Search

In production planning and control, assessing the performance of a manufacturing system is a multi-dimensional problem, in which neglected dimensions may lead to hidden inefficiencies and missed opportunities for gaining a competitive advantage. This paper proposes a data formalisation method to model a manufacturing system by simultaneously considering value creation and technical, economic, and environmental performance. The proposed method combines the techno-economic assessment of lean manufacturing and sustainable manufacturing with the data-driven approach, typical of Industry 4.0, to overcome the limitations of the lean approaches in addressing complex systems. The method is based on integrating Multi-layer Stream Mapping and a combination of Enterprise Input-Output and Material Flow Analysis. It also considers non-value-added activities such as transport and inventories. Pen and papers and digital approaches can simultaneously exploit the method as a shared architecture for formal data integration. The implementation of the method is shown through a numerical example based on a recycled plastic pipeline manufacturing system.

We develop a material flow cost accounting system for planning efficient and inefficient costs in arbitrary production processes. The basis of this accounting system is a material flow model with waste and rejects as the main factors of material losses, which is used to determine efficient and inefficient material demand at quantity center and product unit level. This production theoretical foundation enables an extension of the known material flow cost accounting system by a cost unit accounting and clarifies the relationships to other cost accounting systems. Finally, we discuss the necessary steps to implement material cost accounting as a marginal cost accounting system to provide relevant information for short-term decisions.

In the context of sustainable development, environmental considerations embedded in the life cycle of a product cannot be separated from the environmental management accounting of product and waste costs, or from the quantification, monitoring and evaluation of external environmental damage. In this paper, a three-dimensional model for environmental management accounting is built that takes into consideration the dimensions of material flow, value flow and organization; this model is based on material flow cost accounting and the traditional life cycle theory. On this basis, this paper explains the basic principles of the resource value flow analysis method, and it dissects the internal mechanism of the three-dimensional model from the perspective of the enterprise, the industrial park and the nation. Then, using aluminum production as a case study, this paper briefly expounds on the implementation of resource value flow analysis from the perspective of the organization. This three-dimensional model expands the organizational boundaries of material flow cost accounting, providing guidance for tracking and quantifying the environmental impact of material flow over the entire life cycle of the enterprise, and evaluating the efficiency of the objective of material flow.

From the perspective of material flow cost accounting (MFCA), which treats both material and financial flows within a company, this study proposes a corporate waste decomposition model to investigate the effects of material and financial factors on corporate waste generation. The proposed model decomposes waste into the material loss (waste ratio of raw materials [WRMat]), raw material-to-cost ratio (RtCR; material use efficiency), cost-to-sales ratio (or COGSR), total asset turnover ratio (TATR), leverage, and total equity. As an application, the waste decomposition analysis is performed using the log-mean Divisia index (LMDI) method, and 125 listed firms in 5 Japanese manufacturing sectors from 2010 to 2015 are analyzed. The LMDI results show that the RtCR, the most crucial term in MFCA, had the largest effect on increases in waste generation as of 2015; however, this effect is not so robust among sectors over the years, implying that MFCA is valid mainly for specific companies/sectors or years. Also, corporate environmental burdens (waste and carbon emission) are likely to be correlated negatively with leverage and positively with total equity in the models, implying that the financial and stock markets have an essential role in deciding corporate environmental burdens.

Material flow cost accounting analyzes input/output relations of material flows in the production process based on mass balance principles. However, the measured data of a process contains errors representing a mass imbalance in the system such as that of a wastewater treatment plant. Therefore, measured data should be verified before establishing mass balance and, subsequently, material flow cost accounting. Hence, in this work, a novel practical stepwise methodology using data reconciliation technique is introduced to improve the accuracy and certainty of measurements before material flow cost accounting. A full-scale petrochemical wastewater treatment plant was selected to establish this methodology. The presented results of this case study show an error of −3.22% (−35244 t/year) between total input and output streams of wastewater treatment plant demonstrating mass imbalance in the system. However, the overall mass balance could be closed by simultaneously solving the incidence matrix (system of balances). The results revealed that by including data reconciliation into material flow cost accounting, an accurate mass balance can be performed, which is a key element in material flow cost accounting calculations. The comparison results showed a relatively significant difference between material flow cost accounting for reconciled and measured data (unreconciled). The developed approach provides a reliable set of data for implementing material flow cost accounting in the system. Therefore, using this novel stepwise approach will help decision-makers to enhance both financial and environmental performances more confidently and to define appropriate improvement plans.

