11th Australasian Centre for Social and Environmental Accounting Research (A-CSEAR) Conference

Indigenous Peoples, Mining and Impacts & Benefit Agreements: Who is Keeping Score?

Nola Buhr — Mon, 03 Dec 2012 09:00:00 PST

This presentation covers the subjects of * Score-keeping; * Indigenous Peoples; * Mining and Indigenous Peoples; * Impact and Benefit Agreements (emphasis on Canada); and IBA Saskatchewan example.

Where is the responsible in RI engagement?

Ben Jacobsen — Sun, 02 Dec 2012 15:30:00 PST

Purpose Responsible investor (RI) engagement seeks to change corporate strategic priorities on environmental, social and governance (ESG) issues whilst balancing the financial imperative. This paper argues that attempts to change corporate strategic actions on climate change will be less effective whilst the financial performance logic provides relatively more legitimacy to investors and companies. Methodology A case of responsible investment engagement is used to illustrate multiple logics (ESG and financial) in the field of investment. Discourse of the proponent, supporters and opponents of Australia’s first climate change shareholder resolution is analysed using framing analysis. Findings Framing indicated that the proposal emphasised the dominant financial performance logic and often omitted the ESG logic. One possible explanation is that the process of shareholder proposal nomination and the financial imperative within active ownership obligations effectively institutionalised RI engagement within the field of investment.

Voluntary disclosure of GHG emission information

Janice Hollindale et al. — Mon, 03 Dec 2012 13:30:00 PST

Purpose The purpose of this paper is to determine the nature of Australian public companies’ voluntary environmental management disclosures for companies making disclosures about their greenhouse gas emission performance and management in the year before and the year after the introduction of Australia’s National Greenhouse and Energy Reporting legislation, and to empirically test the hypothesized influence of several company characteristics on the quality of these disclosures. Design/methodology/approach The content of GHG performance and management disclosures made in annual reports and stand-alone sustainability reports of 1,766 (1,853) publicly listed Australian companies in 2007 (2009) is determined using an index of quality based on GRI guidelines. The relationship among the quality of disclosures and various company characteristics taken from information asymmetry, agency, political cost and proprietary cost theories is examined using an OLS-regression model. Findings Results indicate that voluntary disclosure of GHG information is significantly related to companies requiring increased debt and having higher leverage, companies belonging to some politically sensitive industries and to the age of companies’ fixed assets. Disclosure of greenhouse gas emission information is also significantly associated with lower ROA, higher Tobin’s q and with having dual (overseas) stock exchange listings.

Visualization techniques to disclose the link between managers’ remuneration and organisation’s performance

Alessia D'Andrea et al. — Sun, 02 Dec 2012 14:30:00 PST

Purpose – The purpose of this paper is to investigate the relationship between the managers’ remunerations and the company’s performance and to propose a visualization technique so that this link can be better understood by stakeholders. Design/methodology/approach – This paper presents an analysis of the compulsory and voluntary disclosure in a sample of Italian listed companies. Content analysis method is used to identify the state of the environmental and social disclosure in the reports. Findings – It is argued that information on managers’ remunerations and company’s performance is actually provided in the available disclosure, but it is spread over several documents and this makes the understanding of the link quite difficult to stakeholders, especially to the non-expert ones.

Travel carbon emission reduction: managing and accounting in a global company

Nadia Di Giacomo et al. — Mon, 03 Dec 2012 11:30:00 PST

Purpose: This case study explores how a global company does or does not adapt to climate change through changes in managerial action. Specifically, the research concerns a travel project in a global consulting company based in London, the stated aim of which was a 25% reduction of carbon emission generated by air travel in one year. The research explores the actions undertaken to achieve carbon emission reduction. Design: A case study method is employed to follow the travel project over one year to examine its contributions, if any, to carbon emission reduction. Findings: Several solutions were implemented by management aimed at reducing carbon emission by air travel. Travel incentive schemes to reduce flight travel were implemented, with a focus on new communication technology. Despite significant managerial effort, carbon was not reduced. When, at the completion of the analysis, the stated objective of achieving 25% carbon emission reduction had not been met, the company instead changed its targets to adapt to much higher levels of carbon emissions to meet its actual levels, which had increased significantly.

