Impact of green intellectual capital and environmental

proactivity on sustainability: Mediating role of

environmental management accounting

Presenter
Syeda Umal Banin
Contents
• Abstract
• Introduction
• Literature review
• Theoretical Framework
• Methodology
• Results
• Conclusion
Abstract
• The study examines the impact of green intellectual capital and environmental
proactivity on sustainability with mediating effect of environmental management
accounting on manufacturing sector of Pakistan.
• Structural equation modeling (SEM) is used to empirically analyze the impact of the
constructs.
• Data is collected from managers of manufacturing sectors using survey-based
questionnaire.
• The results of the study indicates positive and significant association of variables.
Introduction
• Researchers, policy makers, and organizations are predominantly focusing on
sustainable environment. Businesses affect the organizations by increasing pollution
and minimizing natural resources. It is considered that businesses vaguely affect the
natural environment. Therefore, businesses focus on environmental protection and
effective and efficient achievement of environmental goals.
• Organizations are considering social and environmental goals as the same time as
economic, corporate and monetary goals. Natural resource protection and preservation
has become the area of interest. The ecosystem has been immensely affected due to
environmental decimation. The rising environmental issues have moved the focus of
organizations towards the creation of eco-friendly goals and objectives to protect the
ecosystem.
• The manufacturing sector serves as the backbone in the development and growth of an
economy or country. This sector immensely contributes towards pollution, energy
consumption, and ecological issues.
• The manufacturing sector overall contributes 12.97% in the gross domestic product
(GDP) and provides 16.1% of total employment.
Continue…
Problem statement

The rising environmental crises have led the interests of organizations and customers towards the
protection of ecosystems. In the recent era, the focus is on sustainable development. Businesses are
pressurized to develop and implement practices regarding environmental regulations and standards
by government, stakeholders as it is their corporate and ethical responsibility. To gain a competitive
advantage, the organizations must focus on environmental issues for sustainable development.

Significance of study

The organizations are focusing on being green and utilizing green resources. This has the following
reasons:
It is ethical behavior of firms to focus on environmental concerns.
The organizations must focus on ecological concerns to gain a competitive advantage and attraction of
customers, suppliers, and other stakeholders.
it will also motivate and bring to the knowledge of other firms to develop and accomplish these
practices.
Hence, firms must comply with the protection of the ecosystem.
Continue…
Scope of the study

This research focuses on the implementation of various environmental resources and assets such as
sustainable and green intangible assets that will increase financial and non-financial growth, value,
and performance. This study adequately focuses on GIC, environmental proactivity, sustainability,
and EMA that will lead towards a sustainable environment.

Rationale and justification

This study comprises of adoption of green intellectual capital, developing and managing practices
that lead towards environmental proactivity and their influence on sustainability with mediating
effect of EMA on them.
  To evaluate the impact of Green Intellectual Capital On sustainability of
manufacturing sector of Pakistan.
 To inspect the association between Green intellectual capital and
Environmental management accounting of manufacturing sector of Pakistan.
 To determine the effect of environmental proactivity on sustainability of
manufacturing sector of Pakistan.
 To check the relationship between Environmental proactivity and
Research Objectives Environmental management accounting of manufacturing sector of Pakistan.
 To evaluate the association between Environmental management accounting
This study mainly determines the and sustainability of manufacturing sector of Pakistan.
relationship of sustainability on GIC
 To examine the mediating role of Environmental management accounting on
and EP with mediating role of EMA
in manufacturing sector of Pakistan. green intellectual capital and sustainability of manufacturing sector of Pakistan.
This study will provide insight into  To conclude the mediating role of environmental management accounting on
how organizations deal with effective environmental proactivity and sustainability of manufacturing sector of
alignment of various green resources.
Pakatan.
  What is the impact of green intellectual capital and
environmental proactivity on sustainability?
 What is the impact of green intellectual capital on
environmental management accounting?
 What is the impact of environmental proactivity on
sustainability?

Research Questions  What is the impact of environmental proactivity on

environmental management accounting?
Sustainability of an organization
 What is the impact of environmental management accounting
can be increased through
implementation of green resources. and sustainability?
Innovation, performance, and
 What is the role of environmental management accounting
competitiveness can be enhanced
through GIC. on green intellectual capital and sustainability?
 What is the role of environmental management accounting
on environmental proactivity, and sustainability?
Literature Review

Variables Authors

Green intellectual capital (Malik et al., 2020) and (Asiaei, Bontis, Alizadeh, et al.,
2021)

Environmental (Seroka‐Stolka & Fijorek, 2020) and (Junquera & Barba-

proactivity Sánchez, 2018)

Sustainability (Zhang, Sun, Yang, & Li, 2018) and (Schwaninger, 2015)

Environmental (Asiri, Khan, & Kend, 2020)

management accounting
Theoretical Framework
Green Intellectual Capital

Green Human Capital

Green Structural Capital Sustainability

Green Relational Capital Economic sustainability

Environmental Management Environmental sustainability

Environmental Proactivity Accounting

Environmental planning & Social sustainability

analysis

Environmental responsibility
and organization

Environmental management
control
 •H1: Green intellectual capital has a significant impact on sustainability.

•H2: Green intellectual capital has a significant impact on environmental

management accounting.

