BusinessPeople In BusinessTake social responsibility

Take social responsibility

There is now more focus on how economic activities affect the environment, and a growing acceptance that many of them may not be sustainable.

Accountants have been hard at work in this area, with initiatives ranging from ‘triple bottom line reporting’ to ‘social accounting’. But despite all this, only limited practical progress has been made. One reason is that many decisions are taken that have hidden or not fully-considered consequences.

There are countless examples. Farmers are encouraged to apply chemicals to the land even though water companies are then paid to extract them from the water. Money is saved by sourcing centrally even though the unemployment and other support then needed for local suppliers far outweighs the saving.

Because information about longer term and wider costs, and benefits, is not readily available or sufficiently robust to form a basis for decision-making, decisions are made on a short-term and/or a narrow basis.

Our knowledge of the complexities of life and the consequences of our actions is now far greater but the accountancy profession has yet to provide us with a mechanism to allow us to assess and quantify them.

Accounting mechanisms have not kept pace with our requirements for sustainability information. And yet we need that information urgently if we are to avert man-made catastrophes in our over-crowded world.

As a result of persistent concerns about sustainability, I took the initiative to establish an accounting for sustainability group last year to see what could be done to encourage longer-term and broader perspectives in decision-making.

Its report shows there is scope for those who want more rapid progress with sustainability to work with the grain of human nature and stress the financial benefits from choosing the sustainable option.

Your profession is one of the key pillars of our economic stability and prosperity, but to ensure that our descendants can experience something of that stability and prosperity there is a real urgency to adapt accounting procedures to the critical challenge of minimising the damage done to our fragile world.

This is an edited version of a speech given at a dinner to commemorate the ICAEW’s 125th anniversary

Related Articles

Shortlist announced for British Accountancy Awards 2017

Accounting Firms Shortlist announced for British Accountancy Awards 2017

4m Emma Smith, Managing Editor
Pimlico Plumbers to take employment case appeal to Supreme Court

Legal Pimlico Plumbers to take employment case appeal to Supreme Court

4m Alia Shoaib, Reporter
HMRC appoints new director generals

HMRC HMRC appoints new director generals

5m Alia Shoaib, Reporter
Submit your entry for the British Accountancy Awards!

People Business Submit your entry for the British Accountancy Awards!

6m Emma Smith, Managing Editor
BDO appoints two non-executive directors as advisers to leadership team

Accounting Firms BDO appoints two non-executive directors as advisers to leadership team

6m Emma Smith, Managing Editor
Ex-HMRC chief to join ICAS council

HMRC Ex-HMRC chief to join ICAS council

8m Emma Smith, Managing Editor
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

11m Stephanie Wix, Writer
Settlement reached between Margaret May and CIMA

Accounting Standards Settlement reached between Margaret May and CIMA

11m Stephanie Wix, Writer