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Abstract

The aim of this study is to investigate the effect of environmental management accounting information (EMAI) on the design process of environmental and sustainable products of Iraqi industrial companies. This process has five different sub-processes: research process, analysis process, conceptual design process, detailed design process and design production process. The study uses the quantitative approach as the questionnaire was designed and distributed to 87 quality managers, production managers, design managers and financial managers. The MANOVA analysis shows that EMAI has a positive and significant effect on three of these processes, namely research process, analysis process and detailed design process, while EMAI has an insignificant effect on conceptual design process and design production process. The study has practical implications for managers of industrial companies. The results provide practical and theoretical knowledge for design and production managers as well as senior management to plan the production of environmental or sustainable products.

Keywords

Eenvironmental management accounting information environmental and sustainable products product design industrial firms Iraq

Introduction

Management accounting plays an important role in providing financial and non-financial information for decision-making. Such information allows decision-makers to make appropriate choices about the use of the organization’s resources and capabilities. This traditional role of management accounting has been useful in managing product design costs Varaniūtė et al.,¹ management control systems Dahal,² financial and non-financial performance measures Bogićević and Krstić,³ and other important aspects of performance measurement. This trend has given rise to a number of important accounting applications that are considered integral parts of the strategy of modern industrial and commercial companies in a highly competitive, complex and dynamic environment. These applications include activity-based costing, activity-based management, balanced scorecards, target cost, quality cost, managerial creativity; value management and shareholder value analysis Rasyid et al.⁴

Due to the complexity of the business environment and the social role of industrial companies in terms of protecting the environment, reducing pollution levels, reducing carbon levels in the air and contributing to the sustainable development of society, industrial companies have been paying attention to environmental and sustainability issues and integrating them into accounting systems. This integration is known as environmental accounting (EA), or green accounting.⁵

EA is not a new field; it dates back to the 1970s as reported by Khalid et al.⁶ and has gone through different stages of development, reflecting the concern of accounting with contemporary and renewable environmental issues. This concern is evident in the integration of environmental information into the accounting system.⁷ The main outcome of this integration is environmental management accounting (EMA) as a component of EA. Vinayagamoorthi et al.⁸ stated that the objective of EMA is to provide decision-makers with accounting and non-accounting information that goes beyond the traditional management accounting system. Sari et al.⁹ pointed out that EMA is the process of collecting and analysing information related to environmental costs in order to assist management in making decisions related to product design, process design and product pricing.

EMA has developed because it has a relationship with product design, especially for environmental or sustainability products. Some multinational companies have introduced products, such as environmental products, clean products, sustainable environmental products and environmental design products that have become popular and accepted by consumers worldwide. Hojnik et al.¹⁰ pointed out that European consumers prefer to buy ecological products that take into account environmental design. However, Doorasamy¹¹ argued that the development of EMA is still slow, and it is used in different areas in industrial companies. Similarly, Varaniūtė et al.¹ argued that managers do not want to make large investments in the development of EMA systems for the long term because they believe that these investments are associated with high risks and uncertainties.

Research gap and problem

Al-Mahdawi and Abdul-Amir¹² diagnosed many environmental challenges facing the business environment in Iraq, including increasing environmental pollution, climate change, desertification, drought and high waste rates. There have been several attempts to use green production and the green economy to provide solutions to environmental problems. For example, Abdulhussain¹³ examined the possibility of applying EA in Iraqi industrial companies and concluded that although there is an awareness of the importance of applying EA in this environment, this type of accounting is not applied due to several difficulties and limitations. Jaff et al.¹⁴ concluded that the application of management accounting methods and environmental costs in cement firms is limited due to the fact that the majority of these firms do not use management accounting and environmental cost accounting. Al-Humairi¹⁵ examined the method of integrating the traditional applied accounting system and the disclosure of environmental information by including such information in financial statements. Thabit and Abdulrahman¹⁶ pointed out that EA is an important control tool for reducing environmental violations, harmful emissions and the cost of manufacturing products in the long run.

