Professional Documents
Culture Documents
Review
Centre for Accounting, Governance and Sustainability, School of Commerce, University of South Australia, GPO Box 2471, Adelaide, SA 5001, Australia
Department of Accounting and Corporate Governance, Macquarie University, Sydney, NSW 2109, Australia
a r t i c l e i n f o
a b s t r a c t
Article history:
Received 28 November 2013
Received in revised form
30 August 2014
Accepted 2 September 2014
Available online xxx
Recent times have seen the business world challenged to improve efciency by reducing its material and
energy usage. Material ow cost accounting has been suggested as a management tool that can assist and
a new international environmental management accounting standard, ISO 14051, has emerged for
consideration by business. This paper presents a review of extant MFCA literature, the purpose being to
develop a research agenda which will provide a foundation for future development of the material ow
cost accounting tool. Concerns are raised about the absence of theorising behind material ow cost
accounting; the lack of knowledge and application of the tool in practice; the need for survey, interview
and statistical research methods to supplement case studies; lack of systematic evidence of the tool's
applicability beyond manufacturing and in different rm sizes; and complementarity with other accounting tools used to improve performance. An agenda identifying promising avenues for research, the
scope of application within companies and broadening of methods for investigation is then outlined.
2014 Elsevier Ltd. All rights reserved.
Keywords:
Material ow cost accounting
MFCA
Research agenda
ISO 14051
Environmental management accounting
Review
1. Introduction
With increasing pressure to achieve higher productivity with
reduced environmental impacts, business organisations require
access to tools that enable them to account for all inputs and outputs to their operations with a view to supporting eco-efcient
decisions that simultaneously improve economic and environmental performance (Kokubu and Tachikawa, 2013, p. 351). Material ow cost accounting (MFCA) has been suggested as one such
tool that can support eco-efcient decisions. The potential importance of MFCA has been further recognised with the release in
September 2011 by the International Organization for Standardization (ISO) of the ISO 14051 standard for material ow cost
accounting.
MFCA has been described as among the most basic Environmental Management Accounting (EMA) tools1 (Jasch, 2006;
Schaltegger and Wagner, 2005). The data afforded by MFCA also
provides a foundation for the development of further environmental management accounting activities which may include investment appraisal, environmental impact assessment and short
and long term environmental budgeting (Burritt and Schaltegger,
2001; Jasch, 2006; ISO, 2011). Based on these arguments it would
be reasonable to assume knowledge concerning MFCA would (or
should) be among the most developed topics within the EMA
literature. However, a review of available publications suggests that
despite 15 years research in this eld, there remain more questions
than answers.
To date, extant research on MFCA has been predominantly
conceptual. Although limited case studies do exist, these are largely
action-based projects in which experienced researchers played a
central role in facilitating the adoption and implementation process
(Heupel and Wendisch, 2003; Jasch, 2006; Nakano and Hirao, 2011;
Schaltegger et al., 2012). Furthermore, even in the presence of
experienced researchers it may be difcult to convince managers of
the merits associated with MFCA activity. For example, at the
Mackenzie Paper Division paper mill in Canada, Gale (2006) found
that while an MFCA approach revealed environmental expenses to
be more than double what would usually be reported in the
nancial statements, management remained unconvinced of the
merits associated with EMA in general and argued that the organisation was already efcient.
While the normative origins associated with MFCA are not
problematic in and of themselves it can be argued that, if the take
up of MFCA by business is to improve, it is now necessary to
http://dx.doi.org/10.1016/j.jclepro.2014.09.005
0959-6526/ 2014 Elsevier Ltd. All rights reserved.
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
2
Materials in this context is generally held to include energy and water (ISO,
2011, p. 3).
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
3. Method
In order to investigate the research question presented in Section 2, this study utilised a review of extant MFCA literature. In
summary, the purpose of the research was to review, critique, and
synthesize representative literature on a topic [] such that new
frameworks and perspectives on the topic are generated (Torraco,
2005, p. 356; Neuman, 2006). Torraco (2005, p. 363) suggests that
among the primary reasons for undertaking a literature review is to
develop and present a research agenda that ows logically from
the critical analysis of the literature and it was with this purpose in
mind that the current study was undertaken (also see Neuman,
2006).
Literature for inclusion in the review was sourced from the
following databases: Science Direct, EBSCO, Emerald Management
Plus, JSTOR, ProQuest, SpringerLink, Taylor and Francis and Wiley
Interscience. Given the emerging and contemporary nature of
MFCA as a topic, keyword searches were limited to material ow
cost accounting, ow cost accounting, ISO 14051 material and
energy ow cost accounting, energy ow cost accounting and
MFCA. Database search tools were set to order references based on
relevance to these search terms.
