The impact of environmental management accounting practices on corporate sustainability dimensions: evidence from Saudi petrochemical companies

Abstract

This study examines the relationships among Environmental Management Accounting (EMA), Sustainability Reporting Quality (SRQ), and Corporate Sustainability Performance (CSP) in Saudi petrochemical companies. These companies are facing increasing pressures related to sustainability and ESG. We studied data from 13 listed companies from 2017 to 2024 and explored how eco-efficiency and emission efficiency affect environmental and economic sustainability performance, directly and through the quality of sustainability reporting. A quantitative research design was used, applying Partial Least Squares Structural Equation Modeling (PLS-SEM). Eco-efficiency was measured using asset-based energy efficiency. Emission efficiency assesses the ability to generate economic value in relation to greenhouse gas emissions. SRQ was measured using a multidimensional disclosure index that meets Global Reporting Initiative (GRI) standards. The findings showed that EMA practices have a greater impact on sustainability performance than sustainability disclosure mechanisms alone. Emission efficiency positively influences environmental and economic sustainability outcomes. In contrast, eco-efficiency shows negative short-term effects, indicating costs associated with sustainability transitions and pressures for organizational adjustments. The results also suggest that SRQ acts as a selective mediator, benefiting environmental sustainability outcomes more than economic performance. This study adds to the literature on sustainability accounting and environmental management. It highlights the need to integrate EMA practices with sustainability reporting to advance industrial sustainability transformation and ensure environmental accountability, in line with Saudi Vision 2030.

Keywords

environmental management accounting / sustainability reporting quality / corporate sustainability performance / eco-efficiency / emission efficiency

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