Beyond the financial: Re-thinking the capitals in practice and assurance
To be socially responsible in business is gaining momentum. James Guthrie reflects on the role accounting has on transforming the world’s thinking about the value of nature and society.
In 1494, Italian monk Luca Pacioli published an overview of the mathematics of his time. His 36-chapter work described what has since become standard knowledge among the world’s finance and business professionals and a building block of balance sheet accounting: double-entry bookkeeping. And since the advent of this method, invested capital has been the pillar of every enterprise, government and economy.
Even today, in the wake of the global financial crisis and amid a spreading debt crisis, invested capital remains the core and the promise of economies everywhere. But a much bigger crisis is yet to come — one that strikes at the very purpose of economies but is scarcely noted, let alone managed: the crisis in social capital, natural capital, intellectual capital and human capital.
This push to be socially responsible in business is gaining momentum and is one that is addressed by Jane Gleeson-White, in her new book, Six Capitals: The revolution capitalism has to have — or can accountants save the planet?
The question Gleeson-White poses in her book’s subtitle: “can accountants save the planet” is one that we hope to explore — if not perhaps answer — at Chartered Accounting Australia and New Zealand’s fifth Accounting Frontiers Forum, where Jane Gleeson-White will be presenting. Gleeson-White’s question reflects the central role that accounting has played in important moments in history. As accounting is the language of business, it has the potential to transform the world’s thinking about the value of nature and society in light of the cost of capitalism’s obsession with growth. This obsession, she argues, may ultimately cost us a huge price in terms of the environment and our own wellbeing.
It is a question that will be explored more widely at the upcoming forum. The event will bring together a variety of stakeholders, including accounting educators, researchers and professionals to discuss the frontiers of accounting innovation from both a research and practice perspective. It promises to be thought-provoking and engaging.
A copy of Chartered Accountants Australia and New Zealand’s new thought-leadership publication, Is Policy Making Measuring up? Rethinking How We Measure the Success of a Nation, will also be available. It discusses how global demands have changed the way we think and measure success, and whether more recognition is needed on of environmental and social outcomes as well as economic aspects.
If you would like to attend the Forum, please register here.
James Guthrie AM is a Professor Emeritus at the Department of Accounting and Corporate Governance in Macquarie University and Editor-in-Chief of the Journal of Behavioural Economics and Social Systems (BESS). He was Head of Academic Relations at Chartered Accountants Australia and New Zealand from 2008 to 2017.
