Does air pollution motivate organisations to adopt environmental management accounting practices? Evidence from South Africa
Does air pollution motivate organisations to adopt environmental management accounting practices? Evidence from South Africa

Summary/Abstract: This paper identifies the extent of airpollution in motivating companies to implementenvironmental management accounting (EMA)practices in 67 mining and cement companies listedon the Johannesburg Stock Exchange (JSE), SouthAfrica, from 2012 to 2021. Pooled ordinary leastsquares regression is applied to analyse the data.EMA is proxied by environmental training,environmental audits and energy efficiency, while airpollution is measured based on the air quality index(AQI). The results show that air pollution is essentialfor companies to adopt EMA practices. This meansthat when air quality declines within a company’slocality, a company proactively adopts EMApractices. This suggests that air pollution is a keybasis of companies' adoption of EMA, as predicted bythe legitimacy theory. The study includes threecontrol variables: size, return on assets (ROA) andnumber of years listed on JSE. Two control variables,namely Size and ROA, portray a positive andsignificant effect on adopting EMA from air pollution.This portrays that a financially stable company tendsto submit to air pollution and use EMA to counter thepollution. In contrast, as the number of yearsincreases for companies listed on JSE, EMA will likelybe adopted less to reduce air pollution.

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