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Supply chain MFCA implementation: emphasizing evidence on coordination

Akira Higashida (Department of Business Management, Meijo University, Nagoya, Japan)

Sustainability Accounting, Management and Policy Journal

ISSN: 2040-8021

Article publication date: 4 March 2020

Issue publication date: 3 August 2021




This study aims to clarify systematically the contribution of material flow cost accounting (MFCA) to green supply chain management (GSCM) by examining the coordination mechanisms.


Two qualitative case studies are conducted in a major Japanese manufacturing company, which introduced MFCA in two different supply chains. The concept of coordination mechanisms in supply chain management is used to consolidate the understanding on the usefulness of MFCA in GSCM.


The study’s findings reveal the significant role played by MFCA in coordinating material flows and eliminating sub-optimization in the supply chain from both economic and environmental perspectives. Furthermore, the focal company in the chain has an important role as the MFCA leader in implementing MFCA in the chain. In particular, the environmental department can eliminate suppliers’ concerns regarding opportunistic buyer behaviors and focus on material flows across the supply chain.

Research limitations/implications

The study highlights the possibility of reviewing existing transactions by coordinating material flows. This is a new direction for the adoption of MFCA in GSCM. In addition, although the study highlights the importance of the environmental department as an MFCA leader, future research is necessary to establish this aspect with greater precision.

Practical implications

The two case studies discussed in this paper demonstrate the usefulness of MFCA expansion into the supply chain, as well as information sharing and progression, in the development of GSCM.

Social implications

This study will contribute to enhance the green supply chain by implementing MFCA.


This study indicates that MFCA can potentially reveal the material losses caused by sub-optimization and provide information to avoid sub-optimization in decision-making. Moreover, it highlights the importance of the environmental department as an MFCA leader.



This paper forms part of a special section “Responsible Supply Chain and Social Sustainability: Sustainability Accounting and Management Research and Practice”, guest edited by Ki-Hoon Lee and Stephan Vachon.

The author gratefully acknowledges the helpful comments and suggestions from the two anonymous reviewers and the guest editor Ki-Hoon Lee. This work was supported by JSPS KAKENHI Grant Number JP16K04017.


Higashida, A. (2021), "Supply chain MFCA implementation: emphasizing evidence on coordination", Sustainability Accounting, Management and Policy Journal, Vol. 12 No. 4, pp. 695-718.



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