Papermaking enterprises are currently under both environmental pressure and economic pressure for sustainable development in China. Thus, the efficiency, effectiveness, and benefits of resource utilization need to be improved. High-consumption and high-pollution companies should manufacture paper using sustainable methods. This study highlights a resource value flow analysis from the circular economy perspective, developing an extension of material flow cost accounting and modifying it by accounting for environmental damage as well as economic benefits. With reference to the Plan-Do-Check-Act cycle, this specific case study was conducted to verify the comprehensive utility of resource value flow analysis by establishing decision-making prioritization according to the dualistic diagnosis of “internal resource loss–external environmental damage costs.” In general, applying a resource value flow analysis can both reduce resource consumption and minimize environmental damage, enhancing the sustainable development of a process industry with limited resources.

Reducing waste is a significant strategy for reducing the negative environmental effects of agricultural production. Material flow cost accounting (MFCA) is an environmental management tool that can assist farmers to better understand the financial and environmental consequences of the use of materials and energy and provide opportunities for achieving financial and environmental sustainability of agricultural activities by providing solutions. The objective of MFCA for soybean production is to quantify and identify agricultural inputs/energy waste to improve management of residue, waste and energy at different stages of crop production. Analysis of the economic and environmental performance of soybean production was performed using an MFCA for the first time. Current economic and cost analysis using MFCA was compared and a new method was used for incorporating material waste into classic energy and cost analysis. The results shows that the total energy consumption and production cost for 2701 kg of soybean seed were 52064.63 MJ and 1408 USD, respectively. The economic indices of gross production value, gross return and the benefit/cost ratio were evaluated for conventional and MFCA cases. The MFCA results indicate that gross production value, gross return and the benefit/cost ratio were 2103 USD ha−1 and 695 USD ha−1 and 1.49, respectively. These values for conventional calculations were 1781 and 373 USD ha−1 and 1.26, respectively. The gross income in conventional mode showed a difference of 322 USD with MFCA, which is equivalent to the cost of material waste. The benefit/cost ratio was higher by 0.22 because of the calculation of the cost of material waste in MFCA. The efficiency of the use of energy and energy productivity were calculated based on the equivalent input and output energy. The energy use efficiency of soybean production in MFCA-based and conventional calculations were 1.04 and 1.29, respectively. In this case, energy use efficiency decreased by 0.25 compared to conventional calculations. When calculating net energy, the input energy was obtained from the total energy of the negative (with negative sign) and positive products. The net energy in MFCA-based and conventional calculations was 2436.42 and 15460.36 MJ ha−1, respectively. As seen, the net energy in MFCA accounting is 13023.94 MJ ha−1 less than conventional mode. Energy and cost analysis based on MFCA was efficient for soybean production. This approach helps to better understand the relationship between economic factors and the environment through a comprehensive energy and cost assessment.

In recent years, material flow cost accounting (MFCA) has gradually been recognized in Asia by the standardization of ISO 14051 and 14052 and by the project of dissemination undertaken by the Asian Productivity Organization (APO). However, MFCA is still not used across the board. This study analyzes the characteristics of material flow (MF) management to facilitate the expanded use of MFCA. The research framework of this study investigates the degree of MF management and the sequential relationships among financial factors, MF management, and waste performance, based on a questionnaire survey of non-financial listed companies in Thailand. Fifty-eight percent of the respondent firms answer that they are managing MF information (self-rating). Meanwhile, 50%, 49%, 29%, and 24% of the firms actually disclose the amounts of total waste, hazardous waste, raw materials consumed, and recycled waste, respectively. The results of this study show that respondent firms with MF management (self-rating) are more likely to manage/disclose total waste, hazardous waste, and raw materials consumed than those without it. In terms of financial factors, cost ratio and profitability are likely to affect firm decisions regarding whether to manage the MF. Additionally, MF management is likely to decrease the hazardous waste ratio. The series of results shows that firms in Thailand are more likely to be concerned about hazardous waste management than resource efficiency. Therefore, hazardous waste should probably be thoroughly managed, as a preliminary step in the promotion of MFCA.

The natural rubber (NR) processing industry plays a critical role in the economies of many developing countries, particularly in Asia. Among the different types of NR, crepe rubber holds a significant position, as it is used to produce pharmaceutical and surgical rubber items, and also articles that are in contact with foods. At present, the crepe rubber manufacturing has been challenged by low productivity, rising cost of production, and environmental issues. Therefore, this study was aimed to assess the feasibility in the adoption of sustainable manufacturing practices in the crepe rubber production as a case study in Sri Lanka. This study consisted of three steps: 1) quantification of material and economic losses and global warming potential (GWP) via material flow analysis (MFA), material flow cost accounting (MFCA), and life cycle assessment (LCA) on a gate-to-gate basis, 2) developing proposals of improvement options with the help of Pareto and What-if analyses, field interviews, and the existing literature; and 3) validation of suggested improvement options through the re-execution of MFA, MFCA, and LCA. For 1 MT of rubber input, the underlying economic losses and GWP impact in the current manufacturing process were identified as LKR 19,585 and 279.3 kg CO2e with the values of 7% and 13% for Relative Standard Deviation, respectively. As improvement options, reduction options of water, chemicals, electricity, milling duration were proposed. It revealed that adoption of these reduction options could mainly reduce 32,064 kg of water and 30.1 kWh of electricity resulting in 5.3% of cost savings and a 4.3% of GWP impact reduction. Other implications associated with improvement options and their limitations are also discussed.

