The Effect of Environmental Management Accounting on Corporate Sustainability

Abstract

This research aimed to examine the effect of Environmental Management Accounting (EMA) on corporate sustainability in mining, agriculture, construction and construction materials, energy, textile and apparel companies in Indonesia from 2014-2018. This research had 87 observations from 20 in Indonesia from 2014-2018. EMA was measured by eco-efficiency energy. Meanwhile, corporate sustainability was measured by environmental and social factors. The researchers used content analysis to measure entity sustainability. The data were qualitative and quantitative in the form of annual reports and company sustainability reports based on the G4 of Global Reporting Initiative (GRI). The results show that there is a positive influence between EMA on corporate sustainability. The high value of the eco-efficiency of the companies indicates the low usage of energy. The low use of energy certainly has a positive impact on environmental and social aspects as well as being a determining factor for corporate sustainability.

The Choice of Environmental Management Accounting Practices Adopted by Managers: Evidence from the Hotel Sector in KwaZulu Natal, South Africa

“…He opined that effective EMA practices lead to improved organizational performance. In addition, some empirical studies such as by Christine et al (2019) and Pratiwi et al (2020)have established a positive relationship between EMA practices and financial performance. This is because the benefits of EMA practices offset the cost (Tung et al, 2014).…”

Environmental Management Accounting System and Value Creation: An institutional perspective

“…There are some approaches for a business to create value which is through the adoption of EMAS. Pratiwi, Meutia, and Syamsurijal (2020) revealed that EMAS adoption has a significant positive relationship with corporate sustainability. Value creation within the current study is considered value-added by enhancing financial performance, market performance, and environmental performance.…”

“…A study done by Larojan and Thevaruban (2014) found that EMAS application correlates positively with the financial performance of the listed manufacturing companies in Sri Lanka. Prior researchers found that implementing environmental practices positively improves financial performance (Pratiwi, Meutia & Syamsurijal, 2020;Ong, Teh, Ng & Soh, 2016). Firms certainly spend much money when adopting EMAS in their organizations.…”

Environtmental Management Accounting, Competitive Advantage, Firm Perfomance: Indonesia’s Manufacturing Sector.

“…Rahman, Meero, dan Mansur (2020) mengemukakan bahwa EMA memiliki dampak signifikan terhadap keunggulan kompetitif (keunggulan pemimpin biaya, keunggulan diferensiasi berkelanjutan, dan keunggulan segmentasi pasar berkelanjutan). Pratiwi et al (2020) juga mengemukakan bahwa penerapan EMA membuat perusahaan memperoleh keunggulan kompetitif, yang nantinya akan meningkatkan nilai perusahaan sehingga EMA berpengaruh positif dengan keunggulan kompetitif (competitive advantage).…”

“…Hal ini sesuai dengan hipotesis yang menyatakan bahwa EMA berpengaruh positif dengan keunggulan kompetitif (competitive advantage). Hal tersebut sejalan dengan penelitian Dunk (2007), Rahman et al (2020), dan Pratiwi et al (2020) yang menyatakan jika ada pengaruh positif antara EMA dengan keunggulan kompetitif. EMA memberikan dampak terhadap peningkatan keunggulan kompetitif (keunggulan pemimpin biaya, keunggulan diferensiasi berkelanjutan, dan keunggulan segmentasi pasar berkelanjutan ) dari perusahaan.…”