The resources identied via the aforementioned means were
further supplemented with ofcial documents from government
and non-government organisations in which MFCA was among the
primary concerns. These references include resources from The
International Organization for Standardization (ISO), Federal Ministry for the Environment in Germany, Ministry of Economy, Trade
and Industry (METI) in Japan, and the International Federation of
Accountants (IFAC).
Once identied the academic references were subjected to a
preliminary word search in line with the keywords provided above.
This undertaking was used for the purpose of screening and to
ensure reference to MFCA was not limited to a passing comment or
a sole item located within the reference list. Any documents
deemed irrelevant to the topic on this basis were discarded. Upon
completion of this process the remaining resources were read in
full with relevant data documented against individual references in
table format. The information gleaned from this process allowed a
comprehensive understanding of the topic to be developed which
provides the foundation for the information presented in the
remainder of this paper.
In order to appreciate how academic research can be used to aid
understanding of current MFCA development it is necessary to rst
understand what MFCA is, how the practice developed and the
steps involved in the implementation process. This information is
required to contextualise the empirical evidence on the topic which
is addressed later in the paper. Hence the following section will
commence the review by considering the development of MFCA in
greater detail.
4. The development of MFCA as a management tool e a brief
overview
MFCA was developed in the late 1990s by the Institut fr
Management und Umwelt (IMU)3 in Augsburg, Germany, under the
name ow cost accounting (Federal Ministry for the Environment,
2003; METI, 2007). The potential relevance of the practice to
manufacturing concerns attracted the attention of Japanese authorities and in 2000 the Japanese Ministry of Economy, Trade, and
Industry (METI) began promoting a modied version of MFCA to
the Japanese business sector (Kokubu and Tachikawa, 2013). An
important element of this process was the Environmental Management Accounting Promotion Project which commenced in 1999
(Onishi et al., 2009). The Japanese effort culminated with the
release of a Guide for Material Flow Cost Accounting published by
METI in March 2007 (METI, 2007). To date, while it can be argued
Germany and Japan have been the prime instigators at the forefront
of global MFCA development, interest in the practice is growing and
emanating from regions as diverse as Europe, Asia, the Middle East
and North America (Jasch and Savage, 2008; Jindrichovska and
rea, 2011; Kokubu and Tachikawa, 2013).
Purca
The Japanese and German versions of MFCA are often discussed
separately within extant literature. It is possible this situation is
attributable to the difference in system boundaries recommended
under each approach. The Japanese version, for example, has primarily been concerned with product lines or processes (IFAC,
2005). The German version, on the other hand, is more interested
in facility wide management (IFAC, 2005). Nonetheless, it can be
argued recent years have seen a more pragmatic stance on the part
of MFCA advocates and there is now greater acceptance that the
system boundaries associated with any MFCA experiment will
likely be determined by both organisational circumstance and the
underlying reasons for implementation (Kokubu and Tachikawa,
2013). Furthermore, regardless of the level at which MFCA is
implemented (company, facility, cost centre, process or product),
the underlying principles will remain essentially unchanged (Jasch,
2003b). While MFCA can undoubtedly be implemented at different
organisational levels, it has been suggested that initial adoption is
more usual at the company level given this form of aggregate data is
more readily available in most operations (Jasch, 2003b).
Recent years have seen even further development in MFCA. In
particular the success of the practice when applied to Japanese
companies became the catalyst in 2008 for a submission by the
Japanese Industrial Standards Committee (JISC) to the International
Organization for Standardization. A working group was subsequently created with the culmination of their efforts being the
release in September 2011 of the rst edition of ISO 14051: Material
Flow Cost Accounting (Kokubu et al., 2009; Trappey et al., 2013).
Countries involved with the development of this standard include:
Japan, Germany, Brazil, The United Kingdom, Finland, Malaysia,
Mexico and South Africa (Schmidt and Nakajima, 2013). In line with
the published preamble, the overarching aim of ISO 14051 is to
offer a general framework for material ow cost accounting (ISO,
2011, p. v). In addition, ISO 14051 provides information concerning
common terminologies, objectives and principles, fundamental
elements and an overview of the MFCA implementation process
(ISO, 2011, p. v).
In keeping with more recent publications ISO 14051 places
especial emphasis on the universal applicability of MFCA to business (Kokubu and Tachikawa, 2013). While it can arguably be
contended MFCA is likely to be more useful to organisations
involved with the manufacture of physical products (IFAC, 2005),
there is growing consensus the practice can also be applied in nonmanufacturing settings which include organisations located in
either the service or not-for-prot sectors (Jasch, 2009;
Papaspyropoulos et al., 2012). Indeed, ISO 14051 argues MFCA is
applicable to any organization that uses materials and energy,
regardless of their products, services, size, structure, location, and
existing management and accounting systems (ISO, 2011, p. 1).
