Sustainability Accounting And Reporting Sustainabi

Sustainability Accounting and ReportingSustainability accounting commonly known as social accounting is an accounting practice that emerged nearly 20 years ago. The practice involves accounting or disclosure of other non-financial information concerning a firm’s performance mainly to the external stakeholders, authorities and creditors. There are three main approaches paths to sustainable accounting as highlighted by Burritt and Schaltegger, (2010). For example, “the inside-out approach recognizes the sheer complexity of sustainability accounting and the usefulness of the resulting information” (83).Sustainability accounting and reporting can greatly improve corporate accountability. Ideally, ordinary accounting only highlights the financial capabilities of an organization while overlooking the effects that the firm has on the environment and the society. In addition, relying solely on financial data cannot precisely measure important parameters such as customer satisfaction and product quality. Gray, (2006), Notes that modern financial capitalism are designed to exploit the environment leading to destruction and erosion. Thus, accounting for non-financial aspects through sustainable accounting and reporting helps a firm to make better and informed decisions. On the other hand, such practices have overall improvements in financial performance of an organization. Based on the fact that sustainability is a long-term objective, businesses are obliged to improve on their