Linking Green Accounting to Financial Performance: The Role of CSR and Environmental Performance

Abstract

Abstract:   

Research aims:

Empirical findings on the financial impact of green accounting, CSR, and environmental performance in Indonesian manufacturing firms remain inconsistent, especially in the post-pandemic period. To determine the effect of green accounting, CSR, environmental performance, and company size on financial performance of manufacturing companies.

Design/Methodology/Approach:

Quantitative explanatory research with a causal-verification approach, using panel data regression on 140 firm-year observations from 28 manufacturing companies listed on IDX over 2019–2023.

Research findings:  Green accounting, CSR, and environmental performance significantly enhance ROA, suggesting environmental management integration improves profitability.

Theoretical contribution/ Originality: Theoretical contribution/Originality: This study provides one of the first multivariate panel-data tests that jointly examine green accounting, CSR disclosure, and PROPER-based environmental performance on ROA in Indonesian manufacturing firms, addressing inconsistent post-pandemic empirical findings.

Practitioner/Policy implication: Supports mandatory green accounting disclosure in annual reports; guides corporate investment in environmental systems.

Research limitation/Implication: Secondary data; sample limited to manufacturing sector; future research should expand to service sector and test mediating effects.

Keywords: green accounting, corporate social responsibility, environmental performance, financial performance.