Our continued efforts are towards the creation of financial accounts that reflect our company’s financial, and social impact performance. We are creating accounting statements that transparently capture external impacts in a way that drives investor and managerial decision making:
- Impact can be measured and compared
- Impact should be measured within an accounting framework with the aim of harnessing our economy to improve our society and planet
- Transformational change requires that impact measurement be scalable
- To be scalable it needs to be actionable and cost-effective
Massive environmental damage, growing income and wealth disparity, stress, and depression within economies amid a substantial economic boom are examples of how our current system of creating and distributing value is broken. We need to be able to factor into our decision-making the consequences of our actions not only for financial and physical capital but also for human, social and natural capital. In the same way that accounting standards define which financial transactions to capture and how to account for them within financial statements, our accounting methodology reveals our firm’s overall value to society through its impact. Creating a GAAP and IFRS analogue for impact accounting pertaining to human capital development would generate benefits: transparency, comparability, accountability.