Revista Ciencia UNEMI

Vol. 19, N° 50, Enero-Abril 2026, pp. 43 - 55

ISSN 1390-4272 Impreso

ISSN 2528-7737 Electrónico

https://doi.org/10.29076/issn.2528-7737vol19iss50.2026pp43-55p

Effect of participatory budgeting on the social

responsibility of managers mediated by

professional ethics

Jamalleddin Mahdiyan Nasab^1*; Javad Madani²; Habib Ebrahimpour³

Abstract

Direct participation of people in budgeting is examined under the title of participatory budgeting (PB), and research results con-

firm its effect on improving performance and achieving organizational goals. This study aims to investigate the effect of PB on the

Hamadan Municipality Organization and also on the social responsibility of managers through professional ethics. The statistical

population of this study comprises 160 managers of Hamadan Municipality. The sample size is determined using the Morgan Table

and the Cochrane formula (n=113). Data are collected through stratified random sampling using a comprehensive, researcher-de-

signed questionnaire that integrates Belkaoui PB (1990), Maignan and Ferrell CSR (2002), and Cadozier PE (2002) questionnai-

res. Research analysis is conducted using SPSS and PLS software. Results indicate a positive and significant nexus between PB and

the social responsibility of managers, both directly and indirectly, through the mediating role of professional ethics.

Keywords: Participatory Budgeting, Social Responsibility of Managers, Professional Ethics, Budgetary Participation, Hamadan

Municipality.

Efecto del presupuesto participativo en la

responsabilidad social de los directivos mediado

por la ética profesional

Resumen

La participación directa de las personas en la elaboración del presupuesto se analiza bajo el concepto de presupuesto participativo

(PP), y los resultados de investigaciones previas confirman su efecto en la mejora del desempeño y el logro de los objetivos organi-

zacionales. Este estudio tiene como objetivo investigar el efecto del PP en la Organización Municipal de Hamadán y también en la

responsabilidad social de los directivos a través de la ética profesional. La población estadística de este estudio está compuesta por

160 directivos de la Municipalidad de Hamadán. El tamaño de la muestra se determina mediante la tabla de Morgan y la fórmula de

Cochran (n=113). Los datos se recopilan mediante un muestreo aleatorio estratificado utilizando un cuestionario integral diseñado

por los investigadores, que integra los cuestionarios de Belkaoui PB (1990), Maignan y Ferrell CSR (2002) y Cadozier PE (2002). El

análisis de la investigación se realiza utilizando los softwares SPSS y PLS. Los resultados indican una relación positiva y significativa

entre el PP y la responsabilidad social de los directivos, tanto de manera directa como indirecta, a través del papel mediador de la ética

profesional.

Palabras clave: Presupuesto participativo, Responsabilidad social, Ética profesional, Participación presupuestaria, Municipalidad

de Hamadán.

Recibido: 29 de septiembre de 2025

Aceptado: 03 de diciembre de 2025

¹M.Sc. of Public Administration, Department of Public Administration and Tourism, Faculty of Social Sciences, University of Mohaghegh

Ardabili, Ardabil, Iran. https://orcid.org/0009-0007-7694-7072

²Assistant Professor, Department of Public Administration and Tourism, Faculty of Social Sciences, University of Mohaghegh Ardabili,

Ardabil, Iran.https://orcid.org/0000-0001-7204-5572

³Professor, Department of Public Administration and Tourism, Faculty of Social Sciences, University of Mohaghegh Ardabili, Ardabil,

Iran. https://orcid.org/0000-0001-6498-2400

^*Corresponding author mahdiyannasabjamalleddin@gmail.com

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Volumen 19, Número 50, Enero-Abril 2026, pp. 43 - 55

rights and initiatives under the leadership of people

I. INTRODUCTION

and citizens over the past 40 years. He believes that PB

is the best measure intended to achieve environmental

goals and social responsibilities around climate change.

He indeed introduces the green PB.

Optimal use of resources is an inevitable issue

under the current economic conditions and rarely

available resources. This occurs when organizations

have accurate planning for use of resources and

required surveillance to achieve the planned goals.

The effectiveness of surveillance and planning

systems is substantial for motivating subordinates

and encouraging them to participate in the budgeting

process. These motivational and cognitive mechanisms

allowparticipatorybudgeting(PB)amongsubordinates.

