Katsuhiko Kokubu

Weighting across safeguard subjects for LCIA through the application of conjoint analysis

BackgroundMany types of weighting methods, which have integrated the various environmental impacts that are used for life-cycle impact assessment (LCIA), were proposed with the aim of developing the methodology as a useful information resource for decision making, such as in the selection of products. Economic valuation indexes, in particular, have attracted attention, as their assessment results are easy to understand and can be applied in conjunction with other assessment tools, including life-cycle costing (LCC) and environmental accounting. Conjoint analysis has been widely used in market research, and has recently been applied to research in environmental economics. The method enables us to provide two types of assessment results; an economic valuation and a dimensionless index. This method is therefore expected to contribute greatly to increasing the level of research into weighting methodology, in which an international consensus has yet to be established. Conjoint analysis, however, has not previously been applied to LCIA.ObjectiveLCA National Project (METI/NEDO/JEMAI) has conducted a study aimed at the development of a Japanese version of the damage-oriented impact assessment method called LIME (Life-cycle Impact assessment Method based on Endpoint modeling), in order to enhance its reliability and transparency. This study aimed at the application of conjoint analysis to the step of weighting in LIME. An ultimate goal of the research is to determine an amount of willingness to pay (WTP) for avoiding a unit quantity of damage of every safeguard subject (endpoint).MethodsPotential annual damages of four safeguard subjects (human health, biodiversity, social assets, and primary production), known as normalization values in LCIA, were used as fundamental information in this study. These data can be obtained through damage assessment. Taking this background into account, we performed a comparison of importance among the four safeguard subjects defined in LIME by applying conjoint analysis. A choice-based type of questionnaire was prepared for the interview with the respondents selected by random sampling. Pre-tests were conducted for 108 respondents in advance of the main survey. After we confirmed that the analyzed results of the pre-test were revealed to be statistically significant, the main surveys were conducted for 400 respondents by interviewing. WTP per quota can be determined by statistical simulation based on the random utility theory reflecting the responses to the questionnaires by random sampling.Results and DiscussionThe values of one unit (standard) of attributes were significant statistically at the 1% level (all of the p value for coefficients of safeguard subjects were less than 0.0001). Based on the calculated results, two types of weighting factors, an economic valuation and a dimensionless index were obtained. The capability of generating two kinds of weighting factors is unique to conjoint analysis. A relative comparison of importance among the four categories indicates that human health gains the highest recognition, biodiversity gains the second highest recognition, and the weight of primary production and social assets have been estimated to be relatively smaller than the other two safeguard subjects.ConclusionIt is desirable to prepare a small number of attributes when conducting a conjoint analysis, because the efforts of respondents have to be reduced as far as possible. We confirmed that the damage-oriented method, which minimizes the number of attributes, is suitable to the requirement of conjoint analysis, because the results of comparisons among safeguard subjects were statistically significant, and showed that the contents of the questionnaires were well understood among the respondents. Judging from the results of this study, where statistical significance has not even been fully verified in the conventional research on the development of weighting coefficients for LCIA, it can be concluded that the weighting factors derived from this study based on the economic theory have a possibility to reveal the impact of environment on society.

A Note on Corporate Social Disclosure in Japan

The purpose of this study is to investigate the practice of corporate social disclosure in Japan, which will not be familiar to those outside Japan. After briefly presenting an analytical viewpoint of this subject, it explains the media of corporate social disclosure in Japan and then investigates these disclosures according to the type of report and the type of industry. The practice of corporate social disclosure tends to be overlooked in Japan, as Japanese companies disclose no social information in their mandatory annual reports. However, it will be shown that they disclose some social information in the voluntary reports.

Implementing Material Flow Cost Accounting in a Pharmaceutical Company

In Japan, several dozen companies are now attempting to introduce material flow cost accounting (MFCA) through a project initiated by the Ministry of Economy, Trade and Industry (METI) and others. Nevertheless, the majority of companies that have introduced MFCA have used it in only a single project for the purpose of cost study and few companies use it continually to conduct improvement activities. In this paper, we present the case of Tanabe Seiyaku Co. Ltd., which has succeeded in the implementation and organisation-wide deployment of MFCA, in order to analyse the primary factors leading to the use of MFCA in continual waste reduction. Our results demonstrate that MFCA data is reflected in the departmental and employee performance evaluation at Tanabe Seiyaku as part of its management control systems and this mechanism is the key to the continual use of MFCA within the company.