The Public Sector Accountants’ Perspective on Sustainability

Belinda Williams — Tue, 04 Dec 2012 09:00:00 PST

Purpose This paper focuses on the accountants‟ perspective towards sustainable development and sustainability reporting in local government authorities, and their current and future role in the reporting process. Design/Methodology/Approach A multi-method approach was employed to collect data utilizing both mail survey and interview techniques. Findings Findings indicate that whilst local authorities are perceived to consider sustainable development important at the organisational level, there is reduced emphasis being placed on the integration of sustainable development activities into the accounting processes and reporting functions of the organisation. Accountants are supportive of involvement in sustainability reporting but their actual involvement differs significantly from the level of involvement they believe they should have. This points to the need for further up skilling required by accountants but in doing so, it brings into question accountants traditional training and the need to develop an appreciation of the sustainable development agenda.

The interplay between management control systems and organisational interpretive schemes in change towards sustainability

Venkateshwaran Narayanan — Sun, 02 Dec 2012 15:30:00 PST

Purpose: This paper seeks to understand organisational change towards greater social and environmental sustainability, specifically focusing on the role of management control systems (MCS) in this process. The majority of the extant literature in management accounting and organisational change focuses on change that moves organisations towards greater commercialisation or a single bottom line. In the context of change towards sustainability where economic, environmental and social concerns have to be balanced, this paper argues that role of MCS in change is better understood within the context of organisational interpretive schemes (Laughlin, 1991). Design/methodology/approach: In this paper the changes in MCS are theoretically framed using Simons (1995) levers of control framework, while the extent of organisational change is theorised using Laughlin’s (1991) pathways of change model and Hopwood et al.’s (2005) approaches to sustainability typology is used to frame the direction of change. The empirical data is derived from an in-depth case study of an Australian multinational corporation in the banking sector. Findings: The findings show that the process of organisational change and the role of MCS in change, especially in the sustainability context are better understood by viewing MCS as situated within and influenced by an organisation’s interpretive schemes.

The Impact of the Environment Management Act on the Accountability of Companies in Fiji

Glen Finau et al. — Tue, 04 Dec 2012 10:30:00 PST

Purpose – This study seeks to explore the impact of the Environment Management Act (2005) on the accountability of three companies in Fiji. Design/methodology/approach – The study uses a multi-case study approach based on three subsidiaries of a conglomerate. Data collected for the study included semi-structured interviews with accountants, internal auditors and environmental, document reviews and content analysis of annual reports and websites of the respective companies. Findings – The findings suggest that the Environment Management Act (2005) is having some effect in terms of engendering accountability in the companies case studied. Further evidence suggests that while this increased accountability has lead to disclosures in annual reports and websites; these disclosures are minimal at best and the primary groups of stakeholders these disclosures are addressing are the government regulatory authorities.

The BP Gulf Oil Spill: Public and Corporate Governance Failures

Carolyn Windsor et al. — Mon, 03 Dec 2012 11:00:00 PST

Purpose: To critically examine public and corporate governance failures that we argue predisposed the BP oil spill in the Gulf of Mexico, the worst environmental disaster in United States (US) history. Design/methodology/approach: A critical examination of publicly available documentation to identify systemic governance flaws of a marketized government agency and BP’s self-regulated corporate governance. Findings: The spill was overseen by the US Federal Government agency, Minerals Management Service (MMS). Restructured by the Reagan Administration to mimic business, the MMS regulated and collected revenue from offshore oil leases, a conflict of interest that compromised this public agency’s integrity. Neo-classical economics and its political ally neo-liberalism were instrumental in marketizing the public sector, which became the agency for the ‘business of business regulation’ supporting regulatory capitalism’s ideal of the market as the only way to organize society. Evidence also reveals weaknesses in BP’s corporate governance as oversight of safety, health and the natural environment by various sub-committees was conducted by a few directors with little transparency or public scrutiny.

