1 Introduction
This introduction section presents background information on the emergence of sustainability reporting and sustainability issues. Research problem discussion is also included that leads to the research objectives and research questions around which this research is proposed to be built. Further on the significant of the research and the target group that the research is aimed at are presented.
1.1 Background
Nowadays, there are a lot of social, environmental and economic issues arise for instance global warming, economic fluctuations, climates changes, child labour, gender discrimination and also other problems that are widely discussed by the society at all levels. The discussion has led to demand for solutions of problems and to find ways to conserve also preserve the available scarce resources. This is to ensure the achievement of healthy ecosystems, equitable societies and overall sustainable future through sustainable development.
A classic definition of sustainability as defined by Brundtland (1987), is:
“Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs”
The demands are not only being directed to individual but especially to companies and businesses as they are the main users of resources. Companies are increasingly demanded by societies to take responsibility for their economics, environmental and social impacts (Nakabiito & Udechukwu, 2007). It has been found that companies are now under greater external pressure to become stakeholder-oriented (Waddock, Bodwell, & B. Graves, 2002). The increasing stakeholder influence might be due to globalisation, expansion of the internet and societies ability to gain ...
... middle of paper ...
.... (2004). Refinements to legitimacy theory in social and environmental accounting. Commerce Research Paper, 6.
Ullman, A. A. (1985). Data in search of a theory: A critical examination of the relationship among social performance, social disclosure and economic performance. Academy of Management Review, 10(3), 540–577.
Waddock, S. A., Bodwell, C., & B. Graves, S. (2002). Responsibility: The new business imperative. Academy of Management Executive, 16(2), 132–148.
Wartick, S. L., & Mahon, J. F. (1994). Toward a substantive definition of the corporate issue construct: a review and synthesis of the literature. Business & Society, 33(3), 293–311.
Zainal, D., Zulkifli, N., & Saleh, Z. (2013). Corporate social responsibility reporting in Malaysia : A comparison between Shariah and non-Shariah approved firms. Middle-East Journal of Scientific Research, 15(7), 1035–1046.
Stakeholders and investors are no longer only interested in financial performances, they are interested in the governance of the company like what business practices and business models are implemented, social performances, how the company is giving back to society, how costumers are handled, environment and how diversity at work placed is addressed. Hence relevant information must be provided to the stakeholders to assure them that the company has a sustainable business model (Ridehalgh, 2012).
It was after 1980, the stakeholder theory emerge and interpret as a challenge and debates either to be injected into company operation and responsible to meet the demands of both shareholders and society (Carroll, 1999). The debates continue but after 2008 financial crisis, the stakeholder theory evolve as a core concern to every firm and it discipline are known as Corporate Social Responsibility (CSR) (Leeson, 2015).
Duska, R, Duska, B & Ragatz, J. (2011). Accounting Ethics (2nd ed). Sussex: Wiley Blackwell.
Companies have presented investigations about their motivation towards voluntarily social and environmental as insolvent. This paper argues in agreement with Adam’s view that the goal of CSR reporting is to promote credibility and corporate image of stakeholders operating in a particular industry. Whereas companies must focus their efforts on enhancing their profitability, they should also ensure that the welfare of other stakeholders is protected.
Evan, W. M., & Freeman, R. E. (1988). A stakeholder theory of the modern corporation: Kantian
This report investigates our corporate motivations for the voluntary reporting of MacMillan printing company’s social and environmental reporting. Also it indicates as to why we need to do social and environmental report? The greater recognition and benefits we can achieve through our report against our competitors. Our report is the forum for efficiently sharing, both, internally and externally the success of MacMillan, as well as MacMillan’s understandings of the environment, through social and environmental reporting. Also the form our report should take to do this report for our relevant users.
Corporate responsibility can best be described as the specification of all the collective systems that are needed to support a business’s functionality, environmental and shareholders activity (Best practices guide, 2014) Most importantly, however is that it can dictate how a business will actually co-operate (Jan Marchant, 2013) within their industry or law boundaries. Quite simply it can be summed up as aligning moral integrity with new management styles of the 21st century (Bill George, 2010).
