What Is Carbon Accounting?

Carbon accounting is based on energy and environmental laws and regulations. Currency, physical units are measured or expressed in words to perform low carbon responsibilities, confirm energy conservation, pollution reduction and pollution reduction. , A new accounting science that discloses the efficiency of natural capital and social benefits of enterprises. The proposal of carbon accounting can scientifically measure the gross national product and the operating profit of enterprises, so as to more reasonably evaluate the development of the national economy and the operating performance of enterprises.

Carbon accounting

Carbon accounting refers to

In December 2009, the UN Climate Conference was held in Copenhagen. On the eve of the meeting, many countries, especially developing countries, expressed their willingness to take unilateral actions to combat climate change, and announced relevant policies and measures with progressive significance. The conference aims to develop an agreement to replace the Kyoto Protocol after 2012. Although the mainstream media agreed that the conference was a failed one, the commitments made by countries at the Copenhagen Climate Conference are still included in the text of the current agreement. According to the promise, in the next decade, an unprecedented response to climate change will be carried out widely.

After the Copenhagen conference, governments gathered in Cancun, Mexico, and continued to promote the establishment of an international regulatory system to combat climate change. The UN General Assembly is working to create an international regulatory environment to mitigate the causes of climate change and help people better adapt to the changing environment. The Assembly is one step closer to achieving its goals.

In Cancun, governments agree to do their best to maintain global warming below 2 ° C, the global average. All major greenhouse gas emitting countries (and all 80 countries) make commitments on emissions reduction goals and actions. The monitoring, reporting and verification of greenhouse gas (GHGs) emissions in developed and developing countries has created a large number of new requirements. At the same time, the agreement also established a Green Climate Fund, which aims to raise $ 100 billion in annual funding by 2020 to fund emission reduction and adaptation measures.

Since the drafting of the Kyoto Protocol in 1997, the development and implementation of climate policy has been largely regarded as a problem for developed countries. Newly formulated climate policies around the world are being discussed and implemented. However, the climate negotiations in Copenhagen and Cancun have significantly changed the status of climate action and given them new impetus for implementation. At the same time, many governments are considering the role of market mechanisms to give more flexibility to entities or companies with emission reduction tasks.

The EU's Emissions Trading Scheme (EUETS), launched in 2005, is the first economic-level market trading mechanism, and the trading object is greenhouse gases, namely carbon dioxide. This market has an annual transaction value of more than 100 billion Euros and is growing rapidly. Compared with other policies such as directives and regulations and carbon tax schemes, this market has helped companies achieve emission reduction targets at lower costs.

ETS is the cornerstone of EU climate policy tools and will be implemented in the long term. However, within the scope of normal financial statements, there are no precise rules on how companies covered by the scheme should account for EU emissions allowances (EUAs).

The EUAs, issued by the European Commission, are part of the EU Emissions Trading Scheme, which allows the emission of 1 metric ton of carbon dioxide into the atmosphere. This is the basic unit of emissions traded under greenhouse gas emission reduction projects.

In the next five to ten years, carbon prices are expected to become an important part of most major economic systems, but in fact, most prices will be determined by the carbon trading market. Carbon pricing can be achieved through measures such as reducing the cost of clean energy solutions and low-carbon energy resources, or increasing the cost of greenhouse gas-intensive resources. In addition, carbon pricing can be set explicitly through the establishment of emissions trading mechanisms or carbon taxes. Clear and unambiguous carbon pricing is more easily reflected in financial reports.

Regardless of whether it is in the short or medium term, carbon pricing may be affected by the willingness of governments to levy taxes, or by trading mechanisms based on regional or national needs, or other special circumstances. However, if the carbon trading markets are the basis of the carbon pricing mechanism, they can eventually merge into a global carbon trading market. Countries with close economic relations are likely to have already established market linkages and even established multiple carbon trading markets at the same time. At the same time, other links can be established to promote capital investment to a specific goal or an ideal region.

Given the nature of global climate issues and the historical experience of establishing similar commodity market linkages, it will take years to develop carbon trading markets and ultimately to achieve mutual interconnection between markets. And the progress of the negotiation process has shown that in the next three decades, the establishment of an effective market for global greenhouse gas emissions will be possible.

With the development of multiple carbon pricing mechanisms and the initial appearance of globalization of the carbon trading market, the carbon financial accounting business of the EU ETS and the effectiveness of the IASB-FASB emission trading mechanism projects will have an increasing international influence. The public and private sectors should expand their participation in research on this issue. ^[1]

China's low-carbon accounting has just started

The research on carbon accounting in developed countries has been very mature. However, the research on low-carbon accounting by Chinese scholars is still at an early stage. There is no unified and standardized understanding of the basic knowledge of low-carbon accounting, and there is no authoritative report in theoretical research. The theory is the basis of practice. With such a lack of theoretical research, there is even less empirical research on low-carbon accounting in China. Without a solid theoretical foundation and rich empirical experience to support it, the implementation of low-carbon accounting cannot proceed smoothly, let alone coordinate economic and environmental benefits.

Carbon accounting is a new branch of accounting. It is a discipline that gathers knowledge in multiple fields such as accounting, ecology, environment, and resources. The knowledge involved is multifaceted. The development of low-carbon accounting requires multi-disciplinary talent , Not only must be skilled in accounting skills, but also to master certain resources and environmental protection knowledge. China lacks such talent. Colleges and universities only focus on personnel training in accounting and auditing. Enterprises also do not value the selection and training of such talents. Therefore, the lack of professional talents has greatly restricted the development of China's low-carbon accounting. ^[2]