Strategic and Sustainability Accounting

Running head: STRATEGIC AND SUSTAINABILITY ACCOUNTING 1
Strategic and Sustainability Accounting
Name
Institutional Affiliation

STRATEGIC AND SUSTAINABILITY ACCOUNTING 2
STRATEGIC AND SUSTAINABILITY ACCOUNTING
Executive Summary
Three topics have been discussed in this assignment including sustainability, transfer
pricing in Vans, and capital investment analysis in Accent Group Limited. It has been
demonstrated that a company must consider both environmental and social risks to be
sustainable. It is also showcase in this paper that the Vans can buy the raw materials from
external suppliers since it is cheaper as compared to buy within or transferring within the two
departments. It is also recommended that the Company should proceed with the proposal to
upgrade the stores for increased customer experiences.

STRATEGIC AND SUSTAINABILITY ACCOUNTING 3
Table of Contents
Executive Summary.........................................................................................................................2
Introduction......................................................................................................................................4
Question 1: Sustainability................................................................................................................4
Question 2: Transfer Pricing............................................................................................................8
Question 3: Capital Investment Analysis......................................................................................13
Conclusion.....................................................................................................................................18
Appendix........................................................................................................................................19
References......................................................................................................................................21

STRATEGIC AND SUSTAINABILITY ACCOUNTING 4
Introduction
This paper is sectioned into three parts each tackling a separate questions. The first part
has discusses sustainability based on the case of Accent Group Limited. It looks at the impacts of
the Group on environment and society in range of ways. It is held that management of the Group
understands and manage their social and environment risks by benefiting from identification of
appropriate social and environmental performance objectives and use appropriate KPIs to track
its performance towards the identified objectives. The next topic discussed is the transfer pricing
in respect of Vans’ production of lifestyle footwear. The analysis of the hypothetical data
regarding transfer of rubber to its Assembly department from Rubber department is performed to
determine whether it is best to buy from external suppliers or not. Topic 3 discussed is on capital
investment analysis using the Accent Group Limited management case which has received a
proposal from Hype DC manager regarding upgrade of stores to enhance experience of
customers.
Question 1: Sustainability
Conserving environment remains a fundamental issue which must be tackled by Accent
Group Limited given the nature of its operations and products’ impacts on society and
environment in many ways. It remains vital the Group’s management to comprehend and
manage their social and environmental risks. Thus, the Group must correctly identify relevant
social and environmental performance objectives. The Group should use relevant KPIs
performance measures to track the performance towards the set objectives. Accent Group
Limited remains the regional leader in performance and lifestyle footwear’s retail and
distribution, with more than stores crossways ten different retail banners alongside exclusive
distribution rights for ten international brands crossways New Zealand Australia.

STRATEGIC AND SUSTAINABILITY ACCOUNTING 5
The ever increasing demand for shoes raises the production and manufacture of shoes
every year. This leads to various environmental impacts of shoe industry which cannot be
negated much longer. Shoes manufacture, distribution and sales pose various threats to wellbeing
of the planet as a range of toxins, fossil fuels and chemicals being produced as well as leaked
into the environment during the initial and final stages of shoe life cycle. Such chemicals remain
harmful to both the humans and wildlife which come into contact with them, and consequently,
triggers health problems (social risks) (Davila, Herrera, Hunter, Martin & Winkler, 2019).
Moreover, footwear manufacturing emits huge volumes of carbon dioxide that contributes to the
already severe effects on global warming and climate change (Reisman & Olazabal, 2016).
One of the severe environment impact of shoes arise from manufacturing stages; and
sadly, majority of people believe that footwear solely becomes a threat to environment after
being disposed of. Enormous amounts of chemicals and machinery are needed to produce
footwear. Powering these machines require the use of large amount of fossil fuels which emit
greenhouse gases when burned. Coal is one of the energy sources which was often utilized in
powering footwear factories because it is cheap, but its burning emits carbon monoxide that ends
up in atmosphere leading greenhouse effects and hence a negative impact (Tsai & Jhong, 2019).
The transportation and distribution of shoes also emits carbon dioxide since transportation
remains an important aspects of marketing footwear industry since most manufacturing firms
build factories in developing economies for cheap labor. Because factories are located far away,
transportation and distribution using ships, airplane, and trucks require to deliver products to
retailers.
The third environmental impact is that chemicals used in process of manufacturing
contribute negatively to the environment through pollution which socially affects people, and

STRATEGIC AND SUSTAINABILITY ACCOUNTING 6
wildlife health. Several chemical adhesives alongside tanning chemicals are utilized in
processing different footwear parts. Such chemicals leak easily into water and environment via
factories’ discharges hence harmful to wildlife and people who consume such infected plants and
water. Thus, manufacturing process for footwear pose several risks to environment because of
large volumes of carbon dioxide being emitted and various chemicals utilized in manufacturing
footwear (Munny et al., 2019).
Footwear disposal further contributes to significant environment and social impacts as
thrown out shoes end up in landfills which contaminate the soil and drinking water for people
because the chemicals utilized in manufacturing gradually begin to leak into soil as footwear
slowly begin to decompose. Such has significant effect on both humans and wildlife since bio-
magnification alongside bioaccumulation might take place as wildlife consumed by humans
might have drunk contaminated water or fed on contaminated plants (Herghiligiu, Mihai,
Sarghie, Bizarro & Arias, 2016). This might culminate in several health effects like cancer.
Finally, footwear disposal has a huge effect on social and environment as several chemicals
begin to leak and pollute water and soil.
Dimension Objective Possible Performance Measures
Environmental
1. Reduce emission of carbon dioxide
by only buying from suppliers who
promote recycling and use green
energy in production
a. Number of stocks from green suppliers
b. Measure the volume of fossil fuels use