Environmental Management Accounting, Environmental Performance, and the Moderating Role of Female Leaders: Empirical Evidence in Indonesian MSMEs

Abstract

This study is motivated by the increase in environmental degradation and the fact that Indonesian MSMEs, despite being key contributors to the national economy, still have relatively low awareness and implementation of sustainability practices. In this context, environmental management accounting becomes an important mechanism to help MSMEs monitor, manage, and improve their environmental performance in a more structured way. At the same time, there are still gaps in the literature related to the role of gender, especially how female leaders can influence the effectiveness of sustainability-oriented management practices within organizations. Therefore, this study focuses on examining the moderating role of female leaders in the relationship between environmental management accounting implementation and environmental performance in Indonesian MSMEs. The analysis is based on survey data obtained from 743 MSMEs and tested using Moderated Regression Analysis to capture both the direct effect of environmental management accounting and its interaction with female leadership. The empirical results show that environmental management accounting implementation is positively associated with better environmental performance. In addition, the presence of female leaders strengthens this positive relationship, indicating that gender-inclusive leadership can enhance the impact of environmental management accounting. These findings imply that encouraging MSMEs to adopt environmental management accounting, while simultaneously promoting female leadership, can be an effective strategy for improving environmental performance and supporting more sustainable business practices.