Journal of Cleaner Production 11 (2003) 667–676
The use of Environmental Management Accounting (EMA) for
identifying environmental costs
Christine Jasch ∗
Institute for Environmental Management and Economics, IOW, Rechte Wienzeile 1915, A-1040 Vienna, Austria Received 28 August 2001; accepted 27 June 2002
The Expert Working Group on “Improving the Role of Government in the Promotion of Environmental Management Accounting (EMA)” was set up by the United Nations Division for Sustainable Development (UN DSD) in cooperation with a number of government agencies and non-governmental experts to promote Environmental Management Accounting (EMA) through publications, pilot projects and by establishing an international forum for discussion on the role of governments in the promotion of EMA. EMA, Environmental management accounting represents a combined approach that provides for the transition of data from ﬁnancial accounting, cost accounting and mass balances to increase material efﬁciency, reduce environmental impacts and risks and reduce costs of environmental protection. EMA is performed by private or public corporations, but not by nations and has a ﬁnancial as well as a physical component.
The core focus of environmental management accounting and of the EMA UN DSD methodology is assessment of total annual environmental expenditure on emission treatment, disposal, environmental protection and management. In addition, and that is new and challenging for most companies, the material purchase value of all non-product output and its production costs are added. This total sum often provides a frightening picture of total annual costs of inefﬁciency and gets companies to improve their information systems and material efﬁciency options, which is the goal in the light of cleaner production. The ﬁrst book published by the Expert Working Group, Environmental Management Accounting—Procedures and Principles (Jasch, C., United Nations, New York, 2001), deﬁnes principles and procedures for EMA, with a focus on techniques for quantifying environmental expenditures or costs, as a basis for better controlling and benchmarking purposes. The methodology excludes costs external to the company (so-called externalities, e.g. environmental and social effects that occur to the general public), but focuses on comprehensive assessment of direct annual expenditure on emission treatment, environmental protection and management as well as wasted material and energy input (efﬁciency losses in production). Firstly, total annual expenditure is assessed, then improvement options, savings and investment projects as well as product prices can be (re-)calculated. The method is currently applied in several case studies. The following summary provides some of the core deﬁnitions and generic assessment tables. 2002 Elsevier Science Ltd. All rights reserved.
Keywords: Environmental management accounting; Environmental costs; Activity based costing; Full cost accounting; Environmental investment appraisal; Environmental indicators; Benchmarking; Hidden costs; Environmental information systems; Material ﬂow balances; Material ﬂow cost accounting
1. The United Nations Initiative
The Expert Working Group on Improving Government’s Role in the Promotion of Environmental Management Accounting (EMA) was organized as a follow-up to informal discussions on the issue at the 1998 session
of the United Nations Commission on Sustainable
Tel.: +43-1-587-2189; fax: +43-1-587-6109.
E-mail address: email@example.com (C. Jasch).
Development (CSD 6) in the context of negotiations on
environmentally sound technologies. Those discussions
indicated that a number of governments were involved
or interested in promoting EMA, but that there had been
little or no communication among the agencies concerned. The participants in the Expert Working Group are from national environmental agencies and ministries,
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