Accounting and Sustainability Reporting: A Detailed Analysis

This report provides an in-depth analysis of sustainability reporting in accounting, focusing on its importance, current state, and impact on stakeholders. It explores the need for sustainability reports, the role of government, transparency, and global alignment. The report examines practices in sustainability reporting, including material matters and stakeholder engagement, and addresses current social and ethical issues affecting shareholders, management, customers, and employees. It highlights the use of the GRI framework, the triple bottom line, and case studies like Dominos. The report recommends mandatory sustainability reporting and improved GRI implementation, emphasizing the role of sustainability reports in addressing social and environmental issues and facilitating informed financial decisions. It concludes by reiterating the value of sustainability reporting in providing economic, governance, and social information to support stakeholder decision-making.

Executive summary
This report provides vast knowledge on sustainability reporting in accounting by providing critical
and information on the state, process and need for sustainability reporting especially how this
analysis affects the stakeholders in relation to decision making that is financially oriented.
By use of high order analysis this report contains research and analyses of the current social issues
in accounting their evaluation relating to how they impact the stakeholders in the decision making
during their undertakings. The report considered the following areas in its research on the
sustainability reporting and social issues in accounting: the need, current state of sustainability
reporting, practices in sustainability reporting, social issues in accounting and their impact on the
stakeholders.
This report presents findings form various reliable and accurate sources such as the International
Finance Corporation on Sustainability report, Global reporting initiative archive, Australian
Department of Social Services and other reliable peer reviewed articles and journals. This report
clearly shows the need of using this report framework and the current position of this framework.
This report has used very current information especially in the compilation of sustainability report
to provide up to date information that I not misleading or outdated.

Introduction
Sustainability report is a report of an organization that provides information on the organizations
economic, social, environmental and governance performance and function in an organization, the
emphasis of sustainability report is on social and environmental performance (Roy, Salam and
Parvez, 2015). Sustainably report not only outlines the performance of the organization but it also
increases the organizations commitment towards sustainable development.
Organizations improve their sustainability reporting by producing reports on the sustainability
performance. The key of analyzing the quality of a good sustainable report is obtained from
guidelines in Global reporting initiative (GRI). Social and ethical issues are key in the performance
of any organization even as it seeks to improve its profitability as addressed in the sustainability
report (Junior, Best, and Cotter 2014).
Social issues are key in the reputation and the performance of the organization and if not critically
considered could deteriorate the relationship between the organization and its environment and
examples of these are seen in the case of Volkswagen Emissions Scandal and the Toshiba
Accounting standards.
Social issues in accounting have various impact to the stakeholders of any organization (Kozlowski,
Searcy and Bardecki 2015) even in the accounting industry. I will discuss the current social issues in
accounting and their effect on the stakeholders mostly considering the organization called dominos.

Need for sustainability report
Sustainability report is key to the stakeholders of any given company in the
making of vital decisions whether financial or not. Some of the decisions could
include whether to invest in the organization or provide funding among other
reasons but the first question that is asked even before looking at the state of
sustainability, below are the needs for sustainability report:
a. Changing landscape of the society
b. Implementation of the role of the government
c. The need for transparency
d. Moving Towards global alignment

State of sustainability report
The use of sustainability report has continued to become on of the best criteria in determining the social
responsibility of organizations in Australia and the world at large. It communicates the plans of the organization to
both the internal and external stakeholders of an organization thereby influencing their r planning and decision
making concerning their role or involvement in the organization.
The global reporting initiatives are used as the reporting guidelines and standard for non-official measures. It
provides metrics, quality analysis and quality check process to increase and guide the reporting procedure in
organization (Barkemeyer Preuss and Lee 2015).
Recently there have been trainings on the use of this framework in reporting especially in the united states to
enable organizations to produce sustainability report which is almost becoming essential for all organizations.
Organization that produce this report mainly use the ‘triple bottom line’ framework, triple bottom line (TBL) is
framework comprising of three parts financial (economical), social and environmental in which the organization
use in evaluation of their performances brings the idea that an organization must not only focus on earning profits
but also the improvement of people’s lives and the environment (Samudhram, Siew, Sinnakkannu and Yeow 2016).
Currently there are several awards that are given to best sustainability reporting that are recognized In Australia and
overseas, these are The Australasian Reporting Award (ARA) which was established in 1951in Australia and over
time it became to be recognized overseas, the other one is The Association of Certified Chartered accountants
(ACCA) which provides the award for over 20 countries in the globe