Globally, Tanc and Gokoglan⁷ examined the sensitivity of Turkish industrial companies to environmental issues and EA methods within the scope of social responsibility accounting, as well as the applicability of these concepts in these companies and their impact on strategic management accounting. Ariffin¹⁷ considered EMA an important innovation that must be applied by companies to allow them to identify methods of more efficient operations and better consumption of resources that can lead to positive environmental and economic performance. Varaniūtė et al.¹ examined how management accounting systems can be integrated with sustainability and concluded that this integration improves the performance of companies. Johnstone¹⁸ stated that information on environment and sustainability is necessary for firms to support and develop environmental management control systems. Kelsall¹⁹ discussed how EA is used for management purposes. In this regard, management starts to pay more attention to the accounting for ecosystem management and cost accounting for environmental materials.

Accordingly, the relationship between EMA and product design is not discussed in the literature. Therefore, this study aims to fill this gap by identifying the role of EMA information in the design and development of sustainable and environmental products. This research will determine how EMA can be integrated with the stages of the process of environmental product design, meaning how environmental and sustainability requirements are incorporated into the product design and development process.

This study makes several theoretical and practical contributions. First, it provides a theoretical framework for the relationship between the EMA information system and the process of environmental or sustainability product design and development. Second, the study provides a practical framework for using EMA information in the process of designing and developing environmental or sustainability products. Third, it enables design managers, production managers and senior management to plan the production of environmental or sustainability products. Fourth, it helps production, finance and design managers estimate the costs of producing environmental and sustainability products. Fifth, the study provides a practical guide for how to use EMA information at each stage of the design and development of environmental or sustainability products.

Literature review

The concept of environmental management accounting

Bennett et al.²⁰ defined EMA as an accounting system that generates, collects and uses financial and non-financial information to improve economic environmental performance and sustainable business. Doorasamy¹¹ mentioned that EMA is an integrated approach that combines financial and non-financial information to reduce the negative environmental impacts of business activities and increase the efficiency of material use. In the same framework, Vinayagamoorthi et al.⁸ defined EMA as the process of collecting and analysing information about environmental costs for the purpose of making internal decisions on product design, process design and product pricing. Ariffin¹⁷ stated that the role of EMA is related to the diagnosis, measurement and analysis of environmental costs and that it goes beyond traditional management accounting.

Wahyuni²¹ concluded that EMA is useful in cost savings, product pricing, optimal use of resources, innovation, clean products, increasing value for investors and improving the company’s reputation. In examining the impact of environment and sustainability in management accounting, Varaniūtė et al.¹ identified how the management accounting system can absorb environmental and sustainability requirements, especially with regard to product development and integrating those requirements when developing environmental and sustainable products. The results showed that the integration process is the main driver of changes in management accounting, product development and improvement of company performance.

Particularly in environmentally oriented companies, the main aspect of an EMA system is the process of identifying, measuring and analysing environmental information regarding costs incurred by the company in order to improve environmental performance and provide necessary information for making decisions about company activities. This aspect aims at improving the environmental performance of companies and the quality of life in society.

The EA system appeared as a result of the failure of the traditional management accounting system to fulfil environmental requirements imposed by regulations and laws, as well as the voluntary orientations of companies in serving society and improving the environment and quality of life. Ariffin¹⁷ argued that companies have found the solution to their environmental problems through the application of the EMA system, which has become an integrated approach that needs to be applied in companies carrying out environmentally harmful operations. Companies that implement the EMA system have been able to reduce the environmental impact of their operations due to their focus on managing environmental costs and improving the company’s environmental performance.²² In addition, companies that have implemented the EMA system have started to use fewer resources and focus on environmentally friendly resources with less impact on the environment.²³ EMA also plays an important role in providing managers with necessary information about the costs and benefits related to environmental performance and environmental and sustainable products. EMA also plays an important role in the integration of day-to-day operational information that management needs to assess the company’s environmental status and its compliance with environmental requirements.²⁴

