Title

Towards emissions trading: The role of environmental management systems in voluntarily disclosing greenhouse gas emissions

Date of this Version

7-5-2009

Document Type

Conference Proceeding

Publication Details

Published Version.

Wahyuni, D., Rankin, M., & Windsor, C. (2009). Towards emissions trading: The role of environmental management systems in voluntarily disclosing greenhouse gas emissions. Paper presented at the 2009 Accounting and Finance Association of Australia and New Zealand (AFAANZ) conference, Adelaide, South Australia.

Access the conference website.

2009 HERDC submission. FoR code: 1501

© Copyright Wahyuni, D., Rankin, M., & Windsor, C., 2009

Abstract

The Australian government ratified the Kyoto Protocol in 2007 signifying their commitment to address global warming and associated harmful climate change. Central to the Government's strategy is the proposed emissions trading scheme (AETS) now mooted to begin in 2011. Credible, transparent and efficient information is necessary to inform such a market, hence the National Greenhouse and Energy Act 2007 requires annual mandatory corporate reporting of GHG emissions from 1 July 2008.

This study examines GHG emissions disclosure practices of Australian companies as well as their motivations to voluntarily report emissions before mandatory reporting, from a legitimacy perspective. A logit regression is used to analyse the link between voluntary GHG emissions disclosure (VEmD) and: the existence of an environmental management system (EMS); presence of an environment committee; CEO membership of the environment committee; firm size and industry category of 271 ASX300 firms. The findings reveal that firms with an EMS in place are more likely to disclose discretionary GHG emissions data. Firms that have certified their EMS (ISO 14001) are more inclined to voluntarily disclose GHG emissions information than firms without a certified EMS. Energy and mining firms demonstrate a higher propensity to disclose GHG emissions information than other industries. Firm size was also positively related to VEmD. Findings of this study not only emphasise the importance of an EMS as a device to manage environmental impacts of a firm‟s operations, but it also shows the role of an EMS in bridging communication between firms and their relevant stakeholders.

 

This document has been peer reviewed.