Prague Economic Papers 2021, 30(1):37-60 | DOI: 10.18267/j.pep.761

GHG Emissions Performance: Alternative Accounting Approaches for the European Union

Patricia Milanés-Montero ORCID...a, Esteban Pérez-Calderón ORCID...a, Ana Isabel Dias ORCID...b
a University of Extremadura, Badajoz, Spain
b Lisbon Polytechnic Institute / Lisbon Accounting and Business School, Lisbon, Portugal

This study provides evidence on the probability of adopting an accounting approach for emission allowances and greenhouse gas emissions as a function of each company's GHG emissions performance. The different accounting treatments adopted by national standard-setters and the lack of specific guidance from the International Accounting Standard Board (IASB) allow identification of the use of multiple accounting approaches. Based on a sample of 85 companies registered with the Portuguese, Spanish, and French National Plans of Allocation, data collected from the annual reports were analysed for the period 2008-2014. The results suggest that the probability of adopting omission strategies is positively associated with better GHG emissions performances. It addresses the importance of introducing the transactions of the European Union Emissions Trading Scheme (EU ETS) in financial reporting as the visibility of the costs of polluting is one of the purposes of the market mechanism.

Keywords: Emission allowances, greenhouse gases, accounting approaches, content analysis, logistic regression
JEL classification: M14, M40, Q56

Received: May 13, 2019; Revised: March 27, 2020; Accepted: September 21, 2020; Prepublished online: December 9, 2020; Published: February 4, 2021  Show citation

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Milanés-Montero, P., Pérez-Calderón, E., & Dias, A.I. (2021). GHG Emissions Performance: Alternative Accounting Approaches for the European Union. Prague Economic Papers, 30(1), 37-60. doi: 10.18267/j.pep.761
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