Part A:
Give a brief background to the organisation and its activities, particularly in relation to CSR.
Using your selected case study report, identify and explain the internal management accounting systems and techniques employed by the organisation in relation to social and environmental issues.
Using the case study report and any other relevant information, critically evaluate the extent to which the company’s internal systems and procedures demonstrate embedding of sustainable business practices within the organisation. Determine whether the organisation is operating more eco-efficiently as a result.
Based on your analysis, draw conclusions and make recommendations as to how the company could better embed sustainability “within its DNA”.
Part B:
Give a brief background to the organisation and its activities, particularly in relation to CSR.
Explain the key concepts / principles / criteria of your selected theory (stakeholder, legitimacy or accountability) or regulatory framework (GRI, CRF, AA1000 series).
Introduce the report. State the year. Give a brief description of the report e.g. length, content, main target audience (in your opinion), whether or not it has been externally verified (and if so, by who). Give any other information e.g. sustainability reporting award achieved?
Using your theory / framework as a base, critically evaluate how well the company, through its CSR report, demonstrates a commitment to accounting for sustainability.
Based on your analysis and your knowledge of current developments in sustainability reporting, draw conclusions and make recommendations as to how the company’s external reporting practices could be improved.
BT Group plc is one of the largest British multinational information transfers administrations organization with head workplaces in London, England, United Kingdom. It has business operations in more than 170 nation of the world. In addition to this, it should also be noted down that, due to increases pollutions and changes in the environment of the nations, BT plc is looking for changes in its operations and reduce the use of consumptions of electricity and power to reduce cost and protect the environment. Moreover, pressure from shareholders, employees, customers, communities and society played major role to encourage organization to go green and focused on environment sustainability (Cornelissen, 2011).
BT plc is also looking for go green and reduces waste and pollutions to sustain environment. BT plc uses the green building and energy efficiency organization centre. BT plc is also looking for reduce risk through promoting improvements in innovation. Moreover, organizations engage in CSR activities and maintain connections between financial execution and social or environmental execution. BT plc has run the CSR activities as through improving energy efficiency, use green data centre, company nursery school, children welfare plan and proper renewable plan. The company is also encouraged young women to jobs in IT, engineering and natural science through run “Girl’s Day” program (Dhillon, 2002).
In the current time, BT Group plc is using a variety of tools and techniques with a specific end goal to incorporate natural effects into administration choices. This rule concentrates on three such administration choice making methodologies: costing investigation, speculation examination and execution assessment (Shah, 2008).
Costing Analysis: This is one of the major management accounting strategy used by BT Group plc to identify and measure environmental costs effectively.
Allocation of Environmental Costs: BT Group plc is examining and executing frameworks that better amass and measure their past, present and future natural expenses identified with item costing. BT Group plc for the most part recognizes among three classifications of ecological expenses. These are expenses caused to react to: past contamination not identified with continuous operations; current contamination identified with progressing operations; and l future natural expenses identified with progressing operations (Solomon, 2007).
Life-Cycle Assessment: By coordinating ecological considerations into their products and procedures now, BT Group plc is deliberately positioning them for the subsequently century, when aggressive environmental management will be an imperative for business survival. BT Group plc concentrates on conforming to government regulations as well as on diminishing their corporate natural effects. BT Group plc is additionally applying different techniques and methods that energize a far reaching assessment of all “upstream” and “downstream” impacts of their exercises or items. For instance, Life-Cycle Assessment (LCA) to help BT Group plc to assess the support to-grave ecological weights and opportunities connected with their items, techniques or exercises (Visser, 2011).
For case, BT Group plc use LCA to help conquer any hindrance between enhanced representing existing inner ecological expenses and distinguish- of outside natural effects. Notwithstanding this, with the assistance of this procedure, BT Group plc distinguishes and evaluates ecological effects. This procedure assesses the natural impact of an item or movement comprehensively, by examining its whole life cycle. This incorporates distinguishing and evaluating vitality and materials utilized and squanders discharged to nature, surveying the ecological effect, and assessing open doors for development. In the same way, with the assistance of LCA, BT Group plc addresses natural effects in biological wellbeing, human wellbeing and asset exhaustion (Baumgartner, 2002).
