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We are just weeks away from world leaders meeting in Copenhagen to thrash out plans for reducing carbon emissions. At the same time accountancy professionals are acutely aware that companies, especially large multinationals, do not have a standardised accounting approach for dealing with the value of carbon on the balance sheet. That’s not a good state of affairs given the pressing need to integrate concern for the environment into every aspect of our working lives.
It’s no good simply blaming the International Accounting Standards Board. The organisation has been under pressure since the beginning of the credit crunch over the issue of fair value and numerous other problems and its resources are limited. Much of that distraction has been caused by governments and institutions dragging the IASB into responding to political pressure. And much of that has been an unnecessary drain on the board.
If we accept there is no bigger issue than the environment then we need to accept that the IASB needs to be resourced in way to deal with it. Politicians will need to recognise that too. As will the organisations providing the IASB’s funding.
There can be no better way to engage companies in thinking about the environment than if they have to consider the reporting requirements laid out in an accounting standard. If you want finance directors to grapple with the environment, give them an accounting standard to wrestle with. If accountancy really wants to play its part in improving environmental conditions, it cannot afford to put these issues off for very much longer.