Crowdsourcing Corporate Transparency through Social Accounting: Conceptualising the ‘Spotlight Account’

By Dr Stephanie Perkiss, Dr Bonnie Dean & Dr Belinda Gibbons, University of Wollongong, Australia 

Winners of the 2019 Reg Mathews Memorial Prize for the paper considered to have made the most significant contribution towards the social and environmental accounting literature published in Social and Environmental Accountability Journal. The paper is FREE to download here.

Image L-R: Stephanie Perkiss, Theresa Heithaus
(Program Manager, WikiRate), Belinda Gibbons, Bonnie Dean.

Organisations play a key role in addressing global economic, social and environmental challenges. Increasingly we are seeing organisations selecting to integrate sustainability activities into their Corporate Social Responsibility (CSR) efforts. Yet, these CSR reports are indispensably limited, privileging self-serving discourses. 

External accounts, such as alternative and counter accounts, offer opportunities to increase transparency and accountability in the areas of sustainable development. While external accounts challenge organisations’ social accounting, there remains a need to develop this further and investigate new models of social accounting that engage multiple viewpoints and stakeholders. With the evolution and public adoption of technology into our everyday lives, there is great potential for crowdsourced applications to enhance organisational accountability. 

This paper explores the role of accounting in the context of social and environmental change agendas and introduces a new framework for social accounting, the ‘Spotlight Account’. What is significant about the Spotlight Account is the use of the crowd and technology as a way of creating new visibilities and channels for participation. Unlike shadow or silent external accounts, the Spotlight Account seeks to illuminate and transform global organisational transparency and disclosure practices by centrally locating and recording comparable, aggregated and independently sought organisational information. 

The paper conceptualises the Spotlight Account through the exploration of a new technological platform, WikiRate. WikiRate is a collective awareness platform for sustainability that organises corporate narratives, disclosures and accountings relating to the United Nation’s Sustainable Development Goals (SDGs) and other frameworks such as the GRI, into a peer-produced, crowdsourced database. While crowdsourced platforms are not new - think about websites such as TripAdvisor - WikiRate is unique to the CSR field as a free platform that engages stakeholders through information sharing. 

Image: sample of a 'metric' on Wikirate

This conceptual paper highlights a new social accounting framework, empowering anyone to assume the role as a social accountant through participation in the platform and leveraging technology to facilitate transparent and comparative organisational data. In naming this new account, we wanted our readers to think about a spotlight – how it gives centre stage to a space, a number, a metric – each light coming from a member of the crowd to brighten sustainability information for decision-making or, to brighten a lack of corporate sustainability information that may drive better disclosure. 

Spotlight Accounting has the potential to address (some) issues of contemporary CSR practice as it focuses on the process through which accountability information is created. It represents an accounting theory or practice (process, method) and an effective form of social change. We conclude that the exploration of new social accountings can bring about emancipatory change. It opens up the possibilities for social accounting to achieve greater accountability and communication between companies and their stakeholders. We invite accounting scholars to consider the implications of Spotlight Accounting, and consider how advances in technology and increased participation from stakeholders can drive organisational SDGs. 

You can check out WikiRate at: wikirate.org or contact the WikiRate team via info@wikirate.org to discuss setting up your own WikiRate higher education program. 

Editor’s note: As part of the award, Stephanie Perkiss, Bonnie Dean & Belinda Gibbons’ original paper published in Social and Environmental Accountability Journal is available FREE to download via the publishers' website, via this link.

Can you quantify social outcomes? A critical look at the Social Return on Investment (SROI)

by Dr Pål Vik, University of Salford, UK

It is hard to compete with the allure of precision and quantitative measures to guide investment and management efforts. On the face of it, quantitative metrics offer a comparable, intuitive, and seemingly robust and objective measure of how well an organisation or company is performing.

The not-for-profit and social enterprise sector has not been immune to this allure. In fact, there has been a distinct shift towards quantitative approaches in proving their social value added in the last few years. Social Return on Investment, or SROI for short, has been among one of the more popular quantitative approaches used by the sector. SROI generates a monetary value of social impact for each pound or dollar invested net of costs. Its' appeal is reinforced by the similarity to conventional cost benefit analysis, making it easily understandable. An important aspect of SROI is that it links the services and products of an organisation with the social outcomes for individuals and groups external to that organisation, generally by comparing the users of a service with a benchmark or control group.

In my recent paper (Vik 2017) I critically assess the viability of calculating a monetary return for social outcomes drawing on over 20 large-scale microfinance impact studies spanning over two decades. There are important lessons from microfinance as the sector has used increasingly sophisticated quantitative approaches to prove social impacts to investors and funders. The chief difficulty has been to link client outcomes to the services provided by microfinance organisations (implicit in the SROI methodology).

