A Silver Lining?

At my home University in Canada I study accounting, and through conversations with fellow classmates here, it has been revealed that I am not the only future ‘bean counter’. Speaking from what I’ve experienced over the last 4 years at the University of Ottawa, there seems to be an increased emphasis on transparent, objective reporting to stakeholders since the Enron and Worldcom scandals. This increased emphasis is a testament to the traditionally reactionary nature of accounting standard setters. It is terribly unfortunate that it did take catastrophic scandals to bring about an increased emphasis on transparency in reporting; but maybe there is a ‘silver lining’. I do not think it is too far of a stretch to say that all reporting, both financial and non-financial, may now be more closely scrutinized in this post Enron/Worldcom era, and therefore given increased attention by management and stakeholders alike. If this assumption is true, then an increased emphasis on CSR follows; if this is true, then sustainability reporting also receives this emphasis. Now my only desire is an IASC requirement, guideline or at least recommendation on sustainability reporting, but that’s something for another blog 🙂

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Posted in corporate sustainability
3 comments on “A Silver Lining?
  1. Katariina says:

    Please take a look at the GRI website in case CSR interests you more. http://www.globalreporting.org/Home
    GRI has developed very quickly into an internationally accepted organisation that works to publish sustainability standars available for businesses to implement. Right now the rate of change in the business world concerning environment and other responsibilities is extremely rapid, so new GRI is published as often as possible. A lot of multinationals and other large entreprises who use these standars contribute to the development of GRI by annual feedback.
    I actually already mentioned this same site on Maitane’s blog about CSR, but I think this is so contemporary and useful for us, as we are the future employees of these companies and are in the position to question our future companies’ methods and values in order to really make a difference in the actual implementation and development of these standards.

  2. jeremy says:

    I share your enthuiasm about GRI. If you are interested in keeping abreast of developments, you might want to consider subscribing to their news service.

  3. adrian says:

    I agree that something has to be done in order to avoid scandals such as Enron and Worldcom. However, these scandals have nothing in common with environmental issues since they were about manipulating financial figures and, thus, the bottom line. Thomas mentioned the International Accounting Standards, but it is highly doubtable that someone will come up with a new standard taking into account a company’s depletion (or creation) of natural capital since that is impossible to capture by financial instruments. One could hardly see a potential creation of natural capital as an asset that increases a company’s value. Furthermore, one can hardly argue that the efforts for environmental protection of a company should not be treated like expenses. What do you propose? I want to refer to my comment I posted on Maintane’s blog or rather on Katariina’s comment. A company could just report on environmental issues but not account them (so the IAS are not appropriate).

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