IDEAS home Printed from https://ideas.repec.org/a/spr/endesu/v16y2014i3p797-807.html
   My bibliography  Save this article

Forced internalization of external environmental cost: experience of a South African Company

Author

Listed:
  • Michael Fakoya

Abstract

While environmental regulations are designed to ensure that organizations comply with minimum environmental standards, organizations may be compelled to pay penalties if they exceed the set standard. This study provides explanations on the effectiveness of a forced internalization of external environmental cost in a brewery in South Africa. A review of relevant literature indicates the apathy of organizations to internalize environmental costs. To see whether this apathy still holds, this paper uses the contingency theory approach to management accounting to analyze a case study on the effectiveness of forced internalization of brewery wastewater treatment cost by a municipality in South Africa. Findings reveal that the policy forced brewery managers to develop a waste-reduction strategy to improve production efficiency while limiting the volume of brewery wastewater and chemical oxygen demand emissions discharged to municipal waste treatment plant. A significant implication of this study is the forced internalization of wastewater treatment cost and the use of resources more efficiently and sustainably in production by the brewery as a result of the municipality’s policy to demand extra fees when agreed minimum wastewater discharges are exceeded. The importance of this policy is that it brought about improvements to the environmental, social, and economic performances of the brewery. The study suggests that environmental regulators should look beyond mere regulatory and monitoring roles to formulate policies to ensure that organizations take responsibility for external environmental costs they have created. Copyright Springer Science+Business Media Dordrecht 2014

Suggested Citation

  • Michael Fakoya, 2014. "Forced internalization of external environmental cost: experience of a South African Company," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 16(3), pages 797-807, June.
    • Handle: RePEc:spr:endesu:v:16:y:2014:i:3:p:797-807
    DOI: 10.1007/s10668-013-9498-1
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10668-013-9498-1
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10668-013-9498-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Sandy Q. Qu & John Dumay, 2011. "The qualitative research interview," Qualitative Research in Accounting & Management, Emerald Group Publishing Limited, vol. 8(3), pages 238-264, August.
    2. Annette Hofmann, 2007. "Internalizing externalities of loss prevention through insurance monopoly: an analysis of interdependent risks," The Geneva Papers on Risk and Insurance Theory, Springer;International Association for the Study of Insurance Economics (The Geneva Association), vol. 32(1), pages 91-111, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bokolo Anthony & Mazlina Abdul Majid & Awanis Romli, 2020. "Green IS diffusion in organizations: a model and empirical results from Malaysia," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(1), pages 383-424, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Roberto Cerchione & Emilio Esposito & Maria Rosaria Spadaro, 2015. "The Spread of Knowledge Management in SMEs: A Scenario in Evolution," Sustainability, MDPI, vol. 7(8), pages 1-23, July.
    2. Jan Chocholac & Roman Hruska & Stanislav Machalik & Dana Sommerauerova & Petr Sohajek, 2021. "Framework for Greenhouse Gas Emissions Calculations in the Context of Road Freight Transport for the Automotive Industry," Sustainability, MDPI, vol. 13(7), pages 1-28, April.
    3. Francesco Badia & Grazia Dicuonzo & Saverio Petruzzelli & Vittorio Dell’Atti, 2019. "Integrated reporting in action: mobilizing intellectual capital to improve management and governance practices," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 23(2), pages 299-320, June.
    4. Centobelli, Piera & Cerchione, Roberto & Maglietta, Amedeo & Oropallo, Eugenio, 2023. "Sailing through a digital and resilient shipbuilding supply chain: An empirical investigation," Journal of Business Research, Elsevier, vol. 158(C).
    5. Gaia Bassani & Cristiana Cattaneo & Francesca Maria Cesaroni & Annalisa Sentuti, 2018. "Sistemi di gestione e controllo e professionalizzazione delle imprese familiari. Uno strumento di accreditamento intraparentale?," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2018(2 Suppl.), pages 15-35.
    6. Pina Puntillo & Carmela Gulluscio & Donald Huisingh & Stefania Veltri, 2021. "Reevaluating waste as a resource under a circular economy approach from a system perspective: Findings from a case study," Business Strategy and the Environment, Wiley Blackwell, vol. 30(2), pages 968-984, February.
    7. Won, Jongho & Lee, Daeho & Lee, Junmin, 2023. "Understanding experiences of food-delivery-platform workers under algorithmic management using topic modeling," Technological Forecasting and Social Change, Elsevier, vol. 190(C).
    8. Neema Kavishe & Nicholas Chileshe, 2018. "Identifying Project Management Practices and Principles for Public–Private Partnerships in Housing Projects: The Case of Tanzania," Sustainability, MDPI, vol. 10(12), pages 1-23, December.
    9. Richard Peter, 2024. "The economics of self-protection," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 49(1), pages 6-35, March.
    10. Katharina Löhr & Christian Hochmuth & Frieder Graef & Jane Wambura & Stefan Sieber, 2017. "Conflict management programs in trans-disciplinary research projects: the case of a food security project in Tanzania," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 9(6), pages 1189-1201, December.
    11. Jana Kozáková & Mária Urbánová & Radovan Savov, 2021. "Factors Influencing the Extent of the Ethical Codes: Evidence from Slovakia," JRFM, MDPI, vol. 14(1), pages 1-18, January.
    12. Tom Sander & Phoey Lee Teh & Biruta Sloka, 2014. "The use of Social Network Sites for the Employment Seeking Process," Proceedings of International Academic Conferences 0702459, International Institute of Social and Economic Sciences.
    13. Francesco Badia & Graziana Galeone & Simona Ranaldo, 2021. "La crisi COVID-19 come "crash-test" per i sistemi di controllo aziendali: il caso di un?azienda di trasporto pubblico locale," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2021(1), pages 57-80.
    14. Lisa-Marie Semke & Victor Tiberius, 2020. "Corporate Foresight and Dynamic Capabilities: An Exploratory Study," Forecasting, MDPI, vol. 2(2), pages 1-14, June.
    15. Selena Aureli & Mara Del Baldo & Rosa Lombardi & Fabio Nappo, 2020. "Nonfinancial reporting regulation and challenges in sustainability disclosure and corporate governance practices," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2392-2403, September.
    16. Gottlieb, Uliana & Johed, Gustav & Hansson, Helena, 2022. "Accounting and accountability for farm animals: Conceptual limits and the possibilities of caring," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 84(C).
    17. Giuliani, Marco & Skoog, Matti, 2020. "Making sense of the temporal dimension of intellectual capital: A critical case study," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 70(C).
    18. Smith, Julia A. & Cordina, Renzo, 2014. "The role of accounting in high-technology investments," The British Accounting Review, Elsevier, vol. 46(3), pages 309-322.
    19. Giorgia Nigri & Mara Del Baldo & Armando Agulini, 2020. "Governance and accountability models in Italian certified benefit corporations," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(5), pages 2368-2380, September.
    20. Milad Mirbabaie & Felix Brünker & Nicholas R. J. Möllmann Frick & Stefan Stieglitz, 2022. "The rise of artificial intelligence – understanding the AI identity threat at the workplace," Electronic Markets, Springer;IIM University of St. Gallen, vol. 32(1), pages 73-99, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:endesu:v:16:y:2014:i:3:p:797-807. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.