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ABSTRACT
Environmental sustainability has gained importance across the globe due to the increased concern for externalities that companies' activities place on society. Government and other stakeholders are putting pressure on businesses for greater transparency regarding social and external performance and impacts. Accountants have an important role to play in identifying, measuring and allocating sustainability-related costs, developing and reporting sustainability performance metrics and helping corporations formulate and implement environmental strategies. The purpose of this paper is to provide insight into contemporary understanding of the new dimension of accounting for sustainability.
CORPORATE SUSTAINANBILTY
In recent years, sustainable development has become a significant part of the objectives of many organizations. In general, corporate sustainability can be considered as a broad approach, integrating financial, economic, environmental, and social aspects that can assist firms achieve a more holistic level of accountability (Schaltegger and Burritt 2005). The United Nations (UN) World Commission on Environment and Development gave the initial definition of the term, "the ability to meet the needs of the present without compromising the ability of future generations to meet their own needs," (Bruntland, 1987). Dixon and Fallon (1999) describe the development of sustainability concept, from single resource, to the multiple resource ecosystems, and expanded to integrated social-physical-economic systems. They provide an operational definition of sustainability as six socio-economic questions:
* How should equity, both intergeneration and intergenerational, be handled with respect to resource management decisions?
* What do we leave to future generations to ensure that they are not worse off?
* Will there be enough to go around?
* How far into the future do we worry about (next week, next year, next century)?
* Are there some patterns of resource use that should be accepted irrespective of losing or saving the resource?
* To what extent can market forces (and technology) intervene in the process of development vis-a-vis resource use (the conservationist versus possibilist debate?
CORPORATE SUSTAINABILITY AND ACCOUNTING
Gray (1992) provides a structured view of sustainability, as a theoretical foundation to "sustainability accounting" based on a systems view of the environment. Initially, the relationship between management accounting and economics fails to notice the environment and biosphere as relevant to costing. Birkin and Woodward (1997) define essentials to move management accounting from its economic basis...