Motivational mechanisms include making subordinates

familiar with budgeting importance, helping them

understand the occupational conditions, etc. Public

participation in budgeting is such an important case

that people gain greater trust in the management

system and governance, paying taxes and tolls easily.

PB is an instrument used to improve the democratic

process by allowing people to directly express their

ideas about how to use public budget (Benade et al.,

2018). PB has been adopted worldwide since its first

application in the municipality budget. PB is done

within two steps. First, citizens provide their proposals,

some of which are in the final list; then they vote for

the final projects regarding the limitations set by the

budget (Rey et al., 2020).

Aziz and Shah (2020) conduct a study entitled

“participatory budgeting: models and approaches" and

define PB as a democratic approach to deciding the

funding of public projects, which has been adopted in

many cities across the world.

The most precious contribution of PB is its capacity

andabilitytoprovideimaginativeandcreativesolutions,

which are chosen through participatory procedures.

They can provide valuable inputs to design plans and

policies on reducing climate change locally with global

impacts (Cabannes, 2021). With the development of

stakeholder theory, the concept and philosophy of

social responsibility are integrated into the structured

(systematic) vision of the organization regarding the

dynamic communication between companies and their

stakeholders.

Social Responsibility (also called Corporate Social

Responsibility (CSR)) includes four economic, legal,

ethical, and philanthropic dimensions based on the

definition presented by Carroll. According to these

elements, a corporation or organization that is socially

responsible must try to obey laws and ethics and be a

good corporate (organizational) citizen to earn profit.

Many researchers have structured their theories based

on Carrol's work and developed these components.

According to Díaz and Bolívar (2014), the foundations

provided by different CSR definitions show the need

for management based on the strategic elements of

environmental quality, safety, and occupational health

that should contribute to improving performance in

human talent processes, strengthening the confidence

of collaborators and community towards the

organization, and influencing them in the management

of human talent (Ramírez et al., 2018). According

to Antelo and Robaina (2015), CSR is the ongoing

commitment to sustainable economic development

through improving the life quality of employees,

families, the local community, and society. It tends

to take measures that link stakeholders and is in

favor of vulnerable individuals. Lotero (2015) states

that social responsibility is the sum of management

responsibilities that pertain to laws, the environment,

business results, ethics, and transparency concerning

the groups involved in the business.

Budgeting and urban management researchers

and experts have introduced various definitions

and subsequent classifications for PB regarding the

nature of the context. This classification depends on

different tastes because PB is based on the general

principle of direct public participation or a structure

that differs from the representative model. This kind of

classification cannot be further developed and defined.

However, PB now is classified based on the project

types regarding executive operations.

Aziz and Shah (2020) classify PB into two types:

divisible and indivisible PB. PB is a popular voting

method, which is used to distribute a limited budget

(divisible resources, such as money, time, etc.) among

proposed options (that are called projects). PB is

broadly categorized as divisible PB (if the projects are

fractionally implementable) and indivisible PB (if the

projects are atomic) (Sreedurga et al., 2021).

The studies conducted on PB by scholars reveal

the importance of this case. Yves Cabannes is an urban

activist, researcher, and expert who has been involved

in the study and development of urban and housing

44 │

Mahdiyan. Effect of participatory budgeting on the social responsibility

"consequences of social and environmental corporate

responsibility practices: managers’ perception in

Business-related social responsibility consists

of promoting responsible business procedures

that are beneficial for businesses and society and

contribute to sustainable social, economic, and

environmental development by maximizing the

positive effect of business on society and minimizing

the negative impact on the environment (Chumarina

Mozambique” (Madime

&

Gonçalves, 2022), the

relationship between all core components of the social

and environmental practices and economic, financial,

social, and environmental performance is positive but

insignificant except for social practices of community

support, which have a weak relationship with the

&

Abulkhanova, 2021). Now, the importance of

economic-financial

performance,

environmental

CSR is undeniable, so a movement has been shaped

around this topic across the world. The reason for this

fact is numerous academic research and initiatives

conducted and promoted by commercial institutions,

non-governmental organizations, and UN-associated

institutions (Barbieri & Cajazeira, 2012). However,

academic studies on CSR advantages and its effect on

the performance of organizations and corporations

have shown contradictory results (Gonçalves et al.,

2021). It has been revealed that since its creation,

socio-environmental movement is not considered a

configured integrated and homogenous movement. On

contrary, it presents a multifaceted character due to

the plurality of visions, values, and objectives in which,

the formation of a global movement occurs. While

some sectors of the company or corporation consider

CSR a financial loss, others see it as a strategy to

increase economic-financial, social, and environmental

performance (Madime & Gonçalves, 2022).

performance, and social performance, as well as

the environmental practices. The data indicate that

incentive economic-financial strategies and policies

must be strengthened for the agents who promote good

CSR practices in the country to achieve satisfactory,

measurable, and comparable economic-financial,

social, and environmental performances.

