Environmental accounting practices are integral part of business success. They help in allocating environmental costs and integrating them in business decisions. These practices usually precede environmental reporting where the organization communicates its accountability regarding environmental efforts. Globally, some of the contemporary environmental issues that affect business include climate change, lack of access to clean drinking water, acute food shortages caused by draught and the use of non-renewable energy sources. Due to the rapid environmental deterioration, stakeholders, including business persons, are called to unite in curbing depletion of the natural resources by excessive human exploitation. The Kenya Vision 2030, in its social pillar, aims at making the country enjoy equitable social development in a clean and secure environment. This paper examines the environmental accounting practices and environmental costs of business based on a study of sampled large petrol filling stations in Eldoret Municipality in Uasin Gishu County, Kenya. The study was conducted in the month of November 2014. The study was guided by Stephen Ross and Barry Mitnick’s Agency Theory. A total of 70 large petrol filling stations were selected using purposive sampling. The study employed a survey research design. Data was collected using questionnaires. Data analysis was done with the aid of the Statistical Package for the Social Sciences (SPSS) and presented using descriptive statistics. The findings revealed that 87.5% of the petrol filling stations carried out environmental accounting practices with only 20% facing challenges at implementing it. Moreover, 97.5% of the petrol filling stations were found to be evaluating these practices on a yearly basis. The findings further indicated that the contingent, image and relationship environmental costs were not largely incurred by the petrol filling stations. The most common costs incurred were the inspection, pollution control, spill response and waste management. The study recommended the need to carry out more research on ways to overcome challenges facing petrol filling stations while carrying out environmental accounting practices. In addition, there is need to devise ways to sensitize and motivate petrol filling stations to engage more in frequent evaluation of these practices, environmental reporting, support environmental groups, train on environmental issues and carry out more research on environmental issues.
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