Green accounting

[Abhijit Banerjee]

The common concensus today is that economic forces are at the root of environmental degradation. Well, they do have a point actually. Land developers convert and deface wetlands, timber companies denude forests, fishermen over-harvest lakes and oceans, industries and automobiles pollute the water and the air and so on. Economic activity definitely affects the environment in very many ways. In producing and consuming goods and services, societies draw materials and energy from the environment, adversely affecting the diversty of flora and fauna inhabiting both land and water.

Green accounting incorporates environmental assets and their source and sink functions into national and corporate accounts. It is the popular term for environmental and natural resource accounting.