Furthermore, EMA provides the necessary measurements to track costs and revenues and build measures for assessing environmental and sustainable performance.²⁵ These measurements enable a company to plan costs and profits and assess the feasibility of manufacturing and providing environmental products from environmental, social and economic viewpoints. Székely et al.²⁶ believe that EMA will be able to integrate many activities within the framework of environmental manufacturing processes for the purpose of achieving environmental goals and requirements. Some of these activities are related to creativity in product design, process design and the recruitment of creative and exceptionally skilled human resources. Doorasamy¹¹ believes that EMA provides information about product pricing when costs associated with environmental products are involved. In other words, management accounting provides information about the price of a product that fulfils the characteristics of or complies with environmental requirements. From another perspective, EMA provides information about measuring the profits of environmental products, making the appropriate decisions about abandoning or continuing the production of an environmental product, redesigning in order to reduce costs, improving the environmental performance of the product and eliminating unnecessary costs.

Accordingly, EMA plays a vital role in the success of a company’s environmental policy and its compliance with the environmental requirements imposed voluntarily by the organization or by environmental laws and regulations.

Product design process

Product design is one of the important processes in industrial firms. It requires the accurate analysis of structural requirements and other materials and requirements to determine the possibility of manufacturing and developing a product.²⁷

Ghimisi and Nicula²⁸ defined product design as all activities related to the creation and communication of information to transform data from multiple parties, including the market, into information and opportunities for the purpose of producing and presenting prototypes, initial specifications, designs and programmes. Cheng²⁹ defined product design as a creative, planned, step-by-step, purposeful and directed activity, where the design process refers to the process of developing the design and the order in which this process is carried out to achieve the design tasks.

Althuizen and Chen³⁰ viewed product design as a process of interactive and iterative sequential arrangement. This process requires an integrative design of the product life cycle — an exchange of information between designers from the beginning of the product design, taking into account all factors related to the product design process. This is in order to achieve the objectives of the design process in terms of improving quality, shortening the development cycle, reducing costs and protecting the environment. Chen³¹ described product design as a series of interactive and iterative processes. In this process, the designer considers factors such as technology with a focus on product performance.

The product design process focuses on the need to integrate a number of aspects, such as manufacturing, assembly, inspection, materials and other process-related factors, including maintenance, environment, distribution and recycling.²⁷ Ginting et al.³² emphasized this integration by pointing out that the product design and development process requires a holistic view of all aspects of the process and is not limited to one aspect rather than another. For example, technological products that require high technology should not neglect other aspects such as shape, weight and size.

Raffaeli et al.³³ focused on the role of designers in the product design and development process, noting that designers quickly learn about the production environment and try to obtain the necessary information for the design by using their experience in product design to simulate the requirements of the new design. However, it must be admitted that the designer cannot satisfy everyone, as experience alone is not enough. This is because the design process requires that designers have timely access to actual production data in order to design excellent professional products.

Stages of the product design process

The product design process encompasses the following stages:

1- Research: This stage is considered to be the starting point in the process of designing a new product or developing an existing one. Cheng²⁹ asserted that at this stage, the designer needs to know the management objective behind the production of the new product, the resources currently available and how and from where the information required for the design process can be obtained. At this stage, the designer’s attention is focused on human resources, material resources and the internal and external environment. For example, the designer needs to know who the current users of the product are, future potential users, distributors, other manufacturers and how to dispose of and recycle the product. With regard to environmental and sustainable products, the designer must gather the necessary information about the environmental products available, the way they are distributed, the information available about them, the level of consumer awareness of these products and the prices, quantities and types of products offered. Chan³⁴ pointed out that, in addition to legal requirements imposed by governments, there are several incentives that make companies pay attention to incorporating environmental and sustainability requirements into product design. However, as discussed by Yuliarini et al.,³⁵ legal requirements are not the only motivator that makes companies think about providing environmental and sustainable products, as the variables of awareness of community requirements, reputation and optimal use of available resources play an important role in a company’s product development and design.

Alli et al.³⁶ noted that the role of the EMA information system is highlighted in providing information about the availability of the potential to produce environmental and sustainable products by the company, information on the availability of machinery and equipment capable of producing environmental and sustainable products, information on the human potential to produce environmental and sustainable products and information on the internal environment suitable for producing sustainable environmental products. Therefore, this study’s first hypothesis was as follows:

Hypothesis 1:

There is a statistically significant positive correlation between the EMA information system and the research stage.

