This research aims at exploring the interconnection between smart green balanced scorecard system (SGBSC) and digital environment, society, and governance performance (DESGP). Alternatively, it investigates how the effectiveness of sustainability accounting information system (ESAIS) induces a mediating impact on SGBSC and DESGP. The empirical portion of this study is based on statistical information gathered from a survey given to a cross-sectional sample of 883 SMEs in developing country. The findings from the structural equation modeling approach demonstrate that greater SGBSC implementation can result in higher DESGP. This interconnection is also partially mediated by ESAIS concurrently. The observations may provide practitioners and policymakers with fresher perspectives to develop focused strategies for SGBSC application and sustainability accounting information system implementation, which can ultimately result in beneficial outcomes in DESG establishment and operationalization.
Top1. Introduction
The “Brundtland Report” (Brundtland, 1987), which put forth the idea of sustainable development, was published by the United Nations Commission on Environment and Development in response to the rise of these problems. Since its release, the Brundtland report has engendered an enormous impact on sustainable development (Phillips, 2023). For the benefit of future generations, the Brundtland report emphasizes the importance of development options that satisfy current needs without endangering the environment (Brundtland, 1987). To put it more specifically, the report is successful in highlighting environmental issues as a key component of governmental initiatives (Gomes et al., 2023). In order to lessen the pressure society puts on the environment, businesses are stated to have a significant role in regulating the impact of population on ecosystems, resources, food security, and sustainable economies (Pazienza et al., 2022). Due to severe climate change, the depletion of natural resources, unfavorable working conditions, the escalating number of corporate scandals (Zhu & Huang, 2023), COVID-19, and global conflicts (Garel & Petit-Romec, 2021) the public's demand for businesses to be environmentally, socially, and ethically responsible has increased. Corporate social responsibility and sustainability are receiving more attention from customers and investors (Zhu & Huang, 2023). Businesses are likewise investigating better moral and environmentally friendly ways to conduct their business (Chen & Xie, 2022). Investors and fund companies increasingly take environmental, social, and governance (ESG) performance into account in addition to financial performance as part of a sustainable finance strategy (Friede et al., 2015). This implies that businesses in which investors participate are expected to be not only financially successful but also environmentally and socially conscious (Tsang et al., 2023). As a result, companies worldwide are aggressively implementing ESG management (Niu et al., 2022). Due to the advancement of economic, sociological, scientific, and technological knowledge, humans have achieved tremendous things (Eccles & Viviers, 2011). The COVID-19 pandemic, on the other hand, is accelerating the adoption of digital technologies in fields including the environment (Niu et al., 2022). Through the use of digital platforms, businesses may now execute and promote their good ESG practices (Puriwat & Tripopsakul, 2022). While the academic notes have reached the consensus on the significant and positive influence of digital transformation on ESG enhancement (Fu & Li, 2023; Lu et al., 2023; Wang & Esperança, 2023; Kwilinski et al., 2023; Su et al., 2023; Zhong et al., 2023) and Huang et al. (2023) advocate that digital innovation induces a substantial and positive effect on the performance of ESG, Fang et al. (2023) argue that digitization helps businesses improve goodwill and further boost social scores as well as lowering agency costs and raising governance scores. However, there is no evidence to support the claim that digitization raises businesses' environmental rankings. Against this backdrop, businesses need to proactively take these developments into account in order to adapt to the ongoing changes brought on by digitization and meet their obligations to a range of stakeholders (Khattak & Yousaf, 2021). Businesses today work to put digital projects into practice within the context of the corporate environment that has been digitalized and declare in their strategic planning their intentions towards the environment, society, and governance in relation to these varied digitalization agendas (Puriwat & Tripopsakul, 2022). In this way, a business uses digital technology to communicate with a variety of stakeholders and gives digital ESG top priority in its strategic planning (Puriwat & Tripopsakul, 2022).