Twin-roll casting is an energy-efficient technology for the magnesium strip production consisting of casting and rolling combined in one process step. Producing magnesium strips in an adequate quality-price ratio requires the application of material flow cost accounting to identify hidden improvement potentials. In the following, a material flow cost accounting analysis is carried out for the twin-roll casting process of AZ31 twin-roll-cast strips. Based on the findings, inefficient process steps of the twin-roll casting process are to be revealed, and actions for cost reduction from the point of a stable process management are to be assessed. Overall, an economic process and efficient material consumption can be designed for twin-roll casting considering the strip property development.

The optimal use of material and energy by different industries has recently become an issue of great importance due to limited energy resources around the world. Material flow cost accounting (MFCA) has been suggested as a novel management system that can enhance waste management and provide an estimation of actual values of losses. This research aims to apply MFCA to the wastewater treatment unit of the Tabriz Oil Refining Company. In order to establish MFCA, the amount of input and output material, material costs, system costs and energy costs were studied. Using mass balance in all sections of wastewater treatment unit, losses were identified and costs and benefits were established. Results from MFCA calculation indicated that the annual cost of the unit is 28.14 million USD. This study also investigated the effect of changing the type of microorganisms in the biological treatment section that are able to digest high levels of ammonia and hydrogen sulfide and addition of reverse osmosis to the cooling drain section. It was found that the positive product's value increased from 58.92% to 90.76% and negative product's cost reduced from 41.08% to 9.23%. In addition to economic issues, use of these modifications considerably reduces environmental issues due to the release of NH3 and H2S to the environment and contamination of ground water through evaporation ponds.

As an innovative method of Environment Management Accounting (EMA), a model of Material Flow Cost Accounting (MFCA) is widely used in the field of cost calculation in the manufacturing process industry, and it has obtained a level of achievement in recent years. Based on the existing literature in the field, this report argues that the application of the current MFCA model in the process industry has defects, such as content restrictions, a single accounting index, simple methodology and one-sided conclusions, among others. This paper combines the current MFCA model with the “3R” principle of a circular economy (CE), and the industry characteristics of high consumption and pollution. The research focuses on the iron and steel industry as a representative of a process manufacturing industry and forms a modified MFCA model for an iron and steel enterprise according to the perspective of CE. The modifications we make to the model occur in the fields of model content, the accounting index, the methodology of application and the extension of functionality. Finally, through a specific case study, this report verifies the comprehensive utility of the proposed modified model. In general, the modified MFCA may, to a certain extent, be considered innovative in its approach to information and data connections, extension of methods and procedures, modes of disclosing information, construction of evaluation analysis and management of circular decision-making. Each of these elements is conducive to realizing a triple win situation for the conservation of resources/energy, providing an economic value-add, reducing the environmental load and enhancing the sustainable development of a resource-constrained process industry.

This research applied Material Flow Cost Accounting (MFCA) to identify the costs of material and energy loss, as well as the opportunity for technology improvement to increase productivity in starch and ethanol productivity in Thailand. The results showed that ethanol production incurred more loss cost than starch production because it entails several conversion processes. Scenario for technology improvement was evaluated and expanded to the broader scale of the whole country to assess the possibility of increasing cassava feedstock in order to meet the AEDP target. The result shows that the Very High Gravity (VHG) and Simultaneous Saccharification and Fermentation (SSF) processes can increase plant capacity and efficiency. Ethanol production from cassava pulp can also play an important role in meeting the Renewable and Alternative Energy Development Plan (AEDP) and utilizing by-product from starch processing, increasing its value and offsetting loss cost from starch production plant. Those improved options in the scenario can help to reduce cassava feedstock amount required to produce ethanol for the AEDP target. Yield improvement can satisfy feedstock requirement without the need of land for plantation expansion, reduce cassava export and allocation of more molasses for ethanol production.

