Environmental Management Accounting Adoption in Gunungpati Community Self-Help Group (CSHG) – A Case Study

Public organizations increase awareness of environmental issues by encouraging Environmental Management Accounting (EMA), which has been said to deliver numerous benefits to users. This paper proposes to investigate the adoption of EMA in public corporatized water supply organizations. This study was a case study in the Gunungpati Community Self-Help Group (CSHG). Data was from interviews with managers, internal data, and financial report documents. Data were analyzed using the Miles and Huberman technique including data reduction, data presentation, and conclusions. The findings show that Gunungpati CSHG provides water and sanitation services to 198 households, distributing to an estimated population of 103,000 individuals. Five broad categories were identified, four containing physical and monetary information. Product output, non-product output, waste flows, indirect costs, and externalities exist. They produce the volume of water purchased and extracted, water lost, environmental benefits from water recycling, potable water substituted with river saved, and damage to river health from operations. Meanwhile, the organization pay attention to the impact of the organization on the environment to maintain the ecosystem.


Introduction
In the last decade, studies on sustainability and environmental issues have triggered scholars to examine them more comprehensively.The concept of both has preceding been introduced as Triple Bottom Line (TBL), which today is considered the theoretical blueprint for all studies on sustainability [1,2].The concept developed from TBL believes companies must consider environmental and social values instead of just focusing on economics.This concept is known as the 3Ps (People, Planet, and Profit).It then gives birth to the sustainability concept in companies, stating that profit depends not only on economic performance but also on care for society and the environment-which are two inseparable factors from the business.
Environmental Management Accounting (EMA) is one of the developments of sustainability and environmental concepts.Research [3] found that EMA can mediate the relationship between Triple Bottom Line (TBL) and economic-environmental performance.The elements of TBL are also stated to be integrated with corporate performance.Meanwhile, another research [4] developed the concept of EMA by combining two environmental components, Monetary Environmental Management Accounting (MEMA) and Physical Environmental Management Accounting (PEMA).MEMA focuses on the financial impact of the environment on the company.At the same time, PEMA pays attention to the environmental impact on the ecological system, which includes past, present, and future effects.EMA emphasizes the importance of considering environmental impacts so companies do not lose their economic resources.This situation departs from the fact that consumers are recently moving towards environmental awareness (green consumers).Companies that are not environmentally conscious and 1248 (2023) 012017 IOP Publishing doi:10.1088/1755-1315/1248/1/012017 2 responsible are likely to be avoided, leading to a decline in profitability and reluctance from investors to invest in such companies.Hence, this decision will further affect the company's going concern.
Previous studies have found that EMA enhances business sustainability and competitive advantage [5-7].In addition, it also promotes process and product innovation that reduces water and energy consumption [6,8].Improved innovation in the production process also escalates cost-effectiveness and cost-efficiency for companies, especially in production units.EMA has been rapidly developing.However, information projects are still, unfortunately, limited [9].Its scarce adoption by companies is due to various factors, one of which is that EMA is still voluntary.Its implementation is mainly motivated by social structure and institutional theory [10].Thus, it emphasizes the importance of socioideological control [11].
Furthermore, the implementation of EMA is still limited and fragmented within companies, primarily in reactive and preventive stages to save costs and improve efficiency [12].Moreover, the implementation faces challenges, such as inconsistent government policies and regulations, resource unavailability, technological incapability, inadequate training and expertise, environmental cost allocation, and environmental reporting [13].This indicates the need for emphasis on coercive, normative, and mimetic pressures to increase EMA adoption [14-16] and the need for appropriate government policies and regulations [17].
The Gunungpati Community Self-Help Group (CSHG) is a social and economic enterprisededicated to improving the livelihoods of its members and the surrounding community.CSHG provides water and sanitation services to 198 households, serving approximately 103,000 residents.The provision of clean water and sanitation is mandated by Presidential Decree No. 185 of 2014.However, the process faces numerous challenges, particularly regarding the availability of clean water, resulting from changes in land use and environmental degradation [18].Moreover, to the researchers' knowledge, current regulations and policies primarily emphasize Environmental Impact Assessment (EIA).However, significant environmental impacts persist in practice-despite EIA being a requirement for company operations.This issue must be promptly addressed to prevent further socio-economic and public health implications for the community.As an agent of community empowerment, the Gunungpati CSHG should actively participate in sustainable village development.One way to achieve this is by implementing EMA, allowing it to focus on the economic aspects of selling water products and actively engage in mitigating environmental impacts and addressing social issues resulting from its operations.
This study investigates the implementation of Environmental Management Accounting (EMA) in public corporate water organizations.This study identifies the drivers motivating public water corporations to adopt EMA and explores the effects of institutional interaction.The analysis is based on interviews with managers and the use of other relevant secondary data.The main contribution of this study is to provide an understanding of the institutional pressure forces in the implementation of EMA and the public awareness of environmental issues.It provides evidence through a case study of the potential drivers for implementing EMA in community-owned water companies-an area rarely explored.In essence, this article responds to the presence of management accounting research on how community business organizations in the water sector can apply EMA and management and create control systems that have external impacts to achieve sustainability.

