Green Accounting and Intellectual Impact on MSMEs Sustainability in Medan

Abstract

This study examines the influence of green accounting and green intellectual capital on MSME sustainability in Medan City. Environmental pressures and regulatory requirements necessitate sustainable business practices among small enterprises. A quantitative approach using survey methodology was employed with 120 MSMEs from trade, service, and manufacturing sectors. Data were collected through structured questionnaires and analyzed using Partial Least Square Structural Equation Modeling (PLS-SEM). Results demonstrate that green accounting significantly influences MSME sustainability (β = 0.332, p < 0.001), indicating that environmental-based financial recording enhances resource efficiency and regulatory compliance. Green intellectual capital shows stronger influence (β = 0.430, p < 0.001), highlighting the strategic role of environmental knowledge and innovation capabilities. The model explains 45.7% of sustainability variance. These findings suggest that integrating green accounting practices with environmental intellectual capital development can significantly enhance MSME competitiveness and sustainability performance.