It all boils down to one question: How can you find a control group or benchmark that is similar in all aspects save the intervention? Turns out, this is much more difficult than one might think because of two biases. Firstly, those that decide to take out a loan with a microfinance provider are inherently different from non-clients, including in ways that are not easily observable (such as risk aversion and entrepreneurial acumen). Secondly, the clients that these organisations serve have been selected through a careful screening process. In a sense, the likelihood of success may be a precondition to rather than an outcome of the access to microfinance services. These biases are likely to lead to overestimates of social return on investment especially where interventions require a high level of initiative on behalf of the beneficiary and access is subject to a careful screening or selection process.

In my paper, I conclude that rather than striving to apply increasingly sophisticated quantitative methods to quantifying and attributing social outcomes, there should be greater recognition of the limitations of SROI and similar methods. The value of these tools lies in highlighting the value of activities with no obvious monetary value rather than calculating an accurate social return on investment. To paraphrase the British philosopher Carveth Read, it is better to be roughly right than exactly wrong.


Editor's note: This blog post is based on Pål Vik's article "What's so Social about Social Return on Investment? A Critique of Quantitative Social Accounting Approaches Drawing on Experiences of International Microfinance", for which he was awarded the Reg Mathews Memorial Prize in 2017. The Reg Mathews Memorial Prize is an annual award for the paper considered to have made the most significant contribution towards the social and environmental accounting literature published in Social and Environmental Accountability Journal (SEAJ). The paper is selected by the editorial board of SEAJ and is named in memory of Professor Reg Mathews, a leading figure in the development of social and environmental accounting.

As part of the award, Pål Vik's original paper published in Social and Environmental Accountability Journal will be available with free access until February 2019.


References:

Vik, Pål (2017). What's so Social about Social Return on Investment? A Critique of Quantitative Social Accounting Approaches Drawing on Experiences of International Microfinance. Social and Environmental Accountability Journal, 37(1), 6-17.

The Social and Environmental Accountability Journal (SEAJ)

Matias Laine and Helen Tregidga, SEAJ Joint Editors

SEAJ is the journal of CSEAR and an important part of our community.  Its strength relies on the CSEAR community and as such we would like to take this opportunity to update you on the journal and also outline the various ways you can contribute. 

There have been some recent changes at SEAJ.  Coming to the end of his term as Joint Editor, Carlos Larrinaga vacates the position (Helen will now join Matias as Joint Editor from 2018 – 2021).  We would like to thank him for his service in this role in which time that the journal has continued to develop.  He continues to support the journal in his role as Convenor.  We have also welcomed several new members to the Editorial Board. We are pleased to have them join the team. The SEAJ Editorial Board, we believe, is an amazing collection of scholars in our field drawn from across the globe.  Representative of the growing diversity (geographically and topic wise) of our community.  We encourage you to visit our journal homepage and view our Editorial Board members and journals scope.

While we believe the journal is in a good position, we are mindful of the increasing pressures of the publishing environment.  We need to be mindful and put strategies in place to ensure its success.  We believe one of the strengths and opportunities of the journal is its association with the vibrant CSEAR community and a supportive Editorial Board.  As such, we take the opportunity here to outline our strategy moving forward, and also how you, as CSEAR members and friends, can assist the journal in the coming period.

We know that the driver of achieving our aim of developing the journal in a way that meets the needs of the CSEAR community is an increased profile and, above all, quality submissions.  As such, we have a few ideas for doing this.

In order to raise the profile of the journal we will be starting to tweet new journal content (via the @csearUK Twitter account) and also calls for papers for the journal.  Please, if you are on Twitter, follow CSEAR and retweet SEAJ content as appropriate.  Tweet about the journal and any paper/review that you read.  We know that in the current environment this is important to raise awareness of the journals content and increase readership. 

We are also looking to increase the use of the Commentaries section of the journal.  Commentaries, outlined in the journals aims and scope, are short editorial reviewed pieces which can take the form of a polemic, debate, definitional pieces, revisiting/reviving previous issues/papers, reviews etc.  These types of publications fit with the aim and ethos of the journal and we believe are an ideal way for authors to engage on issues and topics important to our field.

To foster this section of the journal our intent is to commission some pieces from members of our community (including some of you).  We hope that if you are invited you will agree.  We also strongly invite you to contact us with possible commentaries – either ideas you think are worth exploring (ideally with possible suggestions for those we could ask) – or with ideas for pieces that you are interested in contributing yourself!

Special issues continue to be a strong contributor to content.  The special issue for this year (edited by Delphine Gibassier and Simon Alcouffe) is in the final stages of production and submissions are strong for the 2019 special issue on Sustainability Governance (edited by Leonardo Rinaldi).  For the 2020 special issue it has been decided that an appropriate theme would be ‘SEA 2020 and Beyond’. The official information for this issue along with dates for submission etc will be announced shortly, but the aim here is to attract submissions which consider the future of SEA – whether that be issues, theories, methods etc.  Once again, this theme fits the ethos of the journal and our aim to create new academic literature in the broad field of social, environmental and sustainable development accounting, accountability, reporting and auditing.  Please consider supporting this issue by reflecting on your own research in relation to the theme and consider submitting to the issue and encouraging others you know to prepare submissions. 

