it’s good business, not altruism.
by 卡塔尔世界杯常规比赛时间 research
accounting has long assessed organization sustainability from a financial perspective. it’s always been assumed that if a company can generate revenue, it’s a going concern and will keep “on going.”
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but true, long-term sustainability depends on much more than mere money, according to the association of chartered certified accountants, a global institution with 241,000 members in 178 countries.
a report from the acca, “accounting for society’s values,” points out that sustainability depends on three domains that add up to a “triple bottom line”:
- economic viability
- environmental protection
- social equity
consider the polycrisis
before you brush off the concept as wishful wokeism, consider the “polycrisis” of the past few years, that ongoing (and worsening) maelstrom of pandemics, climate catastrophes, political turmoil, european war, culture war, a widening wealth gap, geopolitical tension and the imminence of artificial intelligence.
can accountancy help determine whether a company can sustain itself under such turbulent transition?
the acca says it must but that current accounting isn’t measuring all that matters.
seeking information
the report points out that the economic and environmental aspects of sustainability are already receiving plenty of attention, but the social equity element is rarely considered. pleading that social equity matters, the report starts off with this statement:
“the role of the accountancy and finance profession is changing as regulators and other stakeholders seek increasing amounts of information from organizations on how they are addressing one of the key risks that all entities face: that their future will be unsustainable.”
the report brings out the importance of social equity by explaining the many ways it touches on company performance. among them:
- living wage
- lifelong learning
- health and well-being
- human and legal rights
- safe working environment
- conservation and distribution of food and water
- consumer protection
- data protection
- quality services and products
- disclosure
- equity of wealth
- respect for rights
- political and corporate corruption
inadequacy on any of these fronts can imperil the financial health of an organization and therefore should be considered in financial reports.
a circular aspect
the recognition of the importance of social equity is not a call for corporate altruism.
“it is not altruistic behavior,” a north american contributor to the report said. “the reality is [that] the more [a] company invests in its community, the more likely it is to develop people, to build the capabilities of the infrastructure of the community as a whole. obviously, the company ends up benefiting from that. so, there is a circular aspect to it.”
the report cites the impact-weighted accounts initiative, a program based at harvard business school that is tossing around the concept of “impact valuation,” a measurable economic value that results from the actions of an organization. the actions range from carbon emissions to the quality of employment to community contributions.
sir ronald cohen, iwai board chair, said he expects functional impact valuation standards in place within three years, enabling investors to mix corporate impact into their financial analysis of corporations.
still, there are many specifics to hammer out and corporate boards to convince. but the acca report suggests ways that corporations can already begin to formulate a strategy toward eventual adoption. among the subtopics are
- performance management
- the balanced scorecard for internal reporting
- financing the organization
- risk management and governance
- external reporting
- inequality financial disclosures
- human resources due diligence
the report concludes with warnings of inevitability.
“whether or not organisations create structural changes in the coming years will depend on the decisions and the investments that they choose to make now and in the near future. standing still is clearly not an option that we can afford, for the planet or ourselves. change must happen.”