SMEs around the globe are often challenged by the issues related to productivity enhancement, material usage, waste management and sustainability. Material flow cost accounting (MFCA) is considered as a green productivity tool that can be utilised by SMEs to overcome these challenges. Despite the benefits, its adoption among SMEs, especially in developing countries, remains low. The purpose of this research is to examine how MFCA can be suitably implemented in an SME set-up to improve the financial and environmental performance of the enterprise. This study utilises case based research methodology to exemplify the application of MFCA tool in an Indian steel pipes and tubes manufacturing SME. As a part of MFCA analysis, material cost, system cost and energy cost at each quantity center was calculated to identify inefficiencies in the production process of the SME. Thereafter, several solutions were implemented to address these inefficiencies. The result of the MFCA implementation showed an overall annual savings of 21,028,452 INR (USD 302,350) through an investment of 495,400 INR (USD 7123). The present study reveals that the application of MFCA tool leads to higher productivity, better energy efficiency and improved environmental performance. The SME’s performance was also monitored for five years to study the long-term benefits of MFCA implementation. The findings suggest that, post MFCA implementation, the return on invested capital of the SME increased by 29.37% and the material usage cost reduced by 26.58%. This research would be beneficial to managers, practitioners, and policymakers for effectively implementing MFCA in SMEs.

In the natural rubber industry, concentrated latex (CL) holds a prominent position due to its use in manufacturing dipped rubber products (e.g., gloves, condoms, etc.). With no previous studies on the process efficiency at commercial level of CL manufacture, this study aimed at adopting process analyses tools in three CL factories (factory A, B and C) in Sri Lanka in view of improving CL manufacture process in financial and environmental terms. This approach possessed three steps: 1) quantification of resource use, financial losses and global warming potential using material flow analysis (MFA), material flow cost accounting (MFCA) and environmental life cycle assessment (ELCA), 2) identification of key issues and proposing improvement options with help of Pareto and what if analyses, field interviews and literature, and 3) determination of potential improvement and feasibility through re-performing MFA, MFCA and ELCA, and discounted cash flow analysis, greenhouse gas payback time and novel loss reduction efficiency index. On average, the present level of financial loss and global warming potential per 1 MT of rubber input were found to be LKR 9608 and 112.8 kg CO2e, respectively. Installation of an advanced trap tank was proposed to factory A (i.e., option-1) whilst extending sedimentation time (i.e., option-2) and Installing inverters and solar panels (i.e., option-3) were recommended to all factories as improvement options. Combined scenario entailing options 2 and 3 for all factories, was found to be the most applicable in terms of financial returns and environmental benefits.

Environmental management accounting provides a set of tools designed to support management to make better decisions about cleaner production. Diffusion of innovation theory provides a foundation for understanding the dynamics of environmental management accounting implementation. Based on five case studies of businesses in Indonesia, the Philippines and Vietnam characteristics of environmental management accounting innovations and temporal path of development are explored. The cases examined reveal the importance of incremental path specific changes to work towards complex sustainability settings and demonstrate the richness and usefulness of fostering cleaner production practices through a multitude of environmental management accounting tools, which rejects the view that one environmental management accounting method such as material flow cost accounting would suffice. Moreover, the findings show the relevance of involving external support and the need for interdisciplinary execution in diffusing environmental management accounting innovations.

Material Flow Cost Accounting (MFCA) enables companies to identify the added value they lose as a result of material losses. MFCA can also be understood as a special allocation method for distributing the costs in a production system to both the products and the material losses. A mathematical algorithm for this purpose that can be deployed flexibly is presented. It is based on the physical quantity structure of the energy and material flows in a production system. These physical quantities can then be taken to represent monetary values or environmental impacts. From an economic standpoint the outcome is the known MFCA. From the environmental standpoint it is possible to calculate what environmental impacts could be saved by reducing the material losses. The process can also be used to analyze internal recycling flows and their potential for economic and ecological improvement. In particular, the algorithm is suitable for creating software solutions that can perform transparent cost accounting as well as environmental accounting with consideration given to the MFCA approach for all kinds of complex production systems and supply chains. This supplies valuable information that can help companies in deciding what material flow-related measures are suitable for saving costs and reducing environmental impacts.

Material flow cost accounting (MFCA) has been developed worldwide as a major tool in environmental management accounting. The International Standard on MFCA was published as ISO 14051 in 2011. In Japan, the Ministry of Economy, Trade and Industry (METI) has been strongly supporting the promotion of MFCA, and the number of companies introducing this tool has been steadily increasing. However, in order to apply MFCA in companies continuously, it is necessary to overcome conflicts between MFCA and existing management perspectives. This paper argues that such conflicts are likely to be caused by the essential features of MFCA, and indicates some theoretical solutions based on organizational design. Then, by looking at three example cases of companies that have succeeded in the continuous use of MFCA, specific countermeasures for dealing with conflicts are investigated.