Hierarchical Cost Analysis: On the other hand, according to this, strategy, BT Group plc develops a hierarchical costing method in order to identify, track and monitor environmental costs for the organization.
Activity-Based Costing: BT Group plc also used this costing as a part of request to allocate ecological expenses to items legitimately. With a specific end goal to get more exact and helpful data about their expenses, and given the weaknesses of customary expense bookkeeping frameworks, BT Group plc execute action based costing (ABC) for particular methodologies or frameworks that contain an expansive bit of the natural dangers and liabilities. It is on account of ABC is particularly important to ecological expenses due to the diffuse, long haul and less substantial nature of such a variety of natural expenses. Henceforth, utilizing ABC, BT Group plc distinguishes expense bearing exercises viably and to dispense expenses to individual items can help defend administrative choices (Löber, 2011).
Quantification and Monetization of Externalities and full environmental cost accounting: BT Group plc has made a corporate duty to utilizing full ecological expense bookkeeping as a part of its choice making. For the utility, full natural expense bookkeeping is an instrument that can help incorporate ecological contemplations into business choices. Aviva plc’s way to deal with full natural expense bookkeeping joins ecological and other inward expenses with information on the outer effects and expenses/advantages of the utility’s exercises on nature and on human wellbeing (Paetzold, 2010).
Investment Analysis and Appraisal: This is another management accounting technique and system that used by BT Group plc in relation to the social and environmental issues. For example, under this, different approaches are used by BT Group plc that offers significant improvements for environmental management. They include:
Total Cost Assessment: According to this methodology, BT Group plc characterizes and evaluations venture expenses and profits. It is on the grounds that, Total expense appraisal (TCA) enhances the choice making procedure for venture investigation and examination by guaranteeing that the information assembled incorporate ecological expenses both immediate and roundabout and natural dangers. Moreover, it likewise helps BT Group plc to examine the long haul expenses and investment funds of contamination aversion ventures. It considers a more extensive scope of expenses than does conventional speculation examination, including certain probabilistic expenses and investment funds. TCA uses full ecological expense bookkeeping systems to appropriately allocate natural expenses and funds to all contending tasks, items or methodologies (Sauerbrey, 2010).
Multi-Criteria Assessment: This technique is designed by BT Group plc to systematically assess choices as per numerous criteria that are in some cases measured on distinctive and/or non-commensurable scales. MCA is additionally utilized as a part of BT Group plc to analyze and assess “dissimilar to” natural and social effect data when the organization does not have a full scope of adapted effect information. For example, BT Group plc has utilized MCA to make exchange offs among ecological measures to recognize key pointers of natural effect/harm for consideration and assessment inside its corporate arranging procedure. BT Group plc additionally utilize MCA to think about and make exchange offs of ecological and different qualities.
Risk and Uncertainty Analysis: BT Group plc is focused on completely incorporating ecological contemplations into corporate life and perceives the significance of coordinating natural estimations into their execution assessment frameworks. This guarantees that announcements of ecological obligation enunciated by the CEO and in corporate statements of purpose are appropriately actualized (Tsamenyi & Uddin, 2009).
The company improves the ecological and social aspects of sustainability through waste separation in potential recyclables, glass, etc. The company also focused on sensible use of printer, copying machines, air conditions and reduces consumptions of technical equipment to save power consumption and protect environment. In the same manner, BT Group plc is likewise utilizing diverse methods and in addition routines so as to finish CSR capacity. Case in point, there are different projects and exercises directed by the organization for the social viewpoints. Notwithstanding this, utilitarian support is likewise utilized by the organization as a part of request to backing the legitimate and controlled procurement of merchandise and administrations. Aside from this, managed and legitimate procurements are likewise trailed by the organization in a viable and fitting way (Brennan, 2011).
Conclusions and Recommendations
On the basis of above discussion, it can be conclude that the company follow different process and use innovative techniques in order to fulfill objectives related with the CSR. In addition to this, it can also be summarized and suggested that, the company could better embed sustainability “within its DNA by using such techniques: Engaging, Signaling, Communicating, Managing talent, Reinforcing, Creating smart, integrated public policy, Build a national dialogue on responsible consumption, Communicate sustainability goals throughout the organization (Carroll, Lipartito, Post & Werhane, 2012).
