SOCIAL ACCOUNTING: A METHOD OF ASSESSING THE IMPACT OF NIGERIAN ENTERPRISES DEVELOPMENT ACTIVITIES
1.0 BACKGROUND OF THE STUDY
Social accounting as an approach began developing in the U.K in the early 1970s, when the Public Interest Research Group established Social Audit Limited. This organization carried out, and publicized investigations into the operations of large public companies, without necessarily gaining their permission or co-operation. Whilst lending support to consumer pressure, there is an argument that this had a negative effect on accountability, as organizations sought to ensure that sensitive information was hidden from such investigations.
Globalization has brought with it a wide realization that companies do not operate in isolation, but can have marked impacts on the environment and people at local, national and global levels, (Chris, 2006:1). This has led to an increasing awareness of Corporate Social Responsibility (CSR) and the “triple bottom-line” of business success measuring the business not only in the financial performance, but by its social and environmental impact as well. Traid craft and the New Economics Foundation (NEF) pioneered a form of social accounting in the early 1990s that is voluntary in nature and rooted in engagement with stakeholders. This can assist organizations, both commercial and NGO, in understanding and improving their social impact.
The concepts of Social accounting is growing in recognition and sophistication, as it becomes one of the foundations of good practice in corporate social responsibility (CSR), interest is growing within large corporations, consultancies and voluntary organization alike. If large companies are using a social accounting methodology to assess their social impact, the question sensibly arises as to whether this is something that can be usefully adopted by those seeking to assess the impact of enterprise development activities. Most of the organizations that adopt this concept are concerned with poverty reduction and enterprise development.
Social accounting is a way of demonstrating the extent to which an organization is meeting its stated social or ethical goals, whilst independently verified the organization itself on the process of data collection and analysis and the process is driven by indicators, the organization sets in consultation with stakeholders as opposed to being based on standards or criteria determined externally. This is balance by the principle of bench marking which whilst still developing, should enable organizations where possible, (Chris, 2006:2).