Environmental accounting reports; ABC and ABM for environmental costs Many countries provide motivation for entities to produce environme

            Environmental accounting reports; ABC and ABM for environmental costs

Many countries provide motivation for entities to produce environmental accounting reports. For example, 17 countries - United Kingdom, Denmark, Netherlands, Belgium, France and Germany among others - participate in the European Environmental Reporting Awards program. In Japan, the Global Sustainability Forum and the National Association for the Promotion of Environmental Conservation have given Environmental Report Awards since 1997. In addition, Toyo Keizai and the Green Reporting Forum have given a Green Reporting Award since 1998. These awards encourage organisations to take responsibility for environmental conditions that affect the wellbeing of society as a whole. Visy Industries in Australia (refer to self-study problem 1) has also been recognised by similar Australian sustainability awards programs.

You are required to conduct research about corporate environmental disclosures. Choose one company located in Japan and a competitor located in Australia. Go to each company’s website and search for information about its environmental policies and procedures.

Also conduct research to find governmental guidelines for environmental accounting. Go to the website of the Environmental Protection Authority in your state or territory (for example, www.epa.vic.gov.au; www.epa.sa.gov.au) and search for information about environmental or sustainability accounting. Now perform a similar search on the website of Japan’s Ministry of the Environment (www.env.go.jp/en/). Skim through the information that you find on each website.

In its Environmental Accounting Guidelines, Japan’s Ministry of the Environment identified the following environmental conservation cost categories:

Required

(a)     Is environmental accounting an ethical issue? Why?

(b)     Which company provides the easiest-to-find and most understandable information about environmental policies and procedures? Explain.

(c)     Discuss a company’s responsibilities for reporting environmental information to various stakeholders, including shareholders, managers, employees, other companies, government regulators, product customers and the general public.

(d)     If one company provides better reporting than a competitor of its environmental behaviour, policies, and procedures, does that mean the company is more environmentally responsible than its competitor? Why?

(e)     What factors are likely to affect an entity’s willingness to publish an environmental accounting report?

(f)      Discuss possible reasons why the governments of different countries place different degrees of emphasis on environmental accounting reports.

(g)     Discuss ways in which ABC systems could be used to capture information for environmental accounting reports.

(h)     Discuss ways in which the process of preparing and publishing an environmental accounting report is likely to help a company reduce its environmental costs.

(i)      Should all governments require companies to publish environmental accounting reports? What values did you use to arrive at your conclusion?

            (LO1, 2, 3 and 4)