Linking Environmental Management Accounting to Sustainable Performance: The Mediating Role of Sustainable Innovation and the Moderating Role of Proactive Sustainability Strategy

Abstract

Sustainable performance (SUPE) remains a critical priority for businesses. However, empirical evidence quantifying the roles of accounting practices and innovation in achieving SUPE is still limited. This study investigates the indirect impact of environmental management accounting (ENMA) on SUPE through the mediating role of sustainable innovation. Additionally, it examines whether a proactive sustainability strategy (PRSS) strengthens the relationship between ENMA and sustainable innovation. Data were collected via an online survey of 339 chief executive officers (CEOs) and chief financial officers (CFOs) from manufacturing firms in Vietnam and analyzed using SmartPLS version 4.1.1.2. The results reveal that: (1) ENMA positively influences sustainable innovation; (2) sustainable innovation significantly enhances SUPE; (3) sustainable innovation mediates the relationship between ENMA and SUPE; and (4) PRSS positively moderates the relationship between ENMA and sustainable innovation. These findings contribute to the advancement of dynamic capability and stakeholder theories. Specifically, PRSS serves as a mechanism for identifying stakeholder needs and transforming external pressures into enhanced ENMA capabilities, thereby promoting sustainable innovation and, ultimately, SUPE.