BHP Billiton's Sustainability Accounting & Reporting

BHP BILLITON
SUSTAINABILITY ACCOUNTING & REPORTING

Sustainability
1. Summary and insights
It can be observed from the article that there are significant opportunities and challenges
concerning climate change, emission reduction, assurance and reporting, accounting, and
greenhouse gas emissions into the atmosphere. Nevertheless, in the current scenario, auditing
and accounting for issues like GHG and carbon emissions has become enormously
challenging because of uncertainties that exist in estimation methods. As the adequacy of
present formulation of policies to stop such emissions is inappropriate in nature, this is the
reason why implications have been raised for all nations, sectors, organizations, and
individuals through this article. Besides, the methodology adopted assists in overviewing the
climate change issues together with an extensive collection of inter-disciplinary and
independent contributions to accounting for such change of climate. Furthermore, the
methodology of shadow carbon account and accounting analysis assists in shedding light on
how nations and organizations are responsible for and communicate their GHG emissions and
behavior. Based on the current findings, it is observable that the policies to stop or curb
emissions is ineffective in nature and therefore, such challenge is expected to increase on a
wider scale in the upcoming future if corrective actions are not implemented. The article also
evaluates the significance betwixt research of social and environmental accounting of
interdisciplinary viewpoints. Further, with the help of Air New Zealand organization, the
article scrutinizes the complexities, challenges, and uncertainties associated with accounting
for GHG and carbon emissions. Nonetheless, a series of questions are raised through this
article on the effectiveness of offsetting and feasibilities for timely reducing the emissions 9
Milne & Grubnic, 2011). Therefore, the aim of this article is not to seek a reduction of all
climate-change based research of accounting to evaluations of corporate carbon footprints.
However, even if it did, various interesting and different methods to encounter such issues are
also prevalent. In simple words, the article intends to frame an agenda for future research that
remains different and interesting as a whole (Milne & Grubnic, 2011).
2. Engagement of accounting academics in climate change issues
Accounting academics are increasingly moving beyond traditional zones of tax, finance,
auditing, and accounting services. Such academics possess the ability to assist clients, sectors,
nation, and organizations to identify significant areas of problem in relation to climate change
and recommend opportunities for improvement of profitability and reduction of costs (Milne
& Grubnic, 2011). More than simply reducing costs, attaining sustainability is a significant
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Sustainability
target for companies given their liability to deliver long-term value and sustain risks for the
interests of all stakeholders. In relation to this, the risk management and core analytical skills
of accounting academics can be taken into account to understand the practical and strategical
implications of a reduction in emissions of GHG or carbon, thereby facilitating in the
achievement of sustainable business practices (Milne & Grubnic, 2011). Senior management
may fail to identify the relevance of energy as a material business cost but accounting
academics can play a role in illustrating a compelling business case that can capture the
return on investment (ROI). Further, by combining business and energy data and translating
these into economical metrics can influence the stakeholders in an organization. This is the
reason why accountants in many organizations act as a bridge betwixt people liable for
driving sustainability and the management team as a whole. Moreover, such additional
efficacies come on top of savings of energy cost, enhancing the bottom line of the business.
Accounting academics can play a key role in utilizing their insight into financial metrics to
assist clients to capitalize on financial gains (Milne & Grubnic, 2011). Nowadays accountants
are also engaged in offering valuable advice to companies on seeking the optimum position
of tax for the green projects, government incentive strategies, and reporting and measurement
of carbon emissions. Besides, this has become an EU-wide necessity for larger firms.
Therefore, accounting academics must engage in climate change accounting research.
3. BHP Billiton’s management of climate change issues
BHP Billiton supplies energy and mineral commodities that are vital for its economic growth.
The products in the company’s portfolio require emissions of GHG and carbon into the
atmosphere. However, in relation to the management of climate change issues, the company
has an integrated and comprehensive approach to prepare for all risks that climate change
poses to it and further actions are also being taken to deliver an efficient international
response (Milne & Grubnic, 2011). It is also adapting to impacts in climate change by
building resilience to the same. Furthermore, the company is also accelerating the
deployment and development of low-emissions technology as a major response for
management of climate change issues. Moreover, BHP is also operating with others to
increase the international response to issues of climate change. Effective evaluation of
climate science is vital for the purpose of planning. BHP collaborated with CSIRO to obtain
regional analyses of climate science. Therefore, it can be witnessed from the activity that the
climate resilience planning is being undertaken as it will help in understanding of the
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