INFORMAL DECISION-MAKING PRACTICES AND PROJECT TRANSPARENCY IN PAKISTAN’S PRIVATE SECTOR: THE MODERATING ROLE OF ORGANIZATIONAL FORMALIZATION

Abstract

This study investigates the impact of informal decision-making practices on project transparency in Pakistan’s private sector and examines the moderating role of organizational formalization. Drawing on a quantitative research design, data were collected through a structured questionnaire from project managers, team leaders, and coordinators across multiple private sector industries. Using SPSS and Hayes’ PROCESS Macro (Model 1), the study tested the direct relationship between informal decision-making and project transparency, as well as the moderating influence of formal organizational structures. The findings indicate that informal decision-making practices significantly reduce project transparency due to selective information sharing, undocumented approvals, and reduced accessibility for stakeholders. However, organizational formalization mitigates this negative effect, as formal rules, procedures, and documentation ensure that decisions are traceable, communicated effectively, and aligned with governance standards. The study contributes to project management literature by highlighting the interplay between informal organizational behavior and formal structures in shaping transparency. Practically, the findings suggest that private sector organizations can enhance transparency by balancing informal flexibility with formalized procedures, thereby improving accountability and project governance.