Practices in sustainability reporting
The practices in sustainability reporting include:
Concentration on material matters: To determine the issues that matter most companies use GRI
guidelines (Higgins, Milne, and Van Gramberg 2015).
Companies are changing their sustainability report to align to the company’s strategy and in
addressing issue of internal and external stake holders.
Some companies have continued to partner with GRI to learn how to produce sustainability
reports.
Companies have opted to engage stakeholders in making the sustainability report to provide
connectivity in gaining input from all the stakeholders

Social issues in accounting and their impact on stakeholders.
Current social issues have ended up affecting different stakeholders differently, stakeholders
mentioned in the accounting sector include the shareholder, management, the customers and
the bank employees.
Social and ethics issues: in recent times there has been reduction in ethics among some
accountants (Herremans, Nazari and Mahmoudian 2016) leading to unethical behavior while
attending to stakeholders resulting to scandals, this in turn leads to reduction of customers and
the shareholders will lose profits.
Unqualified accountants: there has been rise of unqualified accountants in the internet who
carry out accounting poorly after opening a business in the internet, this has led to lack of trust
in online banking and accountants.
Online technology: with the introduction of online technology there has been introduction of
accounting applications, despite their sufficiency there are a lot one individual learn by meeting
accountants on one on one basis hence customers end up missing in vast accounting knowledge
while shareholders shares reduce (Endrikat, Hartmann and Schreck 2017).

Business amalgamation and social roles: to sustain themselves a lot of banks have opted for merges,
this has led to merging of accountants who conflict in interest and knowledge thereby reducing the
delivery of services offered by the accountants to the customers due to conflict in social roles.
Remuneration: There has been cases with demand of pay rise, if the pay is not made the accountants
are not motivated (Sierra‐García, Grima and García‐Benau, 2015) hence they may provide mediocre
services leading to reduction in customers and the shareholders will surely loose.
Human resource management: One of the biggest problem is in human resource management
especially in dealing with conflict in the organization, if conflict whether agency conflicts are not
dealt with properly the whole organization will perish.

Findings
According to a study by Australian Center for Corporate Social Responsibility (ACSR) in Australia and New
Zealand 53% of the organizations observed said that they wanted sustainability report to be mandatory.
According to a study by the state of sustainability reporting in Australia 40% of organizations were attributed
to the use of GRI in their sustainability report and 30% of these 40% could clearly show how GRI worked
and its use.
In a study by UNCTAD in countries in its membership between May 2012 and June 2013 the number of
companies that published sustainability report increased from 96 to 157 companies.
Some companies are confused between focusing on whether to focus on important organizational issues or to
focus on meeting their social responsibility
Most organizations have opted to produce the sustainability report alongside is annual report example
National Australia Bank (NAB) and Dominos amongst many others.
In the case study of Dominos:
Dominos is involved in the generation of sustainability reports as it generates its annual reports, some of the
activities it is involved in within the community are: provision of relief during disaster, provision of food to
the needy, provision of funds in the education of youths and leadership and entrepreneur activities

Recommendation
I recommend that sustainability reporting should be made mandatory in organization after
they have been properly taught how to produce the reports.
From the finding there is growth of organizations generating sustainable report but most of
them are not doing it according to the GRI standards which means that there is need for
more information on GRI so that companies can implement them.
Most of the social issues that are affecting companies can also be dealt with by the
generation of sustainability reports in the organizations (Visser and Tolhurst 2017), the use
of sustainability report should therefore be encouraged in such institutions.
Organizations should work further with all the stakeholders in the production of
sustainability report in ensuring that there is cohesion in the application of the report
(Ioannou and Serafeim 2017), moreover, investment in new technology is not bad but
organizations should invest carefully to avoid interfering with the environment eco system
because of trying to improve its production.

Conclusion
In conclusion sustainability report is a documented report that provides
information concerning the economic, governance and social information about a
company, there is need to implement this model by use the GRI model,
implementation of sustainability report will help in dealing with cases of social and
environmental issues and it will also help other stakeholders in making financial
decisions whether to invest, bank or own shares in a company.