Scholarly record
THE ROLE OF ACCOUNTING IN DETECTING AND PREVENTING "GREENWASHING": ECONOMIC IMPACTS ON THE ENVIRONMENT AND CORPORATE TRANSPARENCY
Abstract
Global sustainability initiatives, effective resource allocation, and corporate responsibility are all at risk from greenwashing, which is the willful distortion of environmental sustainability policies. With an emphasis on the economic ramifications of greenwashing, corporate transparency, and the economical use of natural resources, this paper explores the function of accounting in identifying and stopping it. We examine how sound accounting procedures might improve responsibility in resource and waste management by analyzing financial reporting standards, sustainability disclosures, and auditing procedures. Key findings show that regulatory monitoring, third-party verification, and standardized Environmental, Social, and Governance (ESG) measures are essential for ensuring that business statements are in line with actual environmental performance. Examined are the negative economic effects of greenwashing, such as skewed capital flows, reputational hazards, and legal repercussions, highlighting the necessity of open and verified sustainability reporting. This study also demonstrates how better accounting frameworks can eliminate waste, encourage the circular economy, and support the efficient use of environmental resources. Policy proposals to improve corporate openness, lessen information asymmetry, and promote sustainable economic development are included in the study's conclusion.
Publication Impact Profile
Publication details
References18
S. Remya and Rupini. T.S, “A STUDY ON AWARENESS OF ENVIRONMENTAL ACCOUNTING AND REPORTING WITH SPECIAL REFERENCE TO EMPLOYEES OF THRISSUR DISTRICT,” International Journal of Engineering Technology and Management Sciences, vol. 7, no. 3, p. 8, Jan. 2023, DOI: 10.46647/ijetms.2023.v07i03.002.
H. Q. Linh and V. K. Nguyen, “The Role of Environmental Management Accounting in Sustainability,” Sustainability, vol. 16, no. 17, p. 7440, Aug. 2024, DOI: 10.3390/su16177440.
H. A. Riyadh, M. A. Al-Shmam, H. H. Huang, B. Gunawan, and S. A. Alfaiza, “THE ANALYSIS OF GREEN ACCOUNTING COST IMPACT ON CORPORATIONS FINANCIAL PERFORMANCE,” International Journal of Energy Economics and Policy, vol. 10, no. 6, p. 421, Oct. 2020, DOI: 10.32479/ijeep.9238.
B. O. Adelakun, B. O. Antwi, A. Ntiakoh, and A. O. Eziefule, “Leveraging AI for sustainable accounting: Developing models for environmental impact assessment and reporting,” Finance & Accounting Research Journal, vol. 6, no. 6, p. 1017, Jun. 2024, DOI: 10.51594/farj.v6i6.1234.
T. Greenham, “Green accounting: a conceptual framework,” International Journal of Green Economics, vol. 4, no. 4, p. 333, Jan. 2010, DOI: 10.1504/ijge.2010.037655.
M. I. Hossain and M. R. Karim, “The Effects of Green Banking Practices on Financial Performance of Listed Banking Companies in Bangladesh,” Canadian Journal of Business and Information Studies, p. 120, Nov. 2020, DOI: 10.34104/cjbis.020.01200128.
B. Latif, Z. Mahmood, T. S. Ong, R. M. Said, and A. Bakhsh, “Coercive, Normative and Mimetic Pressures as Drivers of Environmental Management Accounting Adoption,” Sustainability, vol. 12, no. 11, p. 4506, Jun. 2020, DOI: 10.3390/su12114506.
K. Taygashinova and A. Akhmetova, “Accounting for environmental costs as an instrument of environmental controlling in the company,” Management of Environmental Quality An International Journal, vol. 30, no. 1, p. 87, Jun. 2018, DOI: 10.1108/meq-08-2017-0088.
G. Friend, “EcoMetrics: Integrating direct and indirect environmental costs and benefits into management information systems,” Environmental Quality Management, vol. 7, no. 3, p. 19, Mar. 1998, DOI: 10.1002/tqem.3310070304.
S. Syah, E. Saraswati, E. G. Sukoharsono, and R. Roekhudin, “Blue Accounting and Sustainability,” Jan. 2020, DOI: 10.2991/aebmr.k.200606.085.
Organisation for Economic Co-operation and Development, Food and Agriculture Organization of the United Nations, The World Bank United Nations, International Monetary Fund, and European Commission, “System of Environmental-Economic Accounting 2012—Central Framework.”
D. Gadenne, “Strategic Environmental Management Accounting An Exploratory Study of Current Corporate Practice and Strategic Intent,” Journal of Environmental Assessment Policy and Management, vol. 4, no. 2, p. 123, Jun. 2002, DOI: 10.1016/s1464-3332(02)00095-4.
The Triple Bottom Line: What Is It and How Does It Work? https://www.ibrc.indiana.edu/ibr/2011/spring/article2.html
Stopping greenwashing: how the EU regulates green claims https://www.europarl.europa.eu/topics/en/article/20240111STO16722/stopping-greenwashing-how-the-eu-regulates-green-claims
Green claims https://environment.ec.europa.eu/topics/circular-economy/green-claims_en
Greenwashing – the deceptive tactics behind environmental claims https://www.un.org/en/climatechange/science/climate-issues/greenwashing
Katsarski Nikolay THE ROLE OF SOCIETY IN ENVIRONMENTAL AUDITING Conference: 24th SGEM International Multidisciplinary Scientific GeoConference 2024 November 2024 DOI: 10.5593/sgem2024/5.1/s21.84
Leibus I. Filipova L. Natural resource tax as an instrument for sustainable environmental governance Conference: 25th International Scientific Conference. “Economic Science for Rural Development 2024”, September 2024 DOI: 10.22616/ESRD.2024.58.001
View or Download full articleAccess options
SWS access login
Login as SWS Scientific CommitteeLogin as SWS Scientific PartnerLogin as SWS AuthorAuthors and approved SWS contributors will read and export their own linked papers after identity matching by SWS profile, email and SGEM GlobalID.
For librarian assistance: [email protected]
Purchase Instant Access
- Article can be downloaded after successful payment.
- Article may be used according to SWS library access terms.
- Article cannot be redistributed.