DISSERTATION

Effects of Cost Environmental Management Accounting on Operational

Efficiency in the Mining Industry. Case of Hwange Colliery Company
Limited in 2017-2018

BY

Tanangizihwa Ndlovu

Dissertation proposal submitted to the Zimbabwe Open University in

partial fulfilment of the requirements for Master of Business Administration
Degree Programme

Mat-North Region, Zimbabwe

Supervisor: H. Ncube

YEAR : 2021
 DISSERTATION PROPOSAL

PROBLEM ARTICULATION

1.0. Introduction

Cost Environmental Management Accounting has taken centre stage in the mining industry
with high environmental impacts worldwide. Coal Mining Companies are among the largest
contributors to environmental impacts as advanced by Heede (2014), contributing over 30% to
the world environment pollution, mostly in the form of carbon and greenhouse gas emission.
Pollution and other environmental impacts contributing to climate change has been claimed to
be one of the most significant global problems of recent times (Guthrie and Demartini, 2016).
This current study has been proposed on the back of realising that the effects of cost
management on operational efficiency in the mining industry has become a primary focus for
businesses, governments, non-governmental organisations (NGOs), International Organisations
and other pressure groups in a global political landscape towards sustainable reduction of
negative environmental impacts. The motive for focusing on the coalmining industry come
from the immense contribution this industry makes to the socio-economic development of
Zimbabwe in particular and the African continent in general, whilst at the same time having
significant negative environmental impacts on the lives of communities in which coal mining
companies are operating but with limited environmental cost management accounting systems
for presenting relevant financial information to interested parties and shareholders. The
proposal presents background of the study, statement of the research problem, purpose of the
study, research questions and research objectives. Statement of hypothesis and the significance
of the study will be also presented as well as research assumptions. The scope in which
limitations and delimitation of the study are presented will be discussed. The proposal will
examine brief literature and the study methodology which describes how the study will be
executed.

1.1. Background to the Study

The concept of Cost Environmental Management Accounting in the mining industry is applied
as a measure of environmental costs generated by corporate entities during their operational
activities. Cost environmental management accounting came into practice because of the
shortcomings of conventional management accounting and financial accounting to address
environmental issues separately in industries with high environmental impacts such as the

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mining sector (Mohamed, Muhammad and Ali, 2015). According to Cortese, Irvine and
Kaidonis (2018), some mining firms lack modalities for implementation of environmental cost
management accounting to encourage these firms` environmental efficiency. Coal mining
industries are on record as having high environmental impacts with irreparable damages
(Alewine, 2015; Murombo, 2016). Although, it has been perceived that because most
environmental impacts are negative and implementation of environmental cost management
accounting could therefore be detrimental to the financial viability of companies, there are
benefits which can be accrued through the implementation of environmental cost management
accounting in different companies within the mining industry. While the industry is on record
for having the highest negative environmental impacts (Murombo, 2016), there is limited
accounting efforts to demonstrate how they are mitigating them through the implementation of
environmental cost management accounting.

In the global perspective, information available is awash with evidence of the benefits that
accrue to companies after the implementation of environmental cost management accounting.
For example, Fujitsu and Canon Groups in Japan, Marauer Bier Breweries in Austria and
Xerox’s European Photocopiers are some of the companies that are benefiting from the
implementation of environmental cost management accounting systems in their operations
(IFAC, 2017). The coal mining industry can also embrace cost management accounting in its
operations to improve efficiency. In this regard, such benefits could underscore the importance
of cost management accounting in any economic activity.

This is acknowledged by the International Federation of Accounting, which submits that taking
care of the environment has become an enormous global preoccupation, and that cost
management accounting for the environment and related issues is increasingly gaining
importance (Christ and Burritt, 2016). Globally, many organisations are moving towards the
‘green revolution’ which consists of green accounting, green environment, green markets,
green research and green purchasing.

However, in most developing countries, Zimbabwe included, mining companies are facing a
plethora of challenges in applying cost management accounting on operational efficiency in
the environmental ecosystem they operate in on their corporate reports. Coal Mining
Companies in developing countries are still facing challenges in developing better Cost
Management Accounting Systems for operational efficiency in the environment they operate
in due to inaccessibility to environmental technologies, limited enforcement of environmental

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standards and laws, limited training and limited skills and knowledge on how to measure costs
for environmental impacts as a result of their operational activities.

In local context, some organisations in Zimbabwe, both in the public and private sectors, are
not exempted from the green revolution as evidenced through their corporate governance
initiatives. For instance, Econet, which is Zimbabwe’s largest mobile network, and Telecel
provide solar products, ‘green’ outlets and green network boost stations (Kabweza, 2018).
According to environmental pressure groups, the Coal Mining Industry which produces dust,
gas and other emissions into the atmosphere have an extreme and a detrimental impact on the
environment as alluded by Qian, Burritt and Chen (2015). The impacts of dust emission form
Coal Mining activities include pollution of the environment and outright covering of topsoil
and vegetation; sedimentation of nearby water bodies; disruption of wildlife feeding and
reproduction and migration habitat (IFAC, 2017). There are also negative effects on the
livelihood of people who depend on the affected ecosystem for food and clean water. The
depletion of non-renewable or slowly renewable natural resources is also a cause for concern
(IFAC, 2017).

