-. EPA/-742/F-97/005
xs/EPA
United.Slates ;
Environmental Protection
Agency
Office of
Prevention, Pesticides,
and Toxic Substances
_MC. 7409 ' ''
September 1997
Environmental Accounting Project
Quick Reference Fact Sheet
Mission: To encourage and motivate businesses to
understand the full spectrum of their environmental
costs, and integrate these costs into strategic
decision-making.
Background Environmentaland economic benefits
of practicing pollution prevention (P2) can be
difficult to measure using traditional methods of
accounting. As a consequence, industrial managers
often may not adopt P2 practices even when it might
be in the best interest of a company to do so.
EPA initiatedthe EnvironmentalAccountingProject
in 1992 to encourage businesses to incorporate
environmental costs into managerial accounting and
capital budgeting practices. An increased focus on
these costs and the closer tracking of these costs to
the responsible products' and processes gives
managers an incentive to identify opportunities for
reducing or eliminating those costs. As a result,
companies can achieve improved environmental
performance, gain competitive advantage, and enjoy'.
cost savings and/or enhanced revenues..
The Project operates in cooperation with, and based
on the recommendations ofj the business
community, accounting and other professional
societies, the academic and research community,
government, and other stakeholder groups to
advance the development and application of
environmental managerial accounting concepts and
methodologies. Major issue areas addressed by the
Project include:
• Concepts and terminology; .
• Management incentives; . .
.• Education, guidance, and outreach; and :
• Tools, .methods, and systems^
The Environmental Accounting Project maintains a
Network Directory of some 800 members who are
actively participating or are interested in the issue.
Examples of Accomplishments to Date:
• Developed an environmental accounting primer
that covers the basic terms and concepts and
discusses application options • - —.
• Published case studies on environmental
accounting initiatives at AT&T and at Ontario
Hydro (a Canadian utility) • •
• Published an analysis'of how environmental
accounting applies jto the electroplating industry
• Documented available techniques for '
estimating potential environmental liabilities*
• Published best practices report of chemical and.
oil companies' environmental accounting efforts
• Facilitated environmental accounting training for
: small business technical assistance providers
• Hosted workshops for industry and government
creating dialogue oh environmental accounting
• Supported the development of a software tool to
help companies incorporate environmental costs
into their capital budgeting decisions
• Published resource guide on tools and software
that account for environmental costs
• Completed a status report the on the extent to
which the nation's manufacturing firms consider
environmental costs in investment decisions
Projects underway include: . •
• Case studies on life cycle accounting for
materials management
• Series of short case studies demonstrating the
application and benefits of environmental1
accounting across a range of business decisions
• Research on corporate decision-making behavior
with respect to pollution prevention investments
• Research on health and safety costing issues
For further information: See the Project's website
atwww.epa.gov/bpptintr/acctg, or contact EPA's
Pollution Prevention Information Clearinghouse
at 202/260-1023, fax 202/260-4659, or
ppic@epamail.epa.g
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