



Limitations and Implications:



The study is subject to several limitations, including its qualitative nature, the relatively small number of participants, and its focus on the Iranian institutional context, which constrains statistical generalizability. Nevertheless, the diversity of expert perspectives and the detailed description of the research context enhance the conceptual transferability of the findings to other public and quasi-public organizations with similar governance structures. These limitations also point to opportunities for future research employing quantitative, comparative, or mixed-methods approaches.



Practical Implications:



The findings offer actionable insights for policymakers, supervisory bodies, corporate boards, and senior managers of public non-governmental subsidiary companies. The study highlights the necessity of reforming corporate governance structures, increasing transparency in budgeting and transaction systems, strengthening accountability mechanisms, and systematically managing conflicts of interest. Implementing these measures can significantly reduce corruption risks and improve the efficiency and integrity of public resource allocation.



Originality / Value:



The principal contribution of this study lies in proposing a context-sensitive and integrated analytical framework for identifying corruption hotspots in subsidiary companies of public non-governmental institutions based on a three-dimensional model. By moving beyond single-factor explanations, the study conceptualizes corruption as the outcome of dynamic interactions among structural, behavioral, and contextual dimensions. This approach provides both a robust theoretical contribution to the literature on corruption and governance and a practical foundation for designing more effective and sustainable anti-corruption policies.