Impact of Green Accounting and Environmental Performance on Financial Performance: An Empirical Study of IDX-Listed Mining Companies, 2021–2024

Abstract

This study examines whether green accounting and environmental performance are associated with the financial performance of mining firms listed on the Indonesia Stock Exchange during 2021–2024. Using a quantitative, associative design, we compile a balanced panel of four issuers over four years (16 firm-year observations). Green accounting is operationalized as a binary indicator of environmental-cost recognition in the annual report; environmental performance is proxied by the national PROPER rating (black = 1; gold = 5). Financial performance is measured by return on assets (ROA). We estimate firm fixed-effects panel regressions in EViews 12 and conduct standard diagnostics (normality, multicollinearity, heteroskedasticity, and autocorrelation). The model explains 76.54% of the variation in ROA (R² = 0.7654). Individually, green accounting does not exhibit a statistically significant effect (p = 0.0764 > 0.05), and environmental performance is likewise insignificant (p = 0.3474 > 0.05). However, the regressors are jointly significant (Prob(F-statistic) = 0.0060 < 0.05). Estimated coefficients indicate a positive association for green accounting (β = 0.114) and a small negative association for environmental performance (β = −0.033). The study distinguishes environmental-cost recognition from generic disclosure, employs the ordinal PROPER scale as an external environmental proxy, and applies firm fixed effects to a focused mining sample in the post-pandemic period. The findings clarify that while individual predictors may be insignificant in small samples, their combined contribution is economically and statistically relevant to profitability, highlighting the value of integrating environmental accounting practices with environmental performance management.