Question

Sustainability accounting: Explain some of the reasons why a complete picture of corporate activity with all its economic-ecological-social effects remains an unattainable ideal model.?

Answer 1

Sustainability accounting represents the activities that have a direct impact on society , environment and economic performance of an organisation.

The pictureof corporate activity with all its economic-ecological-social effects remains an unattainable ideal model. There are a number of reasons which make this an unattainable model.

The very first reason is that it is practically impossible to measure all the effects that an organisation can have on the society , environment or the economy. An organisation does a wide range of activities which have several direct as well as indirect impacts on various things in its environment from human being to animals to plants to income to daving to GDP to pollution to health impacts . All of this cannot be measured and cannot be accounted. Even after accouting for most of the things, there will always be a lot of other things that will go unaccounted. Second things is that the comapny may not wish to account for its negative impacts. It will list all the positive impacts it can have but when it comes to showing the negatives , it may not reveal all the facts because of the fear of loss of reputation. Another reason is that sustainability accouting is quite expensive as it requires expert knowledge to measure the indirect effects of a company on the society. A lot of research work and study is required to measure such effects and every organisation and company want to be cost effective. Even working in a sustainable manner is quite expensive in some areas. There is also a little difficulty in working in a sustainable manner . It is human nature to choose the easy way out.

So keeping these things in mind , sustainable accounting may be achievable to a certain extent, but an ideal model of it an utopian concept.