2- Analysis: During the research stage focus on gathering information related to human resources, material resources and the internal and external environment, the designer will be able to analyse this information and identify users’ wants and needs and the expected form of the product.²⁹ At this stage, the designer can reach one of two conclusions. The first is that the condition of the product is suited to current trends and can meet the needs of most people in the environment. The second conclusion is that the product does not meet the needs of individuals and the designer needs to explore alternative methods of solving the problems associated with individuals’ lack of interest in this product. In the case of sustainable products, Rasyid et al.⁴ pointed out that the designer will specify the required environmental specifications, the features that user’s desire, their ability to distinguish these features and the aspects they prefer to see in the product. For example, consumers may want to know about the recyclability of the product, the chemicals contained in the product and the impact of such chemicals on public health.

Tanc and Gokoglan⁷ pointed out that the EMA system provides information related to the analysis of purchasing options for the machinery required to produce environmentally sustainable products. The company selects the machinery capable of producing the products it chooses and allocates efficient human resources capable of designing and producing environmental and sustainable products. Pratiwi et al.²² stated that the company will be able to analyse environmental and sustainable products, determine the characteristics of each product and assess the impact of the products on the surrounding environment. In addition, the company must also identify and analyse the products that consumers want and that the company has decided to produce. Therefore, the second hypothesis was as follows:

Hypothesis 2:

There is a statistically significant positive correlation between the EMA information system and the analysis stage.

3- Conceptual design: The conceptual design stage begins after the research and analysis stages because it reflects the results of the first two important stages. The conceptual process is a very important process in the product life cycle. Cheng²⁹ stated that the conceptual design is a set of ordered and focused concepts for the concise design of a product based on the analysis of market demand and consumer needs. At this stage, the designer is able to transform the vague and abstract image of a product into a clear and tangible one. Conceptual design determines the main purpose and direction of future product development. This is one of the most important stages as it enables the company to conserve resources, improve production and sales, potentially increase profit margins and improve recycling issues.¹

Within the framework of the EMA information system, Yuliarini et al.³⁵ argued that the company builds a set of procedures to start producing environmental and sustainable products, such as determining the types of environmental products required and the types of characteristics desired in each product. Thus, the company sets goals for each environmental product to be produced and identifies opportunities to change and improve the conceptual design and the resources required to produce each environmental and sustainable product. Therefore, the third hypothesis was as follows:

Hypothesis 3:

There is a statistically significant positive correlation between the EMA information system and the conceptual design stage.

4- Detailed design: Patil et al.³⁷ stated that the detailed design stage is a visualization process based on the previous design concepts in the early stages. According to Cheng²⁹ this stage can expand and vary based on different design concepts and gradually form a clear visual image of the product. At this stage, the focus is on abstract design concepts, which are thought of and extended from different angles to different characteristics and methods. Gan and Grunow³⁸ asserted that at this stage, the techniques of disseminating modern technologies, computer-aided design and manufacturing are fully utilized. It is also possible to make full use of technology to build a digital design using design drawings and three-dimensional prototypes that can be obtained with rapid prototyping technology. The designer will implement the model in terms of the functional, structural, colour and form design of the product.

Mukwarami et al.³⁹ pointed out that the EMA information system should provide information related to internal decisions on the cost of converting the detailed design into a final product and the cost of making substantial changes to the final product. The EMA information system also provides information related to the company’s ability to evaluate the selected designed product from all angles and dimensions. Here, the company can reach the stage of maximization in relation to the expected benefits of the product. The company develops detailed procedures for the product in terms of structure; design features such as colour and size; and calculates the expected costs and benefits of each feature. Therefore, the fourth hypothesis was as follows:

Hypothesis 4:

There is a statistically significant positive correlation between the EMA information system and the detailed design stage.

5- Design production: The design production stage mainly refers to the production of the initial design to prepare the final product. At this stage, the design results are presented in a detailed and complete manner by providing the design, dimensions, drawings, parts drawings, construction drawings, detailed presentation drawings, structural drawings and so on.²⁹

Here, companies need to introduce new products faster than their competitors, before new technologies emerge, market changes occur and the complexity of production and products increases, which requires the creation of a broad knowledge base for engineers.⁴⁰ According to Huseno⁴¹ the product launch decision includes what to launch, where to launch, when to launch and why to launch in the market, taking into account that although the product may be clear, it may fail due to the weakness of the product launch strategy. Here, if the new product launch strategy is in line with the actual market, the product launch will be successful.

