The impact of institutional pressures and environmental management accounting on financial, environmental and economic performance of the company

Document Type : Research Paper

Authors

1 Professor of Accounting, College of Social Sciences, Economics and Management, Shiraz University, Shiraz, Iran

2 Faculty Member, Department of Accounting, Faculty of Humanities, Technical and Vocational University (TVU), Tehran, Iran.

Abstract

Purpose: The aim of this study is to evaluate the direct effect of institutional pressures on company's performance and the indirect effect through the mediating role of environmental management.
Method: Quantitative data has been collected through a structured and standard questionnaire from 202 employees of the financial department who are aware of the general activities of companies, and structural equation modeling has been used to evaluate the hypotheses.
Results: The results showed that institutional pressures have significant relationship with financial performance. Normative pressure has positive and significant relationship with environmental performance. Coercive pressures have a negative and significant effect on financial performance only in cellulose industry. Normative pressures on financial performance in oil and gas, petrochemical and cellulose industries and also on environmental performance in metal and cellulose industries have positive and significant effect. The impact of normative pressures on economic performance in oil and gas and petrochemical industry is negative but significant and in metal industry is positive and significant. Mimetic pressures have positive and significant effect on environmental and economic performance only in oil and gas and petrochemical industry. Results also showed environmental management accounting has acted as a mediating variable on the relationship between institutional pressures and company’s performance.
Conclusion: Institutional pressures significantly increase implementation of environmental management accounting, which it increases financial, environmental and economic performance of company.
Contribution: findings of this study will help companies and policy makers to understand the importance of EMA and the impact of institutional factors in determining the company's performance.

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History

  • Receive Date: 06 January 2023
  • Revise Date: 21 March 2023
  • Accept Date: 02 April 2023

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