Contemporary Accounting Theory: Brickworks CSR Report Analysis

This report provides an executive summary and in-depth analysis of Brickworks Limited's corporate social responsibility (CSR) practices. It begins with a literature review, exploring the importance of CSR for financial objectives, sustainability reporting, and relevant theories such as social contract theory, legitimacy theory, stakeholder theory, and instrumental and integrative theories. The report then delves into Brickworks Limited's history, ownership, governance, and financial performance, evaluating its sustainability reporting index according to GRI guidelines. It assesses the extent and quality of the company's sustainability reporting, drawing conclusions about its CSR efforts. The report highlights the interrelation between CSR and financial performance, emphasizing the importance of ethical behavior, stakeholder engagement, and sustainable practices in the construction industry. It also discusses the role of sustainability reports in building trust and enhancing profitability.

Contemporary Accounting
Theory
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Executive Summary
Corporate social responsibility is one of the essential parts of all organizations that are operating
their business at a global level. According to the present, all organizations need to earn a high
amount of profits for retaining their business for a longer period in the market. To increase the
sale of their products the business enterprise must enhance their goodwill in society. Thus, it is
possible only when the firms execute various corporate responsibilities in the organization.
Sustainability reports helps the organization to show their activities which are taken by
management for the benefits of society. Moreover, theories and their framework also lead the
corporations to implement CSR practice successfully in all departments of the business. In the
last sustainability report scoring index and the annual sustainable report is considered to
understand annual CSR practices of the organization.
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Contents
Executive Summary.........................................................................................................................2
Contents...........................................................................................................................................3
Introduction......................................................................................................................................4
Part A...............................................................................................................................................5
Literature review for explaining the corporate social responsibility and its importance for
financial objectives.................................................................................................................5
Sustainability reporting and other reporting concepts for representing a holistic view of
corporate social responsibility................................................................................................6
Theories which explains the essence of sustainability reporting............................................8
Part B.............................................................................................................................................11
Introduction of the organization and its overview on history, ownership, governance and
financial performance...........................................................................................................11
Sustainability reporting index according to the GRI guidelines..........................................13
Extent and quality of sustainability reporting of the Australian organization against their
sustainability report..............................................................................................................15
Conclusion.....................................................................................................................................17
References......................................................................................................................................18
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Introduction
Corporate social responsibility can be defined as the process which shows how an organization
manage and control their business by impacting positively in the society. The main agenda to
execute CSR practice in the organization is to increase social responsibility by following and
implementing ethics in their operations. There are various factors are present in an organization
which leads them to perform their operations inappropriate manner. Financial transactions and
corporate social responsibility both are inter-related with each other (Suprianto and et. al. 2017).
It helps an organization accountable towards its stakeholders such as employees, customers, and
stakeholders. This helps them to enhance their profitability by improving image for organization
in the society. The present report is written from the perspective of Brickworks limited company
which operates their business in the construction industry. Further, in this literature review of
various corporate social responsibility and financial objective is included in this report. It also
involved sustainability report by monitoring the annual report for the organization. Along, with
this theory are useful for explaining various sustainability reports will also be covered in this
report. In the last ownership, history, governance and disclosure act will be mention as
underneath.
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Part A
Literature review for explaining the corporate social responsibility and its importance for
financial objectives
According to the (Pava and Krausz, 2010) an organization achieve more success in the industry
by more on ethical behaviour and attitude of all employees who are engaged in the operation of
the organization. Therefore, the organization and its top management need to formulate effective
policies and strategies to complete their work effectively. On the other side, the majority of the
present organization is more concern about the ethical aspects of the society because it helps
them to increase their performance (Shipman and et. al. 2016).
By going through the article of Byrne, (2011) it is analysed that there are various factors are
present in the organization. Like, certain issues related to society, environmental safety,
consumer rights and many more. In the present scenario, all corporations such as Brickworks
need to maintain their business ethics and CSR practices. With the implementation of corporate
social responsibility activities, it is easy for an organization to enhance their business
productivity.
According to the Gjolberg, (2013), several types of research are focused on the relationship
between corporate social responsibility (CSR) and financial performance (FP). Generally, they
are developed for finding out positive results for the organization to earn more profits. On the
other side, it is essential for Brickworks to follow, because it helps them to measure their CSR
practices.
