Accounting in Climate Change

CLIMATE CHANGE 1
ACCOUNTING IN CLIMATE CHANGE
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Summary

CLIMATE CHANGE 2
The primary key insights in this research propose the importance of paying close
attention to aspects pertaining climate change and the trend of emissions behavior as well as
the significance of interdisciplinary standpoints in environmental and social accounting. The
perspectives on challenges intricated in carbon dioxide and GHG accounting are based on
information gained from Air New Zealand. This involves exploring aviation in the tourism
sector and looking into GHG national inventories of New Zealand. According to Dargay et al
(cited in Markus et al. 2011, p. 952) both vehicle and planes ownership is estimated to be on
the rise by 65% to 85%, thus likely to increase the emission of carbon dioxide globally. The
estimated increase in the vehicle production in India and China may make it difficult to
reduce the carbon dioxide emission over the years. The aviation industry, on the other hand,
estimates a passenger growth of 4.9% annually (Airbus, cited in Markus et al. 2011, p.952)
thus increasing fuel usage. Despite efforts to reduce fuel burn in aviation, the increasing
capacity of passengers, has led to more fuel usage thus more carbon dioxide emissions
expected.
When comparing the rates of fuel efficiency between the motor vehicles and the
aviation industry, more carbon dioxide emissions are released when flying annually as
compared to motor vehicles. This is due to the fact that the distance covered in the air is
longer as compared to driving in the same period. There have been controversial measures of
curbing emissions in Air New Zealand such as employing carbon tax. However, this seems
not to favor the passengers who are likely to face the increasing costs. Other measures
proposed include fuel switching, opting for renewable energy and increase in sequestration of
carbon through tree planting. However, according to Milne, (cited in Smith and Rodger
2009), these methods are still not the best option since when it comes to carbon offsetting,
people often overlook the idea that time difference plays a major role in emissions.

CLIMATE CHANGE 3
The other aspect is the accounting of GHG in New Zealand. Other GHG emissions in
New Zealand come from forestry and agriculture sector (Hannigan 2006). New Zealand
shows its commitment through the Kyoto plan on carbon emissions. From the liability
analysis in Kyoto, fluctuation in the liability provision is as a result of changes in the carbon
production rather than fluctuations in the price. However, aviation emissions are not included
in the Kyoto Protocol as a result not included in taxes involving domestic emissions. The
Kyoto agreement stipulates on how to estimate emissions nationally in New Zealand in all
sectors thus analyze carbon accounting. Finally, the paper encompasses the different
meanings attributed to carbon accounting by various people and communities in all the
aspects including political, social, environment, financial and physical.
Role of Accounting Academics in Climate Change
There is a high need for accounting academics to take part in climate change
accounting research due to the increasing rate in which carbon emissions are experienced.
The need to carry out urgent research on the Kyoto policies on emissions and give a clear
audit of what the compliance scheme. Accounting academics play a significant role in
calculating the gross emissions in climate change annually. Targets are calculated on the
reductions rate to determine the trend in which climate change takes. Accounting
professionals take into account the developing carbon accounting systems and the effects they
have. They bring on board the analysis of carbon markets.
Climate change accounting is important in calculating the financial stability of
organizations in place of carbon emission. This helps to determine the annual costs and
annual profits that an organization makes. This plays a significant role in shaping decisions
pertaining ways to curb the effects of carbon emissions. When strategizing on plans to deal
with emissions in a country, the government needs accounting professionals to regulate and