In Zimbabwe, the impact to human life and environment caused by the Coal Mining Industry
brings about the issues of Cost Management Accounting on operational efficiency on the
environment. Thus, Cost Management Accounting on the environment is critical in
Zimbabwe’s Mining Industry considering the phenomenal growth of witnessed in the industry
over the past years. The growth needs to be buttressed by appropriate Cost Management
Accounting systems on the environment to ensure that companies and the society benefit
through utilising the available tools. Studies all over the world where Cost Management
Accounting on operational efficiency of the environment is being implemented have proven
that the benefits of Cost Management Accounting on an environment outweigh the cost of the
lack of it thereof, advances Ambe (2017). Cost Management Accounting system in the mining
industry is an enabler in the identification and measurement of the full spectrum of
environmental costs of current production processes. The economic benefits of pollution
prevention or cleaner production processes are a result of the ability to integrate environmental
impact costs and benefits into day-to-day business decision-making.

There is need for a paradigm shift from traditional recording of costs in the normal routine
financial statements like the statement of comprehensive income and statement of financial
position to environmental accounting reports which are specific to the environment. This will

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help firms in the Coal Mining Industry to know the exact costs and benefits of their operations
to the environment in order to take appropriate actions depending on the outcomes of the
reports. The International Federation of Accountants provides guidelines for Cost Management
focusing on the environment against a growing consensus that conventional accounting
practices simply do not provide adequate information for environmental efficiency
management purposes (IFAC, 2017). The accounting profession, however, argues that the
international accounting standards cover all the cost management accounting details that can
be used on the environment but organisations do not have the knowledge of how to put this
accounting system into practice. Traditional cost management accounting does not provide
adequate information on environmental costs and is intended for internal users. Not bound by
the externally imposed rules of financial reporting, it tends to be more subjective and uses both
financial and non-financial measures, thereby providing more detail than financial accounting.
The area of Cost Management Accounting in which environmental management accounting
falls in, is part of the internal control systems of the organisation which is not visible to
outsiders or intended for external stakeholders though the availability of Cost Management
Accounting on the environment is a system that can have an impact on the outsiders or external
stakeholders. The intention of this proposed study is to explore the effects of Cost Management
on operational efficiency in the Coal Mining Industry operating environment focusing on
Hwange Colliery Company Limited in between 2017-2018.

1.2. Statement of the Problem

Despite Hwange Colliery Company Limited, being a major player in the Zimbabwe Mining
Industry claiming to have mitigating measures to reduce negative impacts as a result of its
operations on the environment, it is noted that mining of coal negatively affects the livelihoods
of many in communities surrounding the mine. Its operating activities destroy animals and
fauna; and pollute the environment whilst at the same time its burning significantly contributes
to climate change. Coal mining is the top contributor to climate change, as well as a leading
cause of pollution, and continues to adversely affect mining communities in untold ways. The
biggest problem is that, the extent to which cost management accounting on environmental
operational efficiency is not clear. Costs on environmental impacts are not fairly reported in
the comprehensive financial position of the company. How proper costs on the environment
are being dealt with in Hwange Coal Mining Company Limited is not clear. This is of grave
concern to the Government and Environmental Management Authority (EMA) since the
residents living in Ingagula Village and N0.5 townships as well as Lwendulu, No. 3 and No 2
Villages are still being negatively affected. The effects of applying cost management

4
accounting on operational efficiency on the environment in which HCCL operates triggers the
need for this current study.

1.3 Purpose of the Study

The purpose of this study will be to explore the effects of Cost Environmental Management
Accounting on Operational Efficiency in the Mining Industry focusing on Hwange Colliery
Company Limited from 2017-2018.

1.4. Objectives of the Study

This study has a number of research objectives that when achieved will contribute to the body
of knowledge.

1.4.1. Main Objective

To explore the effects of Cost Environmental Management Accounting on Operational

Efficiency in the Mining Industry of Zimbabwe.

1.4.2. Specific Objectives

The study intends to:
i. understand how Cost Environmental Management accounting is being implemented by
HCCL, Zimbabwe.
ii. identify challenges in applying Cost Environmental Management Accounting on
operational efficiency faced by HCCL.
iii. ascertain the relationship between Cost Management and HCCL operational
environmental efficiency.

1.5. Research Questions

This study has a number of research questions that will contribute to the body of knowledge
when answered. These are as follows:

1.5.1. Main Research Question

How has application of Cost Environmental Management Accounting affect operational

efficiency of the Mining Industry in Zimbabwe?

