Expanding environmental management accounting: an experimental construct to integrate material wastes and emission flows

Within environmental management accounting (EMA) methodologies, material flow cost accounting (MFCA) has been successful in changing traditional attitudes of corporate organisations towards material wastes from production activities and supporting management with information to improve resource utilisations and material yields. However, EMA has not been able to expand itself beyond material wastes and cover greenhouse gas (GHG) emissions. On the contrary, GHG accounting has institutionalised itself as an independent framework to capture and report greenhouse gases from organisational activities and help firms manage its GHG related risks. The author proposes an experimental construct to integrate these two frameworks, based on their complementarity and commonality of organisational processes, and validates the construct with the help of a case example. The author believes that the proposed unification would help EMA to cover major environmental risks of businesses within single framework, help management with better information flow, and support environmentally-conscious decision-making.