Electronic Accounting Enhances Good Governance: An Empirical Study on Bangladesh’s RMG Sector

Abstract

This study examines the impact of Electronic Accounting on strengthening good governance within Bangladesh’s Ready-Made Garment (RMG) sector, a vital contributor to the country’s economy. The sector is under growing pressure to enhance transparency, accountability, and ethical compliance amid rising global scrutiny. The purpose of this research is to assess how the adoption of electronic accounting systems such as Enterprise Resource Planning (ERP), digital payroll platforms, and supply chain management software contributes to measurable governance improvements in RMG firms. Using a convergent parallel mixed-methods approach, the study collected quantitative data from structured surveys of financial managers and compliance officers, and qualitative data through in-depth interviews with senior stakeholders across small, medium, and large RMG enterprises. Data were gathered from over 100 participants in key industrial zones, including Dhaka, Gazipur, and Chittagong. Statistical analyses, including regression and Structural Equation Modeling (SEM), were complemented by thematic coding of qualitative insights. The findings indicate that firms employing electronic accounting tools report a 45% reduction in financial discrepancies, a 35% improvement in supply chain transparency, and a marked increase in stakeholder trust. Automation in inventory management and payroll systems significantly minimized manual errors and enhanced internal control. However, the study also identified key barriers, including high initial costs, data privacy concerns, and a shortage of digitally skilled accounting professionals. The research has important implications for both practitioners and policymakers. It advocates for the strategic integration of electronic accounting into governance frameworks and recommends collaboration between industry associations and government bodies to develop standardized guidelines and offer capacity-building incentives. This study offers original, context-specific evidence from a developing economy, highlighting the transformational role of financial digitalization in governance reform. By bridging the gap between technology and institutional practices, it contributes to the growing discourse on digital accountability and responsible business conduct in emerging markets. Policy Implications: The revised abstract explicitly outlines the study's recommendations for policymakers, emphasizing the need for collaboration between industry associations and government bodies to develop standardized guidelines and offer capacity-building incentives. This addition strengthens the abstract by addressing the practical applications of the research findings. The abstract maintains a clear and concise overview of the study's objectives, methodology, findings, and implications, ensuring that readers can quickly grasp the significance of the research.