Accounting and sustainable development practices: an interpretive study of a mining company in Ghana
Degree GrantorUniversity of Canterbury
Degree NameDoctor of Philosophy
Recently, sustainability has received increased attention from stakeholders of companies and researchers. The willingness of sustainability stakeholders to participate in sustainable development practices and rely on sustainability reporting depends on their satisfaction with the company's sustainable development performance, which is determined by the extent stakeholders perceive that their expectations on sustainable development practices are addressed. Despite calls for more dialogue and engagement with stakeholders, with global surveys consistently reporting that stakeholder pressure is a key motivator for improved managerial focus on sustainable development in companies, research on accounting practices and management controls in relation to sustainable development have mainly focussed on managerial and employee practices and perceptions. Drawing mostly on stakeholder theory, this thesis identifies stakeholders of a multi-national mining company's subsidiary operating in Ghana and explores how these stakeholders understand “sustainability”, its related practices and the sustainable development performance. The study examines the perceived role of accounting practices in the dimensions of sustainable development and identifies challenges related to sustainable development in Ghana's mining sector.
This study finds that, based on their expectations, different stakeholder groups have divergent perceptions of what sustainability means and of the sustainable development performance of the case multinational mining company's subsidiary. Whilst stakeholders were rating down the case company's sustainability performance in their areas of interest, they tend to rate the sustainable development performance of other areas higher. There were several community development projects initiated by the case mining company’s subsidiary. Evidence in this thesis indicates that these projects were not sustainable as they were not well maintained due to the case mining company's desire to initiate new projects, perhaps for reporting and other legitimating purposes. It was found that the company may not be interested in initiating capital intensive community development projects unless they will benefit from such initiatives. Findings from this thesis indicate how fluid sustainability is by demonstrating that sustainability practices affect food security, nutrition, recreation and spiritual matters of communities nearby. Although stakeholders perceived several roles of accounting in sustainable development practices of the case mining company's subsidiary, these perceived roles were more of managerial control than accounting. It was realised that sustainable development practices at the case mining site were capital intensive and accountants' participation in sustainability are overwhelmed with controlling the high sustainability cost; hence, business as usual. Despite several initiatives of the mining company towards sustainable development, a number of challenges were identified, mostly stemming from tensions among social, environmental and economic dimensions of sustainability within the case company and among the stakeholders. These tensions appear to be driven by economic interests on the part of both the case company and stakeholders. Hence, findings from this study raise doubts about the genuine interest in sustainability of stakeholders including community members, employees and even some regulators.
The findings support the need to understand the expectations of specific stakeholder groups to increase efficient collaboration between companies and stakeholders, and thus enhance sustainability. It also suggests the need for defining and enforcing clearer policies and guidelines on sustainability in the mining sector, particularly in developing countries. The study recommends to management and accounting practitioners in corporate and regulatory organisations to structure the accounting function so it reflects monitoring of the state of the planet. The study makes many contributions to knowledge but these are the key ones. First, this study adds to the literature on sustainable development stakeholders, such as regulators, and their relationships with mining companies, thus adding to our understanding of mining-stakeholder perceptions and relationships. This can have additional benefits such as increasing stakeholder engagement in assessment and reporting initiatives as well as a feedback effect of nurturing awareness. Second, by engaging with the empirical world of accounting and management control, findings from this study will provide theoretical insights valuable for academic researchers as well as a platform which can be used by researchers to establish a fruitful dialogue with accounting and management practitioners. This study contributes to the call for management accountants and managers to consider sustainability as an integral part of their sustainable development decision-making.
Future research could examine the stakeholder response and approach to sustainable development practices across subsidiaries of various industrial sectors by using surveys or case studies to establish the variations. It is recommended that similar studies are conducted to compare how the role of accounting is influenced by different political cultures, for example, within the same multinational mining company’s operations in different countries. Similarly, future research could also focus on the stakeholder activity that influences sustainable development subsidiaries across developed and developing countries, where stakeholder factors influencing multinational companies may vary. Comparative case studies examining different stakeholder perceptions on accounting and sustainable development among subsidiaries and head office, and the resultant role of accounting practices in sustainable development initiatives by multinational mining companies' subsidiaries could also extend my findings.