Material Flow Cost Accounting (MFCA) is an instrument with a considerable potential for gaining transparency of material (and energy) flows and corresponding costs and, thereby, supporting the systematic striving for a higher degree of resource efficiency. However, a use case from the aluminum industry reveals some restrictions of MFCA due to its focus on material, the input-orientation, and the short-term orientation. Thus, this paper suggests extending the scope of Material Flow Cost Accounting by methodical refinements concerning the modeling of energy flows, divergent flow system outputs, especially revenues, and long-term monetary effects caused by investments. For demonstrating these methodical refinements of Material Flow Cost Accounting, the aforementioned use case is taken up.

In this study, we examine the goal of encouraging corporate strategy to adopt a more efficient and sustainable use of natural resources. Material flow cost accounting (MFCA), with its flow-based view, is able to support the formulation of a resource-efficient strategy. However, such goals as resource efficiency can only be achieved if corporations commit themselves to these targets on a strategic level and transfer them to all corporate levels using management control systems (MCS). The four levers of MCS developed by Simons (1995) adopt a key role in this implementation process. We contribute to literature by highlighting that such methods as MFCA require continuous development toward an increased interrelation with MCS, particularly with the four levers of control (LOC), such that the underlying goal of resource efficiency can become part of corporate strategy. Therefore, in a systematic literature review, we analyze how far MFCA and its direct antecedent approaches currently address the LOC. For this purpose, we analyze the contents of 82 studies and derive nine salient issues that are relevant to the interrelation aspect. To guide future research, we moreover ask: What further conceptual developments of MFCA would increase the focus on the LOC? On this basis, we develop a summarizing conceptual framework consisting of five stages. Because this research approach can also be transferred to other methods that aim for further important economic, environmental, and social objectives, we purposefully highlight the course toward sustainable development.

The introduction of Material Flow Cost Accounting (MFCA) to five companies under the Malaysia Productivity Corporation (MPC) project has shown that these companies have indeed achieved simultaneous benefits of economic gains and environmental sustainability. This paper highlights the experience of one of the companies, emphasising how one can leverage enablers and also overcome barriers to implementing MFCA in a small and medium-sized enterprise (SME) in Malaysia. Driven by the diffusion of innovation (DOI) theory, the case company found most of its enablers within MFCA's own attributes. Additionally other factors such as the team composition, interpersonal communication, and efforts of the change agents were instrumental in the success of the MFCA implementation. However, the company was also constrained by its suppliers. More importantly, it is envisaged that a potential hurdle for MFCA advancement is when performance management issues are not addressed by higher management. Drawing upon the company's experience and the theoretical literature, other barriers that may also be encountered by SMEs in Malaysia are also discussed. These include for example, overcoming the traditionalist view held by most SMEs, persevering the implementation processes on their own without the direct assistance from MPC and several others.

There is the undisputed need for the coupling of Life Cycle Costing (LCC) and Life Cycle Assessment (LCA) – the most common methods for the evaluation of the life cycle-wide economic and ecological effects of products and production systems in the context of sustainable decision making. However, in published studies both methods are often used in parallel or with little integration. This causes double work in data acquisition and a lack of consistency of the underlying analyses' scopes and, therefore, limits the significance of the analyses results. Further on, no mature theoretical approach for the integration of LCA and LCC exists. To overcome this problem, the paper presents a procedure model for the integrated use of the methods. More specifically, Material Flow Cost Accounting is suggested as a tie between both methods and is extended according to the requirements of life cycle-wide analyses.

This research is aimed to present how Material Flow Cost Accounting (MFCA) plays a role in waste reduction. The study was carried out as a case study at a textile factory in Chiang Mai, Thailand. Following the procedure of MFCA, a specific type of shirt was selected to be studied. Cost of the positive and negative products of each process are identified, starting from cutting, sewing, quality checking, dyeing, buttonhole drilling, and packing processes. The results from the MFCA analysis showed that the costs of the positive and negative products were 84.26% and 15.74%, respectively. The greatest portion of the negative product cost resulted from material cost was 14.73% from the total of 15.74%. Focusing on the material cost of the negative product, the cutting and sewing process made up 80% of the material cost of the negative product, in comparison to other processes. Thereafter, the cause–effect diagram was used to identify the main source of the material cost of the negative product at both the cutting and sewing processes. Data collection and analysis indicated that three sources of the material cost of the negative product at both the processes, were from the cutting and trimming procedures. Three improvement solutions were proposed, as follows: (1) reducing the gap between the pieces of pattern, (2) reducing the edge width of each piece of pattern, and (3) employing a new cloth-cutting table. The results from the MFCA calculation showed that the costs of the negative product from these three solutions had reduced to 8.51%, 4.57%, and 3.06%, respectively. Moreover, it was found that when three solutions were combined and used at the same time, the cost of the negative product reduced to 11.27%. Practically, the first solution was the only way that could be promptly applied without any investment. However, when additional investments are available for process improvement, the combination of the three solutions was the most effective way that should be seriously considered.