In the present scenario, most of the businesses are performing their work at a global level.
Therefore it is essential to enhance their goodwill to sale their products at a global level. CSR is
a wide practice that undertakes major issues related to society and the environment. Similarly, on
the parallel side, financial terms are included corporate behaviour of its stakeholders such as
employees and shareholders. It represents CSR practice increases the trust of the organization
among its participants due to which it is easy to enhance their profits and productivity. Waldock
and Graves, (2017).
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Sustainability reporting and other reporting concepts for representing a holistic view of corporate
social responsibility
The present work relates and highlights on the financial performance of the organization if it is
related to corporate social responsibility or not. For better understanding, it includes
sustainability reports of an organization (Shehata, 2014). Moreover, the sustainable reports are
developed by the companies to show impacts of their daily activities on economic,
environmental and social. All corporations must make such sustainability reports. As it is
favourable for organization and leads them to generate trust among industries and governments.
(Rajni Bhalla, 2014). GRI which stands for the Global Reporting Initiative formulates different
rules, policies, and guidelines on which the companies formulate their sustainability report.
These reports help the management to understand all essential and relevant information which is
disclosed by the corporations. This report leads them to recognize all aspects that increase the
profitability of their financial departments.
According to the Sanjeev Bansal, 2015), an organization considers economic aspects in
sustainability reports. They need to disclose various policies and strategies which is used by
them for increasing their business performance. Like the actual cost of utilization of resources,
raw materials, and machines. Along, with this, the sustainable reports also ensure that their
activities do not harm to environment. It determines all organizations need to show their reports
to society through website, journals or mails.
Most of the firms or corporation which are performing their business at a global level must be
interested in developing CSR practices. Further, they must develop reports from the perspective
of economic view. It considers that the organization contributes to increasing protection of social
and environmental factors. In their essential roles which is presented by organizations relates to
services that are evaluated based on CSR practices (Sciarretta, 2014). Moreover, there are
various collateral benefits are received by the firms, such as it is easy for customers and
shareholders to evaluate CSR practices of the organization. This determines that management
includes all operations by following the rules of the government. (Dr. Fahad Sulaiman, 2014).
According to the Rodriguez-Fernandez, (2016) most of the global organizations perform and
control their operations at the multi-national level. So they need to consider CSR and FP to inter-
relate with each other. Due to this, it is easy for an organization to retain its business for a longer
period in the market. Further, the main motive to formulate sustainable reports is to earn large
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profits by organization as well as society. Finally, corporate social responsibility helps the
management to distribute profits among all stakeholders.
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Theories which explains the essence of sustainability reporting
By the reference of Carrol (2012), it is stated that CSR consists of various responsibilities such
as legal, economic, ethical and many more. All corporate practices consist of the corporation to
ensure their high profitability in the market, by increasing their goodwill which leads them to
earn a high amount of profits. On the other side, they must fulfil all responsibilities so goodwill
of the organization will be enhanced (Salterio, 2015). Moreover, to implement them effectively
some of the theories are mention as follow:
Moreover, to implement them effectively some of the theories are mention as follow:
 According to the Scott Thompson, (2017)
Social contract theory assists the management
of the business and organization to operate and manage a business under an unprinted
contract. It works as the permission which is provided by the society to the business for
performing their operations effectively. So, this is mandatory for the Brickworks to
perform different activities which benefit the society. Such as to develop educational
institute, better infrastructure etc. as it increases their goodwill in the market

Legitimacy theory leads the organisation to understand the behaviour of employees and
stakeholders. Further, it is beneficial for Brickworks as it helps the management to
implement social policy that is favourable for communicating social responsibility in the
industry by developing positive relationship within the organisation.

Stakeholder theory relates with the all the individuals who are engage in the
organisation for completing and performing their operations in appropriate manner.
Stakeholder theory is also useful for understanding society representatives. The main
motive to execute this theory in the Brickworks is to identify common interest group of
the stakeholders. This activity helps the management to generate trust in the market by
developing policies according to the theory and common interest groups of stakeholders.
According to the Garriga and Mele, (2015) Instrumental theory is one of the most effective that
is used by the business enterprise for making sustainable reports for the organization. The main
motive to implement instrumental theories is to increase their wealth that depends on economic
objectives of an organization. For this it considers different aspects which are as follow:
 Maximizing shareholder value- As per the author's consideration, there are various
tools are considered by the management to increase their value. In this, the main
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focus of the organization is to make effective corporate decisions. This results in
increasing their brand value.
