An example from Africa highlights the importance of definitions, objectives and time horizon in building sustainability into corporate budgeting and planning.Between 1990 and 1998, the prevalence of HIV in South Africa rocketed from less than 1% to more than 22%. In August 2002, Anglo American announced that it was making antiretroviral therapy (ART) available to its entire southern Africa-based workforce. Even the architect of the scheme, Chief Medical Officer Dr. Brian Brink, described it as "a leap of faith."But by July 2010, it was clear that the benefits of the ART programme far outweighed the costs. Providing ART to one worker for one month cost Anglo $126 but resulted in savings of $219.2
Healthy workers are part of a stronger and more equitable society. Of course, they are also a pre-requisite for getting the job done. Employing healthy workers gets more difficult in a community with a 22% incidence of HIV. Whether for noble sustainability goals or simply to maintain its workforce, Anglo American set having healthy workers as an objective. Reaching this objective meant providing ART to all affected workers, a move that would negatively impact profitability in the short term. It is doubtful that this initiative got an immediate, unanimous green light, for it was described as “a leap of faith.” Yet, accounting for the costs and benefits showed, eight years down the road, that the benefits outweighed the costs.3
In this case, being socially responsible, at least within the boundaries of the corporation’s workforce, made the organization more profitable. But, what if it hadn’t? Would or should Anglo American continue providing HIV medicine if it was a drain on profits over the long-term? The answer to this question depends on how one defines sustainability and how one sees the corporate role in its pursuit.
Thus, the most critical step, by far, is the definition of sustainability. Everything else flows from there.Additional resourcesResources for Practice
, Centre for Social and Environmental Accounting Research University of St. Andrews
The website offers guides to social, environmental and sustainability accounting and reporting.About the authorsDr. Nola Buhr
is Professor of Accounting at the Edwards School of Business, University of Saskatchewan, Canada. Her research focuses on accountability and her work includes environmental and sustainability accounting disclosure as well as accounting history. Nola has published widely and sits on seven academic editorial boards. She has been an active volunteer with the Canadian Institute of Chartered Accountants. She was Chair of the Public Sector Accounting Board, which sets accounting standards for all levels of government in Canada, and has been on multiple government audit committees, including for the department of Canadian Heritage and the department of Aboriginal Affairs and Northern Development Canada. She obtained her Chartered Accountant designation in 1988 and, before entering academia, worked for five years in public practice.Dr. Rob Gray
is Professor of Social and Environmental Accounting at the University of St. Andrews, Scotland. He is a qualified chartered accountant and was editor of Social and Environmental Accounting Journal
from 1991 to 2007. He is the author/co-author of over 300 books, monographs, chapters and articles. His books include Accounting for the environment, Financial Accounting: practice and principles
and Accounting and accountability: Changes and challenges in corporate social and environmental reporting.
He is Director of the Centre for Social and Environmental Accounting Research (CSEAR
). He was elected in 2004 as one of 14 founding members of the British Accounting Association Hall of Fame. He was awarded an MBE in the Queen’s 2009 Birthday Honours List and was elected to the Academy of Social Sciences in 2012.