ACCT3321 Study Guide - Final Guide: Global Warming, Global Reporting Initiative, Management System

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3 Jul 2018
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Sustainability and Corporate Social Responsibility (CSR) reporting
- is the social and environmental performance of an entity, referring to the aspects of
an organisation’s operations
- CSR focuses on organisations’ impacts on society
oWhile companies may primarily be focussed on making profits, they also
influence, and responsibility to, society
oEssentially is a social contract, referring to an expectation (rather than a
formal agreement) that organisations act in ways acceptable to societies
oIncludes acting within the law, but also extends to areas which may not be
specifically governed by legislation in all countries
Ensuring fair work conditions, providing a safe workplace for
employees, and minimising environmental pollution
-CSR = environmental, sustainability is broader, encompassing both social and
environmental issues.
Sustainability
- Organisations’ operations effect
oEconomic, Environmental & Social development
- Organisations have a responsibility to the financial interests of shareholders, and to
the broader interests of all stakeholders – both current and future generations to be
socially responsible, economically viable and to have environmental quality.
-Intergenerational equity = long term focus and recognises that consumption of
resources should not affect the quality of life of future generations
-Intragenerational equity = the ability to meet the needs of current generations
-Eco-justice = justice between people and generations
-Eco-efficiency = a focus on the efficient use of resources to minimise the impact on
the environment
-Sustainability – there is a general agreement that it involves preservation and
maintenance of the environment and involves some duty of social justice
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CSR
- Consider how operations affect society, and to act in an appropriate (socially
acceptable) manner
Reasons for adopting sustainable and corporate social responsibility practises
- Compliance with mandatory obligations
oSuch as complying with environmental and social regulations (e.g. meeting
product safety standards for customers). So, they do not incur penalties or
suffer decrease profits through loss of market share due to poor reputation.
oRisk management approach to sustainability
- Voluntary activity, guided by an organisation’s ethical or moral position
oE.g. recycling initiatives, or doing it because you think it’s the right thing to do
oAltruistic approach to CSR
oThose beyond the scope of the law, but they may benefit from enhancing
their reputation and increased market share, resulting in increased profits
- Strategic activity, which benefits the environment, society and the organisation
oStrategic approach to CSR or sustainability
oIt involves activities, like a mining company in a remote area training
unemployed people, who may work later in the organisation
oThis is a shared value for the organisation
-Benefits of sustainability
reporting for companies
oEmbedding sound
corporate governance
and ethics systems
oImproved management
of risk through enhanced management systems and performance monitoring
oFormalising and enhancing communication with key stakeholders, such as the
community and customers
oAttracting and retaining competent staff by demonstrating an organisation is
focussed on values and its long-term existence
-costs for not adopting these practises
oloss of market share
odecreased profits
osustainability-related expenses are views as long-term investments for an
organisation
oorganisations can choose whether and what type of sustainability or CSR
practise they want to adopt
oit is encouraged, not legally enforceable
oencouragement may take the form of tax deductions, such as donations to
charities.
STAKEHOLDER INFLUENCES
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ostakeholders: employees, customers, suppliers, the media, government,
superannuation funds and other institutional investors, lenders and
community groups
obusinesses as a part of their operations, identify and engage with
stakeholders as a means of reducing risk and managing reputation
- stakeholders are increasingly concerned with issues of sustainability – the growing
recognition of social and environmental issues has contributed to this
ohuman rights  child labour, exploitive working conditions
oemployee rights  remuneration, safe workplace standards
ophilanthropy and charitable giving
oethical and transparent business practices  appropriate and transparent
polices
opollution and environmental harm  logging, inappropriate use of non-
renewable resources
oenvironmental protection, and environmental sustainable business operation
oproduct and process quality  safety of products, use of animal testing
ounethical products  socially irresponsible products, weapons
oclimate change  of impact corporations have on global warming
- the extent to which an organisation will consider its stakeholders is often related to
the power or influence of those stakeholders
- such as a mining example – stakeholders include the government organisation for
approving the project, local businesses affected by it, local residence who may be
affected… the stakeholders will have different levels of power, with the government
one typically considered one of the most powerful
Ethical investment
- Entities are challenged by social, environmental and regulatory pressures as
institutional investors increasingly voice their concerns about economic, financial
and regulatory risks of business
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Document Summary

Sustainability and corporate social responsibility (csr) reporting is the social and environmental performance of an entity, referring to the aspects of an organisation"s operations. Ensuring fair work conditions, providing a safe workplace for employees, and minimising environmental pollution. Csr = environmental, sustainability is broader, encompassing both social and environmental issues. Organisations" operations effect: economic, environmental & social development. Organisations have a responsibility to the financial interests of shareholders, and to the broader interests of all stakeholders both current and future generations to be socially responsible, economically viable and to have environmental quality. Intergenerational equity = long term focus and recognises that consumption of resources should not affect the quality of life of future generations. Intragenerational equity = the ability to meet the needs of current generations. Eco-efficiency = a focus on the efficient use of resources to minimise the impact on the environment.