For this paper, Aviva plc is selected that is a British multinational corporation engaged in insurance business and its headquartered is in London, United Kingdom. At the same time, it should also be noted down that, it has more than 31 million customers in approximate 16 nations of the globe. Moreover, it is also found that, it is also known as the largest company in the UK market. In the same way, the company is providing insurance product and services at the international level by satisfying the needs, wants and desire of customers effectively (Pohl and Tolhurst, 2011). On the other hand, it is also analyzed that, the company is also fulfilling its functions associated with the CSR in an innovative and more proper manner. For example, Moreover, Aviva plc also focuses on improving the ecological and social aspects of sustainability without jeopardizing economic success. Application from women is always welcome in the company and the company announces that gender anti discrimination law followed during the hiring new staff. The company also raising awareness in between the employees related to ecological and social aspect of sustainability (Forster, 2005).
In the context of this research paper, GRI regulatory framework is selected. Along with this, it should also be noted down that, GRI is one of the main and worldwide not-revenue driven associations that create viable and important system in the zone of maintainability reporting. Then again, it is likewise observed that, this association additionally assumes a basic part in reassuring and propelling the utilization of manageability reporting. For example, this free association conducts particular tenets on improvement and making of supportability so the association can consider it in their business exercises. In the same way, this association proposes the organizations that they ought to consider four territories of execution, for example, ecological, monetary, administration and social (GRI. 2014).
In the same way, GRI leads and make standard regulations and practices in the setting of manageability reporting which serves to support and direct change towards a supportable overall economy. A possible overall economy should combine long term advantage with good lead, social value, and common planning. A manageability report is a report circulated by an association or relationship about the monetary, environmental and social impacts brought on by its standard activities. A manageability quality report similarly displays the affiliation’s qualities and enactment illustrates, and demonstrates the association between its system and its commitment to a viable overall economy (GRI. 2014).
In the context of CSR, the company introduces the CSR report in more than one eighty six pages that describe major CSR functions, initiatives and other elements for the protection of green environment. It also focuses on sustainability accounting. In addition to this, the main target audiences of the company are customers, stakeholders and employees that play a major role in the total success of the company. On the other hand, it is also found that, the company also receives Tech4Good Awards 2015, European Sustainability Reporting Award, and Building Public Trust Award for sustainability reporting award (Idowu & Filho, 2008).
The Global Reporting Initiative (GRI) standards are used by AVIVAplc to assess the monetary execution and corporate social obligation execution. Also, it is additionally observed that, AVIVAplc deals and income is consistently expanded that demonstrates its great budgetary execution in the business. Additionally, in late time the AVIVAplc likewise concentrates on corporate social obligation and spotlights on representatives, individuals and society before taking the choice. It additionally considers the enthusiasm of all partners before making the strategy and method of the business that demonstrates to it attempt to satisfy its CSR. It appropriately takes after the Law, code of practices and morals identifies with business while run business and actualize any strategy that shows that AVIVAplc execution is likewise great regarding CSR (Global Reporting Initiative, 2013). In addition, it is also focusing on employees and providing those sufficient wages and good working environment (Keinert, 2008). Moreover, AVIVAplc adopts several practices to express its social and environmental accountability. These practices are discussed as below:
Society Relation: AVIVAplc implements community relation practices to display its social & environmental accountability in an effective way. In addition, AVIVAplc struggles to achieve social sustainability via maintaining a strong relationship with the society of the country. AVIVAplc also encourages its workers to work cheerfully for the welfare of the society. It also adopts an unambiguous policy to uphold its society relationships. Furthermore, AVIVAplc hubs on three community issues such as: Indigenous, Disaster assistance, Microfinance and also implements various strategies to solve this issues in an appropriate way (Mallin, 2009).
