Sustainability-Driven Accounting Practices and SME Performance: The Role of Environmental Management Accounting and Accounting Information Systems in Medan, Indonesia
Keywords:
Environmental, Accounting Information Systems, SME Performance, SustainabilityAbstract
This study examines the influence of sustainability-driven accounting practices on the performance of small and medium-sized enterprises (SMEs) in Medan, Indonesia. Specifically, it investigates the roles of Environmental Management Accounting (EMA) and Accounting Information Systems (AIS), as well as the moderating effect of environmental uncertainty. This research addresses the limited adoption of sustainability-oriented accounting practices among SMEs and their implications for business performance. A quantitative approach was employed using primary data collected through structured questionnaires distributed to SME owners and accounting personnel in Medan. The data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) to test both direct and moderating effects among variables.The results indicate that EMA has a positive and significant effect on SME performance, suggesting that effective management of environmental costs and resources contributes to improved business outcomes. In contrast, AIS does not show a significant effect, indicating that the current level of system adoption among SMEs is not sufficient to enhance performance. Environmental uncertainty is found to have a significant positive effect on performance; however, its moderating role is not supported. This study concludes that sustainability-driven accounting practices, particularly EMA, play a crucial role in improving SME performance, while the effectiveness of AIS depends on the level of implementation and utilization. The findings provide practical insights for SME managers and policymakers in promoting sustainable accounting practices.
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