Comparative analysis of environmental Cost Accounting implementation in Micro, Small and Medium Enterprises

Rusmariani, Yuly and Tripalupi, Ramadhani Irma and Dzikrayah, Fithri and Kusuma, Suteja Wira Dana (2025) Comparative analysis of environmental Cost Accounting implementation in Micro, Small and Medium Enterprises. International Journal of Economics Collaboration and Business Innovation, 1 (1). pp. 15-22.

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Abstract

Purpose – The implementation of environmental cost accounting is becoming increasingly important in the context of MSMEs in Indonesia, given their significant contribution to the economy and the challenges in managing the environmental impact of business activities. This research aims to analyze the comparison of environmental cost accounting implementation in two SMEs, namely Tempe Tahu Bintang Jaya and the UD Mega Cipta Wood Sawing SME, as well as to evaluate the effectiveness of environmental cost management in each business. Methodology - This research uses a descriptive qualitative method with a literature study approach. Data are analyzed based on the five stages of environmental accounting: identification, recognition, measurement, presentation, and disclosure of environmental costs. Findings - The research results show that both SMEs have identified and measured environmental costs, but there are still deficiencies in the recognition and presentation of these costs separately in the financial statements. UMKM Tempe Tahu Bintang Jaya is superior in separating environmental costs, although not systematically, while UMKM Penggergajian Kayu UD Mega Cipta combines environmental costs with administrative costs without clear details. The implementation of environmental cost accounting in both SMEs is still in its early stages and requires further development. Implication - Efforts are needed to improve the classification, presentation, and disclosure of environmental costs in order to strengthen social responsibility and enhance competitiveness. Support from the government and increased awareness among SMEs are crucial to encourage the wider adoption of environmental cost accounting, thus supporting sustainability and social responsibility. Keywords: Environmental cost accounting; SMEs; Social Responsibility; Sustainability

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