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1.5.2. Specific Research Questions

This study will endeavour to answer the following specific questions:

i. How has Cost Management accounting been implemented to gain operational

efficiency in HCCL?
ii. How are the challenges in applying Cost Environmental Management Accounting faced
by HCCL mitigated?
iii. How the relationship between Cost Management on HCCL operational activities has
improves environmental efficiency?

1.6. Research Hypothesis

A hypothesis is a specific and tentative statement of prediction of what will be the outcome of
the study. Having formulated the research questions, the study reduces them to specific
hypothesis for testing the relationship between the dependent and independent variable. The
dependent is the operational efficiency while the independent is the cost management systems
employed. Thus, the hypotheses underpinning this study are as follows:

H0: There is no relationship between operational efficiency on the environment and

Cost Management systems employed by HCCL.

H1: There is a strong relationship between operational efficiency on the environment

and Cost Management systems employed by HCCL.

1.7. Research Assumptions

The research assumptions are those developments that this author believes will occur in the
course of this study. Below are such beliefs:-

i. The researcher will be granted permission to research in HCCL, Zimbabwe by the

relevant authorities.
ii. The responses to research questions by research subjects will be truthful.
iii. The researcher will find it relevantly simple to amass literature for review because is a
registered ZOU Library member and has a WIFI which will enable search Google
Scholar for more information on the subject under investigation.
iv. During the course of the study, the researcher will relatively be free from work
pressures thereby enabling the completion of the study within the timelines set by the
University.

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1.8. Significance of Study

The following will be expected to directly or indirectly benefit most from the study on its
completion. These include the Mining Industry, HCCL Management, Environmental
Management Authority and other scholars. The stakeholders are discussed below.

Mining Industry
The study is hoped to provide relevant information on the effect of applying cost management
on operational efficiency to the Mining Industry of Zimbabwe. The information may assist the
Coal Mining Company to have access to green revolution and markets by complying with
global reporting initiatives required in companies which have high environmental impacts. In
view of this, the information is hoped to influence policy changes and working as a benchmark
document for Cost Management practices in this industry.

Managers
The study will enable different levels of management to come up with strategies in the
implementation of Cost Management Accounting practices to enhance cleaner Coal mining
efficiencies.

Environmental Management Authority of Zimbabwe

The research has the potential to influence policy changes at national level as far as
environment management and protection of resources is concerned.

Communities adjacent to HCCL

It is hoped that the study will benefit communities living adjacent to HCCL by providing
information that encourage Coal mining companies to reduce negative environmental impacts
that affect their socio-economic and healthy livelihoods to ensure these communities enjoy
quality of life.

Other Scholars
The study is hoped to be valuable to other scholars, as it may form the basis of further
research. It may be used as a source of reference material for future researchers and is hoped
to help other academicians who undertake the same topic in their studies in future.

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1.9. Limitations of the study
During the course of this research study, the researcher might encounter research limitations.
If that be the case, the researcher will clearly tabulate the limitations and highlight the counter
strategies that will be employed so that the limitations may not have adverse effects on the
research results. The anticipated research limitations are the following:

1.9.1. Lack of cooperation limitation

During the carrying out of this research, the researcher expects to encounter lack of cooperation
from respondents as they may be resistance from management and staff that will be selected as
participants in this study. Some respondents may not be willing to avail information on their
company cost management accounting practices on environmental efficiency which they may
be patronizing as confidential. To mitigate this, permission will be sought from respective
HCCL senior management to conduct this research in their company.

1.9.2. Secretive nature of disclosure of information

The findings of the study may be limited due to the secretive nature and disclosure of Cost
Management on environmental operational efficiency accounting information. The researcher
anticipates that the sampled participants may be reluctant to give primary information on the
challenges they face in applying Cost Management Accounting on the environment as costing
information is highly sensitive to be given to strangers lest they maybe competitors or EMA
Agency wanting to penalizing their company for lack of environmental compliancy. The
researcher will assure the respondents that the study is purely for academic purpose to ensure
they open up and provide relevant information for the success of the research.

1.9.3. Power Load Shading

Power Load Shading by ZESA is anticipated to affect the production of this research study. In
relation to this limitation, this will be overtaken by making use of solar power in order to work
at most convenient times.

1.9.4. COVID 19 Global Pandemic

The study will be carried during the COVID 19 Global pandemic that will be a threat to the
success of the study. The study is expected to face challenges as most departments of the HCCL
offices will have skeletal staff and conducting interviews under the COVID 19 period will be
difficult. This will however, mitigated by conducting the interviews with respondents

8
observing all WHO protocols on COVID 19 such as social distance and wearing face mask all
the time when conducting the interviews and sanitizing. To mitigate personal contact with
respondents, the study also employed the use of social media platforms such as SMS,
WhatsApp, Skype and emails to conduct interviews during this COVID 19 period and
questionnaires will be distributed online as well as hand delivered as long as there will be no
personal contact.

