The Impact of Green Factors and digitalization to Firm Value and Firm Performance: Evidence from Small and medium enterprises (SMEs) in Medan
Pasca Dwi Putra1, Andri Zainal2, Khairunnisa Harahap3, Ivo Selvia Agusti4, Hendra Saputra5, Fenny Afrida6

Department of Business Education, Faculty of Economics, Universitas Negeri Medan, Indonesia 202211
Department of Accounting Education, Faculty of Economics, Universitas Negeri Medan, Indonesia 202212
Department of Accounting, Faculty of Economics, Universitas Negeri Medan, Indonesia 202213
Department of Business Education, Faculty of Economics, Universitas Negeri Medan, Indonesia 202214
Department of Accounting Education, Faculty of Economics, Universitas Negeri Medan, Indonesia 202215
Department of Accounting, Sekolah tinggi ilmu ekonomi eka prasetya, Indonesia 202126

Abstract

The exponential growth of micro, small and medium-sized enterprises (MSMEs) is now creating a highly competitive environment. A variety of strategies have been devised with the intention of attaining a competitive advantage, thereby establishing superiority over rival entities. Conversely, the detrimental impact of environmental damage resulting from the excessive utilisation of natural resources and the subsequent pollution is becoming increasingly apparent. Consequently, the objective of this research is to identify the factors that influence the performance of MSMEs through concern for the environment. The variables employed in this research are green accounting, green innovation, green entrepreneurship, digitalisation, and company value in relation to the performance of MSMEs in Medan City. The research was conducted on MSMEs in Medan City, with a total of 57 respondents. Hypothesis testing employs the Structural Equation Model (SEM). The findings of this study indicate that the implementation of green accounting and green innovation is associated with enhanced company performance, whereas the adoption of green entrepreneurship is linked to an augmented value of MSMEs. The conclusion of this research is that innovations based on environmental considerations and a company^s commitment to environmental protection will lead to improved company performance. Furthermore, there is evidence to suggest that companies that apply green entrepreneurship in their operational activities will increase public trust and, as a consequence, their company value will also increase.

Keywords: green accounting, green innovation, green entrepreneurship, digitalization, firm value, MSMEs Performance

Topic: Economics and Social Education