 Cause-related marketing- This activity relates to the process of formulating and
executing various marketing activities that are used to enhance their revenues. For
increasing the revenues management do acquisition of a large number of operations
which are related to ethical and social dimension.
 Corporate citizenship- Citizenship of the organization refers, to the roles,
responsibilities and possible outcomes that are related to partners, consumers and
investors. In traditional period it relates to the social theory, but in the present
scenario, business performs their work at large level. So it is essential for
management to implement modern approaches for generating a strong sense of
business operation towards the local society.
Theoretical framework of Integrative theories
 According to the Riordan and Faibrass, (2018), integrative theories depend on the
social demands of an organization. It represents that the management of an
organization is mainly focused on the existence of expanding business and growth. It
is also analysed that the social demands refer to the methods by which society
interacts with business to purchase a product and gives a certain legitimacy or status
which increases the goodwill for the organization and its products. Moreover, there
are various theories must be considered by the organization to enhance their profits
and status for a longer period in the market. Some of the essential factors that are
considered by the organization are mention as follow:
 Issue management- The concept of corporate social responsibility is broad when the
business enterprise included social responsiveness and issue to increase their
profitability. Moreover, it is complimentary for the corporations to identify, respond
and evaluates certain issues related to society and the environment of a particular
country.
Stakeholder management- According to the Mele, (2017) stakeholder management is one of
the most important factors for the organization. It assists them to increase their profits by
generating the responsibility for the business towards the public and various groups which are
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engaged in the organization to perform their operations. Moreover, it results that it is easy for an
organization to generate positive results. by making effective decisions to increase profits. For
managing and monitoring stakeholders, management focuses on executing and fulfilling their
CSR practices (Nitzl, 2016).
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Part B
Introduction of the organization and its overview on history, ownership, governance and
financial performance
Brickworks Limited is one of the most well-known organizations which is operating their
business in the construction industry. The core business of brickworks is to assembling and
distributing clay and concrete products for the organization. Along, with this management of
brickworks also engages in the property development, investment and realization of all types of
building materials (Neel, 2017). Major part of the brickworks revenue is earned from the market
of Australia and New-Zealand .
History- Brickworks started to perform their operations in the year 1934. It was established by
the leading manufacture of the Sydney. In the era of 1940's brick and tile, industry faces various
challenges such as crisis and low sales due to the great depression among industries. So the main
motive of Brickworks limited is to ensure the viability and reliability in such complex time.
William King Dawes was one of the most important persons that generate such radical changes
in the brick and tile industry. Due to their constant efforts and determination to achieve success
Brickworks limited is one of the leading organizations in Australia (Modell, 2015).
Governance- Corporate governance is one of the methods that show how an organization is
directed and controlled to achieve huge success in the market. On behalf of its stakeholders
which includes suppliers, employees, customers, regulatory and community. There are several
aspects are present in an organization that helps them to enhance their profits by fulfilling and
monitoring the needs of their stakeholders. Therefore, the board of Brickworks Limited is
committed to developing and maintaining good corporate governance in the business. It
represents that it is already predicted by the management of Brickworks that huge success is
achieved by the organization through developing a positive relationship with its stakeholders.
Example- Brickworks ensures that its employees perform their work through honesty and in the
right manner. This approach helps them to complete their work in an organized manner along
with this it retains the employees for a longer period, which is favourable for both the
organization and its employees.
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Ownership- In the present scenario, the ownership of brickworks is divided between various
shareholders. Some of the major shareholders are Washington H Soul Pattinson & company
limited which holds 43.94 company stake. Another is HSBC Custody Nominees that holds 12.24
stakes in the organization. Whereas, other shareholders hold smallholdings in the stake of
Brickworks which is at least minimum amount of 0.23 of the Brickworks.
Financial performance- As compare to the last years, the financial performance of the
organization is good. But as compare to 2017, the profits for the year 2018 was 5.8%. In the
revenue, the profits for the end of July 2018 are $175.4 million. Therefore, to enhance the regular
profits of brickworks private limited management emphasis on all aspect of corporate social
responsibility which increases sales of its products.
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