Contemporary Accounting Practice and Sustainability Report Australia

Question: Discuss about the Contemporary Accounting Practice and Sustainability Report. Answer: Purpose of the sustainability report Particularly, Australia lacks an mandatory requirement on the whole for sustainability reporting and the levels of sustainability reporting essentially in Australia continue to remain behind different comparable nations such as UK, Germany as well as Japan. Analysis shows that around 30% of the top 500 corporations of Australia publish or are anticipated to declare sustainability reports during the period 2006. However, this result persists on a 16 year increasing trend. The four industry segments that essentially dominate the position of the AXS 300 including business services/products, finance as well as insurances along with manufacturing present their sustainability reporting. However, majority of the corporations that is around 70% presenting the sustainability declarations align their reports or draw reference to the GRI guidelines that is a worldwide voluntary structure for particularly sustainability declarations (Fonseca et al. 2014). As rightly indicated by Sustainability reporting can be considered as the exercise of enumerating, divulging, and being answerable to internal as well as external stakeholders for institutional performance towards the objective of development of sustainability (Hahn and Llfs 2014). Essentially, Sustainability reports grounded on GRI Reporting Structure aids in disclosing outcomes as well as results that happened within the period of reporting particularly in the context of commitments of the organization, strategy, and approach of the management (Bebbington et al. 2014). The GRI framework is a generally accepted structure for sustainability reports that explains what to report and how to report and abide by the protocol, directives and guidance as well as standard disclosures. As such, code of ethics for particularly expert Accountants initiated during 2006 and modified in 2008 acknowledged by APESB Accounting Professional and Ethical Standards Board specifies the obligations for bus iness enterprises to adhere to the GRI- (Global Reporting Initiative). Essentially, an inspection carried out by KPMG reveals that majority of the business enterprises employ the GRI (global reporting initiative) and utilizes the GRI guidelines specifically the G3 directives for sustainability coverage (Ioannou and Serafeim 2016). According to global reporting initiative (GRI), it can be mentioned that sustainability coverage can help out in widespread analysis of potency along with limitations, stakeholder participation that is vital for sustainability coverage. As such, this can assist in advancing vision and institutional strategy. In essence, sustainability reporting helps in communication of diverse credible, pertinent information to a wide range of stakeholders counting members of the staff, financiers as well as potential clientele of the corporation (Buhr et al. 2014). The breadth of the subject matter discussed within the scope of sustainability reporting lead to the develo pment of encyclopaedic pronouncements that can be used by the users and add values to overall business operations of the corporation (Hahn and Khnen 2013). Thus, this exercise assists in developing trust by preserving transparency as regards non-financial performance as well as initiating discussion with stakeholders that sequentially can aid in reduction the reputational risk. Stakeholders interested in the sustainability report In essence, business firms make use of sustainability reporting for adding up values to diverse operations of the business corporation by maintaining transparency as regards non-financial presentation, initiating open conversation/dialogue with diverse stakeholders. Essentially, inclusiveness of all the stakeholders can be considered to be a very important aspect of GRI structure (Lozano 2013). As such, a sustainability report might not essentially involve stakeholder engagement by itself; however stakeholder engagement sure can necessarily utilize the content of the report. The main stakeholders in this case are workers, government as well as different agencies, shareholders or else the owners of the firm, creditors, consumers and suppliers, different unions, along with the community from where thebusinesspulls its resources (Junior et al. 2014). Accordingly, the system of Sustainability pronouncements can be observed as a course of presenting important information by which various stakeholders of the firm can evaluate economic with social values along with environmental policies of a business. This can necessarily assist in appropriate internal management, enhanced process of decision making with the intention of lessening of expenses by suitable supervision, analysis of varied problems specifically energy utilization, exploitation of raw materials in addition to proper waste management (Alonso?Almeida et al. 2014). As per GRI, sustainability reporting can aid in suitable analysis of strength as well as weakness and assist in stakeholder engagement that is mandatory for proper sustainable reporting. However, this system of reporting can facilitate in lessening of cost of conformity by appropriate enumeration of sustainability performance that in turn can assist business enterprises to meet up diverse regulatory necessities efficiently, avert breaches and collect requisite data effectively. Significant difference between the sustainability reports Comparison between the sustainability reports of Wesfarmers and BHP Billiton According to the sustainability reports of the corporation BHP Billiton declared during the 2016, the firm values take in its sustainability, reliability, esteem, presentation, simplicity as well as accountability (BHP Billiton 2017). However, this