Redressing the Balance - Driving Sustainable Corporate Strategies

Based on a global survey, the report explores the views of Chartered Global Management Accountants (CGMAs) and their involvement in corporate sustainability, in particular integrating relevant environmental and social factors into the information and analysis they give decision makers.

A new research shows that management accountants are poised to help their companies develop more sustainable business practices, but they frequently lack the mandate to do so.
 
It is becoming more and more important for organisations to consider environmental and social issues, as sustainable value creation and business resilience increasingly depend on these non-financial factors.
 
Although the world of finance might not traditionally be associated with sustainability, management accountants – with their unique skills and oversight across the business – are ideally placed to provide robust data and insights about the impact of environmental and social issues on business performance including measuring the organisation’s impact on the environment and society.
 
But are these skills being used to the best advantage? To find out how engaged management accountants currently are in sustainability, we commissioned a worldwide survey of 1,100 Chartered Global Management Accountants (CGMAs) and 800 CIMA students.
 
Our main findings are:
  • CGMAs clearly understand the business case for sustainability, with more than two-thirds agreeing that there are significant financial and commercial benefits from integrating environmental and social factors into organisational decisions.
  • The majority (60%) believe that it is their responsibility as management accountants to include relevant environmental and social factors in the information and analysis they give decision makers.
  • There are distinct differences in the attitudes of management accountants across the globe, with those in Africa and Asia Pacific more likely to understand the business case for sustainability and to take responsibility for analysing environmental and social factors.
  • In practice only 45% of CGMAs currently include sustainability issues in their reports to decision makers. Three-quarters of these respondents do so because they believe sustainability impacts on cost, risk and value and, ultimately, on the company’s financial performance.
  • The resounding reason for not reporting on sustainability is a lack of corporate mandate, with 60% saying there is a lack of demand from decision makers and a third stating that it is not part of their role or job remit.
  • However, demand from the top looks set to change as more companies recognise the importance of adapting to societal and environmental change.
  • More than two thirds of CGMAs agree that their organisations will expect them to provide increasing amounts of environmental and social data in the next couple of years.
  • This is good news for CIMA students – the next generation of management accountants – who are even more dedicated to, and involved in, corporate sustainability than current members.

 

Conclusion and next steps

 

To ensure sustainable, long-term business success, as well as to safeguard the planet, it is vital that finance professionals are fully prepared to advise on sustainability issues.
 
Management accountants can support sustainable value creation by using their unique attributes to make the business case for sustainability and to analyse and report on relevant social, environmental and economic data. Yet our research shows that management accountants’ involvement with sustainability strategies could improve. As a result, companies are missing out on valuable analysis and insight.
 
To help decision makers make better use of management accountants’ skill set, we have compiled a short guide outlining their role in sustainability (see page 12). By referring to this tool and tapping into their skills and insights, senior managers can begin to involve accountants in all levels of their organisation’s sustainability work. Management accountants themselves need to be more proactive – collaborating with sustainability colleagues, assessing and promoting the business case for sustainability, and steering decision makers towards a more socially, environmentally and financially secure future.
 

CLICK HERE TO READ THE FULL REPORT

 

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