Gajadhur (2022) reviews and incorporates the

findings of academic CSR and sustainability studies

to direct hotels in achieving sustainability through

CSR projects. In this way, this researcher provides the

field for companies to participate in CSR activities by

identifying the advantage and return rate of investment

in CSR activities in relevant sectors. On the other hand,

the risk of mistakes and violations may increase due to

complicated societal conditions, enhanced structures

and tasks of organizations, and inevitable faults or

unethical and illegal behaviors. Such situations occur

because it is difficult to monitor employees, especially

in service organizations such as municipalities where

people have more demands. Such high demand for

urban services and interaction between people and

employees may lead to the abovementioned faults and

violations. Therefore, surveillance and management

of monitoring systems for employees and managers

are not sufficient because many faults and violations

occur from decision-making and design steps to

implementation and services despite the existence of

surveillance organizations in governmental and urban

management structures.

In addition to profitability and earning

a

profit, organizations need to invest in the future by

making people aware of their products and services.

Therefore, the growth, continuity, and survival of any

organization depend on the economic, environmental,

and social conditions in which they act. In this case,

the main aspects of business ethics shape the base

for development and adherence to CSR (Aimkij et al.,

2013).

Increasing awareness of the severe social

and environmental impacts of corporations and

organizations and attention to CSR targets sustainable

development (Marí-Farinós, 2017). For this purpose,

CSR must be integrated into different business and

organizational strategies and procedures to provide the

field for management of three economic, social, and

environmental fields. Consideration of CSR ensures

that measures cover more objectives beyond the short-

term and instant goals (Ashrafi et al., 2018).

Professional ethics in each profession and job

and adherence to it can perform as an organizational

and trans-organizational tool to prevent such faults

and violations (if an organization adopts specific

educational plans and recruitment commitments to

increase attention level and apply professional ethics,

professional ethics is seen as an intra-organizational

agent. On the other hand, the case is seen as an

individual and trans-organizational agent if employees

Studies conducted on CSR confirm the mentioned

points. According to the results of the study entitled

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Volumen 19, Número 50, Enero-Abril 2026, pp. 43 - 55

(squared value) of 58%, and the dominant variable that

and managers adhere to ethics before entering the

organization). Professional ethics has a positive and

significant effect on both organizational commitment

and the official performance of employees. This

case leaves some consequences for the theoretical

development of human resource management,

particularly by concentrating on organizational

citizenship behavior (OCB) regarding leadership,

ethics, and competency factors that can determine

commitment to the organization and corporation.

This also may have some consequences for operating

achievement and performance. Practical concepts

recommend management apply transformational

leadership, professional ethics, and work competence

to increase organizational commitment and foster

performance (Endri et al., 2022).

affects organizational commitment is work competence.

According to the findings of this study, in addition to

other factors, professional ethics has a positive and

significant effect on both organizational commitment

and the official performance of employees.

Moreover, ethical issues are more complicated

in financial and accounting affairs in the presence of

mutual effect between professional and personal (or

misbehavior)ethics.Ethicalandotheraspectsmeanthat

organizations and institutions that deal with financial

and accounting affairs need reliable ethical leaders that

can positively influence the management performance

and activity of all teams. On the other hand, ethics is

more important in accounting and financial affairs, and

playing the role of an ethical leader in a human team is

required more than before (Williams & Seaman, 2016).

Therefore, the importance and necessity of the

view must be examined regarding the effect of PB on

managers' CSR due to the advantages of participation

of people and employees in the budgeting process

and the incidence of the nation-state phenomenon

in this context. On the other hand, more attention

must be paid to the important aspects of managers'

CSR through professional ethics in management and

budgeting measures. Therefore, this study aims to

examine the impact of PB on managers’ CSR with

mediating role of professional ethics (Case Study:

Hamedan Municipality).

