Keywords
environmental reporting scope
management control system
state-owned enterprises
sustainability management accounting
How to Cite
How to Cite
Abstract
This study examines whether Sustainability Management Control System Maturity (SMCSM) is associated with eco-efficiency in Indonesian non-financial state-owned enterprises. Using annual reports and sustainability reports from 33 enterprises over the 2015–2024 period, this study develops a report-based SMCSM index covering sustainability target setting, KPI measurement, monitoring and evaluation, managerial accountability and governance, corrective action and learning, and integration with operational and risk control. The full dataset contains 320 firm-year observations, whereas the main energy model uses 90 observations from 12 firms due to uneven availability of environmental data. Eco-efficiency is measured using revenue-based environmental efficiency indicators, with energy eco-efficiency as the main dependent variable and emission and water eco-efficiency as robustness measures. The empirical analysis employs panel regression with firm fixed effects and clustered standard errors. The results do not support a significant association between SMCSM and energy eco-efficiency, and similar patterns appear in lagged models, sensitivity tests, and robustness models using emission and water eco-efficiency. However, changes in the scope of environmental reporting are consistently associated with energy eco-efficiency, indicating that the reporting boundary and measurement coverage affect the comparability of report-based environmental performance. This study contributes to sustainability management accounting by introducing a documentary SMCSM index and highlighting the importance of the reporting scope for interpreting eco-efficiency data. Practically, the findings suggest that managers and regulators should not treat disclosed sustainability control maturity as direct evidence of environmental efficiency improvement unless reporting boundaries and operational embedding are clearly established.
References
Adams, C. A., & Abhayawansa, S. (2022). Connecting the COVID-19 pandemic, environmental, social and governance (ESG) investing and calls for ‘harmonization’ of sustainability reporting. Critical Perspectives on Accounting, 82, 102309. https://doi.org/10.1016/J.CPA.2021.102309
Agustini, A. T., & Arifa, C. (2024). Climate change accounting and disclosure: A systematic literature review. The Indonesian Accounting Review, 14(1), 25–41. https://doi.org/10.14414/TIAR.V14I1.3829
Alsaid, L. A. Z. A., & Ambilichu, C. A. (2021). The influence of institutional pressures on the implementation of a performance measurement system in an Egyptian social enterprise. Qualitative Research in Accounting & Management, 18(1), 53–83. https://doi.org/10.1108/QRAM-03-2020-0027
Alsaid, L. A. Z. A., & Mutiganda, J. C. (2024). Sustainability Management Accounting in Urban Development: A Case Study of an Egyptian State-Owned Enterprise. Sustainability, 16(18), Page 8235, https://doi.org/10.3390/SU16188235
Ascani, I., Ciccola, R., & Chiucchi, M. S. (2021). A Structured Literature Review about the Role of Management Accountants in Sustainability Accounting and Reporting. Sustainability, 13(4), 2357, https://doi.org/10.3390/SU13042357
Barney, J. (1991). Firm Resources and Sustained Competitive Advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/014920639101700108
Bastini, K., Getzin, F., & Lachmann, M. (2022). The effects of strategic choices and sustainability control systems in the emergence of organizational capabilities for sustainability. Accounting, Auditing & Accountability Journal, 35(4), 1121–1153. https://doi.org/10.1108/AAAJ-04-2020-4515
Beusch, P., Frisk, J. E., Rosén, M., & Dilla, W. (2022). Management control for sustainability: Towards integrated systems. Management Accounting Research, 54, 100777. https://doi.org/10.1016/J.MAR.2021.100777
Cahyaningsih, C., & Ihromi, F. U. (2024). Environmental Accounting Disclosure, Green Process Innovation, and Environmental Management Accounting Improving Economic Performance. AFRE (Accounting and Financial Review), 7(1), 107–116. https://doi.org/10.26905/AFR.V7I1.10840
Cameron, A. C., & Miller, D. L. (2015). A Practitioner’s Guide to Cluster-Robust Inference. Journal of Human Resources, 50(2), 317–372. https://doi.org/10.3368/JHR.50.2.317
