External environmental accounting: Many rivers to cross

Modern society's interest in environmental consequences of business activities is one logical explanation for the increased interest in the area of environmental accounting. This rise of environmental accounting, however, appears to have developed without any common agreement as to what exactly is meant by the term environmental accounting and how it is, or should be, operationalised. Accounting is commonly split into management (or internal) accounting and external financial reporting. What has to be reported to external stakeholders of an organisation is usually covered by corporate legal reporting requirements and professionally developed accounting standards. In concentrating on the area of external financial reporting, the author's objectives in this paper are to: identify whether there is a demand for external corporate en environmental information to be disclosed, analyse current external accounting reporting frameworks and literature on environmental accounting in order to establish a working definition of external environmental accounting, establish the level of congruence between current external financial accounting reporting frameworks and external environmental accounting, report on current external financial accounting reporting requirements in regard to environmental matters in the UK, Canada, U.S.A. and Australia suggest ways that accountants and the accounting profession could incorporate environmental issues into external reporting standards. Conclusions reached suggest that there is a demand for external corporate environmental information to be disclosed. Current accounting reporting requirements are not likely to meet this demand, due, in part, to the limited framework which accountants currently use to produce external financial reports.