Applying environmental management accounting : the ERDF energy grant scheme experience

Abstract

Purpose: The objective of this research is to gauge the level of involvement of accountants in evaluating energy-related investment and their attitude towards the environmental agenda. It revolved around assessing the penetration of environmental policy in companies, promotion of environmental agenda by accountants, commitment towards minimising environmental impacts and providing accounting support to environmental management within the remit of the ERDF Energy Grant Scheme. Design: 174 DMUs were deemed eligible participants for the questionnaire. These DMUs were contacted via e-mail and invited to respond to the online questionnaire. 45 valid responses were received and analysed. Findings: The findings manifest that the director of the DMU was the individual who drove the implementation of the investment in energy efficient measures. Additionally, the concept of EMA has not yet penetrated within the Maltese accountancy profession. Conclusion: Accountants did not proactively promote sustainability but they have, nevertheless, supported investment in energy efficient measures by honouring their current responsibilities. Furthermore, 29% of the respondents claimed that they have adopted an environmental policy, none of them enlisted the accountant as a contributor towards the drafting of the environmental policy. This research identifies cost savings as the main driver for investing in energy efficient measures. Accountants deem it necessary to prepare some form of financial, or accounting, data or projections, even for investments in energy efficient measures. The concept of EMA has not yet infiltrated the ranks of the established accounting techniques. This is illustrated by the low levels of utilisation rates experienced both in Malta and internationally. Implications Accountants have to realise that promoting sustainability with businesses falls within the remit of their professional responsibility. Therefore, they have to spur the adoption of environmental policy, drive investment in energy efficient measures and pioneer the sustainable agenda.