Colin Dey

Struggling with the Praxis of Social Accounting: Stakeholders, Accountability, Audits and Procedures

Addresses three related, though not entirely congruent, aims. Seeks, first, to initiate moves towards a “normative theory” ‐ a conceptual framework ‐ for the developing of social accounting by organizations. Second, aims inductively to draw out best practice from a range of social accounting experiments, illustrated, in particular, by reference to two short cases from Traidcraft plc and Traidcraft Exchange. Third, draws from the conclusions reached in the exploration of the first two aims and attempts to identify any clear “social accounting standards” or “generally acceptable social accounting principles” which can be used to guide the new and emerging social accounting practice. Presents a number of subtexts which attempt to link back to the accounting literature’s more trenchant critiques of social accounting; to address the tension between academic theorizing and engaging with practice; to synthesize different approaches to social accounting practice; and to respond to the urgency that the recent upsurge in interest in social accounting places on the newly formed Institute of Social and Ethical Accountability. An ambitious paper which means that coverage of issues must be thinner than might typically be expected ‐ exploratory, rather than providing answer, offers a collective view from experience and encourage engagement with the rapidly evolving social accounting agenda.

Social accounting at Traidcraft plc: A struggle for the meaning of fair trade

Purpose - The purpose of this paper is to provide an account of the development and implementation of social accounting at the UK fair trade organisation Traidcraft plc. Design/methodology/approach - Using an ethnographic approach, the paper critically reflects on the role of this emerging form of accounting in an ongoing intra-organisational struggle for meaning within Traidcraft over the management of its “fair-trade” business. Findings - The paper argues that the implementation of a formal system of “social bookkeeping” largely failed to achieve its intended objective to further augment the organisations accountability relationships with its key stakeholders. However, in the context of organisational change, the accounting intervention was nevertheless significant, in a quite unexpected (and possibly undesirable) way. Along with a number of other intra-organisational factors, the intervention produced a decisive, management-led change within the organisation towards a more commercial interpretation of its religious principles, which the organisation termed “New Traidcraft”. Originality/value - The paper contributes to the change/appropriation debate surrounding corporate social reporting by providing insights into the complex range of political, functional and social factors that may influence the outcome of social accounting interventions. The paper also provides evidence to support the argument that social and environmental accounting interventions can be influential (if not necessarily desirable) when they are aligned with substantive changes in the organisation itself.

Methodological issues: The use of critical ethnography as an active research methodology

Ethnography has emerged as a potentially valuable empirical means of understanding how and why accounting operates within organisations. However, its use in the accounting literature has not been without controversy. This paper addresses one of the key issues of dispute: the role of critical foundational theories in ethnographic accounting research. First, the paper draws from competing proposals for ethnography in the accounting literature in an attempt to shed further light on the use of critical theory within an ethnographic field study. It is argued that critical theory can be a valuable tool in developing further insights from ethnographic study, but that its timing within the stages of the empirical work is crucial to achieve a balance between understanding and explanation. Second, in highlighting the lessons learnt from the author’s own ethnographic research, the paper discusses the (as yet untapped) potential for critical ethnography to inform directly the design and development of new accounting systems. It is proposed that using ethnography “actively” in this way could provide the methodological basis for the development of new forms of accounting, such as social accounting.

Developments in Social Impact Measurement in the Third Sector: Scaling Up or Dumbing Down?

This paper outlines the merits of two approaches to social impact measurement that are currently the subject of debate within the third sector: social accounting and audit (SAA) and social return on investment (SROI). Although there are significant similarities between the methods, a number of important differences remain. In particular, while SAA involves a more ‘conventional’ mix of narrative and quantitative disclosures, SROI outcomes are more explicitly quantitative and reductive. This is most evident in the production of the ‘SROI ratio’, which calculates a monetised ‘return’ on a notional £1 of investment. In the UK, with available resources becoming increasingly scarce, the third sector is facing demands for increased accountability as well as being encouraged to ‘scale up’ in preparation for assuming greater responsibility for public service delivery. In this context, it is easy to see why the simplicity and clarity of SROI is attractive to policy-makers, fundraisers and investors, who are keen to quantify and express social value creation and thus make comparative assessments of social value. However, this apparent simplicity also risks reducing the measurement of social impact to a potentially meaningless or even misleading headline figure and should therefore be treated with caution. This is especially so where exact measures are unobtainable, and approximations, or so-called ‘financial proxies’, are used. The use of such proxies is highly subjective, especially when dealing with ‘softer’ outcomes. There is nothing to prevent SROI being used within an SAA framework: indeed, a greater emphasis on quantitative data could improve many social accounts. Nevertheless, we conclude that current efforts to promote SROI adoption, to the likely detriment of SAA, may ultimately promote a one-dimensional funder- and investor-driven approach to social impact measurement in the third sector.

Corporate ‘silent’ and ‘shadow’ social accounting

1 Owen, D.L., Swift, T.A., Humphrey, C. and Bowerman, M. (2000) “The New Social Audits: Accountability, Managerial Capture or the Agenda of Social Champions?”, European Accounting Review, Vol. 9, No. 1, pp. 81-98. At the same time the prospects for effective mandatory CSR in the UK seem distant: the much-vaunted Operating and Financial Review is not explicitly designed for this purpose, and is deficient in both form and substance.

