Social Responsibility and Accounting: A Possible Binomial

Article excerpt


The main objective of our research is to give some evidence, from a conceptual approach, about the possibility of contributing to the social responsibility development, starting from accounting. Different authors agree that there is a rising need for developing a suitable conceptual framework, which gives information companies should provide in relation to their behavior towards the environment. However, this work intends, not only to analyze the reflection of the companies' behavior in financial information, but also to show how a new accounting framework could facilitate progress in the social responsibility of companies. The paper shows that it is absolutely necessary that accounting defines the way of calculating the results of the company, taking into account the social and economical approach. A key question is a more complete definition of the matching principle, and also to put forward the new requirements for information in relation to the new approach. (JEL M41)


In contrast with the classical scenario of presenting accounts to a company's shareholders who are now no longer regarded as the only party with a legitimate interest in receiving them, we have more recently witnessed the appearance of stakeholders, that is, those who have an interest- or stake-in the company (workers, investors, consumers, the authorities, and nongovernmental organizations (NGOs)). Thus, instead of only having a financial responsibility before its shareholders, we are moving towards a situation where a company has a social responsibility before its stakeholders. Therefore, it is becoming increasingly acceptable to publish what is known as the triple bottom line-financial, social, and environmental-taking into account these areas of responsibility.

Recently, in Spain, the country's Instituto de Contabilidad y Auditoria de Cuentas (Accountancy and Auditing Institute) published a White Paper on accounting reform [Gonzalo, 2002, p. 159 and ff.], which reflects the need for a company to provide social and environmental information. Additionally, the country's Socialist Parliamentary Group issued a proposed Corporate Social Responsibility (CSR) Bill on May 10, 2002. In 2001, the Commission of the European Communities published a Green Paper entitled Promoting a European framework for Corporate Social Responsibility. (1) This provides a general definition of CSR as "a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis (...). Being socially responsible means not only fulfilling legal expectations, but also going beyond compliance and investing "more" into human capital, the environment and the relations with stakeholders" (the italics are ours). It is perhaps fitting to conclude this declaration invoking the nulla economia sine ethica call by 1998 Nobel Economics Prize Winner Amartya Sen.

The CSR concept is not universal but implies specific conduct in the here and now, however, this, in another place and time, may be different. (2) Proper implementation of CSR throughout an organization requires, from a management point of view, the right personal competences for its strategic planning and day-to-day administration, as well as a proper general information system and, especially, an accounting subsystem which can respond to the situation by being able to calculate results on an ad hoc basis and produce and communicate relevant information.

From the classical viewpoint or contractual theory of a limited company, the latter is incorporated by means of a contract, and the company is answerable to its shareholders. As pointed out by Garrigues [1971: p. 35], modern (or institutional) theory does not dispute the fact that the company has been incorporated by means of a contract but states that this contract has given rise to an institution, that is, a body whose mission is the pursuit of an intermediary interest that lies between that of individuals and the community in which it finds itself. …