Abstract:
The purpose of this research is to identify the determinants of Environmental
Management Accounting (EMA) practices of Public Listed Companies (PLCs) and
Small and Medium-Sized Enterprises (SMEs) in Sri Lanka. In addition, this paper
discusses the benefits and barriers of EMA implementation of both PLCs and SMEs.
Using a self-administered questionnaire survey, primary data was collected from 33
PLCs and 40 SMEs in Sri Lanka. Hypotheses were tested using regression analysis.
Findings imply that environmental laws, shareholder perception, consumer
perception, competitor perception, staff motivation, and pressure from
environmental groups are the significant determinants of EMA adoption in PLCs and
SMEs. However, EMA implementation by PLCs and SMEs is hindered by unions and
financial institutions. In SMEs, resource constraints and resistance to change are the
main impediments, whereas financial and resource constraints are the main
obstacles to adopting EMA practices in PLCs. SMEs believe that EMA practices reduce
environmental damage, increase ecological sustainability, and improve the firm's
reputation. Moreover, most PLCs believe that implementing EMA practices reduces
pollution, lowers costs, improves environmental stewardship, and improves the
firm's reputation. This study updates and extends on prior survey-based research on
EMA comparing PLCs and SMEs. The study can help SME owners and PLC
management comprehend the benefits of EMA while green-friendly stock
investments will be encouraged. Policymakers may gather data about obstacles
referring to the study to encourage EMA practices
