Environmental accounting
| Environmental accounting |
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| See also |
Environmental accounting is a change in the accounts that refer to national income and is intended to take into account the economic role of the environment - it began in the 1970s[1]. It is an opportunity for companies to introduce regulations into their operations that are cost-effective in order to avoid further regulations in the future. Creating new accounting practices that address environmental problems is one of the ways to respond[2]. According to Stefan Schaltegger „Possible reasons for the development of environmental accounting include the need to measure environmentally induced financial impacts or the ecological damage done and the need to provide a means of developing closer relationships between organisations and society, by transferring the power of knowledge to society and increasing the transparency of organisations”[3].
Items included in environmental accounts
There is no single specific definition of environmental accounting regarding the scope of which projects should be included and which not. Elements that have been taken into account in different countries are for example[4]:
- pollutant emissions in physical terms by economic sector
- actual environmental protection expenditures by economic sector
- output of the environmental protection industry
- environmental taxes, fees, and subsidies
- monetary value of the cost imposed by environmental degradation
- adjusted macroeconomic indicators such as a green GDP, sustainable national income, or genuine savings
Environmental accounting in the Netherlands
The Netherlands is one of the countries that was a leader in the development and implementation of environmental accounting. It started with the economist Roefie Hueting who in his work prepared and wanted to introduce a measure of national income taking into account the degradation and consumption of natural resources that result from economic activity. His proposals were not well received at first, but his support for environmental accounting prompted consideration of other ways to combine environmental and economic data. Thanks to this, the National Accounts Matrix including Environmental Accounts was created, which contains national income accounts and columns containing data on air pollution emissions[5].
References
- Bartelmus P.(2013), Environmental Accounting in Theory and Practice, Springer Science & Business Media, New York
- Debnath S.(2019), Environmental Accounting, Sustainability and Accountability, SAGE Publications India, India
- Hecht J.E.(2000), Lessons Learned from Environmental Accounting: Findings from Nine Case Studies, IUCN, Washington, p.1, 3, 9
- Hecht J.E.(2012), National Environmental Accounting: Bridging the Gap between Ecology and Economy, Routledge, Washington
- Schaltegger S.(2017), Contemporary Environmental Accounting: Issues, Concepts and Practice, Routledge, New York, p.13, 34, 67
Footnotes
Author: Oliwia Kamińska