1.10. Scope of the study (delimitations).

The delimitation of the study comprises of conceptual delimitation, geographic and time
delimitation. These are discussed below.

1.10.1. Conceptual delimitation

The study will be restricted to exploring effects of cost management on operation efficiency on
the environment HCCL is operating in. It will also focus on how the company is measuring
environmental costs and reporting environmental impacts the company have on the ecology of
the adjacent communities it operates in.

1.10.2. Geographic delimitation

The study will be carried out in Hwange Colliery Company Limited, a major Coal Mining
player in the Zimbabwe Mining Industry.

1.10.3. Time delimitation

The time period of study will be from 2017 to 2018. This period has been selected because it
is during the time Zimbabweans living adjacent to HCCL were heavily affected by dust,
carbon-dioxide and toxic gases and other effluent emissions from the operational activities of
the mine. It is also the period when it was observed that the company failed to supply sufficient
information on Cost Management on operational efficiency it has employed. It is also the time
the company failed to take advantage of the use of appropriate Cost Management Accounting
on the environment employing environmental management accounting (EMA) practices to
prove their claims that they do have in place mitigating measures for the reduction of emissions
that have negative impacts on the environment and the communities living near their operating
environment.

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1.11. Definition of key terms

Cost Management
This refers to the process of cost identification and measurement of the maximum amount of
costs that can be incurred to produce a product whist the company still earns the required profit
margin if that product is sold at a particular selling price (Marques and Rocha, 2015).

Operational Efficiency
According to Akeem (2017) operational efficiency is any act of producing products in a process
incurring minimum costs, minimum environment damage and with minimum health problems
to workers and people in the surrounding communities a company operates.

Profitability
Oluwagbemiga et al., (2014) define profitability as the excess of revenue against costs.

1.12. Review of related literature

Review of related literature will be done starting with the discussion of the theories
underpinning the study. This will be followed by the conceptual framework review and the
empirical review of literature will be presented in-line with research objectives so as to expose
gaps in literature as indictors for the need for this current research.

1.12.1. Theoretical framework

A theoretical framework comprise of the theories expressed by experts in the field of Cost
Management Accounting. There are a number of theories that have underpinnings with Cost
Management Accounting research. However, this study will adopt Legitimacy, Stakeholder
and Institutional Theories. These theories are briefly discussed below.

1.12.1.1. Legitimacy Theory (Dowling and Pfefferm 1975

Legitimate Theory was developed by Pfefferm in 1975. The theory suggest that entities are
expected to act in a socially tolerable manner so as to access resources, gain approval of their
goals and places in the society and guarantee continued existence (Guthrie and Parker, 2008).
According to Lindbolm (1993, p.2) “organisational legitimacy occurs when an entity’s value
system becomes corresponding with the value system of larger social system of the entity” as
sited in Janet Luft Mobus (2005), thus, improving trustworthiness of organisational activities.
This theory states that, entities persistently seek to ensure that they are perceived as operating

10
within the bounds and norms of their respective societies which is dynamic. This implies that
their activities are perceived by outside parties as being legitimate. Information disclosure of
the costs of their activities is therefore vital to establishing corporate legitimacy (Deegan,
2016). In view of this theory, it can be argued that HCCL, account for its social and
environmental effects in favour of the Legitimacy theory. It will be further argued that
corporate entities which account for its environmental costs rake huge profits than those which
do not. This implies that if a company` adverse effects on the environment are apparent, the
existing legitimacy of that company is questioned, threatened or challenged which erode its
corporate image. Failure by a company to embark on the expected activities by the community
amounts to breaching of its social contract or making its license for doing business void hence
the company is perceived as no longer legitimate. This threatens a company`s survival as the
success of a mining entity is dependent on fulfilment of the social contract with the community
from which it operates. Pattern (2013) argues that according to legitimacy theory, social
disclosure is a means to deal with the firm exposure to political and social pressure. The theory
further asserts that social and environmental reporting may be just a tool that entities use to
justify their operations and avoiding costly penalties from government and regulatory agencies.

Legitimacy Theory is relevant to this study as it influences organisations in the mining industry
to operate within the bounds and norms of their respective and dynamic societies. It encourages
disclosure of their operational costs of their activities to stakeholders and thus, such disclosure
of information is vital to establishing corporate legitimacy as this reflects how efficient its
production processes are of expected international standards. The theory is relevant to this
study as it encourages HCCL, Zimbabwe Limited to account for its operational costs relative
to its social and environmental effects

1.12.1.2. Stakeholder Theory (Edward Freeman, 1994)

The stakeholder Theory was developed by Freeman in 1994. The theory states that it is the
obligation of the corporate executive of an organisation to perform on behalf of the stakeholder
as agency governing the company in a purposeful manner. According to Liu and Fong (2010)
the goal of maximising the shareholder value is the only appropriate goal for managers in the
modern time corporation. Stakeholder theory has been present as the dominant theory in
business management in capitalist economies (Bennette, Shaltegger and Zvezdov, 2011).