Sustainable Development: 1987 to 2012 - Don’t Be Naive, it’s not about the Environment

Nick Barter et al. — Sun, 02 Dec 2012 14:30:00 PST

Purpose:In this paper we explore the concept of sustainable development through the lens of two United Nations publications. The documents, published 25 years apart, highlight how the understanding and enactment of sustainable development has changed over the course of that time. We highlight how sustainable development has been portrayed as an: epic adventure, the right and only choice, a challenge to categorical thinking, and a story of economic growth for human survival. While the tone of both documents differs, what is clear is from the publications is that sustainable development will not be achieved unless it is part of mainstream economic debate, supported by a holistic understanding of the entwined relationship between humanity, the environment and the economy. Design/Methodology/Approach: As a discussion document the paper uses existing literature. Findings: Sustainable development is a concept that is about perpetuating economic growth, but doing so through a non-categorical understanding of humans and nature relationships.

Stakeholders' Perspectives on Standardised Water Accounting Reports: Accountability Perspective

Edward Tello-Melendez et al. — Mon, 03 Dec 2012 12:00:00 PST

Purpose – This paper explores the perceptions of potential users about water accounting reports prepared under Standardised Water Accounting (SWA), and reflected in the Exposure Draft of Australian Water Accounting Standard 1 (ED AWAS 1). One of the shortfalls in the development of ED AWAS 1 is the lack of a proper study on the information needs of potential users of water accounting reports and this research paper attempts to fill in this gap. Efficient and effective water management is an important element in alleviating water crises caused by misuse of water resources. Design/methodology/approach – The theoretical framework adopted in this paper is Accountability. This concept is explored in depth across three main ideas: clarity of relationship, transparency and power. A mixed method approach was utilised in which a questionnaire was administered to users with water-related interests in five different water-related seminars. The results yield to 36 usable responses. Most questions were closed ended with possible responses ranging from either a five-point Likert scale or a ‘Yes/No/Undecided’. The qualitative phase involved the analysis of secondary by examining public submissions to the Water Accounting Standards Board on ED AWAS 1. Findings – The majority of respondents perceive that it is useful to use a standard system to prepare water accounting reports (applying SWA). Moreover, the majority of potential users are unsure about the effectiveness of such reports in discharging the accountability of water managers, and a significant number of stakeholders were unaware of its development. After analysing the submissions based on the integrated accountability model, it was found that accountability is unlikely to be fully realised. Submissions reflect the perceptions on potential users of General Purpose Water Accounting Reports (GPWAR).

Socially Responsible Investment in Malaysia: Behavioural Framework in Evaluating Investors’ Decision Making Process

Ainul Azreen Adam et al. — Tue, 04 Dec 2012 10:30:00 PST

Socially responsible investment (SRI) represents the method of investment that consider the impact (good or bad) of investment decisions on social, ethics, and/or environment within the context of rigorous financial analysis. Despite the evidence of an increasing interest among academics and industry players on SRI, the understanding of the psychological aspect of decision-making behaviour of SRI investors is still incomplete. Currently, no published evidence has been found in the context of Malaysian investors‘ decision – making behaviour regarding SRI. Thus, this study aims to examine the role of intention, attitude, subjective norms, perceived behavioural control and moral norm in explaining SRI behaviour by investors in Malaysia. The underlying framework is the Theory of Planned Behaviour (TpB) that has been modified to incorporate moral norm as an additional explanatory variable. Studies that apply TpB in their measurement of behaviour indicate a mix of explanations for the relationship of constructs (i.e. - impact of attitude and moral norm) that influence behaviour through intention which warrant further examinations. Previous studies on SRI are extended by examining the role of intention in improving the relationships of TpB‘s attributes on behaviour. This study uses Structural Equation Modelling (SEM) to ascertain the causal relationships between the variables and whether these relationships could be improved by intention as a mediator. The results based on a questionnaire survey of Malaysian investors suggest that attitude, subjective norm and moral norm have positive effect on intention which in turn positively affects behaviour towards SRI. The relationship for attitude, subjective norm, and moral norm to behaviour is improved significantly by intention as a mediator. Based on squared multiple correlations (R²), it is found that the final structural model could explain 46% of the variance in intention and 50% of the variance in behaviour. These results suggest that, together with social, ethical and environmental issues (SEE) and financial goals, SRI providers and policy makers should also consider the influence of social pressure from investors‘ friends and relatives in their SRI decision making. Investors‘ personal standards are also found to influence the intention and behaviour to invest in SRI. Furthermore the results of this study yielded critical information and insights that will enable Malaysian authorities as well as fund management companies to launch effective marketing strategies and develop SRI products.