In the typical business world, organisations seek to maximise profit and growth as the ‘bottom line’ in their pursuit of business survival. Such traditional methods of business accounting implemented by organisation have resulted in different types of social and environmental problems as they only measure performances in terms of economics (Gray & Bebbington 2001). For example, the performance of a manufacturing company is measured and reported solely on its monetary gain without taking into account its adverse impacts towards social and environment if its emissions pollutes the river and destroys the eco-system.
Covey & Brown (2001) “the role of business in society has progressed over the years, from being primarily concerned with profit for sharehold¬ers to a stakeholder and community approach with a focus on corporate social responsibility”
Mainardes, E., Alves, H., & Raposo, M. (2011). Stakeholder theory: Issues to resolve. Management Decision, 49(2), 226-252. http://dx.doi.org.ezproxy.liberty.edu:2048/10.1108/00251741111109133
Financial reporting is the communication that enables users of financial statements to assess the profitability and the financial state of a company( Scott, 2009). This information is provided within an accounting framework to ensure neutrality, comparability and understandability for all users of financial statements. The key role is to reduce information asymmetry between the managers and stakeholders such as investors, creditors, governments, employees, consumers and the general public. These stakeholders are direct or indirect participants in the capital markets from where companies vie for finances in the form of equity or credit(Scott, 2009). In Canada, financial reporting is overseen by the Accounting Standards Board(ASB) whose mandate is to, “ to support informed economic decision-making by maintaining a framework that provides a basis for high quality information about financial performance,”(CICA, 2011). The questions as to whether the ASB should enact new disclosure requirements for firms to report on the environmental performance or sustainable development is fundamentally a question of whether environmental performance and sustainability have a role in economic decision making. The answer hinges on the connection between environmental performance and sustainable development having an influence on financial performance. In this paper, stakeholders to whom this information is important will be discussed, evidence that disclosure is sought and solicited will be presented as well as evidences that environmental performance and sustainability are factors in financial performance will also be discussed. Finally, the case will be made that ASB should enact new disclosure requirements in efforts.
...tion’ has undoubtedly been initiated in the corporate and commercial sectors. In order to effectively bring about positive changes, organizations must also attempt to clearly influence public behavior in a sustainable direction. The problem with tackling environmental issues like climate change seems to be that the immediate apparent effects of it aren’t as strongly felt in comparison to other global issues such as terrorism. Businesses have conventionally been good at implementing safety, stringent quality standards and providing excellent customer service, since the effects of these problems are directly felt on the organization’s bottom line. However, Marks & Spencer PLC with its various initiatives has paved the way for other companies and demonstrated pioneering work in the field of corporate sustainability as an example of the scope of achievable improvement.
CG and SR continue to evolve and are no longer viewed the same as years ago. Businesses are now required to take on a broader range of responsibilities to society and provide to human values that were previously seen as unrelated to a company’s operating success. (Dennis et all 1998). These concepts remain a challenge for international companies as they are increasingly pressed to respond to stakeholders’ requests for additional accountability, as the gap between society and businesses continues to...
Despite the fact that it has been proposed that assimilated financial records contained ecological and social data, it was evident in the article that the genuine mix merits consideration among the stakeholders. Sustainability segments in yearly reports among numerous cases were isolated, albeit incorporated; similarly, applies to corporate administration segments in connection to sustainability. At the same time, when the corporate administration and sustainability turn out to be truly connected and reported together, these offered new doors for integrative methodologies in expansion to the bookkeeping
Now-a-days it is considered that CSR is one of the major concerns of organization’s business ethics. Companies increasingly increase their corporate social responsibility (CSR) and ethical management accepting the positive impact on the bottom line. The vast bulk of Standard & Poor’s 500 companies publish sustainability reports unfolding their program challenges and achievements. These pre-emptive efforts can pr...