The Effect of the Implementation of Green Accounting and Material Flow Cost Accounting on Company Profitability (in Manufacturing Sector Companies Listed on the Indonesia Stock Exchange)

Dimas Nugroho (Universitas Advent Indonesia, Bandung, Indonesia)
Lorina Siregar Sudjiman (Universitas Advent Indonesia, Bandung, Indonesia)

Analitika: Journal of Economics, Management, and Business
Vol. 1 No. 1 (2026): ANALITIKA

This study examines the influence of Green Accounting (GA) and Material Flow Cost Accounting (MFCA) implementation on the profitability of manufacturing companies listed on the Indonesia Stock Exchange (IDX) for the period 2020–2024. The manufacturing sector faces significant pressure to balance competitiveness with growing environmental responsibility demands. Using a quantitative causal-associative approach with panel data from 35 purposively selected companies, this study employs Fixed Effect Model (FEM) regression via EViews 13. Profitability is measured by Return on Asset (ROA), while GA is measured through environmental cost disclosure index and PROPER score, and MFCA through Material Efficiency Ratio and waste reduction percentage. Results show that GA has a significant positive effect on ROA (β = 3.87; p = 0.012) and MFCA also has a significant positive effect (β = 0.29; p = 0.028). Simultaneously, both variables significantly affect profitability (F-prob = 0.000) with R² = 0.462. The findings confirm that environmentally responsible accounting practices are not merely regulatory burdens but strategic investments that enhance financial performance in the manufacturing sector.