Revisiting the link between environmental performance and financial performance: who cares about private companies?

Wei Qian — Sun, 02 Dec 2012 14:00:00 PST

Purpose: The financial market change and the climate change in recent years have triggered the studies of the connection between corporate carbon performance and financial performance, although the link between the two remains elusive in private companies. This study examines the relationship between environmental and financial performance with a particular focus on private companies. Design/methodology/approach: This study compares public listed and private unlisted companies registered under the Australian NGER Act 2007 and investigates the link between carbon performance and financial performance in these two groups of companies during 2009 and 2010. Findings: The results show that carbon performance and financial performance are significantly negatively related in public listed companies, suggesting worse carbon performers tend to enjoy higher financial returns and stronger financial performers are more likely to pollute more and consume more energy. In private companies, no significant link between the two performances is found.

Revisiting Autopoiesis: A Research Note and Another Narrative on Accounting and Sustainability

Tehmina Khan et al. — Sun, 02 Dec 2012 13:30:00 PST

Purpose: This relatively short paper offers a more developed interpretation of the continuing and worrying trend in which “sustainability” is either ignored or implicitly assumed to be part of – and compatible with – notions such as eco-efficiency, growth, profit and the business case. Design/methodology/approach: The essay employs the theory of autopoiesis as a metaphoric lens through which to re-examine accounting, business and educational practice with respect to sustainability Findings: The theory of autopoiesis works well as a lens in this regard and the analysis succeeds in highlighting that the accounting, business and educational systems may well be protecting their “cores” but are doing so by ignoring crucial and life-threatening information. In autopoietic terms, the sub-systems are behaving psychopathically.

Revisiting accounting’s role in past injustice: Income management and the case of Aboriginal apprenticeship programs in NSW

Susan Greer et al. — Mon, 03 Dec 2012 14:30:00 PST

Purpose The purpose of this Australian case study is to examine how accounting was used to facilitate the indenture of Aboriginal children under government negotiated labour contracts in NSW during the period 1883 – 1950. Design/methodology/approach This is an historical paper which draws on a combination of archival records and secondary sources. The paper applies a governmentality approach and extends this perspective to highlight the salient role of pastoral power in administrative sites of governance. Findings The case study of the Aboriginal apprenticeship programs provides a history of the present which narrates an uneasy history of the relationship between accounting and calculative technologies and the government of Aboriginal peoples.

Our place is special: the response of a major fossil-fuel company to emissions trading developments in New Zealand

Ian G. Mason et al. — Mon, 03 Dec 2012 14:30:00 PST

Purpose: To examine and interpret the activity, arguments, and policy proposals put forward over a four-year period by a major state-owned fossil-fuel company, on climate-change policy and emissions trading in New Zealand. Design/methodology/approach: The signing of the Kyoto protocol by the New Zealand Government in 1997, followed by the introduction of Climate Change Response legislation in 2002, and the proposed introduction, and subsequent implementation, of a New Zealand emissions trading scheme between 2007-2011, provide the empirical context for our research. In order to investigate the position on GHG management of a key member of the fossil-fuel industry, submissions on each of the four stages of pre-consultation and review process on the emissions trading scheme were analysed, with a focus on key arguments, policy proposals, and degree of involvement in policy formulation. The company responses were evaluated from a legitimacy theory perspective. Findings: A notable position on emissions control, in which it was argued that New Zealand should be allowed to increase gross emissions over time, whilst relying on carbon sinks, primarily forestry, in order to meet net emissions targets, was revealed. The rationale was that since most New Zealand production processes are less emissions intensive than those elsewhere, New Zealand should enjoy a privileged position in the production of certain commodities relative to other countries. Economic growth, emissions leakage and energy efficiency arguments were invoked to support the position that net emissions reductions should only be made if required by international treaty obligations, and then only in line with actions of key trading partners. It was argued that if an emissions trading scheme were to proceed it should provide maximum support for emitters, free allocations, subsidised allocations, delayed entry of sectors into the scheme and an extended phase-out period for free allocations. The company was found to have played a major role in the submissions process.