The Stakeholder Theory posits that organisations should engage in social responsibility
activities in the best interest of its stakeholders (Doorasamy, 2015). This implies that by taking

11
care of shareholders, this however, involves taking care of all other stakeholders including
people in the communities the company operates. Stakeholder theory emphases on the various
stakeholders groups within society, Doorasamy, (2015) further noted. This theory is used ‘as a
basis to analyse those groups to whom a firm should be responsible. A stakeholder is ‘any
group or individual who can affect or is affected by the achievement of the organisation
objectives (Freeman, 2003). According Freeman (2003) the theory debates that mangers have
a moral obligation to consider and appropriately balance the interest of all stakeholders.
According to Liu and Fong (2016) any individual or group for example, employee, customer,
community, government and regulators, shareholders, and supplier with an interest in the
activities of the firm are recognised as stakeholders whatever their ability to impact on the firms
survival. Hwange Colliery Company’s stakeholders are no exception to this universal group as
they have interest in the company whose activities may negatively impact on their socio-
economic, health and livelihoods. A company`s stakeholders demand different information and
a company should respond to their demands in a variety of ways including corporate social
reporting (Gray, et al., 2018). Thus, the Stakeholder Theory postulates that a company is
expected to respect the powerful stakeholders such as government as the regulatory authority
through Environmental Management Agency, which might evoke sanctions against non-
compliance. In a bid not to be sanctioned for non-compliance for example, companies in the
mining industry may choose to account and disclose its operational costs under the managerial
branch of the stakeholder theory caring for the shareholders` interests or the ethical branch of
the stakeholder theory caring for interests of communities from which the company operates.
The Stakeholder Theory is relevant to this study as it encourages companies in the mining
industry to take care of all their stakeholders such as shareholders and other groups including
people in the communities these companies operate.

1.12.1.3. Institutional Theory ( DiMaggio and Powell, 1991)

Institutional Theory was developed by DiMaggio and Powell in 1991. It is a relatively new
viewpoint that assumes that managers of a company adopt new reporting practices such as
social and environmental cost reporting as a result of a variety of institutional pressures. The
theory postulates that managers may be anxious that if they do not keep up with other
companies in developing new reporting practices, they may risk disapproval from some of their
economically powerful stakeholders.

According to DiMaggio and Powell (1991) institutions are social structures that have attained
a high degree of resilience and also rules the predetermined pattern of conduct that are generally

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accepted by individuals in society. Institutional Theory is relevant to this study as it offers a
possible lens for studying Cost Management on operational efficiency with regard to its
environmental cost reporting behaviour that may result in an organisation gaining legitimacy
and enhance its survival prospects and thus, its profitability (Doorasamy, 2015).

1.12.2. Conceptual framework

In the past decade Cost Management Accounting on the environment has simultaneously
progressed with global development emerging as a very important part of corporate reporting
as espoused by the International Financial Accounting Commission (2017). According to IFAC
(2017) international accounting standards cover all the cost management accounting details on
the environment but organisations do not have the knowledge of how to put this accounting
system into practice. In order to understand the concept of Cost Management with an
underlying focus on environmental efficiency management, a conceptual framework is
developed. According to Ravitch and Riggan (2017), conceptual framework illustrates the
interaction between the independent variables and the dependent variables, where the
independent variable is a property of an observable attribute that has a measurable effect on
the dependent variable. In this study, the issues, challenges and prospects in implementation of
Cost Management Accounting on environmental efficiency in the Mining Industry is the
independent variable that has an effect on the cleaner production efficiency in the industry. The
chart below shows the conceptual model depicting the nature of relationship between the
independent and dependent variable. The figure overleaf shows this relationship.

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Conceptual Framework of Cost Management on operational efficiency

Independent variable Intervening variable Dependent variable

Challenges
4. Difficulty in defining and
Implementation of Cost
5. separating environmental Management Accounting and its
6. costs enforcement framework on
 Identifying and classifying
Environmental costs environment
 Measuring environmental
costs Operational Efficiency

Other Challenges
 Inaccessibility to
environmental management
technology
 Limited knowledge and
7. skills of personnel
8. Training deficiency
 Unclear legislation on
Cost Management on
environment application Accounting practices

Figure 1: Framework for implementation of Cost Management Accounting

Source: Researcher`s own Model (2021)

In the flow chart, the challenges in applying Costing Management Accounting on operational
efficiency of the environment form the basis of the independent variable which includes
difficulties in defining, separating, identifying, classifying, measuring and controlling
environmental protection costs. Other challenges are inaccessibility to environmental
management technologies, limited knowledge and skills as well as training, and an unclear
legislation on application of Cost Accounting on operational efficiency of the environment
practices making compliance to enforcement regulation a laisser-fare approach. The variables
above affect the operational efficiency of HCCL which is the dependent variable. This implies
that, the application of Cost Management Accounting on operational efficiency in the Mining
Industry therefore, will have a positive effect on cleaner and green production efficiency of the
Coal Mining Company.

