In fact, Everlight itself was "pushed" into green accounting in 1998. Because dye manufacturing is a high-pollution industry, European clients wanted Everlight to disclose the pollution control expenditures and other related environmental expenses for each of its products, so those clients could determine whether Everlight's prices were reasonable.
Back then there was little recognition of green accounting principles in Taiwan. And even if foreign companies had already started to use green accounting, Taiwanese firms were unable to use their experiences as a reference because of differences in product type and company size. Without the relevant data, Everlight simply couldn't "provide the figures the clients demanded." Fortunately, that year the Taiwan Business Council for Sustainable Development was interested in introducing green accounting systems, and Everlight went along for the ride, developing Taiwan's first such system.
Chen Wei-wang, Everlight's general manager, explains that when businesses traditionally make an accounting of costs, they calculate for items such as raw materials, equipment, depreciation, personnel, and R&D. Operating costs related to environmental protection are typically concealed under various other headings, making it impossible to calculate the individual environmental costs of a particular product or production line.
By contrast, green accounting seeks to account for all environment-related costs of a business's operations. For instance, what portion of raw materials purchased is green? What portion of equipment purchases was aimed at increasing the efficiency of the manufacturing process and at reducing wastes and recycling? In terms of personnel costs, how much is spent on developing environmental accounting systems and acquiring green certification, and how much is used for monitoring and measuring environmental impacts? Only by thus clearly listing each and every environmental cost, can the enterprise's true total environmental costs be ascertained so that informed decisions can be made.
"These are rigorous accounting procedures, aimed at dividing up those general company costs and assigning them to specific lines and products," explains Chen Wei-wang. Consequently, Everlight had to revise its accounting procedures, train related personnel and change its computer system. The company spent four or five years before getting the system up and running.
Chen Wei-wang explains that the biggest benefit from establishing the green accounting system is that they now can exercise much more precise control and make more informed decisions. For instance, when decision makers have to choose between two potential products to which to devote a production line, they used to be able to consider only profit margins and relative safety levels. But now, with access to green accounting data, they can add up equipment expenditures and environmental costs, such as those involved with the handling of wastes and wastewater, and determine if the costs are too high or the risks too great. They then can decide whether to accept orders for such products and can quote realistic prices.
Take a look at the various products that Europe and America have ceased making. It's not as if those nations lack the capital to make those products, or as if the costs are too high; rather it's that they are unwilling to do excessive damage to the environment. Taiwan manufacturers may not have come to that stage yet, but if they get a clear look at the environmental costs, they may begin to move in that direction. In the past, for instance, Everlight declared the outsourced processing of its sludge as "other." After adopting green accounting, company staff discovered that the costs involved with the outsourcing of sludge processing were too high, so they set out to make improvements and were able to reduce the amount of sludge they produced by more than one half.
The UVA coating on the blades of these wind turbines will greatly extend their functional life. Green accounting aims to make environmental costs transparent. It's the most honest way for a company to show its concern for the environment.