ENVIRONMENTAL ACCOUNTING PRACTICES IN THE GREEN ECONOMY: A SYSTEMATIC LITERATURE REVIEW

Abstract

This systematic literature review examines environmental accounting practices critical for green economy transformation, analyzing 20 Q1 articles from MDPI Sustainability and Heliyon (2019-2024) through PRISMA methodology. Findings reveal Material Flow Cost Accounting (MFCA) and Environmental Management Accounting (EMA) as dominant tools revealing hidden environmental costs in manufacturing, complemented by Scope 1-3 carbon accounting and ESG integration for comprehensive performance measurement. Green reporting integration bridges corporate financial statements with national green GDP calculations, addressing longstanding disconnects between micro and macro sustainability metrics. The study identifies five critical research gaps: sectoral framework fragmentation, SME implementation barriers, corporate-national accounting misalignment, ESG-EA integration mechanisms, and green GDP standardization. A novel Unified EA-Green Economy Framework is proposed, integrating cost accounting, performance measurement, and integrated reporting with practical SME implementation roadmaps and global standards harmonization. Asia dominates research (90% articles), highlighting MFCA leadership in China, agricultural EMA in India, and natural capital accounting gaps in Indonesia. Contributions include the first comprehensive framework bridging theory-practice gaps, actionable SME adoption strategies, and Asia-focused green GDP blueprints. Practical implications guide corporations toward green financing access, governments toward national accounting reforms, and academics toward interdisciplinary research. This framework establishes environmental accounting as the foundational financial system for sustainable economic growth harmonized with planetary preservation