Christ, K. L., Dijkstra-Silva, S., Burritt, R. L., & Schaltegger, S. (2024). Sustainability management accounting – enabling macro-level sustainability transformation towards the United Nations Sustainable Development Goals. Meditari Accountancy Research, 32(3), 923–944. https://doi.org/10.1108/MEDAR-03-2023-1952
Christensen, H. B., Hail, L., & Leuz, C. (2021). Mandatory CSR and sustainability reporting: economic analysis and literature review. Review of Accounting Studies, 26(3), 1176–1248. https://doi.org/10.1007/S11142-021-09609-5
Dharmayanti, N., Ismail, T., Hanifah, I. A., & Taqi, M. (2023). Exploring sustainability management control system and eco-innovation matter sustainable financial performance: The role of supply chain management and digital adaptability in Indonesian context. Journal of Open Innovation: Technology, Market, and Complexity, 9(3), 100119. https://doi.org/10.1016/J.JOITMC.2023.100119
DiMaggio, P. J., & Powell, W. W. (1983). The Iron Cage Revisited: Institutional Isomorphism and Collective Rationality in Organizational Fields. American Sociological Review, 48(2), 147–160. https://doi.org/10.2307/2095101
Donaldson, L. (2001). The contingency theory of organizations. Sage. https://doi.org/10.4135/9781452229249
Downar, B., Ernstberger, J., Reichelstein, S., Schwenen, S., & Zaklan, A. (2021). The impact of carbon disclosure mandates on emissions and financial operating performance. Review of Accounting Studies, 26(3), 1137–1175. https://doi.org/10.1007/S11142-021-09611-X
Edirisinghe, U. C., Hossain, M. M., & Alam, M. (2025). Sustainability integration in management control systems: evidence from a developing country. Journal of Management Control, 36(2), 163–204. https://doi.org/10.1007/S00187-025-00395-8
Fachrudin, A., Setiawan, D., Djuminah, D., & Risfandy, T. (2024). Exploring the recent development of management control systems study. Cogent Business & Management, 11(1). https://doi.org/10.1080/23311975.2024.2357709
Fiechter, P., Hitz, J. M., & Lehmann, N. (2022). Real Effects of a Widespread CSR Reporting Mandate: Evidence from the European Union’s CSR Directive. Journal of Accounting Research, 60(4), 1499–1549. https://doi.org/10.1111/1475-679X.12424
Freeman, R. E., Harrison, J. S., & Zyglidopoulos, S. (2018). Stakeholder theory: Concepts and strategies. Cambridge University Press.
Gunawan, J., Permatasari, P., & Fauzi, H. (2022). The evolution of sustainability reporting practices in Indonesia. Journal of Cleaner Production, 358, 131798. https://doi.org/10.1016/J.JCLEPRO.2022.131798
Hazaea, S. A., Zhu, J., Khatib, S. F. A., Bazhair, A. H., & Elamer, A. A. (2022). Sustainability assurance practices: a systematic review and future research agenda. Environmental Science and Pollution Research 29(4), 4843–4864. https://doi.org/10.1007/S11356-021-17359-9
Korca, B., Costa, E., & Bouten, L. (2023). Disentangling the concept of comparability in sustainability reporting. Sustainability Accounting, Management and Policy Journal, 14(4), 815–851. https://doi.org/10.1108/SAMPJ-05-2022-0284
Kurnianto, S., & Tjahjadi, B. (2025). Sustainability management control system and sustainability performances in Indonesia. International Journal of Management and Sustainability, 14(1), 102–120. https://doi.org/10.18488/11.V14I1.4032
Kuruppu, S. C., Milne, M. J., & Tilt, C. A. (2024). Sustainability control systems in short-term operational and long-term strategic decision-making. Meditari Accountancy Research, 32(1), 234–265. https://doi.org/10.1108/MEDAR-12-2021-1548
Le, O. T. T., Le, A. T. H., Vu, T. T. T., Tran, T. T. C., & Nguyen, C. Van. (2024). Management control systems for sustainable development: a bibliographic study. Cogent Business & Management, 11(1). https://doi.org/10.1080/23311975.2023.2296699
Luque-Vílchez, M., Cordazzo, M., Rimmel, G., & Tilt, C. A. (2023). Key aspects of sustainability reporting quality and the future of GRI. Sustainability Accounting, Management and Policy Journal, 14(4), 637–659. https://doi.org/10.1108/SAMPJ-03-2023-0127
Martinez, C., Morales Pachon, A., Alexandre Castanho, R., Florêncio, M., Oliveira, L., & Costa Oliveira, H. (2023). Management Control Systems and the Integration of the Sustainable Development Goals into Business Models. Sustainability, 15(3), 2246. https://doi.org/10.3390/SU15032246
