The impact of environmental management accounting on environmental and financial performance: empirical evidence from Bangladesh

Abstract

Purpose This study aims to investigate the impact of environmental management accounting (EMA) on manufacturing companies’ environmental and financial performance in Bangladesh. Thus, this research recognizes essential factors such as EMA, environmental performance (EP), financial performance (FP), environmental information systems (EIS), knowledge management (KM), green innovation and energy efficiency (EE). Design/methodology/approach This research uses a quantitative approach and uses 323 responses from the manufacturing firms. This research tests the study model through the “Partial Least Square-Structural Equation Modeling” (PLS-SEM) technique using Smart PLS v3.3 software. This research uses AMOS v24 and 40% sample consideration to check the robustness. The study passes various model fit measures, i.e. reliability, validity, factor analysis and goodness of fit. Findings The research finds that EMA is positively and significantly associated with EP and FP. The study also finds a substantial relationship between recognized factors with EMA and EP. This research connects the stakeholder theory and institutional theory to the EMA model and shows the pressures from stakeholders and institutions reassuring the manufacturing firms to implement EMA. This research evidences that EMA enhances EP and FP. Originality/value The policymakers, regulators and government can consider these findings to formulate policy regarding companies’ EP and FP. Particularly, company executives can focus on KM, EIS, green innovation and EE factors for EP and FP.

Antecedents and effect of creative accounting practices on organizational outcomes: Evidence from Bangladesh

“…A structural equation model (PLS-SEM) is used in this study to analyze the research hypotheses. SEM is a sophisticated multivariate analysis tool used, particularly in the management and accounting research arena, to build and extend current ideas by testing the correlations between endogenous and exogenous variables [ 89 , 90 ]. If the model involves numerous constructs and items, includes a formative construct, violates the data set's normality assumption, deals with a relatively small sample size, and the research goal is to predict the key construct, PLS-SEM has advantages for predictions.…”

The Impact of Green Accounting on Environmental Performance: Mediating Effects of Energy Efficiency

“…The questionnaire included ve items related to environmental practices, four items related to economic practices, and four items related to social practices of green accounting which were adapted from previous studies by Gallhofer and Haslam (1997), Jahamani (2003), and Tu and Huang (2015). Additionally, three items related to energy e ciency and three items related to environmental performance were adapted from Deb et al (2022). Overall, the questionnaire was designed to assess the extent to which the rms engaged in green accounting practices and to measure the mediating effect of energy e ciency on the relationship between green accounting and environmental performance.…”

“…Additionally, organizations may be eligible for nancial incentives, such as tax credits or subsidies, for implementing environmentally and socially responsible practices. Overall, economic practices in green accounting are aimed at aligning an organization's nancial decision-making with its environmental and social values, as well as improving its nancial performance by reducing environmental and social risks and maximizing opportunities for sustainability (Deb et al, 2022;Grunert and Juhl, 1995;Iredele et al, 2020;Pei et al, 2021;Young et al, 2010). Thus, this study developed the following hypothesis: H1: Green accounting through economic practices improves environmental performance.…”

“…In this theory, the external environment, including the norms, values, and expectations of stakeholders, can shape the behavior and practices of organizations. The institutional environment is made up of three types of pressure: coercive pressure, mimetic pressure, and normative pressure (Carpenter and Feroz, 2001;Deb et al, 2022). Institutional pressures from these stakeholders can shape the behaviors and practices of organizations, as they strive to conform to the expectations of their institutional environment.…”

“…In the case of Bangladesh, there is a signi cant gap in research on the relationship between green accounting and environmental performance. Bangladesh is one of the most vulnerable countries to the impacts of climate change, and it has made commitments to reduce its greenhouse gas emissions and promote sustainable development (Deb et al, 2022). However, there is limited research on the extent to which green accounting practices are being adopted by businesses in Bangladesh and the impact of these practices on environmental performance.…”