No. 121: Decision-Useful Carbon Information

Jahr: 2024
Typ: Working Paper
Open Science:

Abstract

Current carbon accounting practices often obscure firms’ actual emissions and abatement progress. This paper builds on financial accounting standards to propose how to characterize the quality of reported emissions and how companies should account for their emissions to achieve a certain reporting quality. In particular, I first propose that the objective of corporate carbon reporting is to provide carbon information about the reporting firm that is useful to managers, investors, and other stakeholders in making decisions related to the firm. Carbon information qualifies as decision-useful if and only if it satisfies a comprehensive system of qualitative characteristics adapted from generally accepted financial accounting principles. I then develop procedures for accounting for corporate emissions and show that firms adhering to these procedures will produce outcome variables that are relevant and faithfully represent the actual emissions embodied in their economic activities. Overall, the paper shows how standard-setters could revise recent carbon disclosure regulations to improve the quality of reported emissions.

Beteiligte Institutionen

Die Hauptstandorte vom TRR 266 sind die Universität Paderborn (Sprecherhochschule), die HU Berlin und die Universität Mannheim. Alle drei Standorte sind seit vielen Jahren Zentren für Rechnungswesen- und Steuerforschung. Hinzu kommen Wissenschaftler der LMU München, der Frankfurt School of Finance and Management, der Goethe-Universität Frankfurt, der Universität zu Köln, der Leibniz Universität Hannover und der TU Darmstadt, die die gleiche Forschungsagenda verfolgen.

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