Recent times have seen the business world challenged to improve efficiency by reducing its material and energy usage. Material flow 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 flow cost accounting tool. Concerns are raised about the absence of theorising behind material flow 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 firm 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. Refereed/Peer-reviewed

It is essential for small and medium-sized enterprises to manufacture products using standardized and sustainable methods. The case study company here is a wood products manufacturer, and an analysis of its production process revealed that almost 70% of the wood raw materials used is wasted in the form of chippings, sawdust, off-cuts and defects. The objective of this research study was therefore to apply the Material Flow Cost Accounting (MFCA) and Design of Experiments (DOE) concepts to the case study company, in order to reduce materials consumption and minimize waste. The research methodology was divided into two main parts. The first part employed the MFCA concept to analyze the inefficiencies incurred due to resource use within the production process, as well as the causes of such inefficiencies. In the second part, the opportunities available to reduce these inefficiencies were examined. The DOE concept was used to increase the efficiency of wood raw materials use, with a full factorial experiment used to find the optimal cutting settings, those creating less damage. Three factors were studied and an analysis of variance (ANOVA) was conducted. The results of the experiment have subsequently been put into practice, resulting in a reduction of wood materials losses in the cutting process, as a proportion of total wood materials used, from approximately 69 percent to 54 percent. In conclusion, applying MFCA and DOE helped both increase product quality and reduce the adverse environmental impacts of the case study company's production process, saving costs and improving its competitiveness.

Waste recovery has become one of the most important strategies to reduce environmental issues and improve economic performance in industry. Thus, different systematic approaches have been developed for waste recovery. However, most of the developed waste recovery approaches do not account for the hidden cost incurred from various processing steps as a criterion for prioritisation of waste recovery. This aspect can be determined by the concept of material flow cost accounting (MFCA). Hence, in this work, a novel MFCA-based approach is developed for prioritisation of waste recovery with consideration of hidden costs embedded in process streams. Two case studies are solved to illustrate the developed approach. It can be seen that hidden unit cost (HUC), carry-forward cost (CFC), amount and quality of discharged waste are important factors that significantly affect the prioritisation results. The developed approach then balances the trade-off among these factors to determine the minimum total hidden cost (THC) of discharged waste, and thus improve the economic and environmental performances of an industrial process.

Berry fruits such as black currants are known to have health-promoting effects as they contain high amounts of phytochemicals (polyphenols, anthocyanins) and dietary fibers concentrated in the peel and seeds. So far, the berry pomace by-product obtained from the production of berry juice is mainly subject to incineration and less recognized by companies as an opportunity to create additional value. Material Flow Cost Accounting is a powerful tool when it comes to the identification of resource inefficiencies in production systems and can provide useful information as an ad-hoc analysis supporting investment decisions, such as the extension of the product portfolio. This study investigates the material efficiency potential of a black currant juice production in Germany while considering potentials for cost reduction, revenue generation, and carbon dioxide mitigation resulting from the avoidance and upcycling of food waste. We used Material Flow Cost Accounting in combination with carbon footprinting and probabilistic scenario analysis to examine the subject. The analysis showed that, in terms of the global warming potential, the environmental performance of the main product, black currant juice, benefits from the upcycling of the pomace to a marketable product. From the economic side, we could not demonstrate a reasonable amortization of the additional investment costs. However, the scenario and uncertainty analysis revealed promising optimization strategies which would lead to an increase in profit of about 13%: first, additional use of apple pomace and second, the production of high-quality, organic pomace to achieve a selling price of at least €2.00/kg as a functional food supplement or in pharmaceutical and cosmetic applications.

Experience drawn from several EMA (Environmental Management Accounting) and MFCA (Material Flow Cost Accounting) case studies shows, that establishing an Input/Output balance in values and volumes on a regular basis is still a challenge, as “current” accounting information systems simply don't offer the opportunities needed to easily integrate the data requirements of ISO 14051 into financial and cost accounting, stock management and production planning. The paper visualizes the linkages between current information systems and where there are common recommendations regarding Input/Output balancing. It draws on experiences from Small and Medium Sized Companies (SMEs) in developed and transitional countries. Most of them have been performed within the UNIDO (United Nations Industrial Development Organization) TEST approach, which assists SMEs in performing Cleaner Production Projects based on a mass balance assessment, implementing as well an environmental management system to ensure continual implementation and improvement. The paper goes on to argue, that first the Input/Output balance should be regularly implemented on the system boundary of the company within the financial accounting and stock management system, before more detailed systems on the level of processes should be attempted, as the later needs much more complex adoptions to cost accounting and production planning information systems.

