Environmental Reporting Verification: A Critical Evaluation of Accountants’ Views and Corporate Practices in India

Shuchi Pahuja

Social Responsibility Journal, 2007, vol. 3, issue 2, 22-31

Abstract: Purpose - To obtain opinions of Chartered Accountants (CAs) on the need for verifying environmental statements produced by a concern and desired status and qualifications of experts doing such an audit. To examine EIA systems of large manufacturing companies operating in India. Design/methodology/approach - Primary data collected by using two structured questionnaires: the first one to obtain opinions of CAs and the second one to examine EIA practices followed by the selected companies. Findings - The users think that companies should produce duly verified environmental reports to increase credibility of these reports. They prefer appointment of a team of external duly qualified environmental auditors for this purpose. Majority of the sample companies prepare only statutorily required environmental statements. Most of these companies claim that they provide audited information in these statements verified generally by external environmental auditors. Research limitations/implications - Some of the respondents gave incomplete answers for not disclosing their organizational policies because of perceived sensitive nature of environmental issues. Non‐manufacturing and small companies not included in the sample. Practical implications - Make EIA mandatory at least in major polluting industries. An urgent need to develop standards covering the scope and limitations of third party EIAs was realised. Companies should also voluntarily try to provide audited environmental information in the annual reports to build credibility and trust among corporate stakeholders. Originality/value - The paper presents empirical evidence from interviews with CAs and executives from the selected companies in India and provides insight into the need for EIA.

Keywords: Environmental management; Audit reports; Accountants; Manufacturing industries; India (search for similar items in EconPapers)
Date: 2007
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Persistent link: https://EconPapers.repec.org/RePEc:eme:srjpps:v:3:y:2007:i:2:p:22-31

DOI: 10.1108/17471110710829696

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