Contemporary Issues in Accounting

This study project discusses about the CSR activity in two parts. In the first part the corporate social responsibilities, a contrast have been made relating to the other theories. Further the legitimacy theory and the institutional theory related to the CSR activity of the company. Further in the second part the history, governance and the overall company financial performance have been discussed in this context.

Running head: CONTEMPORARY ISSUES IN ACCOUNTING
Contemporary issues in accounting
Name of the student
Name of the university
Authors note

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CONTEMPORARY ISSUES IN ACCOUNTING
Executive summary
This study project discusses about the CSR activity in two parts. In the first part the corporate
social responsibilities, a contrast have been made relating to the other theories. Further the
legitimacy theory and the institutional theory related to the CSR activity of the company.
Further in the second part the history, governance and the overall company financial
performance have been discussed in this context.

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Table of Contents
Introduction....................................................................................................................4
Discussion..................................................................................................................4
Part A: THEORITICAL KNOELEDGE....................................................................4
Importance of CSR to the firm’s financial activity....................................................4
Contrasting the sustainability reporting with other relevant accounting standards. . .5
Theories related to the sustainability accounting.......................................................7
Institutional theory.....................................................................................................7
Legitimacy theory......................................................................................................8
Part B: Application of theoretical knowledge to explain reporting practices............9
History........................................................................................................................9
Ownership..................................................................................................................9
Governance..............................................................................................................10
GRI reporting standards...........................................................................................11
Sustainability report of pendal group.......................................................................12
Environmental, governmental and other social factors............................................13
Considering the risks and opportunities...................................................................13
Human capital..........................................................................................................13
Active managers and shareholders...........................................................................13
Sustainability reporting scoring index accounting...................................................14
Conclusion....................................................................................................................15

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References....................................................................................................................16
Appendices...................................................................................................................19

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Introduction
The above study assignment discusses about the reason why corporate social
responsibility had gained advantage to the firms. The corporate social responsibility is a
current topic to deal with and almost all the business entities goes for this issues. Furthermore
the CSR activity have also pointed out towards effectively implementing the business.
Further the business sustainability have also been addressed by comparing the sustainability
theory with the other relevant theories. Apart from that the study topic have also conferred
about the relevant accounting theories which are also related to addressing the sustainability
accounting. Such theories are institutional theory and the legitimacy theory. Lastly the second
part of this topic discusses about the implementation of CSR activity of pedal group limited
and how the same have affected the company governance and the share price
Discussion
Part A: THEORITICAL KNOELEDGE
Importance of CSR to the firm’s financial activity
The corporate social responsibility is considered as an effective business strategy. All
the small and big industries effectively imply the CSR strategy. However the CSR strategy
lacks from the point of view of familiar and non- familiar industries (Kawaguti et al., 2014).
The main focus of the CSR practises are limited to the difference between the familiar and
non- familiar business activities. However the CSR activities are basically related to the
aspects like reputation, fame and identity of the industry and how much they are associated in
dealing with the problems of society. Firstly the familiar firms are only concerned about the
protecting the self- interest as well as doing some good things for the society also. Moreover
the corporate social responsibility is also restricted to the environmental, social, ethical,
corporate and human resource aspects (Hu et al., 2014). Thus these aspects are highly related

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towards making an effective business decision for the betterment of the company.
Furthermore the company’s annual and social report also provides importance in generating
the business operations. In the current decades the financial crisis had effectively generated
the importance of preparing the accounting report for the company. Therefore the company
investors will easily get the view on which way the company is heading towards. Thus the
investors trust will increase. On the other hand the sustainability report helps the entity to
imply effective risk management technique. But on the contrary it can be said that the CSR
activity is not also that much beneficial for the company since it does not provide the benefits
all the time to business. Moreover it can be said that the CSR responsibilities are helpful in
enhancing the corporate business roles and responsibility overall and it had created an
immense impact to the affectivity of the business (Chilamakuri et al.,2014). Since the CSR
activities are investigated from different open source, therefore these activities helps the
company engage on good profit making for the business and thus by generating effective
outputs. Hence any firm could create the CSR value activities only by creating sustainability
towards managing the CSR activity. This can also be said that since the CSR activity is
related to economics, therefore it could create certain attention to the reputation of the
corporate firm (Cai et al., 2015).
Contrasting the sustainability reporting with other relevant accounting standards
The business environment is heavily affective towards the societies and the
environment lived by us. Thus the process is heavily defined by the economic, social and
global perspectives. Therefore it can be said that as far as CSR is concerned it is very much
dynamic in nature. Moreover the environmental demand and the moral stability is totally
dependent on the expectations from the company shareholders who possess the basic
experience at the time of company restructuring. However the corporate restructuring is
relied over the corporate performance. The CSR practises create a certain value to the

