“Accounting and finance, isn’t that all about about making the world a worse place?” – I’m paraphrasing, but this is basically the response from a friend, involved in climate activism, when I mentioned that sustainability is now a core topic in Bristol’s School of Accounting and Finance.
I had to admit that she had a point.
Plenty of people are angry and frustrated at the moment. Corporations, banks, and governments often seem to talk about ‘sustainability’ and ‘corporate social responsibility’, but then continue on with business as usual. There is a lot of ‘blah, blah, blah’, as Greta Thunberg put it. Yet, while this is an important critique, accounting and finance practices, such as measuring costs or planning investments, and those who can engage critically with them, have vital roles to play in going beyond all the talk, in putting sustainability into practice. While we might feel powerless as individuals, as accounting and finance professionals, we can definitely try to make the world a better place.
Thinking of accounting and finance as a force for change might sound a bit surprising. After all, accounting is a dry technical subject, right? It’s for people who are good with numbers, who like things routine and orderly, isn’t it? Stereotypes in the media, and the way many accounting textbooks are written, might give the impression that accounting is a boring, formulaic process, which follows rules and laws that ordinary people can’t understand. But we should be skeptical about these impressions. Talk to anyone who actually uses accounting measures and concepts in their daily work, and they’ll likely tell you a very different story. They will probably tell you about how accounting numbers underpin the decisions they make about how they organise what they do (including the human labour and natural resources they use), what to prioritize, what to develop, and how to do it.
Contained in any organisation’s ‘cost’ and ‘profit’ data is a story about how much it depends on its workers, their community, and the natural eco-system. Decisions made using this data have important implications for how a business impacts on society and environment. They can make the difference between a company that just exploits its workers and environment, and one that shifts the focus onto ‘giving back’.
Accounting and finance organisations are actively telling us that they want critical and creative thinkers. They don’t want ‘number crunchers’, but people who are capable of finding innovative solutions to problems like how companies can reduce their carbon emissions, enrich their local eco-systems, and foster inclusive work places and communities.
The world of finance is also changing, as investors reassess the meaning of risk and opportunity. Instead of just seeking to acquire more ‘things’, many people are seeing that the world is ‘ours’ to look after and protect, as well as to discover and enjoy. Sustainability reporting, and other techniques to assess social and environmental performance, have often been problematic, functioning as ways to improve a company’s image, rather than signify real change. Yet, as debates about priorities happen, and attitudes change, these reporting techniques could play more substantive roles. Accounting and finance education therefore has a role to play in enabling future decision-makers to look critically beyond ‘what is’ to see what ‘could be’, and take action to make it happen.
More opportunities to make a difference can be found in the millions of alternative organisations developing today, including worker cooperatives and social enterprises. Worker cooperatives are organizations that the members own and manage collectively. Because the members are their ‘own boss’, they generally have greater freedom from the bureaucratic structures and procedures, which can hold back change in traditional organizations. Cooperatives have a history of leadership in sustainable development. In the US in the early 20th century, for example, cooperatives formed by African American communities saw themselves as ‘custodians of the land’ and were pioneers of organic farming.
Today, Bristol is emerging as a major hub for cooperative and sustainable business. Giving the city its creative energy are examples like the Bristol Energy Cooperative, a leader of community-based renewable energy, and the Bristol Bike Project, a social institution in the heart of the city that provides affordable transport for asylum seekers and promotes green and healthy living for all. For ethical banking and investing, Bristol has Triodos Bank, there is Bristol Green Capital Partnership, a membership network for businesses and organisations who want to work towards a sustainable Bristol, while Aardman Animations, the employee owned animations studio, demonstrates the benefits of democratic and inclusive management practices. Joining a cooperative or forming one, with the added freedom they provide, could enable you to put that vision of sustainable fashion, housing, lifestyle, or whatever it might be, into practice.
Visit the Cabot Institute for the Environment’s blog to learn more about Cop26 and climate finance.