Most breweries implement enterprise resource planning (ERP) systems to manage their orders, inventory, and finance and customer information without integrating it with other systems. Breweries can leverage the information sharing and visibility between ERP and material flow cost accounting (MFCA) systems by integrating these disparate systems to generate waste information for improved waste-reduction decisions. Brewery waste-reduction decisions have been based on insufficient waste information with opportunities for cost saving being lost. This paper explores the integration of ERP and MFCA systems to provide waste information in support of waste-reduction decisions in a South African brewery. A case study was conducted on a South African brewery to determine the extent and adequacy of waste information generated from its ERP database system and how its integration with MFCA can support and improve waste-reduction decisions. It was found that there is lack of integration among the databases of the various divisions within the brewery. The use MFCA to capture waste cost information was absent in this brewery since existing approach was based on variable costing while other waste-related costs are classified under overhead costs. Integrating ERP and MFCA systems will result in the availability of sufficient waste cost information. This paper concludes that the integration of ERP and MFCA by breweries will decrease errors of visibility of waste cost information for improved waste-reduction decisions.

At current rates of disposal, there are nearly 8 years of remaining landfill capacity at permitted sites in England and Wales. Industry – encouraged by financial penalties from the Government – faces the challenges of cleaner and more sustainable production whilst trying to remain competitive in the market place. This paper proposes “Fit Thinking” as a means by which waste can be reduced from the early design stages, alongside the “All Seeing Eye of Business” – a model to illustrate potential sources of profit and loss in a manufacturing firm's output. A literature review on waste and profitability reveals the basis for the model. Concepts from material flow cost accounting, the Kanthal effect, and the Kano model are combined, together with industry case studies, to develop the model. The model is explained in detail, demonstrating twelve types of relationships between a company's product outputs and the profitability of each output. The model and the relationships it proposes are then tested against examples from literature. Ultimately, Fit Thinking is shown to help companies prevent waste; where waste is unavoidable, the All Seeing Eye of Business model can be used by companies in the understanding of their non-product output (waste), providing insights into the nature of their waste and the impact on profitability. It is hoped that this understanding will encourage them to see waste as a potential profit-making “co-product”, rather than as a necessary evil.

Improving established production processes towards Cleaner Production can be a demanding challenge as the actors involved in these processes – both management and technical staff – often need a fresh perspective on how business and the business environment are developing. Whether existing potentials are effectively and efficiently uncovered largely depends on the availability of information as well as on knowing how to make use of it. An often observed problem is the lack of tools to obtain useful Cleaner Production information efficiently. Against the background of a case study of a major Vietnamese beer producer, this paper highlights the importance of decision-making information and demonstrates how considerable performance improvement potentials can be uncovered using environmental management accounting (EMA) techniques and tools. Particular attention is paid to the information needs of the various users of such information and how these needs can be fulfilled. The analysis of the results suggests a pattern of action that increases the efficacy and efficiency of information management and use in corporate practice.

The opportunity of improving production sustainability through waste minimisation is getting more and more interesting because of remarkable waste generation and the contribution to increase the productivity of natural resources. The article is intended to propose an environmental costing method to enable a proper analysis of the flows of products, by-products and wastes produced by a whole production plant or simply by a section of this plant, in order to properly prioritise a list of likely interventions and to make better decisions to head for higher level of eco-efficiency, hence sustainability. The proposed method origins from a general activity-based environmental costing (ABEC) and, unlike traditional ABEC, considers as cost objects not only the expected products, but also by-products and wastes as in the material flow cost accounting (ISO 14051). Thanks to detail given by the proposed method, it is actually possible to go back to the sources of inefficiency of the process and to simulate the impac...

Collaborative activities with business partners have potential to improve environmental performance of product and life cycle assessment (LCA) is an essential technique to implement eco-design of product and production process. However, collection of LCA data from supply chain is a major issue for LCA practitioners. We propose a Supply Chain Collaboration Model (SCCM), which is a framework for collecting producer-specific LCA data from business partners and for promoting improvement activity of product environmental performance. We demonstrate the practicability of the SCCM using three case studies. In each case study, two or three partner companies organized a product improvement project and carried out process analysis techniques such as LCA and material flow cost accounting (MFCA). As a result, improvement activities from the economical standpoint could provide an incentive for business partners to collect LCA data, and thus the SCCM is an effective framework for eco-design.

Existing research argues that impressive environmental and economic benefits can be and have been achieved with Material Flow Cost Accounting (MFCA). This paper examines the body of literature on MFCA and identifies a limited application of MFCA in comparison to its potential application. Examining the scope of MFCA shows that the methodological proposals and applications are largely focused on production related decisions. So far, the growing (but still limited) body of research on MFCA has not been linked with the conceptual developments in environmental management accounting (EMA). By conducting a literature review based on the EMA framework, additional decision situations and decision makers are identified and the potential benefits of expanding MFCA are discussed. This paper provides a research agenda both for developing MFCA tools and subsequently for spreading them to new areas, where they can contribute to the sustainable development of organizations, the economy and society. Practitioners could benefit from this paper by considering additional areas of applications for MFCA in the specific settings of their company.