Finally, as with EMA, MFCA was developed primarily to evaluate
material ows within individual organisations, the purpose being
to support eco-efcient decisions that enhance resource efciency
and simultaneously improve the economic and environmental
performance of the entity (METI, 2007). However, in more recent
years there has been growing interest in how MFCA techniques can
be extended to assist with supply chain management (Jasch, 2011;
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
is widely accepted that in cases where tangible quantities are unavailable estimates can provide a suitable proxy provided there is
no reason to suspect excessive inaccuracy (METI, 2007). Regardless
of how these values are obtained, it is important that all items be
converted into comparable measurement units (for example kilograms) necessary for the next step in the MFCA process.
The purpose for assigning values to the ow model is to establish a material balance also referred to as a mass balance,
inputeoutput balance or an eco-balance (IFAC, 2005). As noted in
ISO 14051 (ISO, 2011, p. 5):
Because mass and energy can neither be created nor destroyed,
only transformed, the physical inputs entering a system should
be equal to the physical outputs from the system, taking into
account any inventory changes within the system.
The notion of a balance described above borrows heavily from
the law of conservation in physics (Huang et al., 2012; Victor et al.,
1998). Thus, energy and mass are never lost and there is a wellestablished scientic basis for the development of a materials
balance and it is important that any signicant gaps in this data be
investigated.
Once the material balance is complete it is necessary to assign
monetary values for every input and output contained for each step
in the ow model. MFCA has come to recognise several categories
of costs. These include: material costs; system costs which incorporate the expense associated with handling materials and energy
in-house and includes labour, depreciation and transport costs; and
nally, waste management costs (Kasemset et al., 2013).4 There is
some debate concerning the best way to account for energy with
some authors advocating recognition within a separate cost category, however, this decision is generally left to the discretion of
individual organisations (Jasch, 2011; METI, 2007). Indeed, a 2005
study by Kokubu and Nashioka reports organisations are more
likely to consider energy costs in their environmental accounting
activities as opposed to generic material costs (Kokubu and
Nashioka, 2005).
Further to the more basic issues associated with material use
and cost allocation, ISO 14051 also includes explicit guidance
concerning how to deal with costs that are carried from one
4
Readers interested in obtaining a further understanding of these cost categories
are advised to consult ISO 14051 (ISO, 2011), Jasch (2009) and METI (2007).
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
5
A quantity centre is dened in the ISO 14051 standard as selected part of parts
of a process for which inputs and outputs are quantied in physical and monetary
units (ISO, 2011, p. 4).
6
PDCA is an acronym which represents Planning, Doing, Checking and Acting
(ISO, 2011).
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
potential for signicant cost reductions and environmental improvements through what is commonly referred to as good
housekeeping activities (Jasch and Danse, 2005, p. 362; Scavone,
2006), in certain cases it may also be necessary to consider the
potential benet that may accompany investment in new capital
equipment (Kokubu and Tachikawa, 2013). For example, in a case
study from Argentina, Scavone (2006, p. 1285) shows how MFCA
led a sugar cane company to invest USD 350,000 in new equipment
to improve efciency. As a result of this decision the company was
able to save USD 72,000 each year with the overall payback period
being ve years. Staniskis and Stasiskiene (2006) also offer Lithuanian evidence from a number of case studies in which it is clearly
shown that capital investment in cleaner production generally
resulted in vastly improved economic and environmental performance with all items having payback periods of 3 years or less (also
see Staniskis and Stasiskiene, 2005). Moreover, beyond the mere
et al. (2011) suggest MFCA
purchase of new equipment, Hyrslova
may even provide a catalyst for the development of new and more
efcient technologies.
As can be gathered from the preceding discussion, much of the
current work investigating MFCA has been concerned with
manufacturing operations and, in cases where ow charts are
provided, these generally represent a simple linear manufacturing
process, i.e. materials in, work in process, waste and product out
(for example, see Heupel and Wendisch, 2003; Staniskis and
Stasiskiene, 2006; Schaltegger et al., 2012). While these studies
are no doubt important, they do little to demonstrate whether
MFCA is useful in non-manufacturing settings and, if so, how MFCA
can best be applied in these organisations. When viewed in light of
arguments that MFCA can be applied in any business that uses energy or materials (ISO, 2011; Jasch, 2009), the lack of data on multiple sectors would appear to represent a major shortfall in current
knowledge.