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organisations. These CSR activities are not necessarily materialistic since the material
analysis is placed over the centre of global reporting standard. Thus in order to understand the
overall pattern the stakeholder’s value, theyneed to match the industry definition. The
material misstatement process could also negatively influence the corporate brands by
avoiding overall public relations. The companies are highly responsible to maximize the
competitive advantage of the organisation. The competitive advantage is useful in making
effective short term profits to the business but not in a holistic way. Furthermore the
sustainability accounting will be helpful in generating the non-specific approach. The process
is very much effective in determining the stakeholder’s identity. This process could be
helpful in determining the value chain analysis towards implementation of the CSR activities.
Therefore in order to know about the corporate social responsibility, the sustainability
accounting is considered as an important element. On the other hand the GRI G4 accounting
standard had been also compared with the sustainability reporting to have a better view over
the process (Silva et al., 2014).The GRI g4 had anticipated the overall outlook by
implementing the “disclosure on management approach”. This approach predicts the future
activities from the environmental, social and economic aspects. These aspects helps to
determine the targets and goals of the company and predicts the overall results of the process.
In this case the argument for the process is concerned with the labour unrest disclosure
element towards the sustainability issues. The aspects links with the business model related to
the social context. Thus it is clearly stated that the sustainability reporting issue is related to
the usefulness of the accounting standards. Moreover the GRI g4 theory does not thoroughly
discuss about the organisational sustainability. Furthermore the sustainability theory reports
about the sustainability decision making and ensures that the law and fairness of the
accountability will be included towards the identifying the business relations towards the
suppliers and customers. Further the process will deal with the business relations. Thus these

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elements will be transferred to the business activity by the help of the performance and risks
taking capacity of the organisation. Further the laws and regulations will be very much
significant in dealing with these operations (Kawaguti et al., 2014).
Theories related to the sustainability accounting
The sustainability accounting is considered as an important accounting concept. Apart
from this there are multiple accounting concepts which are used to support the sustainability
accounting process (Anticevic et al., 2014).
Institutional theory
Among the various processes, institutional theory is very much effective because it
describes the overall business environment. In the late 1960’s and 1970’s the use of the
institutional environment is accepted by the organisation. The institutional theory provides a
theoretical value through which the company researchers can identify and influence the
legitimacy of the organisational practises. Hence these aspects are fully related to the social,
environmental regulations, traditions and history related aspects. Hence it is important to
acknowledge the resources overall. The legitimacy process refers to the use of sustainability
practises made by the company stakeholders. Thus the institutional theory is fully concerned
with how the groups and organisations can be securing their position and the legitimacy by
applying the rules and regulations. Further the theory can effectively explain how the changes
will affect the overall social value, technological aspects and the environmental management
context. On the other hand the organisational studies help the key players of this process to
implement some changes in the company rules and regulations related to the supply chain
management technique. Furthermore these theories create the expectations which determines
effective actions for the company. These process helps to gather behavioural expectations in

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this case. Therefore it can be sad that the institutional theory helps to create some
sustainability practises in the business (Tumula & Burch 2016).
The institutional theory is considered as a driver change towards creating
isomorphism in the organisational theories, strategies and implementing some effective
processes. Thus these drivers are very much influensive in order to utilise the powerful
positions while implementing the supply chain management technique. Thus these techniques
will be effective and crucial to drive the environmental management and supply chain
technique. Hence these drivers will use the normative legitimacy actions. Hence it is found
that the normative procedures will be helpful in generating the drivers towards the
institutional theories and to understand the new company rules and responsibilities. Further
the social obligations will be effective in generating the necessity on the individuals. Thus it
is the only way to attempt and replicate to the path towards succession of the competitors in
the industry. Further the perspective will be allowing to focus on the role of the community,
regularity and social pressure in dividing the organisational action (Almeida et al.,2014).
Legitimacy theory
Another effective theory which plays an important part in describing the sustainability
is the legitimacy theory. This theory is directly related to the context of the society and the
company. Here the society adopts only the society oriented behaviour related to the
legitimacy process. Thus In turn it can affect the implicit and explicit terms of contract
related to the firm’s survival. Thus the legitimacy theory will be in determining and fulfilling
the gaps related to the legitimacy aspect. Furthermore this aspect will lead to further
implement the company objective. Therefore this process will lead to the voluntary disclosure
of the firm’s objectives (Nathala et al., 2014).

