Accounting is widely regarded as the language of business; however, its impact is goes far beyond the business world and extends far into all of our lives.
Accounting and business reporting commonly – and incorrectly – assumes that value is best expressed in financial terms. They also assume that value is determined by so-called “fair markets”where goods and services are priced accurately and in good faith.
These ideological biases mean that more of our lives are understood primarily in monetary terms people and the environment are treated as commodities. Values increasingly no longer exist outside the financial domain.
Accounting and the mysterious language of accountants are important to all of us; citizens cannot leave reporting to the accounting profession their assumptions about who and what is important. They assume that profits are good no matter how they are created, but worker well-being and environmental degradation are irrelevant.
Conveniently, accountants are seen as too technical to be understood by the average person; that way they don’t have to justify their decisions. Recent proposals on sustainability reporting for all major Canadian organizations, this reflects and should concern us all.
Sustainability reporting – sometimes called ESG (environmental, social and governance) reporting – requires organizations to publicly report on a wide range of performance goals, not just profits.
Read more: What is sustainability accounting? What does ESG mean? We have answers
Sustainability reporting is useful for employees, customers, citizens and governments to assess the impact and sustainability of an organization’s activities. The most popular ESG reporting system, developed by the Global Reporting Initiative (GRI)highlights environmental issues, employee well-being and the social contributions of organizations.
But in recent years, the international accounting profession, led by the International Sustainability Standards Board (ISSB)has created its own set of rules focused solely on the needs of investors.
This issue has recently come to a head in several countries, including Canada. The Canadian accounting profession supports the ISSB and is dramatically proposing to expand it neoliberal approach to every major organization.
Last December, the Canadian accounting profession quietly released their report consultation document on setting sustainability standards in Canada.
There are clearly some positives: it makes some welcome gestures regarding diversity, equality and inclusion, it proposes to make standard setting independent of the accounting profession, and it appeals to the public interest.
But the consultation document does not provide a definition WHO that is public, nor does it offer substantive proposals in any of the areas mentioned above. It also ignores indigenous and feminist perspectives questions the core of the accounting definitions of assets and liabilities.
As an expert in the field of government policy Marilyn Waring noted this decades agoIf women really counted, then unpaid labor, clean water and air and beautiful landscapes would also count. Canada is increasingly recognizing this the need to reflect and publicly discuss the important role of language as an instrument of colonization and repression.
Language guides our thinking, and the language of business is no exception. Sustainability reporting is an invitation to start discussions about the way accounting language exists structures society and makes important aspects of life invisible.
The Canadian accounting profession does always prioritized the views of men and colonists, meaning it prioritizes private property and market transactions. Despite all the talk, the consultation document is aimed at ensuring that the ISSB’s financial perspectives are implemented in Canada.
The proposed sustainability standard board aims to reflect the ISSB as shown in the terms of reference section of the consultation document. The country does not recognize its own financial, gendered, colonial biases and ignores multi-stakeholder approaches such as the GRI. Instead, it paves the way systematic greenwashing.
The Canadian standards will apply to all significant organizations, not just publicly traded organizations. Sustainability reporting, as defined by the ISSB, puts pressure on governments, government organizations, nonprofits and most corporations to focus on investors and bankers while ignoring the concerns of everyone else.
Canadian accountants’ dismal neglect of the public interest ignores the impact these standards will have on future generations and on the planet’s ability to meet the needs of our children.
Now is the time to act
The rules of the Canadian Sustainability Standards Board will eventually find their way into legislation and regulations. The most inclusive and sensible approach to encouraging true sustainability and inclusivity is a multi-stakeholder perspective, including the general public.
But without public intervention and outcry – and without public demands that the accounting profession do something different – people in Canada will be left with ESG rules that focus on investors, not the public.
It is important that people in Canada make their voices heard and let the accounting profession (and government) know that inclusive sustainability regulations are essential for Canada. Anyone can respond to the consultation process until March 31.
The future of ESG reporting and the future of sustainability in Canada are at stake. Who makes the rules and which stakeholders are taken into account when establishing the rules is very important.
Sustainability reporting rules will impact the disclosures required for organizations. This, in turn, will impact decisions and actions related to sustainability, which impact Canadians.