Melenia, F., Agustini, A. T., & Putra, H. S. (2023). The effect of implementing green accounting on the environmental performance of cement, energy, and mining companies in Indonesia. The Indonesian Accounting Review, 13(1), 49–60. https://doi.org/10.14414/TIAR.V13I1.3135
Musviyanti, M., Syakura, M. A., & Ramadhani, M. H. Z. K. (2024). Beyond profit: How to create value in business by integrating ESG and sustainability accounting. The Indonesian Accounting Review, 14(2), 289–300. https://doi.org/10.14414/TIAR.V14I2.4765
Nicolo’, G., & Andrades-Peña, F. J. (2024). Does corporate governance influence environmental, social and governance disclosure practices of state-owned enterprises? An international study. Corporate Social Responsibility and Environmental Management, 31(5), 4715–4731. https://doi.org/10.1002/CSR.2824
O’Connor, C., & Joffe, H. (2020). Intercoder Reliability in Qualitative Research: Debates and Practical Guidelines. International Journal of Qualitative Methods, 19. https://doi.org/10.1177/1609406919899220
Peraturan Otoritas Jasa Keuangan Nomor 51/POJK.03/2017 Tentang Penerapan Keuangan Berkelanjutan Bagi Lembaga Jasa Keuangan, Emiten, Dan Perusahaan Publik (Financial Services Authority Regulation Number 51/POJK.03/2017 Concerning the Implementation of Sustainable Finance for Financial Services Institutions, Issuers, and Public Companies), Pub. L. 51/POJK.03/2017, Otoritas Jasa Keuangan (2017). https://ojk.go.id/id/kanal/perbankan/regulasi/peraturan-ojk/Pages/POJK-Penerapan-Keuangan-Berkelanjutan-bagi-Lembaga-Jasa-Keuangan,-Emiten,-dan-Perusahaan-Publik.aspx
Pesci, C., Vola, P., & Gelmini, L. (2023). Flattening or addressing complexity? The future role of GRI in light of the sustainability accounting (r)evolution. Sustainability Accounting, Management and Policy Journal, 14(4), 792–814. https://doi.org/10.1108/SAMPJ-05-2022-0287
Petersen, M. A. (2009). Estimating Standard Errors in Finance Panel Data Sets: Comparing Approaches. The Review of Financial Studies, 22(1), 435–480. https://doi.org/10.1093/RFS/HHN053
Quesado, P., Silva, R., & Oliveira, H. C. (2024). Management Control Systems and Sustainability: A Bibliometric Analysis. Sustainability 16(12), 5067. https://doi.org/10.3390/SU16125067
Rahi, A. F., Johansson, J., Fagerström, A., & Blomkvist, M. (2022). Sustainability Reporting and Management Control System: A Structured Literature Review. Journal of Risk and Financial Management, 15(12), 562. https://doi.org/10.3390/JRFM15120562
Schaltegger, S., Christ, K. L., Wenzig, J., & Burritt, R. L. (2022). Corporate sustainability management accounting and multi-level links for sustainability – A systematic review. International Journal of Management Reviews, 24(4), 480–500. https://doi.org/10.1111/IJMR.12288
Suchman, M. C. (1995). Managing Legitimacy: Strategic and Institutional Approaches. The Academy of Management Review, 20(3), 571. https://doi.org/10.2307/258788
Surat Edaran Otoritas Jasa Keuangan Nomor 16/SEOJK.04/2021 Tentang Bentuk Dan Isi Laporan Tahunan Emiten Atau Perusahaan Publik (Financial Services Authority Circular Letter Number 16/SEOJK.04/2021 Concerning the Form and Content of Annual Reports of Issuers or Public Companies), Pub. L. 16/SEOJK.04/2021, Otoritas Jasa Keuangan (2021). https://ojk.go.id/id/regulasi/Pages/Bentuk-dan-Isi-Laporan-Tahunan--Emiten-atau-Perusahaan-Publik.aspx
Traxler, A. A., Schrack, D., Greiling, D., Feldbauer, J., & Lautner, M. (2025). The interplay of sustainability reporting and management control – an exploration of ways for dovetailing to develop reporting beyond accountability. Journal of Applied Accounting Research, 26(6), 160–182. https://doi.org/10.1108/JAAR-08-2022-0222
Tsang, A., Frost, T., & Cao, H. (2023). Environmental, Social, and Governance (ESG) disclosure: A literature review. The British Accounting Review, 55(1), 101149. https://doi.org/10.1016/J.BAR.2022.101149
Vanini, U., & Bochert, S. (2024). Integration of sustainability issues into management accounting textbooks. Journal of Accounting Education, 66, 100886. https://doi.org/10.1016/J.JACCEDU.2024.100886
Wagenhofer, A. (2024). Sustainability Reporting: A Financial Reporting Perspective. Accounting in Europe, 21(1), 1–13. https://doi.org/10.1080/17449480.2023.2218398
Zoni, L., & Bustamante, C. W. (2025). Leveraging on levers of control to learn how to integrate sustainability in management. Journal of Accounting & Organizational Change, 21(7), 217–243. https://doi.org/10.1108/JAOC-02-2024-0064
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.