Abstract
Environmental management has become a main concern to the hotel industry with regards to waste reduction, energy savings and water conservation. The hotel industry is frequently accompanied by many adverse environmental impacts as hotel companies extensively consume large amounts of energy, water and non-durable products. Environmental Management Accounting (EMA) is tools that can be used to assist these companies to trace, collect, and analyse physical and monetary environmental information for decision-making purpose and consequently, improves financial and environmental performances. However, there are barriers to EMA adoption. This study aims to examine level of EMA adoption among the hotel companies and the barriers influencing EMA adoption. This study utilises the quantitative research design; using questionnaire survey. A total of 212 usable questionnaires were collected from the hotel companies in Selangor and Kuala Lumpur. Multiple regression analysis was conducted for hypotheses testing. The results of this study show that EMA has yet to be extensively adopted among the hotel companies in Malaysia. The result also shows that the adoption level of both Physical EMA (PEMA) and Monetary EMA (MEMA) are still low. The result further indicates that the low adoption of EMA is caused by the lack of institutional pressures. Specifically, this study shows that financial barrier, informational barrier and institutional barrier significantly influence EMA adoption among the hotel companies in Malaysia. This study is significant to the hotel managers, government authorities and environmental regulatory agencies in understanding the level of EMA adoption in the Malaysian hotel industry. In addition, this study provides valuable contributions to the existing literature by providing useful insights on the barriers influencing EMA adoption in the hotel industry in developing countries.
Highlights
The role of management accounting has expanded from merely recording and reporting of financial information to environmental accounting (Hopwood, 2009)
This study shows informational barrier significantly influences Environmental Management Accounting (EMA) adoption among the hotel companies in Malaysia, supporting H3
This study implicates that majority of the hotel companies in Malaysia have low adoption of EMA
Summary
The role of management accounting has expanded from merely recording and reporting of financial information to environmental accounting (Hopwood, 2009). The failures of the conventional management accounting systems in providing environmental information such as the environmental impacts and its related costs have led to the introduction of EMA (Gale, 2006; Jasch, 2006). According to Ditz, Ranganathan, Bank and Beloff (1995), the conventional accounting system is no longer inadequate as most environmental costs often known as overhead costs are invisible and cannot be identified. EMA is said to be able to help companies in revealing actual costs related to their activities on the environmental impacts and to identify opportunities for cost reduction. According to Jalaludin, Sulaiman and Ahmad (2011), the EMA adoption provides the advantage in handling environmental impacts and costs as well as enhancing managerial decision-making and improves profitability
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