Methodology
This is a qualitative case study.The research was conducted in CSHG Berkah Mandiri of Gunungpati Sub-district, Semarang City.As a public water corporation, CSHG Berkah Mandiri was chosen since the local community manages it and exploits natural resources, particularly water.Its operational activities have the potential to create a sustainable environment and address today's increasing ecological issues.It offers clean water service for daily needs such as bathing and cooking, which is guaranteed according to government standards.The water is clear, colourless, and free from unpleasant odours.CSHG Berkah Mandiri is an empowering organization that should actively contribute to sustainable development.
This research utilized primary data and secondary data.Primary data obtained through in-depth interviews with managers.All activities were conducted from January to May 2023.Key individuals, such as the direct manager, played a role in environmental and sustainability practices; hence, the interviews focused on topics related to environmental sustainability.Additionally, the interviews explained the EMA definition and notification regarding data confidentiality.The selected technique for the interview was unstructured, meaning that the interviews were not conducted using rigid interview guides.It was completed flexibly, allowing for personalized discussions and in-depth information collection.Each interview at the informants' workplace lasted for approximately 1 hour.All interviews were fully recorded and transcribed.Furthermore, this study utilized secondary data in financial reports prepared by the managers every six months.The financial reports were highly beneficial in identifying information on the company's activities and environmental performance disclosure.Both aspects represent the internalization of EMA implementation that can be measured.
This study uses the data analysis techniques of Miles and Huberman.The analysis process involved data reduction, data display, and conclusion or verification [18].To ensure the credibility of the research findings, this study also validated the results through observation period extension for more credibility of the data obtained from the informants.The researcher revisited the field to conduct follow-up interviews with the informants who had provided information and discussions with new informants who had yet to be previously encountered for more comprehensive information.
In determining the list of disclosure categories for EMA, both physical and monetary, five indicators were identified: product output (physical and monetary), non-product output (physical and monetary), waste flows (physical and monetary), indirect costs (monetary), and externalities (physical and monetary).A member check was conducted after transcribing the interviews and drafting the research report.The researcher met with the informants from CSHG and asked them to review the interview transcripts.If any discrepancies were found, the researcher would make corrections and update the data used.An audit trail could be established by cross-checking the research findings with field data and validating them by seeking feedback from experts, academics, and practitioners.CSHG Berkah Mandiri engaged in activities such as recording water volumes, including the amount of water produced, water purchased, electricity usage, water loss and associated electricity usage, unused water recycling, and the manager's role in promoting environmental awareness and addressing the negative impacts of emissions on the surrounding community.The manager ensured effective management practices, enabling the transparent and accountable communication of water quantities in cubic meters to the users (community).In terms of monetary disclosure, the findings indicate that the managers have recorded the expenses incurred for various company activities, such as the cost of water purchases, water distribution, investment in water recycling, research and development activities to improve water quality and its environmental impacts, as well as costs related to reducing emissions from water pump pollution, monitoring, and enhancing water health.

Discussion
Water service companies, as expected, strive to legitimize their position and actions to impact society positively.In delivering services and reporting on water management, they adhere to the company's standard operating procedures, which ensures transparency and accountability.CSHG Berkah Mandiri did not adopt the full Financial Accounting Standards (SAK) but followed a simplified recording method based on the Entity Without Public Accountability (SAK ETAP).This approach is taken because the water company is a community-based organization with a non-profit objective.The community, together with the company's managers, oversaw and evaluated the smooth water supply, ensuring that there were no mechanical malfunctions or shortages of water for daily needs.This is one of the environmental management strategies implemented by CSHG Berkah Mandiri.By engaging in these activities, physically and monetarily, the company's environmental performance is expected to improve [19,20].
When it comes to environmental management accounting, it is known that the business activities conducted by this self-help water company are divided into two aspects: the physical aspect and the monetary aspect.From these aspects, there are five indicators, namely product output (physical and monetary), non-product output (physical and monetary), waste flows (physical and monetary), indirect costs (monetary), and externalities (physical and monetary).These activities indirectly contribute to achieving a sustainable environment, one of the components of the sustainable development goals currently implemented in Indonesia.
The nature of the community-oriented water industry relies on resources and government policies to govern company standards at the national level.Therefore, water companies reflexively endorse the adoption of EMA through actions, or business activities focused on environmental sustainability.This aligns with previous research indicating that companies allocate budgets for environmental activities and implement physical EMA [17].Government policies, such as Environmental Impact Assessments (EIA), strengthen and ensure that companies incorporate environmental costs to minimize the negative impacts of their business operations.Environmental costs, such as corporate social responsibility in environmental preservation, can create a pristine environment without harming the community.However, although the EIA concept is commendable in practice, its implementation still needs to improve, especially regarding periodic evaluations.Therefore, the government needs to be more actively involved since it has the authority and power as a regulator to ensure that clean water corporations like CSHG Berkah Mandiri consistently implement EMA [21,22].[23] found that managers play a significant role in the adoption of EMA.Moreover, CSHG Berkah Mandiri is a community self-help group that should actively contribute to achieving the village's Sustainable Development Goals (SDGs).The awareness and perception of the self-help group regarding the importance of sustainability impact increasing the adoption of EMA [24].
Previous studies indicate coercive, normative, and mimetic pressures can drive companies to adopt EMA [25][26][27].As water service users (customers), the community can be a source of such pressures because customers are critical factors in implementing EMA.For example, non-financial factors are associated with enhancing the significance of customers, including assessing customer feedback in strategic decision-making, aligning organizational responses to sustainability issues and customer values, and understanding customer environmental concerns.Additionally, the community has the normative power to encourage surrounding companies to adopt EMA.Water company managers, as decision-makers, consider the presence of the community as their primary customers, aiming to retain their trust in using the water services.In other words, no customers should be excluded from the list of water users.This will have an impact on the smooth operation of the company in the future.The company's operations may be compromised without preventive action, such as adopting EMA.