Professional ethics includes principles that

individuals must follow voluntarily based on their

consciousness when doing a professional activity

without having any external commitment; otherwise,

they are legally punished. Individual ethics is the

person's responsibility for their behaviors as a human,

while professional ethics is defined as the responsibility

for professional behavior as an occupation owner

or organizational position (Menbarrow, 2021).

Two specifications can be seen in most definitions

provided for professional ethics: A) attitude of

individual originality or individualism, B) restricted

responsibilities and ethical requirements in the job

(Endri et al., 2022).

The conceptual model is designed by illustrating

the type of nexuses to analyze the correlation between

variables by investigating variables and their roles in

the research process.

Today, professional ethics is the missing loop of

a sound and effective management chain that draws

the attention of managers towards ethical principles

indigenously. This factor is required for the self-

monitoring and self-purification of managers in

the current management system of organizations.

Organizations that have managers with professional

ethics are distinguished from others. Endri et al. (2022)

carry out a study to empirically prove the “influence

of transformational leadership, professional ethics,

work competence on commitment and its implications

for the performance of Ship Safety Supervisors in the

Coordination Work Area of the Tanjung Priok Main

Harbormaster Office of the Ministry of Transportation.”

The results indicate that partially or jointly

transformational leadership, professional ethics, and

work competence have a positive and significant effect

on organizational commitment with a contribution

II. METHODS

This was a descriptive, survey-type study with a

quantitative design, and its bibliographic review started

in October 2021. Field studies and data collection were

conducted in August 2022. The statistical population

of the study comprised 160 managers of Hamedan

Municipality, including the mayor general, deputy

mayors, managers of subsidiary organizations, and

mayors and managers of four districts. The sample size

was determined as 113 based on the Morgan table and

Cochrane formula. The stratified random sampling

method was used, and data were collected through a

comprehensive, researcher-designed questionnaire

that included four parts. The first part comprised

46 │

Mahdiyan. Effect of participatory budgeting on the social responsibility

two researcher-made sections:

a

demographic

which comprised 16 items. Finally, 99 questionnaires

were collected and analyzed. Data analysis was

conducted using SPSS and PLS software with statistical

techniques including structural equation modeling, Z

index, Kolmogorov–Smirnov test, Skewness, Kurtosis,

Levene's test, and Variance Inflation Factor (VIF). Data

processing was performed through partial least squares

modeling (PLS-SEM), Fornell–Locker, and HTMT

criteria. Internal and external models were illustrated,

and the final model was analyzed in terms of standards

and significance, then the effects of variables on each

other and their relationships were examined.

questionnaire and some purposeful questions about

the conceptual framework of the study. The second

section included Belkaoui's (1990) PB questionnaire,

which contained 40 items in three parts on a 5-point

Likert scale. Section three included Maignan and

Ferrell's (2002) CSR questionnaire, the revised version

of organizational social responsibility by Carroll (1991),

whichconsistedof33questionsbasedona5-pointLikert

scale and covered four dimensions: economic, legal,

ethical, and philanthropic. The fourth section included

Cadozier's (2002) professional ethics questionnaire,

Figure 1. Conceptual Model.

Conceptual Framework and Instruments

In explaining the conceptual framework above,

it should be stated that PB acted as the independent

variable, and its main components were expressed

within the structure of Hamedan Municipality. To

achieve these objectives, the researcher designed a PB

model based on the following components: executive

infrastructure (referring to the current budgeting

mechanism in the country's municipalities), existing

capacity (referring to the role of neighborhood

councilors as the first step for participatory budgeting),

managers’ perspectives (referring to the way managers

perceived people’s awareness and participation in

budgeting), and future strategy (referring to the

and 40 items, was used to assess the final component

of participatory budgeting, namely the participation of

municipal employees in budgeting. The second variable

in the conceptual framework, social responsibility,

served as the dependent variable and included four

dimensions according to Carroll’s definition (Carroll,

1991). In the third part of the research questionnaire,

this variable and its role were examined using Maignan

and Ferrell's questionnaire (Maignan & Ferrell, 2002),

which contained 33 items across the four dimensions.

Finally, the mediating variable, professional ethics, was

included in the framework. In the fourth part of the

research questionnaire, following its study, Cadozier's

Professional Ethics Questionnaire (Cadozier, 2002),

including 16 items and eight components, was applied.

implementation of participatory budgeting).