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1.12.3. Empirical literature review

According to IFAC (2017), Cost Management Accounting in the mining sector is defined as
the management of economic performance through the development and implementation of
appropriate environmental-related accounting systems and practices. While this may include
reporting and auditing in some companies, cost management accounting typically involves life-
cycle costing, full-cost accounting, benefits assessment, and strategic planning for
environmental management. Several studies revealed that many corporate entities whose
activities have negative impact on the environment and people in the communities they operate
have not embraced Cost Environmental Management Accounting and do not report in full the
costs associated with the environment in which they operate.

A study conducted by Jere, Ndamba and Mupambireyi (2016) concluded that corporate
reporting in most listed companies are not legitimate as their many focus is on financial
accounting with limited integration with Cost Management Accounting on the environment.
Thus, in this view, conventional approaches in corporate reporting have become inadequate
because they have ignored important environmental costs and activities impacting
consequences on the environment. Jere et al., (2016) further note that corporate neglect and
avoidance of environmental costing have left gap of financial incompleteness and absence of
fair view of financial information reporting to users of financial statements, environmental
regulatory agencies and the general public.

The study of Nagle (2014), on costing accounting on the environment reveals that corporate
managers are placing high priority on environmental accounting. However, it can be argued
that Cost Management on operational environmental efficiency as a prevalent subject in the
international community is not yet a priority in Zimbabwe Mining Industry given that there is
limited measurement of costs of emissions into the air, water and land. Also, aspects of
untreated domestic waste outflows into rivers and streams, quantities of solid waste that must
then be disposed of, perhaps through land spreading or incineration costs are clearly measured
and reported. Pollution include airborne SO2 emissions during Coal burning by stack-gas
scrubbing which leaves a highly concentrated sludge and degradation which incorporates slag
on wetlands impact negatively the environment and people`s livelihoods.

At all times it is important in decision making to provide accurate costs information. The
consciousness and need to protect the environment will make for environmental costs to be

15
identified, accurately measured and reported. Besides, certain environmental costs have
previously been reported conventionally along with companies’ overheads before allocation to
products or processes (Choruma, 2016). Sometimes such costs have been totally left out of
financial reporting because they constitute externality social costs which did not form part of
bottom-line financial reporting. Adverse effect on the society known as environmental social
costs, or externality costs is a critical issue for consideration. This is considered an issue of
responsibility for environmental accountability. Externality costs are therefore internalized as
part of environmental cost accounting. Environmental costs are not only the costs paid to
comply with regulatory standards but include costs which have been incurred in order to reduce
or eliminate releases of hazardous substances and other costs associated with corporate
processes which reduce adverse effect on the environment.

1.13. Research Gap

There have been various pieces of research on Cost Management Accounting on operational
efficiency. Some of these studies were for example done in the US, Germany, Australia and
Japan by Qian, Horish and Schaitegger (2016); In Canada paper industry by Henri and
Journeault (2014); Mawali, Rumman and Liu (2018) in the United Arab Emirates. These
studies were mostly focusing principally on some issues in developed countries. In Zimbabwe,
some studies looked at the impacts of environmental issues in the mining industry with limited
number of such studies done to investigate cost management on operational efficiency of such
mining entities on the environment they operate, a gap this current study attempt to close. This
highlights the need for this research in order to contribute to the board of knowledge on
corporate cost environmental management accounting issues in a developing country and
mining industry in particular with a focus on Hwange Colliery Company, Zimbabwe Limited.

1.14. Research Methodology

1.14.1. Research Philosophy

There are a number of research philosophies that can be pursued by researchers in executing
research studies. These are positivism, interpretivism, epistemology, ontology and pragmatism
among others. This study will adopt a pragmatism research philosophy.

1.14.2. Pragmatism research philosophy

This study proposes the use of pragmatism research philosophy. Collis and Hussey (2014)

16
define pragmatism as a philosophical movement that includes those claims that an ideology or
proposition is true if it works satisfactorily, that the meaning of a proposition is to be found in
the practical consequences of accepting it, and unpractical ideas are to be rejected. This
philosophy will be used as an ideal philosophical strand since it recognises that, there are many
different ways of interpreting the world and undertaking research, that no single point of view
can ever give the entire picture and there maybe multiple realities as further noted by Collis
and Hussey (2014). In this view, pragmatism philosophy combines both, positivist and
interpretivism positions within the scope of a single research to the nature of the research
question.