Environmental Sustainability: It is also the other practice that expresses social and environmental accountability of AVIVAplc. In addition, AVIVAplc focuses to realize sustainability in relation of the climate amends, stream and biodiversity effectually. The company has a policy that is helpful to renovate its system to a low carbon economy in futures. It also has several specific policies, governance facsimile & partnerships to diminish carbon secretion in an appropriate way. Moreover, AVIVAplc also has numerous specific strategies to deal with risks & other issues that are associated to climate change, rivulet and biodiversity. Building approach of climate risk management, diminishing straight footprint on the environment, environment congenial product & service, etc. are the other areas in which these adopted strategies play a vital role to exhibit social & environmental accountability of AVIVAplc (Mullerat and Brennan, 2005).
Sustainability in the Work: AVIVAplc considers sustainability objectives and its activities in all stages of the business for the effective operation of the business activities. For example, banking and investment & product and services are the major areas of the business. In addition, AVIVAplc implements precise principles to certify liability in lending from the banking as well as investment areas of the business. It also considers the credible collapse of the investment on the atmosphere. Apart from this, the company also presents products as well as incentives to the customer to be alert of environmental issues in an appropriate way (Perez & Leonard, 2013).
Sustainability Strategy: AVIVAplc also implements sustainability strategy in all phases of its business to express its social & environmental accountability in an appropriate & proper manner. Apart from this, the company’s sustainability strategy also nucleus on the emerging issues and also includes sustainable wealth construction, cultural & demographic amendment and environmental disputes, etc. to remove the environmental issue and to improve the social and environment accountability of the business organization effectively. Hence, AVIVAplc has been espouses several steps to accomplish sustainability and to expose its social and environmental accountability in a proper way (Samson & Daft, 2012).
Conclusions and Recommendations
On the basis of above analysis, it is recommended that, in order to improve a company’s external reporting practices, it should develop and use innovative strategies in relation to the CSR and sustainability. In addition to this, the companies should also focus on sustainability of the organization to prevent the risks of the business and also increase the revenues of the companies. Moreover, the company should also focus on the concept of corporate social responsibilities and sustainability to recover social & environmental recital of the business organizations in a proper way (Baumgartner, 2002).
References
Baumgartner, M. (2002) Corporate Social Responsibility and Corporate Citizenship – Business
Brennan, S. (2011). Corporate Social Responsibility: The Corporate Governance of the 21st Century. USA: Kluwer Law International.
Carroll, A.B., Lipartito, K.J., Post, J.E. & Werhane, P.H. (2012). Corporate Responsibility: The American Experience. UK: Cambridge University Press.concepts for the future!?. USA: Diplomarbeiten Agentur.
Cornelissen, J. (2011). Corporate Communication: A Guide to Theory and Practice. USA: SAGE.
Dhillon, G. (2002). Social Responsibility in the Information Age: Issues and Controversies. UK: Idea Group Inc (IGI).
Forster, N. (2005) Maximum Performance: A Practical Guide to Leading and Managing People at Work. USA: Edward Elgar.
Idowu, S. & Filho, W.L. (2008). Global Practices of Corporate Social Responsibility. USA: Springer. Investigation of Different CSR-Activities and their Effects on Customers. USA: Agentur.
Keinert, C. (2008). Corporate Social Responsibility as an International Strategy. USA: Springer.
Löber, H. (2011) Corporate Social Responsibility and Customer Integration -: An Empirical
Mallin, C.A. (2009). Corporate Social Responsibility: A Case Study Approach. UK: Edward Elgar Publishing.
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Paetzold, K. (2010) Corporate Social Responsibility: An International Marketing Approach. USA: Diplomica Verlag.
Perez, M.A.G. & Leonard, L. (2013). International Business, Sustainability and Corporate Social Responsibility. UK: Emerald Group Publishing.
Pohl, M. and Tolhurst, P. (2011) Responsible Business: How to Manage a CSR Strategy Successfully. USA: John Wiley & Sons.
Samson, D. & Daft, R.L. (2012). Management. USA: Cengage Learning.
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Shah, S. (2008). Sustainable Practice for the Facilities Manager. USA: John Wiley & Sons.
Solomon, J. (2007) Corporate Governance and Accountability. USA: John Wiley & Sons.
Tsamenyi, M. & Uddin, S. (2009) Accounting in Emerging Economies. USA: Emerald Group.
Visser, W. (2011) The Age of Responsibility: CSR 2.0 and the New DNA of Business. USA: John Wiley & Sons.
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