ABSTRACT

The possibility of costly disruption from rapid climate change calls for greater attention to carbon management and accounting in the decision making process (Ratnatunga, 2008). The study on how organization uses carbon cost accounting information for their decision making is very important. This study investigates the effect of carbon cost accounting data and its information display on the attentions of decision makers and investment decision. By using combination of balance scorecard (BSC) and carbon cost accounting (CCA) information, the research aims to examine whether the incorporating CCA data into a BSC, called the SBSC, affect on carbon efficient investment. This research is experimental study. Samples are participants consisted of undergraduate students, graduate students, and graduate. Participants have a variety of professions in accordance with the design of research for investment decisions. Participants were randomly assigned into one of three conditions in between-participants design, and then they chose between two investments using BSCs. The three conditions are: no environmental data (as control variable, called the traditional BSC); CCA data added to a BSC as a fifth perspective standalone; CCA data embedded within the traditional BSC (there is one CCA perspective embedded within four traditional BSC perspectives). By using One Way Anova, Two Way Anowa and Independent sample t-test, the hypotheses were tested. The findings show that the carbon efficient investment was greater with the fourperspective SBSC (CCA data embedded within the traditional BSC) and five-perspective (CCA data added to a traditional BSC as a standalone perspective) rather than traditional BSC. There is no difference between four-perspective SBSC and five-perspective SBSC in the carbon efficient investment choice. Furthermore, the cognitive effort to choose carbon efficient investment was greater with both four-perspective SBSC and five-perspective SBSC rather than BSC. Finally, the finding shows that the knowledge of participants does not influence the carbon friendly investment.

Key Words: Balance Scorecard, Sustainability Balance Scorecard, Carbon Cost Accounting Information, Carbon Efficient Investment, Information Display