Thus, pragmatism research philosophy can integrate more than one research approach and
research strategies within the same study. Moreover, studies with pragmatism research
philosophy can integrate the use of multiple research methods such as qualitative, quantitative
and action research methods in what is referred to as mixed research approach. The other reason
for adopting pragmatism research philosophy which has capacity of integrating more than one
research approach is that, such approaches can complement each other whenever there are
some weaknesses in any one of them. The combination of the positivist and interpretivism will
also help in achieving an accurate identification and selection of an appropriate research design.

1.14.3. Research Design

This study will adopt a descriptive research design. Polit and Hungler (2014) define descriptive
research design as a research study that has as its objective, the accurate portrayal of the
characteristics of persons and situations in an organisation. This study will examine Cost
Management on operational efficiency of HCCL on the environment. The choice of a
descriptive research design where quantitative and qualitative data analysis techniques will be
necessitated by the fact that the study variables will be both quantitative and qualitative in
nature. Another reason is that, by describing the phenomenon under investigation, this research
design will be used to gain a deep understanding of the how implementation of target cost
management accounting on environmental efficiency is being practiced in the mining industry.
Due to these reasons, the researcher has no other option but to adopt a descriptive research
design which enables use of both quantitative and qualitative research approaches, use of
questionnaire, interview and documentary perusal in data collection. The descriptive research
design proposed is found to be the most suitable design for this current study.

1.14.4. Research paradigm

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According to Crotty (2015) a research paradigm or approach is a systematic, orderly plan or
established procedure for accomplishment of the research goal or objective. In this study,
multiple research paradigms will be used as explained below.

1.14.5. Mixed research paradigm

According to Saunders, Lewis and Thornhill (2016), a mixed research paradigm is the use of
multiple research approaches in a single study. This has been corroborated by Leedy and
Ormrod (2015) who note that, more than two paradigms can be used in one research study to
strengthen each other. In this study, quantitative and qualitative research paradigms will be
used concurrently in analysing data collected using the questionnaire and an in-depth interview.

According to Creswell (2014), the implicit assumption in much of the social science literature
on using mixed research method is to ensure that the weak points of one approach are
compensated by the strength found in another approach, resulting in an accurate data analysis.
Using a mixed research approach provides a richer context for interpreting and validating
results, and for the generation of new research questions. Moreover, collecting different types
of data by different methods will be done in order to enhance the accuracy of research results.

1.14.6. Population
The population for this study will be 471 as provided in the HCCL (2017) Report,
comprising of 465 employees and 6 corporate managers drawn from 3 Directors, namely
Financial Director, Corporate Affairs Director, and Director of Operations as well as 3
accountants drawn from a Financial Accountant and two Cost and Management Accountants
from which a sample size will be selected. Bryman and Bell (2015), assert that, the total
population is the universal population from which a sample size is drawn. Quota and purposive
sampling methods will be used in determining the sample size for the study.

1.14.7. Sample size and sampling techniques

1.14.7.1. Sample Size

The sample size for this study will be 100 respondents. Yin (2009) defines a sample size as a
subset of the elements from the sample frame. Yin (2009) noted that, a sample size must be
carefully selected to be representative of the population. Saunders, et al., (2016) contended
that the sample size depends on what one wants to know, the purpose of the inquiry, what is at
stake, what could be useful and what can be done with available time and resources. The sample

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size will be estimated from a population sample frame of 471 from which the sample size will
be selected for investigation.

The study will adopt a quota and purposive sampling methods as follows:
1. 25% of Administrative employees=25% of 93 = 23
2. 25% of Coal Miners = 25% of 252 = 63
3. 25% of Financial and Cost Accounting Clerks =25% of 32 = 8
Total sample size for employees = 96

The study`s sample size of 100 participants thus, will be 96 respondents from employees and
selected using quota sampling method and 6 managerial participants selected using purposive
sampling method.

1.14.7.2. Sampling Techniques

Quota Sampling
In this study, quota sampling technique will be adopted in selecting employees while purposive
sampling will be used in selecting management respondents as the sample size for the study.
Quota sampling technique and purposive sampling according to Leedy and Omrod (2015)
are non-probability sampling methods of gathering representative data from a group. The
application of the quota and purposive sampling methods will be done to ensure that the sample
group represents certain characteristics of the population chosen. The quota sampling method
will be based on the proportion of subclasses in the population for each Department at Hwange
Colliery Company, Zimbabwe Limited.

Purposive sampling
This study will also use purposive method which will be done on the convenience of the
researcher till the sample size is obtained. The sample size drawn using purposive sampling
will be estimated at 6 managerial personnel from directors, management and accountants.

1.14.8. Research Instruments

Bryman and Bell (2015), describe data collection instruments as tools used in order to get
information from respondents. There is a wide choice of research instruments that can be used
for data collection in any research. However, for this proposed study, the questionnaire, in-
depth interview guide and documentary perusal methods will be adopted.