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Part B: Application of theoretical knowledge to explain reporting practices
History
The pedal group limited is a company listed in the Australian stock index exchange in
the 2007 as a specialist investment manager to the history of managing and wealth creation
for long decades (Baumgartner 2014).
The company had been established in the year 1969. In the year 1971 the pedal
nominees ha hold the assets on the behalf of perspective clients, pension value. this company
had changed their name into BT Australia limited and it had become a progressive area
towards the innovative and successful implementation on the successful business of the
organisation and implement the investment banking equities and the fund management
aspects towards the domestic services and foreign clients overall. The company had focused
on the implementation of the investment banking technique which had made the business as
most successful investment banking company of Australia. This company is recognised as the
most recognizing brand of Australia state (Almeida et al., 2014).
Ownership
This company is closely related to the supporting of the regnan company towards the
pedal objectivity in order to improve investor outcomes through the ownership focus.
Further it can be seen that regnan capacity and the overall service proposition will
help to regain the clients services in order to enable the leverage of the fundamental insights
of the highly regarded investment techniques, equity value, fixed income prospects and the
multinational portfolio aspects. Further the process of pendal has a strong heritage in the
process of investing aspects at the time of launching the chart of BT Australia. Currently the
value is related to the sustainable and the ethical strategies overall towards implementing the
effective strategies (Zhang, & Li. 2014).

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Governance
The company is highly committed to the industry standards. It means that the process
actively maintained the corporate governance structure and the effective policies regarding
the aspects of the operations of the business. Further the process will realize the governance
policies towards considering in the light of the ASX policies and procedures. Thus the
process is related to the principles and recommendations towards the relevant policies and
procedures as per the effective standards and the other relevant guidelines (Carroll 2016).
Further it can also be said that the internal governance and the assets ownership
related to the services of the pendal group have set out the organisational goals and policies
towards the business. Further the policies related to the aspect as well as the internal control
activities as per the assets management policies and facts (Silva et al., 2014).
Furthermore the company in each and every year publishes the e. governance
statement which makes the corporate governance of Pendal Company’s governance
framework and the overall policies and procedures.
Apart from this the market disclosure policies and procedures of the business will also
look to meet the market disclosure in order to assist the company in keeping the market
transparency and to meet the market disclosure obligations related to the business aspects of
ASX listed rules (Gama et al.,2014)
Furthermore the corporate rules and regulations are totally related to the company
code of conduct policy rules and regulations.
Financial performance
From the financial report, the overall financial performance of the company is
discussed. Overall it discusses the business performance of the company in the financial year.

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However it is seen that the company’s sales have increased to the value of $2 million in the
current year which is fairly high than that of the last year. Therefore overall earnings had also
increased. Since the company had made a good amount of profit in the last financial year,
therefore they have managed to provide good amount of dividend to its shareholders in the
current year. The company’s share price have also increased due to the increase in
profitability. Therefore the annual average return on the price of the shareholders have also
increased in the financial year. Thus it can be said that the company’s performance had been
satisfying in the current financial year than the previous year.
GRI reporting standards
The GRI standards glossary are created and issued by the global sustainability board.
This board uses the GRI global sustainability standard which enforces the company to meet
all the issues related to the sustainability process.
Total compensation
The annual compensation paid by the pendal group consists of salary, bonus, stock
and option plans, non – equity incentive plan. These created overall value and revenue
earning to the employees. It had affected in the global market of the company.
Anti- competitive behaviour
The actions of the pendal group employees can result in collusion with their potential
competitors. Hence it could limit market opportunity of the industry. For example issues
which the company faces are fixing of prices, creation of market opportunities, imposing
geographic quotas to the suppliers and customers etc.

