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International Journal of Environment and Sustainability, 2016, 5(1): 76-85 79
gained from such activities, provide the best possi- sumer demands and stakeholders. The compa-
ble means of quantitative measurement (in mone- nies will always try to satisfy stakeholders’ inter-
tary value or physical units) and support the com- ests by finding out the needs of environmental
munication of its results”. management which is proactive.
Berry and Rondinelli (1998) as cited in Ja’farda- 4. Competitive Requirements
nArifah (2006), stated that some factors that in-
fluence companies to conduct environmental The development of the global market and the
management activities are: emergence of some trade agreements have influ-
enced the emergence of standardized environ-
1. Regulatory Demand mental quality management. National and inter-
national competition has pushed the companies
Companies’ responsibility to the environment to get quality guarantees, such as ISO 9000.
emerged 30 years ago, after society increased Meanwhile, ISO 14001 is for international stand-
pressure on governments to release their regula- ards of environmental management systems.
tion information because of the spread of pollu- Both of them are different in terms of criteria and
tion. A monitoring system of environmental needs, but they are interrelated practically, by
management is the base for environmental scor- integrating environmental management systems
ing, such as health programs and environmental and company management systems. To achieve
security. Companies assume that it is important the superiority in competition, it can be done by
to get achievement in environmental area, by ap- implementing green alliance. Green alliance is a
plying TQEM principal (Total Quality Environ- partner between business actors and group of
mental Management) effectively, such as using environment to integrate between environmen-
technology to control the pollution through the tal responsibilities with market goals.
use of clean technology. On the other hand, some
regulation of win-win solutions is needed be- Moorthy and Yacob (2012) described green
tween groups involved in creating innovation accounting as an emerging aspect of accounting
and competition and high levels of productivity science that will influence in the near future. The
for the whole company. adoption of basic elements of green accounting
will portray the role of environment in the
2. Cost Factors economy as well as make the analysis of macro-
economic questions easier with the help of green
Complaints about company’s products will cause accounting measures and thus, will lead the
the high cost of quality monitoring, because all economy to a viable path. Below is the table of
activities involved in the production process green accounting measures by Moorthy Yacob
need to be well prepared. This will directly influ- (2012).
ence the emerging of costs, which is quiet high,
such as rough sorting costs, costs of monitoring Environmental accounting, as defined before,
the production process and testing costs. Compa- aims to achieve sustainable development, to
nies’ tendency to decrease pollution also will cre- keep relationships that are beneficial for society
ate other costs like waste management, the use and to pursue the effectiveness and efficiency of
machines using clean technology and preventive environmental conservation activities. The im-
hygiene cost. portance of companies’ efforts can be seen from
the environmental performance score. A record
3. Stakeholder Forces of companies’ efforts in protecting the environ-
ment can be measured by environmental ac-
A proactive approach strategy for environmental counting. Allocation of economic resources to-
management is built based on management prin- ward companies’ effort in protecting the envi-
ciples such as decreasing waste and decreasing ronment can, hopefully, provide good news for
production costs and also responding to con- investors and potential investors.
Science Target Inc. www.sciencetarget.com