Mukwarami et al.³⁹ stated that the EMA information system should provide information about the cost of converting the detailed design into a final product and the cost of making significant changes to the final product so that the designed product complies with the objectives set and environmental characteristics of each environmental and sustainable product, as well as the environmental and regulatory requirements in the environment in which the product will be produced and sold. Therefore, the fifth hypothesis was as follows:

Hypothesis 5:

There is a statistically significant positive correlation between the EMA information system and the final design stage.

Methodology

The research is based on a questionnaire that was developed for the purpose of this study. Face validity and content validity of the questionnaire were made. The responses were classified according to five (1–5) point Likert scale. The questionnaire includes two parts; the first part contains four items related to personal information; the second part contains 40 items related to the research variables. The questionnaire is used for the purpose of this study due to the limitation of secondary data disclosed by the companies in Iraq. On the other hand, as many departments are involved in the production of environmental and sustainable products because it is a multi-dimensional process, collecting data from all these participants is useful to improve the process and reach true conclusions about it.

Population and sample

The population of this study consisted of managers working in industrial companies in Iraq, whose job titles included production managers, quality managers, financial managers, and design managers. 25 industrial companies were visited. These companies are listed on the Iraq Stock Exchange (ISE). One or two interviews were conducted with managers from each company. Table 1 shows the population and sample of the study.

Table 1.

Sample distribution.

Questionnaire	Production manager	Quality manager^a	Financial manger	Design manager^a	Total
Distributed	25	25	25	17	92
Return	22	23	25	17	87
%	0.88	0.92	1.00	1.00	0.945

^aIn some firms, the design management is under the responsibility of quality management.

Research instrument: A survey questionnaire

The study consisted of a survey questionnaire with two main sections. The first section asked for the demographic information about the respondents. The information consisted of job title, education level, years of work experience, and number of training courses. Table 2 shows the demographic information of the respondents.

Table 2.

Demographic data of respondents.

Demographic Info	Class	Number of respondents	%
Job title	Production manager	22	0.25
	Quality manger	23	0.26
	Financial manager	25	0.29
	Design manager	17	0.20
Education level	Diploma	5	6%
	Bachelor	66	76%
	Postgraduate	16	18%
Year of experience	Less than 5 years	7	8%
	5–10 years	47	54%
	More than 10 years	33	38%
No. of training courses	Less than 5 courses	36	41%
	5-10 courses	44	51%
	More than 10 courses	7	8%

In the second section, there are 10 questions about the independent variable (environmental management accounting information-EMAI). Also, the questionnaire includes 30 questions about the dependent variables; research process (RP), analysis process (AP), conceptual design process (CDP), detailed design process (DDP), and design production process (DPP). Table 3 shows the number and order of questions for each variable (see appendix 1).

Table 3.

The structure of questionnaire.

Type of variable	Name of variable	Sequence of questions	Number of questions
Independent	EMAI	1–10	10
Dependent	RP	11–16	6
	AP	17–22	6
	CDP	23–28	6
	DDP	29–34	6
	DPP	35–40	6

Variable measurement and model specification

There are two variables in this study. Following the previous studies (e.g.,^11,17,22,1 the independent variable is the environmental management accounting information (EMAI). On the other hand, the dependent variables are product design processes which include five sub-process; research process (RP), analysis process (AP), conceptual design process (CDP), detailed design process (DDP), and design producing process (DPP).^42,1 In Figure 1, the relationship between the dependent variable and the independent variable is explored.

Figure 1.

Research model.