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Monopoly practise
The action of pendal group can highlight many loopholes within the organisation as
well as impose certain restriction to the business. Thus it could prevent from occurring
competition.
Collective bargaining
The company can negotiate the needs and requirements of the employers and
employees organisation. Thus it helps to create trade union between the workers and on the
other hand they determine the working condition, terms of employment and regulations
between the employers and workers.
Community development programme
The company have also imposed certain responsibilities towards the community. Hence this
plan could provide details action to minimize, mitigate and the compensate the social norms
and other regulations. This can impact on the economic prosperity as well as ensure possible
opportunities and identifies them to enhance the business.
Development cost
The GRI standard is associated with the overall development standard in maintaining
the reporting guidance to the users and distributors. Thus for the company the overall cost of
the process is used highly on the basis of the sector based framework.
Stakeholders input
This approach is related to the technical expertise and it ensures stakeholders
engagement through the diversification of experience. The GRI process is accepted
worldwide. Therefore all the elements related to the reporting framework will be related to
different approach. Further the stakeholders approach will be including the business, society,

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accounting, labour and the government. Hence they are responsible for ensuring the
sustainability practises.
Sustainability report of pendal group
The corporate sustainability report of the company discuss about how actively the
company management is dealing with the ethical and business issues related to the corporate
work culture. The sustainability can be dealt from many aspects like environmental,
management and stakeholder’s engagement, managing the climate risk and human resource
capital. Hence it is important that the company thoroughly maintain the balance between all
these aspects. These are described below-
Environmental, governmental and other social factors
The asset manager of pendal group is highly responsible to mitigate and address the
social and environmental issues related to the business. Firstly it is important to value their
investment made on the behalf of the client and factorize the decision making accordingly
(Sousa et al., 2014).
Further there are a number of issues related to the aspect of the shareholders
operation. Thus in case of own business it is important that the pendal group must deal with
the shareholders interest. Thus the key sustainability issues faced by the company in this area
are-
Considering the risks and opportunities
At the time of addressing the overall investment process, the stakeholders risk is to be
considered on the basis of the climate change.

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Human capital
This process address the ability to attract, engage and retain the talent acquisition
strategy and business difference.
Active managers and shareholders
Role of research and engagement
The effective consideration of ESG process requires the investment process in the
research quality. Further the process will directly concern with the company’s activities and
where the investor can enhance the quality of information technique to the market and
improve the oversight of the management process.
Hence the overall process could outline the initial governance as per the stakeholder’s
commitment.
Proxy voting
The company considers the process of proxy voting as an important aspect of the
investment research technique. The company rather than keeping the update of the process,
could look to implement the same on the virtue of the company stakeholder’s aspect (Zhang
et al., 2016).
Sustainability reporting scoring index accounting
The complete scoring GRI NON –GRI
N= 244 n = 230
Climate change 58% 43%
Water 5% 7%
Other environment 5% 7%
Human capital 36% 45%
Workplace safety 14% 15%
conduct 33% 24%
Other social 32% 26%
Board 22% 21%
diversity 11% 13%

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remuneration 28% 29%
The sustainability reporting scoring index accounting is divided into two areas. These
aspects are determined in the way of global reporting standard and non-global reporting
standard. All these aspects are measured and analysed in order to determine the results. The
parameters include climate change, water, environment capital, and human capital, and
workforce, code of conduct, other social activities, board and diversity.
It is seen that the pendal group have mostly spent on GRI standard. The N here
determines the overall percentage of value acquired. In GRI index the value is N= 244 and in
non GRI index the value of n = 230. Thus the index shows that the company have meet all the
requirements in the GRI global sustainability index. It is properly reflected in the
sustainability report of the pendal group.
Managing the overall climate risk
The groups approach to the climate change continues to grow as a global community
though the understanding of the regulatory framework concept overall. On the other hand the
management had also grown the interest towards the climate change risk and the statement of
the task force towards the risks of climate changes and the functional change guidelines as a
whole. Further it is also seen that the major investors who are responsible for managing the
business model. These areas are best understood when there is adequate support in the field
of economic and earnings stability. Thus the climate changes have also impacted on the
industry sectors and set of classes further the company thinks that the measurement of the
climate change requires the all-inclusive robust measurement reporting((Silva et al., 2016).

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Conclusion
Therefore from the topic a conclusion can be drawn that the pendal group had
effectively dealt with the sustainability issues and addressed the same in the company annual
report. Further the sustainability issues are best understood with the help of the concepts
called legitimacy theory and institutional theory. Both of these theories are related directly to
the CSR activity of pendal group. Further it is also seen that the company had maintained the
company rules and regulations properly from the beginning itself and it had adversely
effected on the company share price.
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Appendices