As discussed in the previous paragraph, to the current time
MFCA has been primarily applied in the manufacturing sector
(Papaspyropoulos et al., 2012). Nevertheless, it has also been suggested MFCA can be applied in both the service and not-for-prot
sectors (Jasch, 2011; Papaspyropoulos et al., 2012). While this
may be true, evidence to support this proposition with regard to
either sector is not well developed. One notable exception is the
study of Papaspyropoulos et al. (2012) which considers the case of
the Hunting Federation of Macedonia and Thrace (HFMT), a not-forprot organisation located in Greece. The authors conclude that
MFCA can support the operation of the sector and provide useful
indications for [] policy decision making (Papaspyropoulos et al.,
2012, p. 141). Recommendations were also made to complement
the use of environmental cost accounting and MFCA in the case
organisation with additional EMA tools, in particular those with a
future-oriented and/or long-term focus.
6.3. How is MFCA implemented in practice?
The actual manner of MFCA implementation is another area
requiring further study. To date, while European studies have
generally advocated company-wide application and the integration
of MFCA data into existing practice via advanced IT options and
Enterprise Resource Planning (ERP) systems (an approach also seen
in select Japanese case studies (Onishi et al., 2009) and more
recently in research to emerge from South Africa (Fakoya and van
der Poll, 2013)), it is accepted not all organisations have access to
such sophisticated systems. For example, Heupel and Wendisch
(2003) discuss the implementation of ow cost accounting in a
group of SMEs (small and medium-sized enterprises) and conclude
the practice can be applied using more simple programming systems. This was noted as being especially important in countries like
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
7
Note: while many references suggest much of the data required for MFCA may
already be available, this is not always the case. Gale (2006) for example, found at a
paper mill in Canada that the necessary information from existing accounting
systems was more difcult to obtain than expected, especially in the case of energy
and waste costs (Gale, 2006).
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
contexts MFCA is less effective than other EMA tools, or combinations of tools, as was found in the study of Lang et al. (2005).
6.6. Proposed extension of MFCA as a supply chain management
tool
Finally, there has been substantial interest in recent years in
developing a greater understanding of how EMA, and more specically MFCA, can be used to assist with Supply Chain Environmental Management (IFAC, 2005; ISO, 2011; Jindrichovska and
rea, 2011). The METI Guidebook for MFCA describes the
Purca
transfer of MFCA data to the supply chain as one of the most
advanced topics in the hierarchy of MFCA activity (METI, 2007). In
addition, if used within the supply chain the data provided by
MFCA could then be used to support further analysis via life cycle
assessment (LCA) (Jasch, 2011; Nakano and Hirao, 2011) and may
help to support the development of closed-loop supply chains
which place less demand on virgin resources as described by
Weigand and Elsas (2013). While limited case studies do support
the potential for MFCA information to assist with environmental
supply chain management (Kokubu and Tachikawa, 2013; Viere
et al., 2007, 2011), problems with the collection of information
and condentiality of data are also acknowledged (Weigand and
Elsas, 2013) and more research on this topic is required.
The above section constitutes a comprehensive coverage of
extant evidence on MFCA in practice. While it can be observed that
the literature in this area is increasing, it could also be argued that
there remain more questions than answers. Hence the need now
exists to move this debate forward. The next section explicitly
considers this need, the purpose being to articulate an agenda for
future research in the MFCA eld.
7. Discussion and the way forward
7.1. Implications from existing research
The previous section clearly demonstrates that while knowledge regarding MFCA is certainly increasing, the overall understanding of the topic remains limited and further research is
required. Numerous studies draw attention to the potential associated with MFCA and a number of action-based case studies have
provided evidence that would seem to suggest it works. Nonetheless these studies are at odds with additional evidence in which
it has been demonstrated MFCA is not well used in practice. Thus, if
we accept the positive results obtained from case-based research,
there would appear to be a role for academic study in seeking to
understand and resolve this paradox. Furthering the understanding
of MFCA in this way is essential to nding ways to encourage
diffusion of the practice in diverse organisations.
Drawing on the discussion presented above the most logical
question with which to commence this agenda would seem to be
When does MFCA work? Are we, as academics, to assume that the
benet associated with MFCA implementation will be equivalent
across all sectors and in organisations of all sizes? Or is this
something that needs to be empirically examined? Who is using
MFCA in different sectors and, more to the point, why are they using
it? What are the key drivers of MFCA implementation? What are
the barriers to MFCA adoption? Are they actual or perceived? Are
barriers to MFCA adoption the same across different organisations?