According to the relationship between the dependent variable and the independent variable, the following models will be tested in the study:

R P = α + β 1 E M A I + ε

(1)

A P = α + β 1 E M A I + ε

(2)

C D P = α + β 1 E M A I + ε

(3)

D D P = α + β 1 E M A I + ε

(4)

D P P = α + β 1 E M A I + ε

(5)

Note:

RP = Research process

AP = Analysis process

CDP = Conceptual Design process

DDP = Detailed Design process

DPP = Design Producing process

EMAI = Environmental Management Accounting Information

β = coefficient

α = constant

ε = standard error

The study uses MANOVA to test the hypotheses because it is the relevant test related to the model of this study. This statistical test is used when the study has one independent variable and more than one dependent variable. Also, the study uses ANOVA and Tukey analysis to find out the effect of demographic variables on both independent and dependent variables.

Results

Result of construct assessment: reliability test

For the purpose of this study, Cronbach’s alpha, as shown in Table 4, was conducted to test the stability of the scale, which indicates how well the items measuring a concept hold together as a set, and it is equal to 0.901 for the whole questionnaire, 0.884 for EMAI, and 0.900, 0.900, 0.802, 0.886, and 0.823 for RP, AP, CDP, DDP, DPP, respectively. These results are considered high reliability.

Table 4.

Results of reliability test.

Variables	No. of questions	Cronbach’s alpha
EMAI	10	0.884
RP	6	0.900
AP	6	0.900
CDP	6	0.802
DDP	6	0.886
DPP	6	0.823
Total	34	0.901

Descriptive statistics

The mean and standard deviation (SD) of all variables of the study were calculated as descriptive statistics. Table 5 shows the results of the mean and standard deviation of the variables.

Table 5.

Descriptive statistics.

Variables	N	Mean	SD
EMAI	87	4.25	0.47
RP	87	3.60	1.174
AP	87	3.61	0.81
CDP	87	3.40	0.93
DDP	87	3.40	1.0
DPP	87	3.50	0.87

The results of Table 5 show that the mean of the variables is between 3.40 and 4.25, which indicates that the industrial companies recognize the importance of these variables. The mean of EMAI is (4.25), which is high, indicating that the respondents believe that EMAI should receive a high level of attention when designing environmental and sustainable products. The respondents also gave a higher weight to the research and analysis processes than the other three stages due to their importance in the design of environmental and sustainable products.

Correlation and multicollinearity

Table 6 presents the Correlation and multicollinearity of the model.

Table 6.

Correlation and multicollinearity.

Variables	RP	AP	CDP	DDP	DPP	EMAI
RP	1.000	—	—	—	—	—
AP	0.211	1.000	—	—	—	—
CDP	0.104	0.185	1.000	—	—	—
DDP	0.321	0.216	0.541	1.000	—	—
DPP	0.123	0.012	0.671	0.557	1.000	—
EMAI	0.276^a	0.313^a	0.256^a	0.590^a	0.114^b	1.000

^aCorrelation is significant at the 0.01 level (2-tailed).

^bCorrelation is significant at the 0.05 level (2-tailed).

The results of Table 6 show that there is a positive and significant correlation at 0.01 between EMAI and RP, AP, CDP and DDP, while the correlation between EMAI and DPP is positive and significant at 0.05. These results indicate that the increase in the information of environmental management accounting leads to the improvement of the process of designing sustainable and environmental products. On the other hand, Table 6 shows that there are no multicollinearity problems in the model as the correlations between the dependent variables are less than 0.80.

Regression analysis: MANOVA analysis

MANOVA is simply an ANOVA with multiple dependent variables. It is used when there are multiple dependent variables as well as independent variable(s) within the model. This section shows the results of MANOVA analysis of EMAI on the dependent variables. MANOVA analysis has two main outputs; the results of multivariate tests, as here there are four models for each dependent variable, as shown in Table 7, and the results of univariate tests of the effects of the independent variable on each of the different dependent variables, as shown in Table 8.Table 7 shows the results of MANOVA for the effect of EMAI on the product design processes. In the MANOVA analysis generated by using SPSS, four test statistics are reported for the group effect: Pillais, Hotellings, Wilks, and Roys. The Pillais, Hotellings, and Wilks tests indicate that the multivariate effect is statistically significant for the data, while the Roys test is used to calculate the largest root criterion of the association between the independent and dependent variables.⁴³ According to Aniesedo and Okoli⁴⁴ all four tests in MANOVA are important to improve the observed power of the model. The results of this study indicate that the EMAI has a significant effect on the three dependent variables as a group where the Sigs for four different multivariate tests are (0.012) which is less than 0.05. The observed power is 0.789 which indicates the power of the statistics and it is acceptable power.

