Financial and Economic Interpretation and Communication Analysis

This assignment explores key concepts in financial and economic interpretation and communication. It begins by examining the debate around mandatory sustainability reporting, arguing against its universal implementation due to concerns about materiality and potential for companies to prioritize compliance over genuine sustainability efforts. The assignment then delves into relative business ethics, supporting the idea that ethical standards can vary across cultures and countries, providing examples like child labor and environmental regulations. Finally, it addresses the sustainability of perpetual economic growth, concluding that such growth is not possible, and suggesting economic stability as a viable alternative. The assignment draws on academic sources to support its arguments.

Running Head: FINANCIAL AND ECONOMIC INTERPRETATION AND
COMMUNICATION
FINANCIAL AND ECONOMIC INTERPRETATION AND COMMUNICATION
Name of the Student
Name of the University
Author Note

1FINANCIAL AND ECONOMIC INTERPRETATION AND COMMUNICATION
Table of Contents
Answer 1....................................................................................................................................2
Sustainability Reporting.........................................................................................................2
Answer 2....................................................................................................................................2
Relative Business Ethics........................................................................................................2
Answer 3....................................................................................................................................3
Sustainability of Perpetual Economic Growth.......................................................................3
Reference....................................................................................................................................4

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Answer 1
Sustainability Reporting
No, sustainability reporting should not be mandatory for all the organization. It is
because of the widespread concern that the mandatory reporting creates the lowest
denominator in the transparency. If the government sets out the number of the indicators of
the key performances that all the companies have to report on, then the companies would
focus on just making tick on the disclosure in comparison to thinking about the issues of their
shareholders. Moreover, other challenge faced by the mandatory reporting is of materiality. It
is quite difficult for defining the set of the issues, which are material for all the companies
across all the sectors (Steyn 2014). When mandatory reporting are being considered, it is
quite challenging for imagining the list of the indicators or the framework, which would be
useful to the stakeholders as well as companies all across the sectors. Moreover, many of the
organizations believe that the mandatory sustainability reporting will be complicated,
expensive and time-consuming. Some companies do not believe in value of the sustainability,
as the profit of short-term is the larger driving force of their ambitions. The organizations
may get worried about the response of the public to them if in case they are not able to
maintain the level of sustainability at par (Ioannou and Serafeim 2017).
Answer 2
Relative Business Ethics
Yes, business ethics can be relative. The theory of relativism of ethics holds that the
morality of ethics is relative to norms of different cultures. Moral relativism is based on the
idea that morality, knowledge as well as truth are not universal but it is relative to the culture
to the culture in which it is raised upon. Whether there is right action or wrong action, it
depends on the society’s moral norms, under which it is operating. It is not necessary that the

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ethical relativism be tied to the proposition of not having objective way for comparing and
evaluating the ethical sets. Although, the proposition is certainly true almost because the
ethics are subjectively defined and hence it can be subjectively evaluated (Weiss 2014). The
action taken by one country may be ethical to them but the same action taken by the other
country will not be ethical to the other country. The relative business ethics says that no
universal moral standards exist in the world. For example, child labor may be ethical in one
country but it may be unethical in the other country. Moreover, producing the goods that
damages the environment may be ethical to one country but in the same situation, it may be
unethical to other country. Ethical perspectives differ company-to-company as well as
country to country (May, Luth and Schwoerer 2014).
Answer 3
Sustainability of Perpetual Economic Growth
No, it is not possible to have sustainable perpetual economic growth. Sustainable
economic growth is defined as growth rate that can be maintained without creating the
significant economic problems, particularly for the future generations. The occurrence of the
economic growth happens when the real output increase over time. Sustainability in respect
of the economic growth is maintenance of the rate of the return in spite of creating any other
significant issues in respect of the future generations. Periods of the growth are triggered
often by the increase in the level of the aggregate demand such as increase in the spending by
consumer but the sustainable growth should involve increase in the output. If there output
does not increases, the extra demand would push up the level of price. It is under the
ecosystem, economy functions. There will not be separation of economy from the ecosystem.
In case of limits of the extraction of resources from the earth and the pollution of the waste,
the biology processes of the plants as well as human societies, come into threat. However, the

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alternative to the sustainable perpetual economic growth is for having stability of economy,
which is apart from GDP growth (Meadows 2014).

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Reference
Ioannou, I. and Serafeim, G., 2017. The consequences of mandatory corporate sustainability
reporting. Harvard Business School research working paper, (11-100).
May, D.R., Luth, M.T. and Schwoerer, C.E., 2014. The influence of business ethics education
on moral efficacy, moral meaningfulness, and moral courage: A quasi-experimental
study. Journal of Business Ethics, 124(1), pp.67-80.
Meadows, D., 2014. Envisioning a sustainable world. In Creating a Sustainable and
Desirable: Insights from 45 global thought leaders (pp. 9-14).
Steyn, M., 2014. Organisational benefits and implementation challenges of mandatory
integrated reporting: Perspectives of senior executives at South African listed
companies. Sustainability Accounting, Management and Policy Journal, 5(4), pp.476-503.
Weiss, J.W., 2014. Business ethics: A stakeholder and issues management approach. Berrett-
Koehler Publishers.