A study by Gilbert Rely of Universitas Bhayangkara Jakarta Raya, Indonesia, published in 2026 in the International Journal of Management and Business Intelligence (IJMBI), examines how management accounting practices influence the relationship between profit orientation and corporate sustainability commitments.
The study highlights an important issue: although companies may publicly express their commitment to sustainability, their internal budgeting, performance measurement, and investment decisions can still prioritize immediate financial returns.
Why Profit and Sustainability Can Be Difficult to Balance
Management accounting helps companies plan budgets, monitor expenses, evaluate performance, and make investment decisions. These processes influence which activities receive funding and how managers define organizational success.
When financial performance becomes the dominant measure of success, sustainability initiatives may struggle to secure resources. Projects involving energy efficiency, waste reduction, environmental protection, or other long-term improvements can require substantial initial investment, while their financial benefits may only become visible over time.
This creates a tension between achieving immediate business targets and meeting longer-term environmental and organizational commitments.
The challenge is not necessarily that companies reject sustainability. Rather, the systems used to evaluate business performance may make short-term financial results easier to measure and reward than long-term sustainability outcomes.
How the Study Examined Management Accounting Practices
Rely used a qualitative exploratory case study approach to investigate this tension. The study involved 18 participants selected purposively, including managers, management accountants, and personnel involved in sustainability-related activities.
Data were collected through semi-structured interviews and organizational document analysis. The information was then examined using thematic analysis to identify recurring patterns in how companies approach budgeting, performance measurement, investment evaluation, and coordination between departments.
This approach allowed the study to explore how organizational decisions are made and how financial priorities interact with sustainability commitments in management practices.
The findings provide insights into the experiences and patterns identified in the study. Because the research involved a limited qualitative sample, its results should not be interpreted as representing every company or industry.
Six Findings Reveal the Tension Between Profit and Sustainability
The study identified six key themes that illustrate how management accounting can influence corporate sustainability decisions.
First, profit targets dominated budgeting decisions. This theme was reported in 15 of the 18 participants' accounts. The finding suggests that financial objectives can strongly influence how organizations allocate resources, potentially limiting the funding available for sustainability initiatives.
Second, sustainability initiatives received greater support when their economic benefits could be measured. This theme appeared in 14 of the 18 accounts. Projects with clearer financial advantages may be easier to justify to decision-makers than initiatives whose environmental or social benefits are difficult to express in monetary terms.
Third, financial indicators outweighed sustainability indicators in performance evaluation. Reported in 13 of the 18 accounts, this theme points to the importance of the measures organizations use to assess success. When financial indicators receive greater attention, managers may have fewer incentives to prioritize sustainability outcomes.
Fourth, short-term investment appraisal disadvantaged long-term sustainability projects. This theme appeared in 12 of the 18 accounts. Investments that require significant initial expenditure but generate benefits over several years may struggle to compete with projects offering quicker financial returns.
Fifth, cross-functional coordination emerged as an important issue. Reported in 10 of the 18 accounts, this theme highlights the role of cooperation between finance teams, operational departments, and personnel responsible for sustainability. Without coordination, financial decisions and sustainability objectives may develop in separate directions.
Sixth, integrated and long-term evaluation mechanisms were beginning to emerge. This theme appeared in 9 of the 18 accounts. It suggests that some organizational practices are moving toward approaches that consider financial performance alongside longer-term sustainability outcomes.
The reported frequencies describe themes identified in this qualitative study; they should not be interpreted as statistical estimates of how common these practices are across all companies.
What Companies Can Do to Improve Sustainability Decisions
The findings suggest that companies need to examine not only their sustainability commitments but also the internal systems that determine whether those commitments receive practical support.
One important step is to incorporate sustainability indicators into management performance evaluations. In addition to monitoring revenue, costs, and profitability, organizations can assess relevant environmental and operational measures, such as energy consumption, waste reduction, and resource efficiency.
Companies can also improve investment appraisal by considering the long-term effects of sustainability projects. Decisions based solely on immediate financial returns may overlook benefits that accumulate over time, including improved resource efficiency and reduced exposure to environmental risks.
Another priority is stronger collaboration between finance professionals and sustainability teams. Finance departments can help translate sustainability objectives into budgets and measurable indicators, while sustainability personnel can provide information about environmental goals and long-term organizational impacts.
Together, these practices may help organizations make decisions that are financially responsible without overlooking their broader sustainability commitments.
Implications for Business Leaders
For business leaders, the study emphasizes that sustainability requires more than public statements or corporate policies. It also depends on the everyday systems used to distribute budgets, evaluate employees, and approve investments.
Management accounting can become a bridge between financial discipline and sustainability goals when its performance measures recognize both short-term business needs and longer-term organizational outcomes.
The findings also point to the importance of evaluating sustainability initiatives using appropriate time horizons. A project that appears less attractive under a short-term financial assessment may offer meaningful benefits when considered over a longer period.
However, the study does not establish that a particular accounting method will automatically improve sustainability performance. Further research involving different companies, industries, and organizational settings would help clarify how these practices operate across broader contexts.
About the Author and Publication
Gilbert Rely is affiliated with Universitas Bhayangkara Jakarta Raya, Bekasi, Indonesia. His 2026 article, “Unveiling the Tension between Profit Orientation and Sustainability Commitments in Management Accounting Practices,” was published in the International Journal of Management and Business Intelligence (IJMBI).
The article explores how management accounting practices shape the relationship between profit-oriented decisions and corporate sustainability commitments.
Original article: https://doi.org/10.59890/ijmbi.v4i5.62
Journal website: https://journalijmbi.my.id/index.php/ijmbi
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