How well do the realised benets associated with MFCA adoption
reect the benets that were expected? These are just a few of the
questions that extant evidence does not answer (see Table 1). While
normative claims suggest MFCA is useful in all organisations, they
are just that, normative, and without a body of evidence to support
these claims there is ample reason to doubt their validity. Answers
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
Table 1
Possible directions for future research.
Table 1 (continued )
Proposed future
research questions
Possible associated
future sub-research
questions
Possible method(s)
Proposed future
research questions
Possible associated
future sub-research
questions
Possible method(s)
Case studies;
comparative case
study; survey based
statistical research;
interviews.
Case studies;
comparative case
study; interviews.
How widespread is
MFCA adoption in
practice?
Why do organisations
choose to
incorporate MFCA
into their activities?
Why do organisations
choose to abandon
MFCA activities?
Case studies;
interviews.
adoption. For example, Lang et al. (2005) posit that the use of ow
cost accounting as an isolated analysis will still provide useful information on cost savings and environmental improvement potentials. When used in this way the authors suggest that the
process does not need too much effort (Lang et al., 2005, p. 147).
However, when MFCA is used for the purpose for which it was
designed, as an addendum to the existing cost accounting system,
Lang et al. (2005, p. 147e8) suggest the process becomes much
more difcult requiring a lot of effort and know how.
Many of the case studies that investigate MFCA as discussed in
Section 6 are arguably based on a single cost assessment that is
used to identify opportunities for both economic and environmental improvement (Jasch, 2006). This information is then used
for benchmarking purposes and to initiate changes that improve
both material and energy efciency (Schaltegger et al., 2012). Thus
it may be that the value of MFCA will be realised, not as a routine
tool, but as an ad-hoc process for assessing efciency and cost
savings potentials (Lang-Koetz et al., 2006). This could be undertaken on an annual or bi-annual basis or whenever it was deemed
necessary by management (i.e. when considering investment in
new plant or developing new products). While it can be argued this
would impair the controlling function associated with MFCA (LangKoetz et al., 2006; Schaltegger et al., 2002), a number of benets
would remain intact. This approach may also be useful when
applied to the supply chain as it would remove the need for the
ongoing coordination of information between organisations
(Weigand and Elsas, 2013). In order to understand this potential it
would be useful to conduct comparative, longitudinal casework in
which both approaches are considered.
Finally, it may be useful to consider cross-national differences in
MFCA application. Although limited, the survey-based research
reported in Section 6 suggests there may be differences in MFCA
knowledge and adoption across cultures (Burritt and TingeyHolyoak, 2012; Kokubu and Nashioka, 2005; Schaltegger et al.,
2011), although it can be argued cross-national studies are largely
absent within existing literature. Given that the development of
MFCA has been inuenced by two distinct and disparate cultures in
both Germany and Japan (IFAC, 2005), as discussed in Section 4, it
may be that one size does not in fact t organisations operating in
every country. For example, Section 6 discusses the application of
MFCA in supply chains as being potentially hindered by problems
with the collection of data and condentiality (Weigand and Elsas,
2013). It is possible this may be more problematic in certain cultures (Deegan, 2007). Thus existing guidelines may need to be
amended via the inclusion of appendices targeted towards particular cultures and countries. However, at this time such arguments
are only speculative and additional research is required to ascertain
whether such action would help or hinder the further adoption of
MFCA activities by companies.
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
10
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
and van der Veen, 2002; Qian and Burritt, 2008), legitimacy theory and stakeholder theory (Deegan, 2007). While this list is not
exhaustive and there are other theoretical approaches and paradigms that may be able to contribute to the further development of
this eld, it does offer a starting point based on established research
on related topics.
The information presented in this review would seem to suggest
there is much that is not known about MFCA in practice. Yet in what
could be described as an interesting development, there has also
been increased work in recent years seeking to develop the tool
beyond its original purpose i.e. to incorporate a life cycle perspecrea, 2011; Nakano
tive (for example, see: Jindrichovska and Purca
and Hirao, 2011; Schrack and Prammer, 2013). Nonetheless it can
be argued these efforts may be premature. While it is important, as
noted in Section 6, to further the current understanding of how
MFCA information interacts with other EMA tools and information
systems (Lang-Koetz et al., 2006; Strobel and Redmann, 2002), this
does not mean it is necessary to reinvent the wheel; especially
when our understanding of MFCA in its original form is so limited,
due in part to the narrow and underdeveloped nature of extant
empirical evidence in this eld. Thus it is the authors' belief that it
is now necessary to consolidate what is already known about MFCA
and what needs to be known before seeking to develop the tool
further.
As it is, the recent release of ISO 14051 may represent a gamechanging event in the MFCA eld. Observation of how (or indeed
if) this event alters perceptions and the overall take-up of MFCA by
business in both the short and long-terms is likely to become a focal
point. The following section will now conclude the paper.
