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Institutional pressures, environmental management strategy, and organizational performance: The role of environmental management accounting
Author(s) -
Gunarathne A.D. Nuwan,
Lee KiHoon,
Hitigala Kaluarachchilage Pubudu K.
Publication year - 2021
Publication title -
business strategy and the environment
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.123
H-Index - 105
eISSN - 1099-0836
pISSN - 0964-4733
DOI - 10.1002/bse.2656
Subject(s) - environmental accounting , business , environmental full cost accounting , management accounting , environmental management system , accounting , environmental scanning , accounting information system , environmental resource management , sustainable development , accounting management , economics , throughput accounting , political science , ecology , irrigation , law , biology
This study investigates the implementation of environmental management accounting in translating environmental management strategy into organizational performance. Further, the study identifies the influence of institutional pressures on environmental management strategy and environmental management accounting to provide a better description of the impact of the institutional environment on corporate environmental practices. The data were collected from 144 business entities in Sri Lanka using a web‐based survey and analyzed using partial least squares structural equation modeling. We found statistically significant evidence to state that the environmental management strategy is positively associated with the environmental and economic performance of organizations, whereas environmental management accounting mediates this relationship. Further, a firm's institutional environment positively affects both environmental management strategies and environmental management accounting. This study emphasizes that the organizational information systems such as environmental management accounting are useful in providing information on environmental costs and monitoring environmental and financial performance when implementing environmental management strategies in the pursuit of corporate sustainable development.