Factors affecting chief executive officers’ managerial autonomy in municipally owned corporations: a qualitative study

The importance of managerial autonomy for organizational performance and accountability is increasingly acknowledged in municipally owned corporations (MOCs) operating within competitive environments. However, few studies have examined the factors enabling or restricting chief executive officers' (CEOs') managerial autonomy in companies reliant on local and central governments. Using the public agency autonomy perspective, we investigate the subjective perceptions of MOCs’ executives concerning three intertwined political and bureaucratic mechanisms. The results of our 18 semi-structured interviews with CEOs of such corporations in various Israeli municipal authorities identified three factors on the micro, meso and macro levels affecting their autonomy. These findings reveal a pattern whereby local political and bureaucratic actors try to engage in framed autonomy, in contrast to the administrative bureaucracy model of the central government that curtails the CEOs’ autonomy substantially. Consequently, this dynamic impedes MOCs from achieving their goals. This interplay of micro, meso and macro factors explains how tensions between local and central governments are reflected in the managerial operations of MOCs. Points for practitioners: Leverage Supportive Political Relationships to Navigate Constraints: Building trust-based ties with supportive political actors can help mitigate regulatory burdens and enable more adaptive decision-making within bureaucratic constraints. Balance Board Governance with Managerial Discretion: Practitioners should remain alert to how political appointments may influence operations and develop strategies to preserve managerial discretion while maintaining accountability. Promote Two-Way Engagement with Central Authorities: Public executives should advocate for more reciprocal relationships with central agencies, encouraging support-oriented oversight that acknowledges on-the-ground realities.