A

researcher-made questionnaire was also developed to

examine these components. Moreover, Belkaoui's PB

Questionnaire (Belkaoui, 1990), including three parts

III. RESULTS

Demographic-Descriptive findings

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Volumen 19, Número 50, Enero-Abril 2026, pp. 43 - 55

In the present study, the majority of the sample

The largest group was with 16 to 20 years of experience

(31.3%), while 7.1% had less than 5 years of experience.

Most of the respondents were senior employees (55.6%)

(Table 1)

was male (77.8%) and female (22.2%). Most of the

respondents were in the age group of 30 to 50 years.

Table 1. Frequency distribution of demographic profile.

Gender

Absolute frequency

Frequency (%)

Relative cumulative frequency (%)

Male

Female

Age

77

77.8

22.2

77.8

100

22

≤30

1

1.0

43.4

46.5

9.1

1.0

44.4

90.9

100.0

30-40

41-50

>50

43

46

9

Education

Diploma

2

32

56

9

2.0

32.3

56.6

9.1

2.0

34.3

90.0

100

BA

MA

Ph.D.

Work experience

<5

7

7.1

6-10

19

26

31

16

19.2

26.3

31.3

16.2

26.3

52.5

83.8

100

11-15

16-20

>20

Job position

Mayor

1

1.0

21.2

44.4

100

Manager

Deputy

20

23

55

20.2

23.2

55.6

Senior-level employee

Budgeting experience

I have

60

39

99

60.6

39.4

100

60.6

100

I do not have

Total

48 │

Mahdiyan. Effect of participatory budgeting on the social responsibility

Table 2. Reports descriptive statistics of variables:

Table 2. Descriptive statistics of variables.

Criterion

Executive infrastructure

Mean

2.38

2.04

3.13

3.80

3.88

3.18

3.82

3.73

3.99

3.82

4.44

4.61

3.46

4.34

3.08

4.10

4.41

4.38

4.10

SD

0.51

0.70

0.73

0.88

0.93

0.56

0.81

0.71

0.57

0.53

0.57

0.59

1.03

0.67

1.25

0.78

0.66

0.58

0.46

Med

2.33

2

Min

1

Max

4

Available capacity

Managers’ view

1

3.13

4

1.30

1.33

1

5

Future strategy

5

Employee participation

PB (PB)

4

5

3.18

4

1.93

1

4.70

5

Legal dimension

Economic dimension

Ethical dimension

The philanthropic and national dimension

CSR

3.78

4

1.11

2.40

2.33

2.50

2.5

1.50

2

5

4

5

3.79

4.50

5

Accountability

5

Honesty

5

Justice and fairness

Loyalty

3.50

4.50

3

5

Competition

1

5

Respect others

4

2

5

Empathy for others

Respecting social values and norms

Professional ethics

4.50

4.19

1.50

3

5

2.81

5

Inferential analysis

Table 3 reports the results of Kolmogorov Smirnov

and Levene's tests.

Table 3. Testing normal distribution of variables.

Criteria

Kolmogorov Smirnov Z

Sig.

PB

CSR

0.061

0.830

1.977

0.144

Professional ethics

0.127

0.076

0.877

0.420

0.054

0.918

1.967

0.146

Levene's test

Sig.

According to the Table 3 Since the significance level

of all variables is greater than α=0.05, parametric tests

can be used to test these variables. Moreover, Table

3 indicates the homogenous variance of all variables

regarding the Sig value>0.05.

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Volumen 19, Número 50, Enero-Abril 2026, pp. 43 - 55

Table 4. Standardized factor loads and validity-reliability indicators of constructs.

Average

variance

extracted

(AVE)

Standard

factor load

Cronbach’s

Composite

reliability

Variable

Items

alpha

Executive infrastructure

Available capacity

Managers’ view

Future strategy

Employee participation

Ethical

0.743

0.669

0.703

0.812

0.693

0.837

0.785

0.680

0.744

0.781

0.632

0.784

0.783

0.648

0.758

0.766

0.613

PB

0.728

0.762

0.751

0.524

0.583

Economic

CSR

0.848

Philanthropic

Legal

Respect others

Competition

Respecting norms

Honesty

Professional

ethics

0.794

0.852

0.524

Justice and fairness

Accountability

Empathy for others

Loyalty

According to Table 4, the indicators selected for

measuring model constructs required accuracy because

all factor loads were greater than 0.7. Moreover, AVE

values of all constructs were greater than 0.5 indicating

the internal validity of variables. The composite

reliability index was greater than 0.7 indicating the

internal consistency of reflective measurement models.

