Environmental Management Accounting Procedures and Principles

Environmental Management Accounting
Procedures and Principles
5.5.1. Consistency
Internal and external users of environmental information need to monitor and compare the
results of environmental performance and cost assessment over time in order to identify
significant trends. Some also wish to make comparisons with other sites or competitors.
Consistency in the recognition, measurement and presentation of environmental information is
therefore essential.
Consistency should initially be established internally, determined by the information needs of
the corporation’s user groups. A data determination and internal assessment guide with clear
definitions of what to include and where to take it from, as well as conversion factors, proves
helpful. Caution is needed when seeking to benchmark between companies in the same
sector, as even minor differences in processes, products or vertical integration through the
product life cycle can significantly distort results. As with financial reporting, it is important that
corresponding information for different periods be reported on a comparable and consistent
basis. Some more guidance on this aspect is also contained in chapter 7 on environmental
performance evaluation.
An important task for data determination is defining guidelines for the registration and
separation of the environmental expenditures dealt with within the environmental information
system. It must be ensured that the data in future periods will be calculated with the same
basis in mind. Only when the calculation method is defined and consistent over years can
comparison of absolute values in tons or money and the resulting indicators over time or
between different divisions bring meaningful results. Thus it is suggested that the data
registration criteria for each expenditure item in the tracking matrix should be documented as
such:
• Description of expenditure item or environmental indicator (absolute or relative);
• Definition of the base data and related denominators;
• Data sources;
• Conversion factors and definitions;
• Frequency of data collection and indicator calculation;
• Responsibility for data registration.
Figure 22 shows the most likely data sources for the environmental expenditures and costs.
The first round of determination of total environmental expenditure will probably also result in
improvements of the consistency of the data sources.
-58-