Managers and stakeholders are increasingly aware of the importance of the environmental impact of a company’s operations in the assessment of risks and the attempt to determine the future profitability. Unfortunately, financial accounting often not fully disclose, these environmental costs. The reasons for this are many incomplete disclosure, ranging from issues of measurement of the structure of the company accounts. In many ways, the issues facing leaders and stakeholders … Read more »

Managers and stakeholders are increasingly aware of the importance of the environmental impact of a company’s operations in the assessment of risks and the attempt to determine the future profitability. Unfortunately, financial accounting often not fully disclose, these environmental costs. The reasons for this are many incomplete disclosure, ranging from issues of measurement of the structure of the company accounts. In many ways similar to the problems faced by managers and players who are trying to assess the environmental costs of operating the business issues faced when attempting the cost of production of products to determine inferior quality. The negative effects on the environment from operations as a failure in the same way that the negative impact of manufacturing a defective product can be seen as a production failure can be seen. Similarly, costs to prevent and detect environmental failures, and the cost of failure-particularly if not addressed within the company-specific can be very large and unknowable. Building on the experience of companies employs quality measures and reporting, this article presents an environmental cost reporting model to a greater transparency about the environmental impact of business operations to managers and business stakeholders to create.
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from
Cecily A. Raiborn,
Janet B. Butler,
Marc F. Massoud
Source: Business Horizons
9 sides.
Release Date: 15, September 2011. Prod #: BH446-PDF-ENG
Environmental Reporting: Toward Improved Information Quality HBR case solution

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