relatively certain costs and its Tiers 2 and 3, the probable costs and benefits. However, a management thinking strategically about environmental issues and likely changes in pressures from external stakeholders should also be considering possible future costs and benefits arising from, for example, new regulatory requirements or changes in consumer perceptions. The emphasis must be on the total life cycle costs and benefits to the company5 from current, future, and potential perspectives. Here, there is a potential link to the need for accounting to develop ways to measure impacts on the environment. Today's externalities may become internalized costs in the future, whether though regulatory or fiscal measures (Bennett and James, 1994). Companies have begun to move up the TCA tiers. Bennett and James (1994) have interviewed companies, including Rhone-Poulenc, Baxter Healthcare, and 3M, that have identified ways to save costs by expanding their identification of relevant environmental costs.

Organizational Changes

Attempts have been made to identify the organizational difficulties that inhibit such developments.6 Apart from the additional complexity of TCA calculations (Tellus Institute, 1992), tracing relevant environmental costs may cut across traditional organizational divisions. Information may need to be collated from various functions (sales and marketing, manufacturing, purchase, supply, research and development, finance, personnel, etc.) (Houldin, 1993), and responsibility may need to be relocated.7 For example, are decisions on environmental factors currently exclusively allocated to the legal department or to specialist environmental managers instead of being integrated across the organization (Epstein, 1994)? such integration may alter the patterns of internal incentive structures, product profitability, and managerial responsibility. A move to a TCA-like approach, therefore, may be resisted by managers who have a vested interest in the status quo (Todd, 1994).

Therefore, positive steps, which may require external regulatory stimulus, are needed to overcome organizational inertia. It does not appear likely that this initiative will come from accountants themselves.

A recent study of the attitudes of accountants, based on a questionnaire survey of the finance directors of the 1,000 top U.K. companies (Bebbington et al., 1994), indicates that a significant proportion (over 50 percent in the case of energy issues) have introduced, or are at least thinking about introducing, some accounting (in financial or statistical terms) for environmentally related activities (in particular for energy, investment appraisal, waste, packaging, and aspects of legal compliance). However, there are also, surprisingly, many accountants who have no plans to address or even claim never to have heard of any of these issues; two-thirds or more expressed negative views about issues such as packaging, legal compliance, environmental budgets, water pollution, recycling, contingent liabilities, remediation costs, air pollution, land pollution, sustainability and life



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