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A Current Status of Carbon Emission Trading and Private Corporate Tasks

  • Legal Theory & Practice Review
  • Abbr : LTPR
  • 2022, 10(2), pp.165-185
  • Publisher : The Korea Society for Legal Theory and Practice Inc.
  • Research Area : Social Science > Law
  • Received : May 9, 2022
  • Accepted : May 26, 2022
  • Published : May 31, 2022

choi, yong-keun 1

1호서대학교 법학연구소

Accredited

ABSTRACT

A direct regulation or economic means have been considered as environmental policies for global warming, but notable policies are the environmental tax (or carbon tax) and the emission trading system. In the case of the introduction of an environmental tax, the condition that the tax rate should be at least equal to the market price of emission permits is necessary. Also, regarding emission permit trading, the incentive effect differs depending on whether the initial distribution is free or auctioned. Emission allowance trading by auction, which is more economically burdensome for companies, increases the incentive effect for technological innovation to reduce emissions. The purpose of this study is to overview the current state of the emission trading system and trading market, to reveal the characteristics of each system in Europe and America and Japan, and to draw the trend, and to address the issues related to the company's system operation from a managerial and accounting point of view. Institutional design for carbon credit trading is expected to lead to a certain direction of convergence, mainly in Europe, where the cap & trade method based on paid distribution by auction becomes mainstream. An important task for companies today is to recognize and measure the cost of greenhouse gas (GHG) emissions as an activity unit for each function based on the value chain, and through this, emission reduction becomes possible by activity unit. In order to achieve this task, it will be useful to accurately identify the emission and its cost by the management accounting approach proposed in this study as a premise for system operation.

Citation status

* References for papers published after 2022 are currently being built.