8. Conclusion
MFCA is a relatively new tool designed to support decisions that
will lead to improved economic and environmental performance
via the explicit recognition of material and energy ows within
business operations, as well as a greater understanding of how
these ows relate to different areas of business expense. The potential importance of MFCA as a business tool has recently been
recognised with the release of ISO 14051: Material Flow Cost Accounting. Given this development it was suggested that the future
will see increased interest given to MFCA by both academics and
organisations from around the world. Thus, this article takes stock
of what is currently known about MFCA, and what needs to be
known, in order to ensure promotional and research efforts are
directed towards the areas where they will make the greatest
difference.
The review covered several areas. These include: a basic overview of what MFCA is in the context of more generic EMA knowledge and development; the development of MFCA as a
management tool; the MFCA process; and a review and synthesis of
empirical evidence concerning MFCA in practice. Finally, suggestions for a research agenda for the future were derived based on the
current state of play of evidence about the usefulness of the MFCA
tool.
While every effort has been made within this review to provide
a comprehensive and balanced synthesis of available MFCA literature, the observations made herein should be viewed in light of
several limitations. As noted in Section 4, MFCA was originally
developed in Germany and Japan. As a result much of the early
work to emanate from these countries was designed for use by
domestic organisations. Thus it is acknowledged there are publications, especially from the late 1990s and early 2000s, that are
only available in German or Japanese. These papers were not
considered within this composition which, as noted in Section 6,
was limited to publications available in English. While it is not
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
References
Altham, W., 2007. Benchmarking to trigger cleaner production in small businesses:
drycleaning case study. J. Clean. Prod. 15, 798e813.
Bautista-Lazo, S., Short, T., 2013. Introducing the all seeing eye of business: a model
for understanding the nature, impact and potential uses of waste. J. Clean. Prod.
40, 141e150.
Bennett, M., Schaltegger, S., Zvezdov, D., 2013. Exploring Corporate Practices in
Management Accounting for Sustainability. ICAEW, London.
Bouma, J.J., van der Veen, M., 2002. Wanted: a theory for environmental management accounting. In: Bennett, M., Bouma, J.J., Walters, T. (Eds.), Environmental
11
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005
12
K.L. Christ, R.L. Burritt / Journal of Cleaner Production xxx (2014) 1e12
Jasch, C., Danse, M., 2005. Environmental management accounting pilot projects in
Costa Rica. In: Rikhardsson, P.M., Bennett, M., Bouma, J.J., Schaltegger, S. (Eds.),
Implementing Environmental Management Accounting. Springer, pp. 343e364.
Jasch, C., Lavicka, A., 2006. Pilot project on sustainability management accounting
with the Styrian automobile cluster. J. Clean. Prod. 14, 1214e1227.
Jasch, C., Savage, D.E., 2008. The IFAC international guidance document on environmental management accounting. In: Schaltegger, S., Bennett, M., Burritt, R.L.,
Jasch, C.M. (Eds.), Environmental Management Accounting for Cleaner Production. Springer, pp. 321e336.
rea, I., 2011. CSR and environmental reporting in the Czech
Jindrichovska, I., Purca
Republic and Romania: country comparison of rules and practices. Account.
Manag. Inform. Syst. 10, 202e227.
Kasemset, C., Sasiopars, S., Suwiphat, S., 2013. The application of MFCA analysis in
process improvement: a case study of plastics packaging factory in Thailand. In:
Lin, Y.-K., Tsao, Y.-C., Lin, S.-W. (Eds.), Proceedings of the Institute of Industrial
Engineers Asian Conference 2013. Springer, Singapore, pp. 353e361.
Kokubu, K., Campos, M.K.S., Furukawa, Y., Tachikawa, H., 2009. Material Flow Cost
Accounting with ISO 14051, pp. 15e18. ISO Insider. JanuaryeFebruary 2009.
Kokubu, K., Nashioka, E., 2005. Environmental management accounting practices in
Japan. In: Rikhardsson, P.M., Bennett, M., Bouma, J.J., Schaltegger, S. (Eds.),
Implementing Environmental Management Accounting. Springer, pp. 321e342.
Kokubu, K., Tachikawa, H., 2013. Material ow cost accounting: signicance and
practical approach. In: Kauffman, J., Lee, K.-M. (Eds.), Handbook of Sustainable
Engineering. Springer, Netherlands, pp. 351e369.
Lang, C., Heubach, D., Loew, T., 2005. Using software systems to support environmental accounting instruments. In: Rikhardsson, P.M., Bennett, M., Bouma, J.J.,
Schaltegger, S. (Eds.), Implementing Environmental Management Accounting.
