Embedding Sustainability into Management Decision-Making
Submitting Institution
Royal Holloway, University of LondonUnit of Assessment
Business and Management StudiesSummary Impact Type
EconomicResearch Subject Area(s)
Commerce, Management, Tourism and Services: Accounting, Auditing and Accountability, Business and Management
Summary of the impact
Collaborative research into sustainability management has led directly to
enhanced embedding of
sustainability considerations nationally and internationally in an
individual company and
professional organisations. The research has positively impacted the
embedding of sustainability in
decision-making within a supply chain of Sainsbury's. It has informed the
practices and policies of
professional accountancy bodies (such as ACCA for their small and medium
sized accounting
practitioner membership) and international bodies developing
sustainability accounting guidelines
(such as the International Integrated Reporting Council (IIRC)).The
portfolio of research has led to
the development of resources that have enhanced professional practice and
understanding in
decision-making and managing for sustainability.
Underpinning research
The School of Management has a long-standing record of research into a
range of aspects of
sustainability management. Underpinning the impacts presented here is
research undertaken by
the following members of the Centre for Research into Sustainability:
Unerman (Professor of
Accounting and Corporate Accountability, at Royal Holloway from 2005 to
2009, and again from
2011 onwards); Spence (Professor of Business Ethics, at Royal Holloway
since 2008); O'Dwyer
(Professor of Accounting, since 2006), Agyemang (Senior Lecturer in
Accounting, since 2005) and
Rinaldi (Lecturer in Accounting, since 2006). Underpinning research has
examined:
-
The roles that accounting policies and practices do and can play in
embedding sustainability
into decisions taken at all levels of management. Spence and
Rinaldi completed case study
research (between 2009 and 2012) on the role of accounting in embedding
sustainability
considerations into decision-making in the lamb supply chain at
Sainsbury's (publication 4).
Governmentality theory enabled the explication of the fine-grained
processes of influence and
control inherent in the practical endeavour to embed sustainability in
organizational decision-making
and extend it through the lamb supply chain. This built on an earlier
case study on
Waitrose (for which Spence completed the empirical work and analysis
before joining Royal
Holloway), in which a new conceptualization of supply chain
responsibility was presented,
taking into account the SME supplier perspective and a partnership
approach (publication 3,
published after Spence joined Royal Holloway).
-
The legitimacy of, and motivations underlying, corporate social and
environmental reporting/
disclosure practices. For example, from 2007 to 2010 O'Dwyer and
Unerman (with Owen from
Nottingham University) undertook research examining aspects of how
sustainability assurance
has gained legitimacy (publication 2). This research developed
legitimacy theory within
sustainability accounting research, and used this theoretical framework
to explain processes of
organizational accountability and their relation to sustainability
policies, practices and impacts.
-
The case for regulation of corporate social responsibility and
accountability. For example,
Unerman and O'Dwyer in 2007 theorized the role that business case
reasoning could play in
the acceptance of greater regulation of Corporate Social Responsibility
(CSR) and
accountability practices (publication 5).
-
Sustainability management suitable for small and medium sized
enterprises. For example,
between 2011 and 2013 Spence (with Swiss partners Baumann-Pauly, Wickert
& Scherer —
publication 1) developed a theoretical framework for understanding CSR
implementation in the
context of differing cost structures for large and small firms. Building
on this theoretical work,
Spence, Agyemang and Rinaldi in 2011 and 2012 undertook practice
orientated research on
the role that SME accounting practitioners may have as sustainability
advisors for their SME
clients, published as a professional report for ACCA (source 5).
References to the research
1. Baumann-Pauly, D., Wickert, C., Spence, L. and Scherer, A. (2013)
Organizing Corporate
Social Responsibility in Small and Large Firms: Size Matters, Journal
of Business Ethics. DOI
10.1007/s10551-013-1827-7.
2. O'Dwyer, B., Owen, D. and Unerman, J. (2011), 'Seeking legitimacy for
new assurance forms:
The case of assurance on sustainability reporting' Accounting,
Organizations and Society,
36(1), pp. 31-52.
3. Spence, L. and Bourlakis, M. (2009) `From CSR to SCR: The evolution of
Supply Chain
Responsibility: The Case of Waitrose', Supply Chain Management: An
International Journal.
14(4), 291-302.
