Achieving a Sustainable Business: The Role of Environmental Management Accounting in Corporate Governance

This paper establishes the relevance of Environmental management accounting (EMA) as an inevitable system for ensuring effective corporate governance. In contemporary business, corporate leaders globally stress on ensuring the interest of stakeholders through diverse means of which the use of Environment management accounting systems could be adopted for that purpose. Reluctance in handling environmental issues could culminate into huge financial loss to organizations in terms of environmental or other opportunity costs. It could also be the source of loss of goodwill on the part of stakeholders which can spell huge consequences for the entity’s business relationships resulting into governance problems. Consequently, the paper suggests that there are several reasons by which environmental management accounting becomes inevitable in the corporate governance process. It further concludes that Environmental management accounting provides information to the CEO that enables companies improve upon their environmental performance which impacts on effective corporate governance. The paper finally suggests specific areas for future research in relation to EMA and corporate governance.