Therefore, each construct of the model had suitable

validity and reliability for measuring variables.

Table 5. Fornell-Locker index for measuring discriminant validity.

Variables

Professional ethics

PB

CSR

Professional ethics

0.724

0.509

0.466

PB

0.726

0.609

CSR

0.764

Table

5

indicates that all constructs are

PLS-SEM modeling was used to examine the

conceptual model of the study. The Path coefficients

were at standard mode and their values vary between

-1 and +1.

independent; it means that diagonal values (the second

root of AVE) of each latent variable are greater than the

correlation between the variable and other reflective

latent variables in the model.

50 │

Mahdiyan. Effect of participatory budgeting on the social responsibility

(A)

(B)

Figure 2. A) Primary model in standard mode, B) primary model in significance mode.

Table 6. Model quality indicators

Coefficient of

Determination (R²)

0.259

Redundancy

factor (Q²)

Good of Fit

(GOF)

Model quality

Professional ethics

0.290

0.327

0.296

PB

0.318

CSR

0.404

According to Table 6, the independent variable

(PB) is the predicted 26% of the variance in mediating

variable (professional ethics) and 40% of the variance

in the dependent variable (CSR). The redundancy

index, which is similar to the Stone-Geisser indicator

examined the model's ability for prediction by omission.

When this index is greater than 0, the observed values

are well restored, and the model has prediction power.

In this research, the redundancy index equaled 0.290,

0.327, and 0.296 for professional ethics, PB, and CSR,

respectively.

GOF is the most important index in the PLS

technique. According to the obtained GOF=0.318 for

this model and the opinion of Wetzels et al. (2009), the

model had a suitable GOF.

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Volumen 19, Número 50, Enero-Abril 2026, pp. 43 - 55

Table 7. Results.

Path

Path coe icient

0.503

t-value

6.781

p-value

0.001

Result

PB → CSR

Confirmed

PB professional ethics → CSR

0.107

2.432

2.759

0.015

Professional ethics → CSR

0.210

0.006

with the case study (i.e., hospitals in Venezuela).

The results of Table 7 indicated that the direct path

coefficient between PB and CSR equaled 0.503. The

t-value equaled 6.718 at the significance level of 0.001,

which is less than the default value of α=0.05; therefore,

this path coefficient is significant at the confidence level

of 95%. Therefore, PB influenced CSR. Deliberative

democracy is one of these features, which is called

empowered consultation. Another feature was fostering

and developing the consultation process based on

collective wisdom and linking operations to discussion

and accurate examination so that projects were

implemented according to people's opinions. The most

critical point in PB was alleviating people's indifference

to urban management, which improved convergence

with the organizational structure and reduced political

indifference, mistrust, and dissatisfaction. According

to the results of studies conducted on the importance

of the environment and its high contribution to social

responsibility, the findings of this study aligned with

those obtained by the following studies. Madime and

Gonçalves (2022) indicated a positive but insignificant

relationship between all major components of social

and environmental practices and economic-financial,

social, and environmental performance; therefore,

incentives, economic-financial policies, and strategies

needed to be strengthened for agents promoting good

CSR practices to achieve satisfactory, measurable,

and comparable economic-financial, social, and

environmental performance. Moreover, Cabannes

(2021) and Karimi Kondozi (2021) highlighted

the influence of environmental management in

Kashan Municipality on the CSR of the organization.

Therefore, environmental issues must be considered

when providing services and implementing measures

to achieve sustainable development, appropriate

performance, and social responsibility. However, this

finding did not align with results obtained by Ramírez

et al. (2018), who explained that social responsibility

principles were absent in the strategic management of

human talent, and labor standards were often ignored,

disadvantaging the principles of anticorruption, human

rights, and the environment, which was not consistent

Theresultsindicatedthattheindirectpathcoefficient

of PB and CSR through professional ethics was 0.107.

