Silas Mukwarami
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Examining the relationship between environmental management accounting practices and return on equity in the South African chemical industry
Environmental Economics Volume 15, 2024 Issue #1 pp. 190-202
Views: 295 Downloads: 103 TO CITE АНОТАЦІЯEnvironmental management accounting practices (EMAPs) have become pervasive, and continued efforts to ensure universal implementation across various sectors often represent financial implications for organizations. Despite many studies that examined the relationship between EMAPs and financial performance, the debate is still inconclusive. Therefore, the study paves the way for chemical firms to explore the effectiveness of EMAPs’ implementation for both financial and environmental gain. The study used purposive sampling to gather quantitative secondary data from annual integrated reports of chemical firms to examine the relationship between EMAPs and financial performance in the South African chemical industries during 2016–2022. Following the results from the regression estimations, two of the EMAPs – water and energy usage – have had a positive relationship with financial performance, with the latter being highly significant. Contradictorily, carbon emissions and environmental expenditure adversely and insignificantly influenced financial performance. The results suggest that chemical firms have in place ineffective carbon management strategies that fail to generate sustainable returns. Overall, the results acknowledge the efforts of chemical industries in making substantial contributions to enhance environmental performance and encourage environmentalists and policymakers to reconfigure environmental policies for improved environmental and financial performance. Further research on environmental management accounting (EMA) barriers in chemical industries is imperative to achieving environmental sustainability.
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