Activism, arenas and accounts in conflicts over tobacco control

Purpose - – The purpose of this paper is to provide theoretical and empirical insights into the effective use of external accounts by social activists in conflict arenas in order to bring about change. Design/methodology/approach - – This paper presents a longitudinal case study of Action on Smoking and Health UK (ASH) and their use of external accounts and other activist practices during the period 1999-2010. The authors explore these practices from the perspective of one organisation engaged in conflict arenas concerning the (un)acceptability of tobacco production, consumption and governance. The authors conduct the exploration based upon a dynamic conflict arena framework that attends to the range of external accounting and activist practices, tactical intentions and states of conflict used by ASH to confront the tobacco industry and bring about change in tobacco governance. Findings - – The study identifies the use of a diverse range of external accounts and other activist practices. This assemblage of practices was used to confront, counter-act and to co-operate with actors engaged in tobacco-related conflicts. The evidence suggests that the deployment of different types of external accounts by ASH was aligned to the context of the particular conflict arena involved, and was influenced by the strategy and engagement tactics of the activists and other actors, as well as power dynamics and acceptability of the tobacco governance in the conflict arena. Whilst ASH used different external accounts in specific episodes of activism, these individual accounts also contributed to an emerging holistic account of the unacceptable consequences of tobacco production, consumption and governance. Originality/value - – This study provides new theoretical and empirical insights into how external accounts can contribute to the problematisation of governance and development of social and environmental change agendas. The dynamic conflict arena framework developed in this paper creates new visibilities and possibilities for developing external accounting practices and for researching this fast-developing area of social and environmental accounting.

Anglo‐American capitalism: the role and potential role of social accounting

Purpose - This paper seeks to consider the impact and potential impact of social accounting at the macro level. It aims to explore the potential for “silent” or “shadow” social accounting to hold Anglo-American capitalism to account for its social outcomes relative to other “varieties of capitalism”. Design/methodology/approach - The role of accounting in spreading Anglo-American capitalist values is outlined. This is followed by a discussion of macro social indicators and their potential to problematise social outcomes. In particular the paper reports on, and updates, an investigation of comparative child mortality figures in wealthy countries that appeared in the medical literature. This evidence is used both as an exemplar and as a substantive issue in its own right. Findings - The specific empirical evidence reported, based on a cross-sectional and longitudinal analysis of child mortality and its relationship to income inequality, exemplifies the consistently poor and relatively worsening performance of the Anglo-American capitalist model. A rationale, and evidence, is also presented for the potential of such social reporting to act as an accountability mechanism. Originality/value - The paper introduces to the accounting literature specific evidence of poor social outcomes associated with Anglo-American capitalism. It considers the wider potential role of social indicators, as a component of silent and shadow reporting at a macro-level, in problematising dominant forms of economic and social organisation.

Accounts of nature and the nature of accounts: Critical reflections on environmental accounting and propositions for ecologically informed accounting

Purpose - The purpose of this paper is to review and synthesise academic research in environmental accounting and demonstrate its shortcomings. It provokes scholars to rethink their conceptions of “accounts” and “nature”, and alongside others in this Design/methodology/approach - Utilising a wide range of thought from accounting, geography, sociology, political ecology, nature writing and social activism, the paper provides an analysis and critique of key themes associated with 40 years research in environmental accounting. It then considers how that broad base of work in social science, particularly pragmatic sociology (e.g. Latour, Boltanksi and Thevenot), could contribute to reimagining an ecologically informed accounting. Findings - Environmental accounting research overwhelmingly focuses on economic entities and their inputs and outputs. Conceptually, an “information throughput” model dominates. There is little or no environment in environmental accounting, and certainly no ecology. The papers in this Research limitations/implications - This paper outlines and encourages the advancement of ecological accounts and accountabilities drawing on conceptual resources across social sciences, arts and humanities. It identifies areas for research to develop its interdisciplinary potential to contribute to ecological sustainability and social justice. Originality/value - How to “ecologise” accounting and conceptualise human and non-human entities has received little attention in accounting research. This paper and

Determinants of accounting choices in Egypt

In recent years, Egypt has been developing rapidly from a socialist to a fully developed market‐based economy. One may expect that this economic transition towards a more capitalist orientation will influence the country’s cultural and socio‐economic environment, and consequently the behaviour of its corporate managers. The increasing separation of ownership and control of capital could be expected to increase agency problems associated with managerial decisions. In these circumstances, it should be interesting to identify whether ‘positive accounting’ hypotheses would apply in such an environment. Therefore, this paper examines the relevance to financial reporting in Egypt of some established positive accounting theory hypotheses in addition to a new hypothesis related to taxation. The evidence of the study is consistent with the validity of the conventional ‘bonus’ and ‘debt’ hypotheses and the new ‘taxation’ hypothesis. These conclusions are also consistent with recent empirical studies of cultural and socio‐economic change in Egypt.

Trust and distrust in a network-style organisation: GPs’ experiences and views of a Scottish local healthcare co-operative

Abstract This paper considers the conditions needed for an organisation to function as an effective network. In particular, the concepts of trust and distrust are explored. Looking at the new labour reforms of 1997, evidence is presented by means of interview responses from GPs, that this powerful group in primary health care lacked sufficient trust in health care managers. In fact GPs seemed to often distrust them. It is unlikely, therefore, that a Scottish local health care co-operative, created as a result of the 1997 reforms to act as an interface between GPs and health care managers could be effective in allocating health care resources. As a result, the reforms did little to improve primary health care services in Scotland despite the increased funding allocated over recent years to this sector.