Improving Hospital Cost Performance through Environmental Accounting Practices: Examining Green Innovation as a Moderating Factor

Abstract

Hospitals are among the most resource-intensive institutions, requiring strategies that balance service delivery with environmental sustainability. This study examines the influence of Environmental Management Accounting (EMA) on hospital economic efficiency, while testing the moderating role of green innovation. Grounded in the Resource-Based View (RBV) and Institutional Theory, EMA is conceptualized as a strategic resource and green innovation as a dynamic capability that enhances its effectiveness. Data were collected through surveys of hospital managers, financial controllers, and sustainability officers in Indonesia, and analyzed using Structural Equation Modeling (SEM-PLS). Reliability and validity were assessed with Cronbach’s Alpha, Composite Reliability, and Average Variance Extracted (AVE), while model fit was evaluated using SRMR, R², and path coefficients. The results show that institutional pressures strongly influence EMA adoption, but compliance alone does not guarantee efficiency gains. EMA positively impacts economic efficiency, and this effect is significantly amplified by green innovation, which also has a direct positive influence on performance. The findings contribute to RBV and Institutional Theory by demonstrating that sustainable hospital efficiency depends not only on external institutional drivers but also on internal environmental capabilities. Practically, the study highlights the need for hospitals to integrate EMA with innovation strategies to achieve long-term sustainability.