Activity‐Based Environmental Inventory Allocation

Abstract

Summary This article presents a generic method to assist product and process designers in measuring resource use and environmental discharges based on the relationships between process flow inputs and outputs and their activity levels. It combines activity‐based costing from conventional accounting with life‐cycle inventories. The method is demonstrated on four electronic assembly product and process designs. The demonstration exhibits the disaggregation and allocation of costs and effluents from various manufacturing operations. This activity‐based environmental allocation approach may be integrated with inventory analysis‐the first step in full and streamlined life‐cycle assessments, design for environment evaluation methods, environmental management activities, and new production planning models that consider environmental impacts.

Eco-efficiency for sustainable manufacturing: an extended environmental costing method

“…Research dealing with environmental cost accounting and its impact shifts over the time from a normative point of view (still dominant in late 1990s, see Stuart et al 1998) towards a more purposeful one, which stems from voluntary over-compliance with environmental standards (Arora and Cason 1995) and starts as a simple specific implementation (Saling et al 2002) to rise to a more systematic (Jasch 2003) and practical (Herbohn 2005, Jasch 2006) analysis of environmental costs and wastes up to the consideration (and quantitative assessment, see Henri andJourneault 2008, Karavanas et al 2009) of the implications on eco-efficiency, total quality and sustainability due to the use of environmental cost accounting (Jasch and Lavicka 2006, Curkovic and Sroufe 2007, Lindhqvist 2007, Curkovic et al 2008, Kharel and Charmondusit 2008, even in the shape of scenario planning (Rivero and Emblemsva˚g 2007).…”

Industrial Ecology and Ecological Engineering

“…In environmental cost accounting, the corporate costs of ensuring environmental compliance are allocated directly to products and processes similarly to how activity-based costing is used in managerial accounting to distribute indirect costs directly to product costs (Stuart et al 1999). It allows companies to make more informed decisions about product mix, manufacturing, and processing techniques because they have more detailed information about the individual environmental impacts of their line of products.…”