Abstract
The quest for sustainability has compelled the leadership of many firms to embrace pro-environmental practices. Environmental Management Accounting helps lower environmental impacts through informed decisions made on costs related to materials and energy. This study is grounded in an Institutional perspective that is utilized to empirically test the environmental management accounting practices adopted by the manufacturing firms operating in China. Structural equation modeling is employed to test the path model relationships among various constructs of the study. The framework employs the three institutional forces, normative pressure, coercive pressure, and mimetic pressures, as antecedents of environmental management accounting directly and through the mediating mechanism of environmental strategy. The moderating impacts of top management support and environmental uncertainty are also taken into account. Survey data was collected from 249 Chinese manufacturing firms. The results demonstrated the significant central role of environmental strategy that fully mediates the relationships between institutional pressures and EMA implementation with the maximum impact of coercive pressures. The central role of leadership in curtailing superficial efforts was revealed through the moderating results of top management support, and the sparingly tested environmental uncertainty over mimetic pressures was also confirmed. The findings present sound and interesting practical and theoretical implications for the management and leadership of the organizations.
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