will change as a result of each decision—whether the extra revenue or other benefits the decision will bring are worth the extra costs. The accountant's approach is to develop systems of accountability and responsibility for costs and profits that provide norms and standards of human performance. The challenge of "environmental costing," Macve concludes, is not only to increase the technical sophistication by which environmental factors are tracked through to activities, but also to construct a new accountability that is linked to real incentives. As the field of accounting develops to provide better information about firms' environmental costs, it is likely to influence environmental-quality-related business decisions (Ditz et al., 1995) and improve the industrial green game.

The measurement of environmental performance is an effective tool when accounting for environmental costs is linked to incentives for managers to play the industrial green game well. What is measured is driven by policies a company may adopt, and a range of measures may be devised to gauge achievement against a set of objectives. The measures are most commonly absolute, such as achieving waste reduction of 200,000 tons against an objective of 150,000 tons. They also may be relative and time dependent, such as achieving an energy-use reduction of 20 percent compared with the previous year's result and against an objective of 30 percent for the current year. A combination of absolute, relative, and time-dependent measures are used to track four areas of environmental performance:

• Environmental Impacts. These are really measures of loading of materials and emissions that result in environmental impacts. They are useful in gauging the overall performance of a firm as well as for assessing the performance of individual organizational units, operations, or processes.

• Contributory Impacts. These relate to the performance of components of a firm such as plant and equipment, and materials quality and use, and to management systems such as training that contribute to the overall impacts.

• Risk Measures. These relate to the probability that the unexpected rare releases of a pollutant may result in potentially serious consequences. In such an instance, the risk, or probability, of such an event is a more useful measure of performance than the number of actual events.

• External Relations Measures. These relate to the environmental performance of the firm within the community. It includes everything from the number of complaints to the level of support of environmental programs.

In developing a system of measures for the green game, several factors should be considered (Business and the Environment and KPMG Peat Marwick, 1992).