Environmental management control systems and eco-capability: Catalysts for sustainable organisation performance

The Natural Resources-Based View (NRBV) and dynamic capability theory are used to support the investigation of the relationship between Environmental Management Control System (EMCS), eco-capability and sustainability performance, which is a major aim of this study within Malaysia's Environmental Sensitive Industry (ESI) context. This study employed a quantitative approach using survey questionnaires and obtained valid responses from 142 respondents. Subsequently, the data were analysed using Partial Least Squares (PLS) modelling with Reflective Formative Type II, Mode B higher-order construct. This study highlights the importance of EMCS implementation as a package of control, including planning, cultural, cybernetic, reward and incentive and administrative control. Furthermore, eco-capability is identified as a significant complementary mediator between EMCS and sustainability performance. The findings have offered both theoretical insights and practical implications, especially in the Asian business region. It advances literature by empirically validating the strategic role of EMCS in driving sustainability through eco-capability. The result can provide valuable guidance for managers in various industries that seek a competitive advantage through sustainability control initiatives and assist policymakers in developing supportive regulatory frameworks.