Springer, pp. 143e168.
Lang-Koetz, C., Loew, T., Beucker, S., Steinfeldt, M., Horstmann, U., Sieghart, T., 2006.
Environmental Accounting Instruments: Implementation & Continuous
UsedConcepts for the Application of Input-output Balance, Environmental
Performance Indicators and Flow Cost Accounting, Material Flow Management.
Springer, pp. 131e157.
Loew, T., 2003. Environmental cost accounting: classifying and comparing selected
approaches. In: Bennett, M., Rikhardsson, P., Schaltegger, S. (Eds.), Environmental Management Accounting - Purpose and Progress. Springer, Netherlands,
pp. 41e56.
Ministry of Economy, Trade and Industry (METI), 2007. Guide for Material Flow Cost
Accounting. Ministry of Economy, Trade and Industry. Version 1. March 2007.
Nakano, K., Hirao, M., 2011. Collaborative activity with business partners for
improvement of product environmental performance using LCA. J. Clean. Prod.
19, 1189e1197.
Neuman, W.L., 2006. Social Research Methods: Qualitative and Quantitative Approaches, sixth ed. Pearson Education, Boston.
Onishi, Y., Kokubu, K., Nakajima, M., 2009. Implementing material ow cost accounting in a pharmaceutical company. In: Schaltegger, S., Bennett, M.,
Burritt, R.L., Jasch, C.M. (Eds.), Environmental Management Accounting for
Cleaner Production. Springer, pp. 395e409.
Papaspyropoulos, K.G., Blioumis, V., Christodoulou, A.S., Birtsas, P.K., Skordas, K.E.,
2012. Challenges in implementing environmental management accounting
tools: the case of a nonprot forestry organization. J. Clean. Prod. 29e30,
132e143.
Parker, L.D., 2005. Social and environmental accountability research: a view from
the commentary box. Account. Audit. Account. J. 18, 842e960.
Qian, W., Burritt, R.L., 2008. The development of environmental management accounting: an institutional view. In: Schaltegger, S., Bennett, M., Burritt, R.L.,
Jasch, C.M. (Eds.), Environmental Management Accounting for Cleaner Production. Springer, pp. 233e248.
Qian, W., Burritt, R.L., Monroe, G., 2011. Environmental management accounting in
local government: a case of waste management. Account. Audit. Account. J. 24,
93e128.
Rogers, E.M., 2003. Diffusion of Innovations, fth ed. Free Press, New York.
Sarkis, J., 2012. A boundaries and ows perspective of green supply chain management. Supply Chain Manag. 17, 202e216.
Scavone, G.M., 2005. Environmental management accounting: current practice and
future trends in Argentina. In: Rikhardsson, P.M., Bennett, M., Bouma, J.J.,
Schaltegger, S. (Eds.), Implementing Environmental Management Accounting:
Status and Challenges, vol. 18. Springer, Netherlands, pp. 257e277.
Scavone, G.M., 2006. Challenges in internal environmental management reporting
in Argentina. J. Clean. Prod. 14, 1276e1285.
Schaltegger, S., Burritt, R.L., 2000. Contemporary Environmental Accounting e Issues, Concepts and Practice. Greenleaf Publishing, Shefeld, UK.
Schaltegger, S., Csutora, M., 2012. Carbon accounting for sustainability and management. Status quo and challenges. J. Clean. Prod. 36, 1e16.
Schaltegger, S., Herzig, C., Kleiber, O., Mller, J., 2002. Sustainability Management in
Business Enterprises: Concepts and Instruments for Sustainable Organisation
Development. The Federal Ministry for the Environment, Nature Conservation
and Nuclear Safety and The Centre for Sustainability Management, Leuphana
University, Lueneburg.
Schaltegger, S., Viere, T., Zvezdov, D., 2012. Tapping environmental accounting potentials of beer brewing. Information needs for successful cleaner production.
J. Clean. Prod. 29e30, 1e10.
Schaltegger, S., Wagner, M., 2005. Current trends in environmental cost accounting
e and its interaction with eco-efciency performance measurement and indicators. In: Rikhardsson, P.M., Bennett, M., Bouma, J.J., Schaltegger, S. (Eds.),
Implementing Environmental Management Accounting. Springer, pp. 45e62.
Schaltegger, S., Windolph, S.E., Herzig, C., 2011. From Knowledge to Application:
Dissemination of Sustainability Management Tools in Large German Companies. Centre for Sustainability Management, Leuphana University, Lueneburg.
