Teaching Management Control for Sustainability

By Delphine Gibassier, Audencia Business School

Next Tuesday I will have my class on management controls for sustainability. Many colleagues, who normally teach environmental and social accounting classes tell me, they do not teach management control, because they would not know how to. As of today, no excuse, here is how I teach it!

The content of the course is as follows:

1/ I teach a definition of it (that you can find in Crutzen et al. 2017)

2/ I first use a classic classification of management control tools by Schaltegger et al. 2000 (Schaltegger, S. and Burritt, R., 2000, Contemporary Environmental Accounting. Issues, Concepts and Practice, Greenleaf, Sheffield.), that exists in French (Antheaume, 2013) and has been also used in Burritt et al. 2011 with carbon as an example.

3/ I introduce Simons' controls (1995) and the example of them being used by Arjaliès and Mundy (2013) in the French CAC 40 companies.

4/ I then introduce further the "integration" of sustainability through management control systems, with the paper by Gond et al. 2012

5/ Last but not least, I finish through the "package" view of Malmi and Brown 2008, used in Crutzen et al. 2017 and the Michelin case study (Baker et al. 2018).

(do not reuse without authorization, Gibassier, 2018)

6/ I introduce the notion of management controls beyond the company (you need to for sustainability) using the figure 1 in the paper "Environmental Management Accounting: The Missing Link to Sustainability?" (2018).

7/ I explain what are "controls for sustainability using the different tables of the same paper (Gibassier and Alcouffe, 2018)

This table is used in our SEAJ special issue intro and Baker et al. 2018. If you use it, cite it!

8/ I present a few tools such as "green capex" (you can use Vesty et al. 2015, or examples using Finance for the Futures Case study of SHE)

9/ Finally I introduce the notion of "sustainability management controller". You can use both Renaud (2014)'s paper (available in French & English) and our report on sustainability CFOs.

I have them read the Michelin Case Study (2018) and then we do an exercice (same as Michelin) to look for controls and put them in the "package" way, +reflect on their sustainability orientation. I am using in French the last L'Oréal report, but any (short) report will do.

You can use our case study on Danone which talks about many of those items available in French and English at the CCMP website.
(this class is part of my "societal impact class where I teach 15 hours, 3 hours on management controls, and the rest on natural capital, social capital and multi-capitals).

More resources here:

• Stefan Schaltegger and Roger Burritt, Contemporary Environmental Accounting: Issues,
• Concepts and Practices, Routledge, 2000.
• Angèle Renaud, Management et contrôle de gestion environnemental, EMS, 2015.
• IFAC, International Guidance Document: Environmental Management Accounting, 2005.
• ICAEW, “Sustainability: the role of accountants,” 2004.
• IFAC, “Professional Accountants in Business—At the Heart of Sustainability?” 2006.
• CIMA, “Sustainability and the role of the management accountants,” 2011.
• AICPA, Accounting for the Sustainability Cycle: How the Accounting Profession Can Add
• Value to Sustainability-Oriented Activities,” 2013.
• IMA/ACCA, From Share Value to Shared Value: Exploring the Role of Accountants in Developing Integrated Reporting in Practice, 2016, .
• Accounting for Sustainability, A4S Essential guides series, 2015-2017 (and notably one on green capex).

More papers here:

• Bartolomeo, M., Bennett, M., Bouma, J.J., Heydkamp, P., James, P., and T.Wolters. 2000. “Environmental management accounting in Europe: current practice and future potential. “ European Accounting Review 9: 31–52.
• Guenther, E., Endrikat, J., and T.W. Guenther. 2016. “Environmental management control systems: a conceptualization and a review of the empirical evidence.” Journal of Cleaner Production. 
• Lisi, I.E., 2015. “Translating environmental motivations into performance: The role of environmental performance measurement systems.” Management Accounting Research 29: 27–44. 
• Milne, M.J. 1996. “On sustainability ; the environment and management accounting.” Management Accounting Research 7: 135–161.
• Norris, G., and B. O'Dwyer. 2004. “Motivating socially responsive decision making: the operation of management controls in a socially responsive organisation.” The British Accounting Review 36: 173–196.
• Rodrigue, M., Magnan, M., and E. Boulianne. 2013. “Stakeholders’ influence on environmental strategy and performance indicators: A managerial perspective.” Management Accounting Research.
• Schaltegger, S., and D.Zvezdov. 2015. “Gatekeepers of sustainability information: exploring the roles of accountants.” Journal of Accounting and Organizational Change 11: 333–361.
• Songini, L., and A. Pistoni. 2012. “Accounting, auditing and control for sustainability.” Management Accounting Research 23: 202–204.

See SEAJ 2018 special issue on this, and the 2013 MAR special issue.
Look for papers in AAAJ and SAMPJ recently (from 2012 to now), and papers by Leanne Johnstone as well.
Check out the EMAN group books, and Stefan Schaltegger's work (as well as Roger Burritt's work).

Editor's note: this blog article was originally published on Delphine Gibassier's own blog in October 2019, and is republished here with permission.

Integrated Reporting public consultation: Have your say

Accounting for Sustainability have launched a public consultation on the development of integrated reporting. This is an important opportunity to feedback to the newly formed International Integrated Reporting Committee. The survey is open until 30th September 2010.

http://www.surveymonkey.com/s/KCM9DSR

Integrated Reporting: Where Have All The Academics Gone?

The newly established International Integrated Reporting Committee (IIRC) announced its formation last week. Having been involved with one of the IIRC's main sponsors, the Prince's Accounting for Sustainability charity, I certainly welcome the formation of IIRC and would wish to endorse its aims. Elsewhere in the blogosphere there have been some reservations expressed about the ability of the IIRC to deliver on its stated aims, which is understandable and also welcome, since it is essential that the work of the IIRC is visible and subject to proper scrutiny and critique.

My own reservation about the IIRC is the apparent lack of academic representation on the main working group. Despite recognising the role of academics as valuable stakeholders in the development of integrated reporting, and despite the work of the academic teams involved in the recent A4S book published last month, the IIRC have not yet appointed any academics to the working group. I sincerely hope that the IIRC reconsiders this situation and seeks to appoint at least one academic to the working group.

Accounting for Sustainability

The recent work of the Prince of Wales' Accounting for Sustainability charity has now been published by Earthscan. The focus of the book is a number of case studies that examine the development of the  connected/integrated approach to sustainability accounting, upon which it seems the entire future of the discipline, and indeed all of humanity, now appears to rest...!

That seems to be the main selling point of the A4S book, but another important (and dare I suggest somewhat downplayed?) point is the fact that the cases have been researched and written by academics rather than, er, 'consultants'...  [OK, important disclosure - I was involved in one of the case studies featured in the book!]. Authors include Jeffrey Unerman, Brendan O'Dwyer, Ian Thomson and Linda Lewis, all of whom are distinguished academics in the field.

A session I was involved in at the recent GRI conference in Amsterdam featured some of the cases in the book. I'd encourage you to check out the Youtube footage of the session if only to see Ian Thomson's provocative presentation which certainly woke up the 'dark forces' of the corporates in attendance, who by that stage of the conference had seemed to be a bit too pleased with themselves about what a marvellous job they were all doing...