We also ask that you also consider the journal for regular submission pieces – and again, encourage others to submit their work.  The journal’s aims and scope note that the journal “provides a forum for a wide range of different forms of academic and academic-related communications whose aim is to balance honesty and scholarly rigour with directness, clarity, policy-relevance and novelty”.  We realise we can’t compete for some types of publications with other high ranked journals, nor has this ever been the goal of SEAJ, but we can contribute to the publishing of good quality content that comes in various forms from longer empirical papers to shorter pieces which provide novel contributions. Likewise, in line with our editorial policy and vision, we continue to have interest in novelty and innovation also when it comes to the shape and form of submissions. Interesting and insightful contributions do not always fall within a shape and style expected in most scholarly journals, and hence at SEAJ we remain open to alternative approaches. Obviously, this does not imply that anything would go, but, rather, that in our view scholarly rigour, clarity and relevance do not depend on a manuscript following a particular form or structure.

And, we can’t forget the reviews section of the journal.  We want to thank many of you for supporting this section of the journal – including our emerging scholar community.  Reviews are again a great way for the journal to participate in discussions of topics of interest and critically engage with the field of research.  The reviews team (Michelle Rodrigue, Hannele Mäkelä and Lies Bouten) would be happy to hear from you with potential review items.

Lastly, we want to take the opportunity to thank you for your continued support for the journal. As we note above, a key strength of the journal is a strong and supportive community of researchers.   We aim to continue to provide a journal that supports that community – and look for ways the journal can further reflect the vibrant important research that we all do.

We look forward to working with you all to build SEAJ!

2015 CSEAR Case Study Competition Award

By guest blogger Christian Herzig, University of Kassel

Suzana Grubnic, Jean-Pascal Gond
and Christian Herzig at the 27th
CSEAR at Royal Holloway
(not on the photo: Jeremy Moon)

My colleagues Dr Suzana Grubnic, University of Loughborough, Professor Jean-Pascal Gond, Cass Business School, and Professor Jeremy Moon, Copenhagen Business School, and I are very grateful to have been awarded the 2015 CSEAR Case Study Competition award. We very much appreciated the invitation to present our teaching case study “A New Era – Moving from Climate Action to a Broader Sustainability Agenda: The Case of Commercial Group” at the 27th International Congress on Social and Environmental Accounting Research, held at Royal Holloway in late August 2015 and to publish the case (including a teaching note) in the latest issue of the Social and Environmental Accountability Journal. The case, we feel, can support lectures dedicated to CSR, sustainability or sustainable development in numerous types of accounting and management modules at different levels.

I still remember when Simon Graham, Environmental Strategist at Commercial Group, delivered his first talk as a guest speaker in my module on ‘Sustainability Accounting and Reporting’ at Nottingham University Business School more than five years ago. Students enjoyed his informative and thought-provoking lecture, his passion for the environment and positive attitude towards the impact business can make towards sustainable development. It was the beginning of a long-term relationship in terms of both welcoming him as a regular guest speaker at Nottingham and deepening our collaboration through case study research initially funded by the Chartered Institute of Management Accountants (some findings from this research have also been published in our CIMA study ‘Management Control for Sustainability Strategy’).

It was Simon and the sister of a sister-brother team (who together with an old school friend established the business in 1991) who set up the measurement systems at Commercial Group and sought to connect with staff members in order to empower them to make a difference. The success of Commercial Group’s journey towards a more socially responsible business since then has been remarkable and has been recognised in the form of awards including Business in the Community Big Tick 2012, Guardian Sustainable Business Award 2013, and various other prestigious awards. Commercial Group will also celebrate the tenth anniversary of its annual CSR Day next year, which serves to reach out to both customers and suppliers and engender further changes.

What makes Commercial Group an interesting case is the gradual extension of its CSR agenda. Commercial Group has always understood itself as a “caring” company, built strongly upon family principles and paying attention to valuing staff as individuals, then inculcating an impressive green agenda (e.g. achieving carbon neutrality and zero waste status) and most recently concentrating on the creation of corporate sustainable value with investment in a new social agenda four times the financial resource originally put into the environmental cause. An interesting lens through which the case can be looked at in class is the management of tensions, trade-offs and potential contradictions relating to the co-existence of the company’s multiple (economic, social and environmental) sustainability objectives. Managing tensions in corporate sustainability has become an increasingly popular topic in the management literature (see for example Hahn et al.’s recent work published in AMR or JBE). However, what role we should attribute to calculative and control practices for managing tensions appears to be a largely under-researched question. At least for debate in class, we provide some suggestions in our teaching note on how this can be reflected on and discussed together with management and accounting students.

