Analysis of the Impact of Material Flow Cost Accounting (MFCA) on the Circular Economy: The Mediating Role of Sustainable Financial Strategies (Empirical Study on Personal Care Companies in Indonesia, Malaysia, and Thailand 2020–2024)
DOI:
https://doi.org/10.24256/kharaj.v8i1.9502Keywords:
Circular Economy, Material Flow Cost Accounting, MFCA, Sustainable Finance, Sustainable Finance StrategyAbstract
This study analyzes the effect of Material Flow Cost Accounting (MFCA) on the circular economy with sustainable finance strategy as a mediating variable in personal care companies listed on the Indonesia, Malaysia, and Thailand stock exchanges for the 2020-2024 period, amidst the challenges of plastic waste in the ASEAN cosmetics sector. The objective is to test the causal relationship and mediation role using a quantitative panel data regression approach. The population includes non-cyclical consumer companies, a purposive sample of 70 observations from annual reports. Instruments include the CE Index (10 indicators), MFCA ratio, and SDGs Index (17 indicators) via content analysis; the analysis includes the Chow-Hausman test, regression, and Sobel test. The results show that MFCA has a significant negative effect on the circular economy (β=-0.409, p=0.042), sustainable finance strategy has a positive effect (β=1.128, p<0.001), but does not mediate (H2 is not significant). In conclusion, companies need to strategically integrate MFCA into green investments for an effective circular transition.
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