Officers’ Due Diligence: Making Work Health and Safety an Accounting Problem?

Sharron O'Neill et al. — Sun, 02 Dec 2012 13:30:00 PST

Purpose New work health and safety (WHS) legislation in many Australian States and Territories places specific due diligence obligations on the officers of an organisation. This paper questions whether imposing an enforceable WHS duty of care on accounting and finance officers is justified and appropriate. Design / methodology / approach The paper critically examines the capacity of accountants and accounting to influence work-related injury and illness outcomes across an organisation. Detailed third-party investigations into fatal WHS failures are reviewed, focusing on the web of contributing factors identified in each case study. Factors that may be traced, directly or indirectly, to accounting practices are identified and explored. Findings The findings suggest accounting practices, such as the resourcing and performance management decisions of accountants, financial controllers, chief financial officers, chief executive officers and directors, can contribute significantly to an increase in WHS failure risk. Consequently, the imposition of WHS duty of care and due diligence obligations on accounting officers appears justified.

Impacts of Mega-events on Sustainability Reporting Practices: The Chinese Banking Sector

Tairan Huang et al. — Tue, 04 Dec 2012 09:30:00 PST

Purpose: The purpose of this paper is to identify and determine how the mega-events in 2008 (Global Financial Crisis, Beijing Summer Olympic Games and Sichuan Earthquake) influenced the contents of a Chinese banks’ sustainability reporting and the impact of this on their legitimacy. Design/methodology/approach: Content analysis is used to analyze the disclosed sustainability indicators of ten banks operating in China, including: state-owned banks, joint-stock commercial banks, Chinese subsidiaries of foreign owned banks and policy banks. The theoretical framework is informed by legitimacy theory. Findings: The results indicate that a unified disclosure model cannot be identified in Chinese bank’s sustainability reports. To date, disclosure of mega-event related issues and other sustainability performance issues differs across institutions. This paper suggests that different levels of disclosure output in relation to mega-events, especially the Sichuan Earthquake, can potentially gain legitimacy or, in-contrast, constitute a legitimacy gap, depending on the contents disclosed.

Getting it Right: Directors’ assessment of information

K. O'Donnell et al. — Sun, 02 Dec 2012 16:30:00 PST

Purpose: The purpose of this research is to examine a role for Information and Process scepticism in non-delegable director duties. We draw upon auditing literature to guide an understanding of scepticism. Design: This is a conceptual paper, drawing upon archival material, including statute law, case law, regulatory guidance material and media releases in Australasia. Research Implications: We present arguments that challenge us to understand the process of information, judgment and actions of directors as a neuroeconomic phenomenon.

Factors that Influence GHG Assurance Provider Quality Perceptions

Wendy Green et al. — Mon, 03 Dec 2012 14:00:00 PST

Purpose: This study investigates the key factors that influence preparers, users and assurers perceptions of greenhouse gas (GHG) assurer quality. Design/methodology/approach: A survey questionnaire was completed by 53 participants, including all three parties to the GHG assurance relationship (preparers, users and assurers of GHG emissions reports) who rated the importance of 34 factors to their perception of assurer quality. Consistent with prior financial statement audit quality research, the factors assessed quality along three dimensions, assurance firm factors, assurance team leader factors and assurance team factors. Findings: Results indicate that perceptions of assurer quality in the GHG setting, is primarily influenced by the ethics and integrity of the assurer as well as the assurance, GHG emissions and regulatory knowledge of the assurance team leader and the assurance team. Less importance was placed on the experience and industry specific knowledge of the assurer and on the degree of communication between the assurer and the client. It is also found that the factors influencing the perception of GHG assurance provider quality differ between preparers, users and assurers.