The article provides definitions for environmental accounting and environmental management accounting based on the approach developed for the United Nations Division of Sustainable Development UN DSD/DESA. It presents the basic framework for assessing corporate environmental costs as well as materials flows (including energy and water) and their costs. The paper is based on experiences from applying the UN DSD EMA framework in company workshops and case studies mainly in Austria. It especially describes how to check for data consistency within different information systems, like the list of accounts, stock management, production planning and process engineering. Common hurdles for obtaining data from different information systems are described and solutions for improved consistency of data in an organization are presented. It provides a detailed example of an assessment in a brewery in the excel tool developed to assist in the application of the UN DSD EMA approach.

The Expert Working Group on “Improving the Role of Government in the Promotion of Environmental Management Accounting (EMA)” was set up by the United Nations Division for Sustainable Development (UN DSD) in cooperation with a number of government agencies and non-governmental experts to promote Environmental Management Accounting (EMA) through publications, pilot projects and by establishing an international forum for discussion on the role of governments in the promotion of EMA. EMA, Environmental management accounting represents a combined approach that provides for the transition of data from financial accounting, cost accounting and mass balances to increase material efficiency, reduce environmental impacts and risks and reduce costs of environmental protection. EMA is performed by private or public corporations, but not by nations and has a financial as well as a physical component. The core focus of environmental management accounting and of the EMA UN DSD methodology is assessment of total annual environmental expenditure on emission treatment, disposal, environmental protection and management. In addition, and that is new and challenging for most companies, the material purchase value of all non-product output and its production costs are added. This total sum often provides a frightening picture of total annual costs of inefficiency and gets companies to improve their information systems and material efficiency options, which is the goal in the light of cleaner production. The first book published by the Expert Working Group, Environmental Management Accounting—Procedures and Principles (Jasch, C., United Nations, New York, 2001), defines principles and procedures for EMA, with a focus on techniques for quantifying environmental expenditures or costs, as a basis for better controlling and benchmarking purposes. The methodology excludes costs external to the company (so-called externalities, e.g. environmental and social effects that occur to the general public), but focuses on comprehensive assessment of direct annual expenditure on emission treatment, environmental protection and management as well as wasted material and energy input (efficiency losses in production). Firstly, total annual expenditure is assessed, then improvement options, savings and investment projects as well as product prices can be (re-)calculated. The method is currently applied in several case studies. The following summary provides some of the core definitions and generic assessment tables.

This introduction provides an overview of the historical development of Material Flow Cost Accounting (MFCA). From its beginnings within an environmental management project at the textile company Kunert in Southern Germany in the late 1980s and early 1990s to ISO 14051: 2011 passed more than twenty years. This article analyses the development and provides several practical examples. Publicly funded projects had proven that MFCA works for companies and could be applied successfully in order to reduce environmental impact and reduce corporate costs simultaneously. This overview gives a detailed description of a research method, developing into an international standard. To understand the MFCA approach its history and roots have to be considered.

The purpose of the present article is to identify the requirements and challenges of promoting a low-carbon supply chain caused by the introduction of material flow cost accounting (MFCA). To this end, the role of an MFCA leader company within the low-carbon supply chain was examined. Next, the results of a questionnaire study that was carried out in 2012 were shown in the second part of the paper. The questionnaire was sent to the listed industrial enterprises (1,561 enterprises) in Japan, and the response rate was 22.8% (356 questionnaires received). The status quo of information sharing between the buyers and suppliers along the supply chain, preconditions, and requirements for introducing MFCA was considered. The study showed that setting environmental indicators as performance evaluation criteria of a company's purchasing department, as well as explaining the performance of MFCA to the purchasing department on the one hand, and promoting inter-organizational information sharing between buyers and suppliers on the other, are important steps in order to effectively introduce MFCA in the supply chain.

Material Flow Cost Accounting (MFCA) combines physical flows and monetary units and is located between energy and material efficiency analyses, environmental management and managerial accounting procedures. Since the development of ISO 14051:2011 research and application in industry increased, but still some theoretical, methodological and practical gaps exist. This Special Volume addresses some of the existing deficits and shows the fertile contribution of MFCA on resource efficiency. As can been seen by the articles and case studies in this Special Volume, MFCA still is continuously spreading into further countries and the methodology is extended, refined and elaborated and increasingly applied in combination with various other tools and concepts. The main challenges are still the continuous implementation of the method in industry and the public dissemination of the results.