Table 7.

Results of multivariate tests^c.

Source and effect		Value	F	Hypothsis df	Error df	Sig	Noncent parameter	Observed power^b
EMAI	Pilli’s trace	0.112	7.043^a	4.000	105.000	0.012	14.130	0.789
	Walk’s, lambda	0.886	7.043	4.000	105.000	0.012	14.130	0.789
	Hoteling’s trace	0.104	7.043	4.000	105.000	0.012	14.130	0.789
	Roy’s largest	0.104	7.043	4.000	105.000	0.012	14.130	0.789

^aExact statistic.

^bComputed using alpha = 0.05.

^cDesign Intercept + EMAI.

Table 8.

Tests of between-subjects effects (N = 87).

Source	Dependent variable	Type III sum of squares	R-square	Mean square	F	Sig	Noncent parameter	Observed power
EMAI	RP	0.632	0.245	0.632	6.176	0.014	6.176	0.693
	AP	0.342	0.218	0.342	5.097	0.026	5.097	0.609
	CDP	9.395	0.009	9.395	0.796	0.317	1.010	0.169
	DDP	0.619	0.136	0.619	1.010	0.037	0.037	0.594
	DPP	0.220	0.072	0.220	0.214	0.118	0.214	0.044

^bComputed using alpha = 0.05.

The second part of the MANOVA analysis presents univariate tests of the effects of the independent variable on each of the different dependent variables, as in Table 8.

The results of Table 8 show that the EMAI has effects on RP, AP and DDP where the Sig values are less than 0.05. On the other hand, EMAI has no effect on the other two dependent variables; CDP and DPP. The observed performances for RP, AP and DDP (0.693, 0.609 and 0.594) are acceptable and they are better than the observed performances for CDP (0.169) and DPP (0.044). From the results, it can be concluded that EMAI is very important for the design of environmental and sustainable products in the early stages of this design process.

The effect of demographic variables

In this study, there are four demographic variables: job title, education level, years of experience, and training courses. These variables describe the type and distribution of the sample used with inferential statistics. Table 9 shows the results of the demographic variables in relation to the EMAI (independent variable) and the product design process (dependent variables).

Table 9.

Results of effect of demographic variables (ANOVA).

Variables	Job title		Education		Experience		Training
Variables	F-value	Sig	F-value	Sig	F-value	Sig	F-value	Sig
EMAI	0.572	0.821	0.699	0.552	2.026	0.031	0.681	0.123
RP	1.754	0.130	0.972	0.433	0.369	0.776	0.552	0.235
AP	1.358	0.141	0.326	0.823	0.068	0.977	0.212	0.995
CDP	0.939	0.430	0.015	0.958	0.509	0.678	0.025	0.988
DDP	0.727	0.541	0.972	0.433	0.320	0.811	0.952	0.332
DPP	1.086	0.365	0.942	0.449	0.987	0.521	0.678	0.505

Table 9 shows that there are statistically significant differences between the respondents in terms of work experience and information about the environmental management accounting system at the 5% significance level. In addition, Tukey analysis was conducted to find out the source of these differences. Table 10 shows the results of Tukey analysis.

Table 10.

Results of Tukey test.

Experience	Size	5–10 years
Less than 5 years	7	3.345
5–10 years	47	4.372
More than 10 years	33	3.931
Sig	—	0.181

^asignificant level 5%.

The results of Tukey test indicate that there is only one source of differences that is (5–10 years) as the mean is the highest (4.372) among the means of other years of experience.

