these and other environmental efforts stymies the development of the measurement techniques and dedicated instrumentation needed to carry them out properly. This lag exists in part because firms face such an enormous task in removing waste from emissions and effluent streams as rapidly and fully as possible. These activities rightly have had to consume the lion's share of corporate environmental investment resources in the short term. As a result, however, most of the development has had to be directed to end-of-the-pipeline waste control rather than to prevention and control of input or process-stage pollution. As a consequence, we see relatively sophisticated measurement and control efforts being made over incineration and waste-water treatment processes, while little or no effort goes toward processes to handle the flows going into the facilities other than, perhaps, engineering estimates required for recharges of facilities' costs.

Previous studies have examined some of the qualitative environmental inadequacies of typical business accounting systems (Todd, 1989, 1994) as well as systematic approaches to environmental profiling and information gathering of firms' productive activities (see, for example, Allenby and Graedel, this volume; Allenby, 1994). This paper focuses on the development of a taxonomy for evaluating the adequacy of environmental measurement systems and information available within the firm, targeting those areas with the most urgent need for measurement development or refinement. The objective is to provide firms with a basic structure for (1) evaluating the current state of environmental measurement and control, and (2) developing a business strategy that will allow them to move systematically from this stage to a rigorous and comprehensive system of environmental monitoring, control, and managerial decision support. Other environmental information systems, for example Allenby and Graedel's (this volume) environmentally responsible facility assessment matrix, could prove invaluable as basic building blocks in the structure. Beyond this immediate objective, the ultimate goal is to develop a metasystem to support pollution prevention efforts at the source. This paper first examines the types of decisions that managers must make, especially about the environment. Next, it considers the nature of measurement and some of the factors that reduce the quality of the measures. Finally, it describes the development of an environmental measurement taxonomy and the types of managerial decisions that are likely to be affected.

Managers' Business Decisions

Typically, managers must make decisions that affect three broad categories of operations: (1) long-term capital investment, (2) monitoring and control of operations, and (3) performance evaluation and motivation of employees. Environmental considerations are increasingly involved in each of these.

Among the most difficult decisions that managers must make are those that involve the long-term dedication of scarce capital to direct asset investment or research and development projects. Such investments are typically undertaken to



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