Scheide, W., Dold, G., Enzler, S., 2002. Efcient eco-management using ECO-Integral
d how to save costs and natural resources at the same time. In: Bennett, M.,
Bouma, J.J., Walters, T. (Eds.), Environmental Management Accounting: Informational and Institutional Developments. Kluwer, Dordrecht, pp. 93e111.
Schmidt, M., Nakajima, M., 2013. Material ow cost accounting as an approach to
improve resource efciency in manufacturing companies. Resources 2,
358e369.
Schrack, D., Prammer, H.K., 2013. Integration of external costs and environmental
impacts in material ow cost accounting e a life cycle oriented approach. In:
Guenther, E., Bergmann, A. (Eds.), Proceedings from the EMAN-EU 2013 Conference on Material Flow Cost Accounting. Springer, Singapore, pp. 150e154.
Staniskis, J., 2012. Sustainable consumption and production: how to make it
possible. Clean. Technol. Environ. Policy 14, 1015e1022.
Staniskis, J.K., Stasiskiene, Z., 2005. Industrial waste minimization e experience
from Lithuania. Waste Manag. Res. 23, 282e290.
Staniskis, J.K., Stasiskiene, Z., 2006. Environmental management accounting in
Lithuania: exploratory study of current practices, opportunities and strategic
intents. J. Clean. Prod. 14, 1252e1261.
Strobel, M., Redmann, C., 2002. Flow cost accounting, an accounting approach based
on the actual ows of materials. In: Bennett, M., Bouma, J.J., Walters, T. (Eds.),
Environmental Management Accounting: Informational and Institutional Developments. Kluwer, Dordrecht, pp. 67e82.
Thomas, G., 1997. What's the use of theory? Harv. Educ. Rev. 67, 75e104.
Thurm, R., 2002. Counting what counts d raising transparency through environmental management accounting at Siemens. In: Bennett, M., Bouma, J.J.,
Walters, T. (Eds.), Environmental Management Accounting: Informational and
Institutional Developments. Kluwer, Dordrecht, pp. 123e135.
Torraco, R.J., 2005. Writing integrative literature reviews: guidelines and examples.
Hum. Resour. Dev. Rev. 4, 356e367.
Trappey, A.J., Yeh, M.F., Wu, S.C.-Y., Kuo, A.Y., 2013. ISO 14051-based Material Flow
Cost Accounting system framework for collaborative green manufacturing. In:
2013 IEEE 17th International Conference on Computer Supported Cooperative
Work in Design (CSCWD), pp. 639e644.
Tsai, W.-H., Shen, Y.-S., Lee, P.-L., Chen, H.-C., Kuo, L., Huang, C.-C., 2012. Integrating
information about the cost of carbon through activity-based costing. J. Clean.
Prod. 36, 102e111.
n, H., Ga
rtner, S., 2011. The benet side of environmental activities and the
Va
connection with company value. In: Burritt, R.L., Schaltegger, S., Bennett, M.,
Pohjola, T., Csutora, M. (Eds.), Environmental Management Accounting and
Supply Chain Management. Springer, pp. 281e300.
Victor, P., Hanna, S., Kubursi, A., 1998. How strong is weak sustainability?. In:
Faucheux, S., O'Connor, M., Straaten, J. (Eds.), Sustainable Development: Concepts, Rationalities and Strategies, vol. 13. Springer, Netherlands, pp. 195e210.
Viere, T., Schaltegger, S., von Enden, J., 2007. Supply chain information in environmental management accounting e the case of a Vietnamese coffee exporter.
Issues Soc. Environ. Account. 1, 296e310.
Viere, T., von Enden, J., Schaltegger, S., 2011. Life cycle and supply chain information
in environmental management accounting: a coffee case study. In: Burritt, R.L.,
Schaltegger, S., Bennett, M., Pohjola, T., Csutora, M. (Eds.), Environmental
Management Accounting and Supply Chain Management. Springer, pp. 23e40.
Weigand, H., Elsas, P., 2013. Construction and use of environmental management
accounting systems with the REA business ontology. J. Emerg. Tech. Account. 9,
25e46.
Wendisch, N., Heupel, T., 2005. Implementing environmental cost accounting in
small and medium-sized companies. In: Rikhardsson, P.M., et al. (Eds.),
Implementing Environmental Management Accounting. Springer, pp. 193e205.
Xiaomei, L., 2004. Theory and practice of environmental management accounting:
experience of implementation in China. Int. J. Tech. Manag. Sustain. Dev. 3,
47e57.
Please cite this article in press as: Christ, K.L., Burritt, R.L., Material ow cost accounting: a review and agenda for future research, Journal of
Cleaner Production (2014), http://dx.doi.org/10.1016/j.jclepro.2014.09.005