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1.14.9. Research ethics
Collis and Hussey (2014) define ethics as the principles of right and wrong conduct in the
execution of a research study. These research ethics are a set of moral principles and rules of
conduct woven through every stage or aspect of conducting a research study. They shape the
methods of how the research is conducted and how the research findings are presented. Though
there are many ethical issues to consider, this study will observe four ethical issues discussed
hereunder.

First, the Chief Executive Officer (CEO) of HCCL will be approached for permission to carry
out this dissertation in this Coal Mining Company. Secondly, no research subjects will
participate in this study unless they give voluntary consent to do so. Third, the identity of all
research data and information that informants will provide is going to be kept confidential and,
fourth, the researcher will avoid any form of deception and will show work of others by clearly
acknowledging them in-text and in the list of references.

1.14.10. Data collection procedure

A letter seeking for permission to carry out a dissertation will be issued by the University.
Armed with this letter, the researcher will approach the CEO of Hwange Colliery Company
requesting for permission to conduct the study. Upon being granted this permission, assistance
of the Human Resources Manager will be sought to distribute questionnaire through the
facilitation of departmental Heads in the company. This will enable the researcher to access
relevant research information from the selected respondents.

During the data collection process, ethical principles in conducting research will be observed
whereby participant`s consent for voluntary participation in this study will be sought. This will
be done following what Collis and Hussey (2014) suggested on ethical considerations.

In this study, data collection will be done using a combination of the questionnaire and the
interview guide. The questionnaire will collect numeric data while interviews collect non-
numeric data from respondents. According to Saunders, et al., (2016) data collection is the
systematic approach to gathering and measuring information from a variety of sources to get
a complete and accurate picture of an area of interest being studied. The goal for data collection
in this study will be to capture quality evidence that allows analysis to lead to the formulation
of convincing and credible answers to the questions that will be posed to respondents.

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1.14.11. Data presentation and analysis
Data presentation will take the form of frequency tables, mean and standard deviation,
correlation and regression analysis particularly for numeric data; charts and graphs to give a
visual presentation of data that is easy to understand. This study will use a Statistical Package
for Social Sciences (SPSS) Version 23 for analysing data that will be collected using the
questionnaire while data that will be collected using the in-depth interview will be analysed
using content analysis in line with suggestions by Tabachnick and Fidell (2018).

1.15. Organisation of the dissertation

This study will be organised in five chapters. The chapters are outlined as follows:

Chapter One
This chapter provides the background of the study and also sets out the context and importance
of implementation of Cost Management Accounting on operational environmental efficiency
of the Mining Industry of Zimbabwe with the main focus on Hwange Colliery Company
Limited. The chapter also presents the research problem which triggered the study, research
questions and objectives; research hypothesis; assumptions; delimitations and limitations of
the study.

Chapter Two
The second chapter covers the review of related literature on which more information on the
topic and what other researchers and authors said concerning the research area under
investigation. The chapter reviewed literature on the concept of Cost Management Accounting
on environmental efficiency. This will be followed by the Theoretical Framework Review
where theories underpinning the study will be presented; Empirical Literature in-line with
research objectives will be reviewed so as to expose gaps to be filled by this dissertation. The
chapter will also presents the Conceptual Framework to interrogate the relationship between
the dependent and independent variables of the study.

Chapter Three
This chapter will provide the research methodology of the study. It presents the research
philosophy which underpins the study followed by the research design; paradigms to be
employed in the research. It identifies and selects the population on which the sample will be

21
carefully chosen. In this chapter instrumentation procedures are discussed and at the end of this
chapter, data collection procedure, data presentation and analysis will be discussed.

Chapter Four
This is a data presentation chapter. It will present data collected using the questionnaire and
interviews analysis of the data to generate findings of the study.

Chapter Five
In Chapter Five, which is the last and final chapter of the study, summary of chapters will be
presented; conclusions drawn from the findings of the study will be discussed in line with
research objectives. The chapter will also presents recommendations of the study and the
implications for further study will be also discussed.

1.16. Timeline (Action plan)

Table 1: Timeline of research activities from April to June 2021

 Midweek of April 2021  Research Proposal submission and approval
 Last week of April 2021  Chapter 1: Introduction and chapter 2: lit review
 1st Week May 2021  Chapter 3: Methodology and Data collection
 Last week May 2021  Chapter 4:Data presentation, analysis and discussion
 1st week June 2021  Chapter 5: Summary, conclusion and recommendations
 Mid-last week June 2021  Preliminary pages & Final Dissertation Draft
Submission

1.17. Research Budget Estimates

Cost Activity Budget Cost (ZWD)
Mobile calls 1800
Internet Surfing 16080
Stationery and Printing 1200
Research Report Binding 2020
TOTAL 21100

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