Table of Contents

Water Accounting

Water Accounting

International Approaches to Policy and Decision-making

Edited by Jayne M. Godfrey and Keryn Chalmers

One of the most pressing global issues of the 21st century is the scarcity of water of a quantity appropriate to ensure economic, environmental and social sustainability. In addressing the issue through policy and management, of critical importance is access to high quality information. But water scarcity has many implications, and it is possible that different reporting approaches, generally called water accounting systems, can be appropriate to addressing them. In this groundbreaking book, international experts respond to the question: what role can water accounting play in resolving individual, organizational, industry, national and international economic, social and environmental issues? They explore how various forms of water accounting are utilized and the issues that they address.

Chapter 11: Water Accounting, Corporate Sustainability and the Public Interest

Mike Muller

Subjects: business and management, management and sustainability, economics and finance, international accounting, environment, energy policy and regulation, environmental management, water


Mike Muller INTRODUCTION The goal of water accounting should be to support better decision-making about water and its use by enabling key performance indicators to be monitored. Ideally it should do this in a manner that is neutral between competing interests. However, just as science is seldom strictly neutral in its real world application, neither is accounting, and approaches that are deemed better for some people may be deemed worse for others. As two Organisation for Economic Co-operation and Development (OECD) commentators note: Indicators are invariably developed to inform and influence different societal, political, technical and institutional processes . . . a composite indicator developed by an environmental Non Government Organisation (NGO) will probably have more success raising awareness among the general public, than as a widely-accepted information tool among government analysts. (Scrivens and Iasiello 2010, p. 9) Different approaches to hold corporate water users accountable for the sustainability of their water use have been proposed, focusing on physical water accounting. However, indicators are not neutral and the accounting approaches chosen will not always produce socially optimal or sustainable results. This chapter considers whether and how approaches to water accounting and information from the accounting process can help to achieve the goals of water resource management. It focuses on some of the approaches to water accounting that large business enterprises have been encouraged to adopt in order to improve the sustainability of their water use. It also illustrates how inappropriately applied water accounting may contribute to outcomes that are suboptimal for particular communities....

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