Environmental Management Accounting Practices in Japan

Environmental accounting practices in Japan have been led by two governmental initiatives. One is the MOE initiative which emphasized external disclosure. The other is the METI initiative which emphasized the applications of environmental accounting to internal management, namely Environmental Management Accounting (EMA). To characterize corporate environmental accounting practices in Japan, a questionnaire survey was administered to all companies listed in the first section of the Tokyo Stock Market. After a brief review of these governmental initiatives, this paper will examine the survey results. From the results it is found that environmental accounting is still oriented mainly toward external information disclosure, but that the application to internal management (EMA) has increased steadily. The survey results are also used to assess a set of hypotheses regarding factors and conditions important to promoting adoption and maximizing the benefits of EMA. Findings suggest that key factors include: a well-established environment department actively engaged in decision-making across the firm, understanding of environmental accounting concepts by top and middle management, and the use of specialized EMA tools.

Two Governmental Initiatives on Environmental Management Accounting and Corporate Practices in Japan

There are two main governmental initiatives on environmental accounting in Japan, which have been taken by the Ministry of the Environment (MOE) and the Ministry of Economy, Trade and Industry (METI). MOE published the environmental accounting guidelines in 2000 and since then has continued this initiative. METI launched a three-year research-based project on environmental management accounting in 1999, and this was completed in March 2002. This paper will examine the influence of these two governmental initiatives on Japanese corporate environmental accounting practices, with an analysis of environmental accounting disclosure and a questionnaire survey. The examination indicates that the MOE guidelines have had a very strong influence on Japanese companies which in turn shows that Japanese corporate environmental accounting is oriented to external reporting, since the MOE guidelines stress the external disclosure function of environmental accounting more strongly than the internal management function.

Environmental Management Accounting for Staff Appraisal: Evidence from Australia, Germany and Japan

Interest has emerged in the idea of promoting the development of environmental management accounting systems within organisations. Various environmental management accounting frameworks and tools for analysis have been proposed and some evidence has been gathered about current practice. This paper adds to the existing body of knowledge on the potential of environmental management accounting information to be used for individual performance appraisal. It examines the results of a survey of the styles of environmental information gathered and environmental management accounting practices of companies listed on stock exchanges in Australia, Germany and Japan. The focus of the survey is on an exploratory study of the comparative link between environmental management

Corporate Environmental Accounting: A Japanese Perspective

The development of corporate environmental accounting in Japan has been accelerated by the MOE guideline. The number of companies that disclose environmental accounting information in their environmental report is increasing, with most either already following the MOE guideline or likely to follow it in future. While the guideline has some limitations, MOE have already published some new reports in order to address these, and will be publishing more within the near future.

A critical examination of implementing government sponsored intellectual capital management and reporting programs for small and medium enterprises: Hong Kong and Japan

Purpose – This study aims to examine the impact of implementation of government-sponsored intellectual capital (IC) management and reporting (ICMR) programmes in Hong Kong and Japan for small and medium enterprises (SMEs) for the purpose of issuing an IC statement (ICS). Design/methodology/approach – The authors present a critical analysis using semi-structured interviews with employees and owners of Hong Kong and Japanese SMEs who participated in their respective government’s ICMR programmes and who published an ICS. Findings – The authors conclude that many enterprises did not achieve the full benefit of participating in the ICMR programme because consultants funded by the government prepared the ICS. Instead, consultants should take on more of a “missionary” role, educating enterprises about IC, rather than doing the work for them. Research limitations/implications – This research is restricted to enterprises that published one or more ICS. Future research should include enterprises participating in th...

Corporate Sustainability Barometer in Japan

This chapter describes the state of the art of corporate sustainability practice in Japan in comparison with the international sample. It is based on a questionnaire survey conducted as part of the International Corporate Sustainability Barometer 2012 (ICSB) Project. In many instances Japanese scores are found to be above the international average, which indicates the significance of sustainability among the investigated companies. While a number of similarities are observed with regard to the intention, integration and implementation of corporate sustainability, some particularities specific to the Japanese context are also noted. For example, communities, consumers and trade associations are seen to be more promoting in Japan than in the international sample. Companies in Japan are also found to prefer different methods and guidelines for their sustainability management. Finally, the findings are explained based on the contextual factors in Japan.

Environmental Management Accounting Practices in Japanese Manufacturing Sites

Previous questionnaire surveys on environmental management accounting (EMA) practices in Japan have targeted managers in environmental departments in corporate headquarters as being representative of the company perspective. By conducting a questionnaire survey in manufacturing sites this paper attempts to clarify Japanese corporate EMA practices at the operational level. Since environmental departments in headquarters are presumed to have considerable influence on the introduction and performance of environmental accounting at sites this study analyses the relationship between manufacturing sites and headquarters. As a result, the following points were identified. First, the main purpose of environmental accounting at manufacturing sites is to send data to headquarters. Second, approximately half of the sites in the sample used environmental accounting for internal management and environmental accounting was felt to be more useful at these sites than at those which did not use it for internal management. Third, an effective headquarters advises sites about the introduction of environmental accounting for internal management.