SESSION 4: Acc Accou ount nting ing for or Sust Sustaina ainabili bility ty By Nuwan Gunarathne Lecturer, Department of Accounting, University of Sri Jayewardenepura
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Environmental Management Accounting (EMA) Represents a response of management accounting Lacks a definite boundary or definition Has emerged as an interface between management accounting and environmental management
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Environmental Management Accounting (EMA) Identification, collection, analysis and use of Physical information on Monetary information on energy, water and materials environment-related costs, (wastes) earnings and savings Users
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Types of EMA systems Physical EMA (PEMA) Monetary EMA (MEMA) expressed in physical expressed in monetary units units
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Dimensions of EMA Time frame (past, current or future) Length of time frame (short term vs. long term) Routineness (ad hoc vs. routine)
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility EMA techniques Accounting for energy Carbon accounting Accounting for water Waste accounting Material flow cost accounting Environmental capital budgeting Environmental activity based costing Life cycle analysis Sustainability balanced scorecard Environmental impact assessment
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Comprehensive EMA Framework EMA Monetary EMA Physical EMA Short term focus Long term focus Short term focus Long term focus generated Routinely Past oriented infor Ad hoc infor generated Routinely Future oriented infor Burritt et al. (2002) Ad hoc infor
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility EMA in context Not merely an environmental management tool among others A broad set of accounting principles and approaches that provide information for the successful implementation of environmental strategies Includes a wide array of accounting practices and acts as the common thread that supports environmental strategies New practices are being introduced or existing practices adopted day-by-day
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility EMA development stages Stage 3 - Environmental Stage 2 – Integration Realization Stage 1 - Compliance
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Vision Compliance Conservation Integration Focus on main items Key stakeholder engagement Selected EMA practices
SESSION 4: Accounting Account ing for or Sustaina Sustainabilit bility Vision Compliance Conservation Integration Focus on main items Comprehensive coverage Key stakeholder engagement All stakeholder engagement Selected EMA practices Inclusion in daily management (EKPIs)
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility EMA to Sustainability Management Accounting (SMA) When social dimensions are integrated into existing EMA systems there will be SMA Social side of sustainability is the least developed Accounting for the social dimension of sustainability is challenging - intangible - qualitative nature - lack of consensus on relevant criteria
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Pathways for professions At present, the majority of sustainability accounting skills and knowledge comes from external training and in-house training Universities & PAB should be proactive to cater to new demands of the work place Incorporate accounting, engineering, architecture, physical sciences, etc Trans-disciplinary approach for sustainability education (approaching a problem from a number of different perspectives beyond discipline boundaries)
SESSION 4: Account Accounting ing for or Sustaina Sustainabilit bility Lighting candles…. At the Department of Accounting, USJ, we have introduced SMA and sustainability reporting Objective is not to offer these subjects in few years time Students work on different projects to understand the trans-disciplinary nature of sustainability
Thank hank y you ou
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