Eco Accounting
Treatment of Consolidated Environmental Accounting
The business activities of companies and other organizations in the modern socio-economic system have expanded in scale, diversified, and become globalized to a degree not experienced previously. A great number of companies have been established corresponding to each purpose, and group management is practiced.
In a group management system, the independent decision-making ability of group companies is limited. At the same time, the primary objective becomes management of the group, limiting the environmental impact of the holding company itself, which essentially consigns functions such as production, sales, and distribution. In such cases it becomes difficult to perceive the actual environmental conservation activities from the data for individual corporate units assembled under a legal structure.
Consolidated data reflecting economic activity is already part of the mainstream in financial accounting, but it is also necessary in environmental accounting to focus on environmental impact within the broader scale of the supply chain to the greatest extent possible, so as to make it possible to understand the costs of environmental conservation within business activities and the benefits derived from them.
It is therefore necessary in environmental accounting as well to ascertain and evaluate data reflecting the actual business activities of the consolidated group (business group), rather than of each individual unit of the company or other organization, in order to understand the actual situation at the company or other organization.
Scope of Consolidation
The consolidation range for environmental conservation goals has been established corresponding to importance in terms of environmental conservation.
The standards for determining importance take into consideration the particular business group’s environmental impact. In particular, this means specifying the significant areas of environmental impact
The business activities of companies and other organizations in the modern socio-economic system have expanded in scale, diversified, and become globalized to a degree not experienced previously. A great number of companies have been established corresponding to each purpose, and group management is practiced.
In a group management system, the independent decision-making ability of group companies is limited. At the same time, the primary objective becomes management of the group, limiting the environmental impact of the holding company itself, which essentially consigns functions such as production, sales, and distribution. In such cases it becomes difficult to perceive the actual environmental conservation activities from the data for individual corporate units assembled under a legal structure.
Consolidated data reflecting economic activity is already part of the mainstream in financial accounting, but it is also necessary in environmental accounting to focus on environmental impact within the broader scale of the supply chain to the greatest extent possible, so as to make it possible to understand the costs of environmental conservation within business activities and the benefits derived from them.
It is therefore necessary in environmental accounting as well to ascertain and evaluate data reflecting the actual business activities of the consolidated group (business group), rather than of each individual unit of the company or other organization, in order to understand the actual situation at the company or other organization.
Scope of Consolidation
The consolidation range for environmental conservation goals has been established corresponding to importance in terms of environmental conservation.
The standards for determining importance take into consideration the particular business group’s environmental impact. In particular, this means specifying the significant areas of environmental impact