4. Spence, L.J. and Rinaldi, L. (2012) Governmentality in Accounting and
Accountability: A case
study of embedding sustainability in a supply chain, Accounting,
Organizations and Society.
DOI 10.1016/j.aos.2012.03.003.
5. Unerman, J. and O'Dwyer, B. (2007), `The business case for regulation
of corporate social
responsibility and accountability', Accounting Forum, Vol 31, No
4, pp. 332-353.
The following grant funded some of the research: Association for Certified
Chartered Accountants
£20,000. Environmental Aspects of Sustainability, SMEs and the Role of the
Accountant. Spence,
Agyemang and Rinaldi. Awarded March 2011.
Details of the impact
In 2011, Spence and Rinaldi's research fed into direct contributions to
developing Sainsbury's
supply chain sustainability management practices (source 1). Sainsbury's
used insights from this
research — including highlighting the different approaches to, and
interpretations of, sustainability
throughout the supply chain — to enhance learning and understanding about
sustainability
management at all levels of the company, up to the CEO, and implemented
this into their own
practices and through their supply chain. Sainsbury's Director of Brand
notes:
"I think what [this] gave us was the confidence to approach what we
would see as very complicated
supply chain work. In breaking it down into manageable chunks in a very
analytical and scientific
way and that was very valuable to our understanding and consequently the
changes that we have
made to improve those supply chains and make them more sustainable".
Research into sustainability management led to an invitation in January
2009 from The Prince's
Accounting for Sustainability Project (A4S) for Unerman to co-lead (along
with the late Professor
Anthony Hopwood and the Executive Chairman from PWC) a series of
practitioner-oriented case
studies to guide organisations in developing and implementing policies and
practices to help
embed sustainability considerations into decision-making at all levels.
The resulting book (source
7) has been used as a resource across a range of professional and
commercial organizations to
help enhance understandings among their staff of the significant role that
innovative accounting for
sustainability mechanisms can and do play in identifying and realizing
sustainability-related
opportunities and identifying and reducing sustainability-related risks
(sources 2 and 7):
"Insights from the research ... provided valuable learning both in
terms of next steps for A4S's
work to develop practical approaches to accounting for sustainability
and to organisations seeking
to learn...." Executive Chairman, A4S (source 2).
The research by Spence and Rinaldi at Sainsbury's also informed A4S's
approach:
"The case provided important insights in particular around use of
language, context for achieving
action and the role of different actors within the supply chain which
have informed subsequent A4S
research and continue to be some of the most important areas where
greater insight and action is
needed. Most significantly, the research has provided a vital input to
frame A4S's work to establish
the International Integrated Reporting Council (IIRC) and develop an
international integrated
reporting framework. This work is having a significant impact globally
to change corporate reporting
so that `mainstream' reporting brings together material information
about an organization's
strategy, governance, performance and prospects in a way that reflects
the commercial, social and
environmental context within which it operates." Executive Chairman,
A4S (source 2).
Professional accounting bodies, leading companies and public sector
organizations are investing
considerable resources into developing sustainability accounting practices
and guidelines. Spence,
Agyemang and Rinaldi's 2012 analysis of SMP-SME relationships (source 6)
has been
incorporated into policy making by the commissioning professional body
(ACCA), who have stated
that the research:
"had a genuine impact on our understanding of our members'
willingness, confidence and level of
skills in this area, and therefore an important basis from which ACCA,
and other professional
bodies, can start to address this more actively in the future."
(source 5)
The report's findings form the basis of ACCA's policy and practitioner
recommendations for
Embedding Sustainability in SMEs (source 9).
The research has also contributed to changes in policies affecting the
accounting profession, and
by extension accounting practices in business organizations globally,
through its initial influence on
the development of integrated reporting. This is noted by the Executive
Chairman of A4S who is
also a member of the IIRC Board (source 2). The IIRC is a global coalition
of regulators, investors,
companies, standard setters, the accounting profession and NGOs that is
developing global
integrated reporting guidelines. Insights from the research were one input
informing A4S's work to
launch and shape the IIRC (source 2).
The SME-related research led to the development of a tool to help SMEs
embed sustainability
considerations into decision making (source 3) along with the ACCA report
(source 6) that has
made a difference to recommendations made by intermediaries (such as the
Network for Business
Sustainability (NBS) and ACCA) seeking to promote sustainability (sources
3, 4, 9).
