THE IMPACT OF CARBON MANAGEMENT ON ENVIRONMENTAL PERFORMANCE: EVIDENCE FROM MANUFACTURING FIRMS IN MALAYSIA

Abstract

This study aims to investigate the impact of carbon management on environmental performance. By applying the Natural Resource-Based View (NRBV) and Legitimacy Theory, this study examines key dimensions of firm-level carbon management that influence the environmental performance of manufacturing firms in Malaysia A questionnaire survey was conducted among 220 manufacturing firms registered with the Federation of Malaysian Manufacturers to achieve the research objectives. Data were analysed using structural equation modeling revealed that carbon governance (β=0.424) had the strongest impact, followed by carbon disclosure (β=0.339), carbon operations (β=0.360), and carbon accounting (β=0.280). Policymakers and industry players can leverage these insights to refine carbon management practices, improve operational efficiency, and achieve long-term cost savings, thereby enhancing manufacturing firms’ environmental performance and overall competitiveness.