Environmental Management Accounting Procedures and Principles

Environmental Management Accounting
Procedures and Principles
aspects. The number of environmental audits, staff training, supplier audits, cases of noncompliance,
certified sites, etc. serve as examples. They provide useful information, however,
not on the actual external environmental impact or internal environmental aspects. They
supply internal quantifiable data on environmental management activities to controlling but no
information on environmental performance or impacts. An exclusive use of MPIs for evaluating
environmental performance is therefore not recommended in ISO 14031, as they do not reveal
the material environmental impacts and may even camouflage them.
“ECI, Environmental condition indicator, specific expression that provides
information about the local, regional, national or global condition of the
environment.”
Environmental condition indicators directly measure the quality of the environment. They
are used to assess the impact of air emissions on air quality or water quality. The
environmental conditions around a company, such as water and air quality, are typically
monitored by government authorities. Only if one particular company is the sole or main
polluter in a region, monitoring by individual companies may be requested by law or may make
sense also voluntarily, e.g., noise for airports, air quality for power stations, water quality for
pulp and paper industries. Since the quality of environmental media such as air, water, soil
and the impacts of human activities (e.g., overfertilization of water, reduction of biodiversity,
greenhouse effect) depend on many factors (emissions of other companies, of power plants,
households and traffic), the measurement and recording of ECIs are primarily performed by
official institutions.
These external environmental indicators, in connection with objectives of environmental
policies, assist the company’s determination of priorities and objectives. Global and national
indicators for the evaluation of environmental quality are mostly termed “environmental
indicators” or “environmental condition indicators” and are not referred to as “performance
indicators”.
For the assessment of corporate environmental performance and impact the operational
indicators, based on the material flow balance, are relevant. The other indicators, for the
condition of the environment and the management system, are secondary.
ISO 14031 also indicates how information conveyed through indicators can be presented.
EPIs may be aggregated or weighted as appropriate to the nature of the information and its
intended use. Aggregation and weighting should be done with caution to ensure verifiability,
consistency, comparability and understandability.
Indicators can be presented in the following ways:
• Absolute figures, like tons of waste per year;
• Relative figures, compared to another parameter. The most common denominators are
production volumes, production hours, sales (turnover) and number of employees;
• Percentages or indexed, in relation to a baseline, like hazardous waste as a percentage of
total waste, or hazardous waste as a percentage of the previous year;
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