Conclusion
CSHG Berkah Mandiri has adopted Environmental Management Accounting (EMA) in its business operations.The company has integrated the recording of two environmental components, including product output (physical and monetary), non-product output (physical and monetary), waste flows (physical and monetary), indirect costs (monetary), and externalities (physical and monetary).However, in the adoption process, CSHG Berkah Mandiri has implemented a simplified recording system in accordance with the SAK ETAP standards.This is due to the business model of CSHG Berkah Mandiri, a community-based organization focused on the well-being of the community rather than profit.The adoption of EMA by CSHG Berkah Mandiri can serve as a role model for other public water corporations in implementing EMA.This is particularly important because clean water scarcity is a significant issue in several regions in Indonesia.Implementing EMA can help address this problem by ensuring that each area has good water resilience through sustainable EMA practices.Furthermore, although the recording system is still simplified, it demonstrates the commitment and awareness of the management regarding the environmental impact of their operational processes.Moreover, the adoption of EMA by CSHG Berkah Mandiri has increased public trust and participation in preserving the environment and ensuring clean water resources.
This recent study used a qualitative approach and focused solely on adopting EMA in CSHG Berkah Mandiri Gunungpati.Therefore, the findings cannot be generalized to public water corporations in Indonesia.However, it can serve as a role model for other public water corporations to adopt EMA.For

Table 1 .
related to EMA 3.1.1.Physical EMA.This table analyzes the characteristics of EMA information and environmental data disclosure.Table 1 presents the activities successfully identified concerning Physical EMA.Physical EMA in CSHG Berkah Mandiri

Table 2 .
EMA.This stage analyzes the patterns of EMA information and environmental document disclosure in CSHG Berkah Mandiri to collect patterns.Table 2 demonstrates the types of activities successfully identified concerning Monetary EMA.Monetary EMA in CSHG Berkah Mandiri future research, researchers can utilize survey methods to investigate further the driving factors for clean water corporations in adopting EMA, including cultural, institutional, and government regulations.Nyakuwanika M, van der Poll H M and van der Poll J A 2021 A conceptual framework for greener goldmining through environmental management accounting practices (Emaps): The case of zimbabwe Sustain.13 [11] Johnstone L 2020 A systematic analysis of environmental management systems in SMEs: Possible research directions from a management accounting and control stance J. Clean.Prod.244 118802 [12] Gunarathne N and Lee K H 2021 Corporate cleaner production strategy development and environmental management accounting: A contingency theory perspective J. Clean.Prod.308 127402 [13] Mukwarami S, Nkwaira C and van der Poll H M 2023 Environmental Management Accounting Implementation Challenges and Supply Chain Management in Emerging Economies' Manufacturing Sector Sustainability 15 1061 [14] Latif B, Mahmood Z, San O T, Said R M and Bakhsh A 2020 Coercive, normative and mimetic pressures as drivers of environmental management accounting adoption Sustain.12 [15] Yang L, Xiao X and Gu K 2021 Agricultural waste recycling optimization of family farms based on environmental management accounting in rural China Sustain.13 [16] Asiri N, Khan T and Kend M 2020 Environmental management accounting in the Middle East and North Africa region: Significance of resource slack and coercive isomorphism J. Clean.Prod.267 121870 [17] Jamil C Z M, Mohamed R, Muhammad F and Ali A 2015 Environmental Management Accounting Practices in Small Medium Manufacturing Firms Procedia -Soc.Behav.Sci.172 619-26 [18] Susilowati N, Mahmud A, Latifah L, Susanti A and Sari P N 2022 Analyzing the environmental sustainability of rural water management in community self-help group (CSHG) -A case study of Gunungpati district IOP Conf.Ser.Earth Environ.Sci.1098 0-8