•H3: Environmental proactivity has a significant impact on sustainability.

•H4: Environmental proactivity has a significant impact on environmental

management accounting.
Hypotheses
•H5: Environmental management accounting has a significant impact on
sustainability.

•H6: Environmental management accounting has a mediating effect between

green intellectual capital and sustainability.

•H7: Environmental management accounting has a mediating effect between

environmental proactivity and sustainability.
Methodology
Research philosophy Positivism approach

Research approach Deductive approach

Research method Quantitative research method

Research strategy Survey-based questionnaire

Time horizon Cross-sectional time horizon

Population Manufacturing sector of Pakistan

Sample Managers of manufacturing industries

Nature of study Primary study

Sampling technique Non-probability sampling technique

(Purposive sampling technique)

Questionnaire design Close-ended questions and response questions, 5-point Likert scale, 44
items

Data collection procedure Through email and by sharing link of google form

Statistical tools SPSS and AMOS

Results and Analysis

Descriptive Statistics
N Minimum Maximum Mean Std. Deviation Skewness
Statistic Statistic Statistic Statistic Statistic Statistic Std. Error
Sustainability 322 2.08 5.00 3.9211 .65749 -.489 .136
GRIC 322 1.00 5.00 3.8732 .87409 -.649 .136
EPR 322 1.00 5.00 3.8869 .84824 -.565 .136
ENMA 322 1.00 5.00 3.9011 .82271 -.490 .136
Valid N (listwise) 322

Construct validity

CR AVE MSV EP GIC EMA S

EP 0.902 0.571 0.082 0.756
GIC 0.954 0.617 0.082 0.286 0.785
EMA 0.888 0.570 0.100 0.254 0.270 0.755
S 0.893 0.477 0.100 0.286 0.248 0.316 0.690

Model fit indices

CFA Indicators CMIN/DF GFI IFI TLI CFI RMSEA
Threshold value ≤3 ≥ 0.80 ≥ 0.90 ≥ 0.90 ≥ 0.90 ≤ .80

Calculated value 1.896 0.829 0.934 0.928 0.933 0.53

 Confirmatory Factor
Analysis
The confirmatory factor analysis
is used to examine the measures
of a research model to analyze
whether the constructs of the
research are comparable with the
researcher’s understanding or
not.
Hypothesis Testing

Hypothesi Direction Estimate SE P-Value Decision

s s
H1 GRIC S .108 .041 .008 Accepted

H2 GRIC ENMA .186 .052 .000 Accepted

H3 EP S .155 .042 .000 Accepted

H4 EP ENMA .168 .054 .002 Accepted

H5 ENMA S .159 .043 .000 Accepted

Mediating Effect

H6 GIC ENMA S 0.039 .017 .000 Accepted

H7 EP ENMA S 0.034 .010 .000 Accepted

 Structural Equation Modeling

This figure shows the range and impacts of variables on each other. The above figure shows that
GRIC exerts 14% impact on sustainability. EPR (environmental proactivity) has 20% impact on
sustainability. ENMA ( environmental management accounting) plays mediating effect among
variables and also impacts the dependent and both independent variables. Therefore 7 hypotheses
have been generated in this study.
Conclusion
• This study aims to aware customers and other stakeholders about the significance of sustainability and
attaining a competitive advantage by adopting and managing environment-related practices, systems,
and procedures.
• The short synopsis of the entire investigation is examined.
• The organizations should also invest in green intellectual capital to gain a competitive advantage and
boost up growth. Environmental proactivity and sustainability should also be predominately focused
on by the organizations for protecting environment and preserving natural resources.
• Environmental management accounting should be considered to generate and implement new and
advanced accounting systems related to environmental management to protect ecosystems and create a
better environment.
• Proper control systems should be maintained by the organizations to achieve environmental goals by
implementing environmental strategies and resources.
Implications
• This study significantly contributes to organizations, stakeholders, investors, customers,
and managers.
• GIC enables the organizations to gain more profit, invest in innovations and R & D
(research and development), enhance growth, gain competitive advantage, and produce
products and services considering environmental concerns more than that of its
competitors.
• This study mainly focuses on accounting systems and internal decision making to
implement accounting practices that concern environmental perspectives more than
focusing on internal reporting.
• The issues related to sustainability can be addressed and benefits can be achieved by
considering social, economic, and environmental factors of sustainability.
limitations and Future Recommendations
• This study was conducted in Pakistan only, thus it has the issue of generalizability
• The research has analyzed a small sample size due to the limited time and resources
available. The sample size of the research should be increased.
• Data of this has collected from the managers performing their duties in manufacturing
industries it should be collected from the CEOs and departmental heads in future
research.
• Furthermore, the recent study only covers the manufacturing sector of Pakistan future
studies should be conducted by considering more than one sector or by the comparison
of different sectors.
• The recent research evaluates the association of green intellectual capital and
environmental proactivity on sustainability with mediating effect of environmental
management accounting. Therefore, future research should examine the effect of
moderating variables.
• Future research can include government regulations regarding green practices.
 THANK YOU!
FOR BEING HERE TODAY.
I REALLY APPRECIATE THAT
YOU TOOK TIME TO BE HERE
AND LISTEN TO MY
PRESENTATION.