business enterprise generates and takes into consideration social and economic values along with environment factors that deliver competitive benefits to the business concern (Lozano 2013). Analysis of the sustainability structure of BHP Billiton also involves sustainable development together with risk management that essentially directs the policy and strategy of the firm both within the domestic and regional communities. Furthermore, the sustainability reportage of BHP Billiton is essentially associated to the operated resources. In addition, BHP Billiton also carve up stewardship of regional cultures and contribute towards environment as well as financial development. Evaluation of sustainability reports of the corporation also reveals that that sustainability governance is highly synchronized by the system that is linked to health and safety, societal as well as environmental influences (). The report also reflects the commitment of the firm to conform to the directives and regulations of the specific country in which the business operates. Reports also divulge that the Operations Management Committee (OMC) of BHP Billiton assumes important decisions relating to the governance of sustainability within the corporation (BHP Billiton 2017). Again, the OMC is also accountable for regulating, scheduling as well as directing all the functions of the business concern. Analysis of the sustainability reportage of the firm also reflects that the sustainability approach of the business concern comprises of different principles in addition to enforced requirements of the condition pronouncements of particularly International Council on Mining and Metals Sustainable Development Framework as well as the Voluntary doctrine on H uman Rights as well as Security (BHP Billiton 2017). In addition, BHP Billiton dynamically is engaged with joint venture partnerships with firm with sustainable development of the framework of formal governance as well as technical interactions. Again, the precedence of the sustainability structure of the corporation BHP Billiton is essentially the administration and detection of risks associated to materiality that are built-in inside business operations, as well as procedures. The report also states that the internal audit operation essentially analyses the functioning as well as design efficiency of the course of sustainability of the corporation yearly (BHP Billiton 2017). On the other hand, the sustainability reports of the corporation Wesfarmers Limited reveal that the firm persistently generates values for future operations of the firm. In essence, the company devotes its attention towards proactive management of the overall environment as well as community in which it functions. Analysis of the sustainability report of the firm Wesfarmers Limited reflects that the company focuses on its people and relentlessly concentrates on delivering safe place for working (Sustainability.wesfarmers.com.au 2017). Addition to this, the management of the firm manages the diversity of the workplace and the concentrates on developing inclusive workplace environment by consideration towards maintenance of gender diversity along with proper addition of Aboriginal over and above people from the Torres Strait Islander. However, sustainability pronouncements of the business also stresses on the sourcing procedure of the firm. The sustainability declaration made by the fi rm refers to the process of sourcing that refers to ethical souring procedures undertaken by the firm Wesfarmers Limited. Reports also reveal that the company engages in maintaining strong and enduring relationship with the suppliers and attempts to find ways of sourcing in an accountable manner by properly functioning with other suppliers and enhances the social along with environmental exercises (Sustainability.wesfarmers.com.au 2017). Comprehensive assessment of the sustainability report also replicates the fact that the management of the retail business enterprise adds certainly to the society by taking into consideration product safety in an effective manner. Addition to this, management of the corporation Wesfarmers Limited also strives towards lessening of the emissions and enhancing the resilience to changes in climatic. Besides this, reducing use of water as well as proper management of waste for the land filling is also taken into consideration (Sustainability.wesfarmers.c om.au 2017). Apart from this, Wesfarmers Limited also attempts to preserve strong corporate governance schemes in different aspects of business functions. Wesfarmers Limited also commit towards creation of value for its prospective shareholders, societies along with employees functioning in a business concern. However, this corporation believes in generation of long-term value and serving to communities in best feasible ways. Sustainability reporting in accordance with GRI guidelines Sustainability Reporting, in accordance with the GRI Guidelines need to be made mandatory as this can help to present a generally accepted structure for covering on an firms economic as well as social performance and environmental influences. Essentially, this framework contains the Sustainability Reporting Guidelines, specific Indicator Protocols along with Technical Protocols, and certain Sector Supplements that can help the readers of the report to gain clarity regarding contents of the report. References Alonso?Almeida, M., Llach, J. and Marimon, F., 2014. A closer look at the Global Reporting Initiativesustainability reporting as a tool to implement environmental and social policies: A worldwide sector analysis.Corporate Social Responsibility and Environmental Management,21(6), pp.318-335. Bebbington, J., Unerman, J. and O'Dwyer, B., 2014.Sustainability accounting and accountability. Routledge. 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