Two Governmental Initiatives on Environmental Management Accounting and Corporate Practices in Japan

Abstract

There are two main governmental initiatives on environmental accounting in Japan, which have been taken by the Ministry of the Environment (MOE) and the Ministry of Economy, Trade and Industry (METI). MOE published the environmental accounting guidelines in 2000 and since then has continued this initiative. METI launched a three-year research-based project on environmental management accounting in 1999, and this was completed in March 2002. This paper will examine the influence of these two governmental initiatives on Japanese corporate environmental accounting practices, with an analysis of environmental accounting disclosure and a questionnaire survey. The examination indicates that the MOE guidelines have had a very strong influence on Japanese companies which in turn shows that Japanese corporate environmental accounting is oriented to external reporting, since the MOE guidelines stress the external disclosure function of environmental accounting more strongly than the internal management function.