The case, we feel, is also interesting because teaching cases often revolve around ir/responsible practices of large, usually globally operating companies which do (or do not) respond to external expectations of powerful stakeholders such as consumers, NGOs or investors. In contrast, our case is about a medium-sized business services company, independently owned, which is not up there on the high street or in the world of consumer orientated businesses. It is thus neither driven by media nor is it massively on the radar of non-governmental organisations. Instead, a mixture of moral obligations, duty of care for staff, operational efficiency and market positioning in the B2B world has driven Commercial Group’s aspirations to become a leading CSR company in its sector. The case study describes how the company has drawn upon management by measurement and management by inspiration to pursue and implement its sustainability objectives and strategy.

A related topic for discussion with students emerges from the challenges associated with the continuous growth of the organization, the difficulty of maintaining its ‘sustainability competitive advantage’ with the consolidation of its competitors, and the complexity of retaining a relationship with all workers which has largely been based upon informal and personal networks. Whilst management, on the one hand, would like to maintain the inspirational drive that was initially behind the sustainability strategy, it has on the other hand also started to debate the option of formalising and integrating measurement systems to a greater extent in the future. Initiatives that could help maintain both elements are outlined in the case and can be discussed further in class.

We genuinely hope that the case will prove helpful for others as a vehicle to provide students with practical insights into and knowledge about “accounting and control for sustainability”.

We would be grateful to receive your feedback on the case and to what extent it might have helped you in your own teaching to raise critical awareness, for example, of the role and use of management conceptions such as management by measurement and by inspiration to implement sustainability strategies.


Case Report:

Grubnic, S., Herzig, C., Gond, J-P. & Moon, J. 2015) A New Era – Extending Environmental Impact to a Broader Sustainability Agenda: The Case of Commercial Group. Social and Environmental Accountability Journal, 35(3): 176-193.


Links to Other Resources:

Arjaliès, D.-L. & Mundy, J. 2013. The use of management control systems to manage CSR strategy: a levers of control perspective. Management Accounting Research, 24(4): 284-300.


Epstein, M.J., Buhovac, A.R. & Yuthas, K. 2015. Managing social, environmental and financial performance simultaneously. Long Range Planning, 48(1): 35-45.


Gond, J-P., Grubnic, S., Herzig, C. & Moon, J. 2012. Configuring management control systems: theorizing the integration of strategy and sustainability. Management Accounting Research, 23(3): 205-223.


Hahn, T., Preuss, L., Pinkse, J. & Figge, F. 2015. Tensions in Corporate Sustainability: Towards an Integrative Framework. Journal of Business Ethics, 127(2), 297-316.


Hahn, T., Preuss, L., Pinkse, J. & Figge, F. 2014. Cognitive Frames in Corporate Sustainability: Managerial Sensemaking with Paradoxical and Business Case Frames. Academy of Management Review, 39(4): 473-487.


Moon, J., Gond, J.-P., Grubnic, S. & Herzig, C. 2011. Management control for sustainability strategy’, in Research Executive Summary Series 7(12), Chartered Institute of Management Accountants. [online]


Unerman, J. & Chapman, C.S. 2014. Academic Contributions to Accounting for Sustainable Development. Accounting, Organizations and Society, 39(6): 385-394.

New issue of the Social and Environmental Accountability Journal published

SEAJ 34(1) Special issue on Carbon Accounting

The first issue in 2014 of the CSEAR journal is a special issue on “Carbon Accounting: The Contribution of Social and Environmental Accounting to the Debate”, guest edited by myself, featuring three main contributions by Francisco Ascui (University of Edinburgh), Martin Freedman and Jin Dong Park (Towson University) and Begoña Giner (Univesity of Valencia).

Ascui’s paper is a review of carbon accounting literature that provides insight into the directions in which SEA research should move to make a more ambitious contribution in the area. He contends that the focus of carbon accounting research is relatively confined to content analyses of corporate disclosures, opening the opportunity to conduct research in other areas, such as the interplay between carbon markets and financial accounting.

Freedman and Park examine the compliance of certain public US firms with mandatory disclosures on climate change, concluding that the regulation produced an increase in disclosure, but also a diversity of disclosure practices among companies.

Begoña Giner, member of the Advisory Council of the International Accounting Standards Board (IASB) and former member of the European Financial Reporting Advisory Group (EFRAG), examines the evolution of carbon financial accounting regulation and uses a suggestive currency metaphor to suggest an alternative carbon financial accounting approach based on considering emission allowances as payment instruments.

As usual, this issue also contains a series of articles reviews and book reviews that researchers interested in social and environmental accountability might find a useful introduction to relevant recent literature.