What is environmental management accounting? Environmental management accounting is a combined approach for the transition of data from financial accounting and cost accounting to increase material efficiency, reduce environmental impact and risk and reduce costs of environmental protection. The thinning of the ozone layer, acid rain, air pollution and global warming are some the effects that have occurred as a result of the Chernobyl Incident. At first these issues were not looked at as an accounting issue. Only in the past few years have these concerns started being addressed by the accounting world. A lot of environmental concern groups have argued that most of the developed countries have placed greater value on economic gain instead of the protection of the environment. They feel that humans need to be responsible for them and design strategies that could help preserve the resources of the environment for the future. Many experts believe that these duties should not be placed entirely on environmentalists but should be placed on everyone involved in the design of the project. Corporations are now realizing the role of accountants in environmental issues is becoming very important. Before we can even begin to understand environmental accounting we must first understand the social significance of accounting. .
Accounting cannot always be the technical part of a business but sometimes has to be the voice of reason. Accounting is used to help corporations make economically useful decisions. This establishes accounting as an organizational culture and has an effect on the business success and credibility. Accounting data is used to represent or even recreate reality. The main function of the accounting process involves providing stockholders of their responsibilities for the corporation. This is meant by accounting process providing information for the corporation. But accounting should not just provide financial information but also acknowledge the social and political impact of accounting practices.