"The Primer has been disseminated to our 3,000 subscribers from
industry and academia; viewed
and shared by NBS's 1,400 Twitter followers; and viewed more than 645
times on our website. The
Primer has also been featured in the Guardian; Living Planet @ Work, the
newsletter for World
Wildlife Fund Canada; and Sustainability Learning Centre, a Canadian
management training
program in sustainability." Managing Director, NBS.
The report on research on SMEs (source 6) includes recommendations for
both small and medium
sized accounting practitioners and the accounting profession. The report
has been widely
discussed within ACCA (source 5), and has been presented to the Global SME
Forum and the
International Federation of Accountants. The research has been recommended
as a resource
through other practitioner publications such as the European Commission's
CSR Handbook for
Small Business Advisors and ACCA's Embedding Sustainability in
SMEs (source 8, 9).
Sources to corroborate the impact
- Video testimonial, from Head of Brand at J. Sainsbury PLC., a
participant in the process of
impact delivery (see http://www.youtube.com/watch?v=wPL9yLLz7Cg)
referring to the
Accounting for Sustainability: Practical Insights research. This
source corroborates the
application of insights arising from research by Spence and Rinaldi to
the development of
Sainsbury's supply chain sustainability management practices.
- Testimonial from Executive Chairman A4S, a participant in the process
of impact delivery. This
source corroborates the importance of the contribution made by Royal
Holloway staff to the
A4S project, particularly the framing of A4S's work to establish the
IIRC, and its subsequent
impact on global corporate practice.
- `Primer: Business Sustainability for SMEs' published by the NBS. This
source corroborates the
development of the primer tool and its publication by the Network for
Business Sustainability
(NBS) Available here: http://nbs.net/knowledge/primer-business-sustainability-for-smes/
- Letter of endorsement from the Managing Director of the NBS. This
source further
corroborates Prof Spence's contribution to the Network for Business
Sustainability (NBS) and
confirms dissemination of the primer tool.
- A testimonial from the Head of SME Policy at ACCA, who is a
participant in the process of
impact delivery. This source corroborates how the research undertaken by
Royal Holloway
staff has impacted on the work of ACCA and the accountancy profession
more generally.
- Spence, L.J., Agyemang, G. And Rinaldi, L. (2012) Environmental
Aspects of Sustainability:
SMEs and the Role of the Accountant. Association of Chartered Certified
Accountants, London.
This source corroborates the findings of the research undertaken on
behalf of the ACCA and
subsequent recommendations made for small and medium sized accounting
practitioners.
http://www.accaglobal.com/content/dam/acca/global/PDF-technical/small-business/rr-128-001.pdf
- Corroboration of the practical impact of `Accounting for
Sustainability: Practical Insights',
Earthscan, 2010, from a number of business and professional body Chief
Executives, such as:
J Sainsbury plc; Chartered Institute of Management Accountants;
Association of Chartered
Certified Accountants; Institute of Chartered Accountants in England and
Wales, Chartered
Institute of Public Finance and Accountancy and the BT Group plc
Chairman. (See `reviews'
tab at: http://www.nhbs.com/accounting_for_sustainability_tefno_174343.html)
- European Commission: CSR Handbook for Small Business Advisors,
`Environmental Aspects
of Sustainability: SMEs and the Role of the Accountant' report is
recommended for Developing
a CSR Roadmap for SMEs. This source corroborates the referencing of
Spence, Agyemang &
Rinaldi's ACCA report (source 6) in a European Commission accounting
practitioner
publication. Available from http://ec.europa.eu/enterprise/policies/sustainable-business/files/csr-sme/tips-tricks-csr-sme-advisors_en.pdf
- Report on `Embedding Sustainability in SMEs' (2012) by ACCA presented
to the ACCA Global
Forum for SMEs, draws extensively on `Environmental Aspects of
Sustainability: SMEs and the
Role of the Accountant' report. This source corroborates the direct
influence of source 6 in the
development of the ACCA's policy on sustainability and SMEs through the
work of the ACCA Global
Forum for SMEs. Available from: http://www.accaglobal.com/content/dam/acca/global/PDF-technical/pol-tp-esis-v1.pdf