To keep on evaluating the wealth or the assets of a State with today’s systems, based on the GDP, and to continue in a direction where indexes like Mibtel, Nasdaq, etc. seem to be the true parameters for the evaluation of how a country’s economy is going, is purely an exercise of informative illusion.
For this reason Environmental Accounting represents the path to follow for getting through the swamps in which the modern economy finds itself without any other possible alternative virtuous solutions.
Environmental accounting is a parallel bookkeeping system to the economic and financial way of compiling the balance sheet, regarding specifically the environmental themes that are of direct and indirect competence of the State.
This new procedure is born from the necessity to reform the systems of definition and control of public strategies with procedures suitable for measuring the sustainability of how the territory is developed, or rather, for incorporating the environmental variable within political decisions.
Environmental accounting is, in fact, an instrument developed for reinterpreting the environmental activities of administrations and to improve policies in the direction of sustainability. The drawing up of the environmental budget allows the state of the environment to be monitored and to accurately evaluate the environmental consequences (positive or negative) of the principal activities of local administrations and the state.
Environmental accounting also represents a means of communicating with the local community. With a green balance sheet, the environmental contents of the different policies become explicit and, in this way, they communicate to all the results obtained by public administration in this field compared to the promises made to and agreed on with the community.
Environmental accounting includes an economic part and a physical one.
The economic accounts evaluate the natural resources and the interactions between man and the environment using money as a unity of measure. They are based on the classification of the expenses of an administration in relationship to the impact on the environment.
The physical part defines the state of the environment, through the quantification of the available natural resources and the extent to which they are used by man. It requires the use of environmental indicators and indicators of sustainability, such as ICE (European Common Indicators for urban sustainability) or the methods for calculating human consumption of natural resources (for example the ecological imprint or analysis of energy consumption).
To sum up, environmental accounting tends to integrate and complete the present model of the GDP as a system of reference for the wealth and assets of a country.
The aim of environmental accounting is therefore to define how to take nature into account, or to improve the quality of the information on the environment and facilitate the integration of environmental considerations in the decision-making processes.
Depending on what is being recorded in the accounts, environmental accounting can be of a physical or monetary type.
Physical environmental accounting manifests itself in the creation of systems of information based on environmental and physical data that can:
• Describe the state of the environment
• Individualize the critical environmental situations
• Identify the elements causing the critical situations
• Quantify the environmental impact of human activities
They are physical environmental accounting instruments for the territory:
• The environmental indicators
• The ecological footprint
• The environmental balance sheet
• The analysis of the flow of materials
• The emergetic analysis
Monetary environmental accounting regards a very vast area of interventions that include both the elaboration of correct territorial balance sheets or balance sheets that contain data/indicators relative to the sustainability of development and the economic evaluation of the environmental assets.
For this reason Environmental Accounting will become more and more the true model for the balance sheets of countries that want to implement ecosustainable policies.