Accounting for co-operative purposes: Reclaiming the conversation

Co-operatives, built on mutuality, present a challenge to the dominant paradigm of the investor-oriented business. It is difficult, if not impossible, to understand and explain co-operative activities properly in the language of returns on financial investment. This paper argues that we need to develop an accounting which facilitates understanding co-operatives on their own terms; an accounting which would allow cooperatives to reclaim the conversation about the sort of society we want to build together from the debates about returns on investment. This paper sets out to explore and champion the possibility of the co-operative movement developing a specifically co-operative oriented format for financial accounting and reporting which would allow cooperatives to differentiate themselves from both investor-oriented businesses and philanthropic organisations: a statement of recommended practice (SORP) in accounting and reporting for co-operatives. Reporting under such a SORP would allow co-operatives to recognise their fundamental principles of participation, mutuality, democracy and community through membership as opposed to investor supremacy or philanthropy whilst still complying with international financial reporting standards (IFRS). This paper uses the SORP in accounting and reporting for charities in the UK as an example of how a very different approach to accounting (concentrating on the organisational purpose) can be, and actually is, accommodated under IFRS in order to explore what can be learnt for co-operatives

Beyond accounting for capitals : FairShares – a model for recompensing capital contributions

Our current organisational structures, in both the commercial and the charitable sectors, suffer from a democratic deficit which acts as a barrier to the creation of a more equal society. The FairShares Model incorporates a straightforward process to recompense providers of non-financial capital to organisations. By doing so, it addresses questions of power and control that are left unanswered by methods which simply measure different sorts of capital used and/or generated by organisations. It is currently primarily concerned with adequately recompensing intellectual, human and social capital contributions in line with financial, and to enhance the management of natural capital through commitments to social auditing

To profit or not to profit? That is the wrong question

In social economy research, the issue of ‘profit’ (whether to make and/or distribute it) is a dominant framing concept. We argue that this dominance (even negatively referenced) maintains the hegemony of financial capital and the ‘for-profit’ paradigm. By refusing to accept a definition that labels organisations in terms of what they are not, scholars of co-operative development, social enterprise and voluntary action can better understand the value-creating activities of third sector organisations (TSOs) on their own terms. We argue that scholars and policy makers are complicit in maintaining the dominance of financial capital and the for-profit paradigm when they adopt for-profit/non-profit language in debates about their field. The counter-narrative we offer is based on engagement with work from the International Integrated Reporting Council (IRC) and FairShares Association (FSA). By comparing six capitals defined by the IIRC with the FSA’s statement on ‘six forms of wealth’, we offer a new way to account for the wealth creation of co-operatives, (other) social enterprises and voluntary associations. This ‘for-purpose’ framework for TSOs “reclaims the conversation” by identifying the wealth creation of social enterprises in comparison with the wealth destruction of private companies locked into chrematistic accounting and reporting practices which focus on the pursuit of profit for its own sake. This allows the fundamental differences between for-purpose enterprises (primarily social) and not-for-purpose businesses (primarily financial) to be clearly articulated

Meeting the information needs of charity trustees: can Enterprise Performance Management Systems help?

Third Sector Organisations (TSOs) have multiple purposes, i.e. financial stability as well as their mission, often operate in complicated circumstances and report to multiple stakeholders. This paper shows that information is not being used as effectively as it could be for regulation and performance management in this sector. A preliminary study of secondary cases indicates that Enterprise Performance Management (EPM) systems could help to address this problem, because of their capabilities to combine, and subsequently analyse, data from various, internal and external, sources. Further interdisciplinary investigation of current practice and potential developments for the use of EPM in charity reporting and performance management is proposed with the expectation that this could enhance effectiveness in the sector

Financial accounting for the common good – from a social economy perspective

This thesis is a pragmatic exploration of concepts to be found in social economy organisations with a view to improving the connection between financial accounting practice and organisational impact in the social and physical world. It approaches financial accounting from a social economy perspective. The research draws on ideas from Aristotle, contrasting the pursuit of wealth for its own sake – chrematistics – with the pursuit of the wise allocation of resources towards a good society in which people can flourish – economics. It also uses Kantian concepts of creative agency and experience as essentially limited and emergent, to discuss the inevitability of diverse views of flourishing. The study develops through three stages. First, there is a qualitative case study exploration of ideas of purpose found in a range of social enterprises. Second, there is analysis of the findings using theories drawn from development studies and sociology. Third, there is a discussion of the implications for current practice in accounting for financial resources, specifically contrasting not for profit accounting with for profit accounting. The findings suggest that the social economy accommodates myriad possible purposes, both macro and micro, within and between organisations, with the organisational macro purpose acting as the internal orchestrator of other priorities. Our current not for profit formats and systems for financial accounting, if understood in non-philanthropic, multiple macro and micro purposes terminology, provide a starting point for the development of financial accounting as a tool for Aristotelian economics; for the allocation of resources to meet diverse needs and interests. The study contributes to critical accounting research, particularly the strand focused on flourishing, from the perspective of the social economy. It shows that the multiple purposes approach, by accommodating choice of organisational macro purpose, can encompass profit as a macro purpose but the for profit approach is too narrow to accommodate any other purpose. It demonstrates that we already have in practice a broader, more flexible way of accounting for financial resources than for profit accounting, and suggests that this approach should be recognized and further developed