Discussion

The present research aimed to determine the role of EMA information systems in improving the design process of environmental and sustainability products in a sample of Iraqi industrial companies. These companies are trying to produce green and environmentally friendly products. In order to produce these products, it is necessary for companies to develop a management accounting information system that simulates the need for environmental and green information about the products, machines and equipment necessary to achieve this, as the traditional management accounting information system has failed to provide this type of information. On this basis, previous studies have pointed to the potential role of management accounting in providing financial and non-financial information for decision-making on the design of environmental products and in providing information at each stage of the product life cycle. The EMA information system evaluates the available alternatives for environmental products and collects information on the sales prices of each environmental product and its sales forecasts and costs. In terms of non-financial information, the EMA information system provides information about qualified human skills in dealing with environmental products, the environmental performance of the company, efficient use of materials in the manufacture of ecological products and information on trends and opportunities for improving the environmental performance of both the company and sustainable products.

This study has attempted to provide new practical evidence about the role of EMA information in improving the product design process in an industrial environment that requires such information for improvement of the manufacturing process for environmental and sustainable products. In alignment with prior studies (e.g.,^29,30,39 the results of this study showed the importance of the EMA information system in improving the design process of environmental products, especially in the stages of research, analysis and detailed design, where there is a significant need for financial and non-financial information of an environmental nature, including environmental costs, compliance with environmental specifications and product structure, characteristics and specifications. In these three stages, the product image becomes physical and complete, and consequently, management will have a clear idea of the cost and structure of the product. All other processes that complete the design process will be routine and ordinary. Cheng²⁹ pointed out that in the research and detailed design stage, there will be a significant need for information by the designer to form an abstract image of a realistic product. In addition, management will have a clear picture of the production costs, expected production quantities and other expenses, selling prices and the marketing process of the product.

In the Iraqi industrial environment, there is a tendency for industrial companies to start the production of environmental and sustainable products in order to catch up with global development in this field, whereas environmental products and sustainability and development projects have become one of the most important features of the era.

Conclusions

This study is one of the few studies conducted in the Iraqi industrial environment. It aimed to analyze the role of environmental management accounting information in improving the design process of environmental and sustainability products. The study assumes that the improvement process requires identifying the information needed in all the different stages of the product design process, starting from the research stage to the production stage. The study has found that environmental management accounting information is important and necessary for making decisions related to improving the product design process. The importance of environmental management accounting information is clearly reflected in the research, analysis and detailed design stages, where the impact of such information was positive and statistically significant. This reflects the important role such information plays in making decisions related to product design, where the importance of information such as product costs, associated environmental costs, service costs and recycling is clear. In addition, the study find out that the years of experience as one of the demographic variables has effect on EMAI indicating that the respondents with more experience have more awareness about integrating EMAI in the production of environmental and sustainable products.

There are several practical implications of these findings that can serve management and designers. First, it visualizes the relationship between environmental management accounting information system and the process of designing and developing environmental or sustainability products, and the importance of building and designing an environmental management accounting information system in industrial enterprises. Second, in practice, the system provides financial and non-financial information for the purpose of improving the design and development of environmental or sustainability products. For example, this system integrates financial and non-financial information to consider most of the aspects related to the decision to design, improve or develop a product. Third, the research results provide practical and theoretical knowledge for design and production managers as well as senior management to plan the production of environmental or sustainable products. Fourth, the research results provide a practical guide on how to use environmental management accounting information system at each stage of designing and developing environmental or sustainable products.

However, the research results are subject to the following limitations: First, the information related to the construction of the research model and obtaining the results was obtained through a questionnaire addressed to a sample of production, quality, design, and finance managers. Therefore, the research results reflect their point of view and are difficult to generalize to all companies. Here, the study suggests the use of other tools to collect information, such as interviews or approved administrative records. Second, most of the companies surveyed do not currently produce environmental or sustainable products and do not have an environmental management accounting information system. As a result, the results of the research are only visions of the sample members and are not related to actual facts. Therefore, the study proposes to compare the results of the relationship between environmental management accounting information system in companies that produce sustainable products with those that do not. Third, the stages of product design are many and different from one company to another, so it is difficult to study all the stages of product design used by different companies. On this basis, this research examined the relationship between the environmental management accounting information system and the stages of product design as described in the relevant literature review in this field. In this regard, the present study suggests conducting a similar study using different stages of the ecological product design process.

Footnotes

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Dunia Jaleel Jafer Al Mosaoy

Appendix

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