The t-value was 2.432 (Sobel) at the significance level

of 0.015, which was less than the default value of

α=0.05. Therefore, professional ethics could mediate

the relationship between PB and corporate social

responsibility. Consequently, the second hypothesis of

the study was confirmed. The results demonstrated the

mediating role of professional ethics in the relationship

between PB and CSR. This finding aligned with the

results obtained by Sojoodi and Kiakajoori (2022), who

confirmed the mediating role of professional ethics. As

Feka and Abdullai (2019) stated, the application of an

ethics charter includes all values so that each member

of the organization is responsible to respect these ethics

to achieve organizational goals. This measure must be

implemented to alleviate citizens' concerns. Moreover,

service principles, professional ethics, and valuable

morals reduce corruption in different contexts. They

indeed introduce the intermediary role of professional

ethics in various functions of each organization,

considering its influence on achieving desired

outcomes. In other words, professional ethics are vital

accelerators for current organizational functions and

mechanisms. The direct path coefficient of professional

ethics and social responsibility of managers was 0.210.

The t-value was 2.759 at the significance level of 0.006,

which was less than the default value of α=0.05.

Therefore, this direct path coefficient was significant

with a 95% confidence level. Hence, it is concluded that

professional ethics affects CSR. This result is consistent

with findings obtained by Madime and Gonçalves

(2022), Malchi and Taleb Ghasabi (2021), and Talebi

and Seify Komar (2019). Moreover, Amiri et al. (2016)

explained that justice-oriented, task-based, and

altruistic characteristics are components of professional

ethics that improve social responsibility in the Iranian

Traffic Police, while selfish ethics components prevent

the realization of CSR in this organization. The

coefficient of correlation between professional ethics

and CSR was positive and significant at 0.76. Therefore,

52 │

Mahdiyan. Effect of participatory budgeting on the social responsibility

for this document to be recognized as official law

for nationwide application. The implementation of

professional ethics remains challenging because a

professional ethics charter for municipalities is lacking,

which may affect organizational ethical commitments.

Addressing administrative shortcomings, corruption,

improved professional ethics enhances its outcome,

which is social responsibility. Accordingly, there is a

direct linear relationship between professional ethics

and social responsibility.

IV. CONCLUSION

and violations requires designing

a

professional

According to the research findings and managers'

views on public awareness of and participation in

urban budgeting, this study demonstrated that PB

(PB) can positively influence managers' perspectives.

This influence may facilitate a future strategy for

the urban budgeting system, including PB and the

creation of a comprehensive citizenship survey system

based on residents' criteria in Hamadan, Iran. Such

an information system would make citizens aware

of the budgeting process, while the Samanshahr

citizenship system could collect citizens’ feedback on

the municipality’s annual projects. These comments

can be utilized in determining executive and subjective

priorities, fund allocation, budgeting processes, and

annual planning by the Municipality and City Council.

This system enhances managers' perspectives, increases

citizens’ confidence, and can serve as a strategic model

for direct participation of all societal groups in the

budgeting process. For future strategies on direct public

participation and PB, it is recommended to launch a

Comprehensive Citizenship System and a dedicated

platform for collecting public votes. It is also advised

to establish a working group to study and plan the

infrastructures required for implementing direct public

participation in the budgeting process in Hamadan as a

pilot case for Iran. If all legal, administrative, financial,

and educational aspects are addressed within an

intelligent PB system, Hamadan could serve as a model

city with the necessary preparations for this purpose.

Furthermore, it is suggested that the Islamic City

Council of Hamadan and the Cultural-Social Deputy

of Hamadan Municipality establish a working group

to design a Comprehensive Document on Hamadan

Municipality’s CSR. This document would include

legal, ethical, and socio-economic responsibilities

in both organizational and extra-organizational

contexts. In addition, municipal executive operations

should be implemented with cultural, social, and

environmental attachments. The document can be

tested for its applicability in Hamadan Municipality

and used as a model for other municipalities in Iran.

However, legal approval by Islamic Councils is required

ethics bylaw through collaboration between Hamadan

Municipality, Municipality Security, and the City

Council, ensuring employees adhere to its principles. It

is recommended that the Islamic City Council reviews

and enforces this charter, imposing sanctions for

any administrative violations. The legal status of the

charter can be formalized in the next phase, adding

it as a chapter to the municipality act and holding

the Inspection Organization and Judiciary System

responsible for legal enforcement.

Finally, it is worth noting that this study was

conducted in Hamadan Municipality, which may

differ from other municipalities regarding cultural,

social, administrative, and managerial characteristics.

Therefore, the results cannot be generalized to all cities

and local communities.

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