Wealth, Social Enterprise and the FairShares Model

This conceptual and empirical paper explores how the fields of social enterprise (SE) and sustainable development (SD) problematise the concept of wealth and reframes it to include non-financial outcomes. Using discussion documents published by the International Integrated Reporting Council (IIRC) and FairShares Association, we articulate an argument that wealth can be conceptualised as access to six forms of capital (natural, human, intellectual, social, manufactured and financial). We deploy this framework to investigate the wealth creating capabilities of different types of SE, then apply it to a case study of Resonate Co-operative Ltd. Resonate was chosen on the basis that it applied the FairShares Model (FSM) to music streaming services to alter distributions of power and wealth to benefit music makers (labour) and music fans (consumers). Its co-operative model of inclusive SE development aligns SE with SD through structures and systems that recognise and reward each form of wealth contribution. We conclude that it offers a coherent framework for aligning SE and SD

The role of disease management programs in the health behavior of chronically ill patients

__Abstract__ Objective: Investigate the effects of disease management program (DMP) implementation on physical activity, smoking, and physical quality of life among chronically ill patients. Methods: This study used a mixed-methods approach involving qualitative (35 interviews with project managers) and quantitative (survey of patients from 18 DMPs) data collection. Questionnaire response rates were 51% (2010; 2619/5108) at T0 and 47% (2011; 2191/4693) at T1. Results: Physical activity and the percentage of smokers improved significantly over time, whereas physical quality of life declined. After adjusting for patients' physical quality of life at T0, age, educational level, marital status, and gender, physical activity at T0 (p< 0.01), changes in physical activity (p< 0.001), and percentage of smokers at T0 (p< 0.05) predicted physical quality of life at T1. Project managers reported that DMPs improved patient-professional interaction. The ability to set more concrete targets improved patients' health behaviors. Conclusions: DMPs appear to improve physical activity among chronically ill patients over time. Furthermore, (changes in) health behavior are important for the physical quality of life of chronically ill patients. Practice implications: Redesigning care systems and implementing DMPs based on the chronic care model may improve health behavior among chronically ill patients

Environmental and biological controls on Mg and Li in deep-sea scleractinian corals

Author Posting. © The Author(s), 2010. This is the author's version of the work. It is posted here by permission of Elsevier B.V. for personal use, not for redistribution. The definitive version was published in Earth and Planetary Science Letters 300 (2010): 215-225, doi:10.1016/j.epsl.2010.09.029.Deep-sea scleractinian corals precipitate aragonite skeletons that provide valuable archives of past ocean conditions. During calcification biological mediation causes variability in trace metal incorporation and isotopic ratios of the aragonite such that signals caused by environmental controls can be overwhelmed. This complicates the interpretation of geochemical proxies used for paleo-reconstructions. In this study we examine the environmental controls on the Mg/Li ratio of 34 individuals from seven genera of deep-sea scleractinian corals: Desmophyllum, Balanophyllia, Caryophyllia, Enallopsammia, Flabellum, Trochocyanthus, and Lophelia. In addition we examine the distributions of Mg and Li in Desmophyllum and Balanophyllia using laser ablation inductively coupled plasma mass spectrometry (LA-ICP-MS). Both Mg/Ca and Li/Ca ratios increased by more than a factor of 2 in the center of calcification regions compared to the outer, fibrous regions of the coral skeleton. As a result, replicate ~10 mg subsamples of coral show less variability in the Mg/Li ratio than Mg/Ca. Microscale Mg and Li results are consistent with Rayleigh-type incorporation of trace metals with additional processes dominating composition within centers of calcification. Comparison of Mg/Li to seawater properties near the site of collection shows that the ratio is not controlled by either carbonate ion or salinity. It appears that temperature is the major control on the Mg/Li ratio. For all 34 samples the temperature correlation (R2=0.62) is significantly better than for Mg/Ca (R2=0.06). For corals of the family Caryophyllidae the R2 value increases to 0.82 with the exclusion of one sample that was observed to have an altered, chalky texture. Despite this excellent correlation the scatter in the data suggests that the Mg/Li ratio of deep-sea corals cannot be used to reconstruct temperature to better than approximately ±1.6°C without better temperature control and additional calibration points on modern coral samples.Financial Support was provided by the USGS WHOI Co-operative agreement, NSF-ANT grant numbers 0636787 and 80295700 and the WHOI Ocean Life Institute. David Case was supported by the WHOI Summer Student Fellowship

Corporate Governance for Sustainability

The current model of corporate governance needs reform. There is mounting evidence that the practices of shareholder primacy drive company directors and executives to adopt the same short time horizon as financial markets. Pressure to meet the demands of the financial markets drives stock buybacks, excessive dividends and a failure to invest in productive capabilities. The result is a ‘tragedy of the horizon’, with corporations and their shareholders failing to consider environmental, social or even their own, long-term, economic sustainability. With less than a decade left to address the threat of climate change, and with consensus emerging that businesses need to be held accountable for their contribution, it is time to act and reform corporate governance in the EU. The statement puts forward specific recommendations to clarify the obligations of company boards and directors and make corporate governance practice significantly more sustainable and focused on the long term