The concept of social accounting encompasses the process of attempting to measure the value of intangible assets such as intellectual capital, customer and vendor loyalty, employee satisfaction and creative “synergy” and community support.
Beyond the impact of financial statements as a tool for assessing corporate performance, the social responsibility audit report is designed to integrate the impact of intangible assets on stakeholders by providing them with reliable social performance achievements contrasted against generally accepted social responsibility criteria.
The technology of assessing corporate performance, beyond the financial statements, requires a multi-disciplinary audit team including accountants, behavioral science practitioners, attorneys and engineers.
Within the past ten years, greater focus has been leveled at corporate performance in “green” terms by the Generation of the Sixties whose ethical foundations hold corporate behavior to higher standards than the “Aerospace” Generation. The so called Baby Boomers, now wealthy and seasoned, continue to assert core ethical values as a paradigm for daily behavior.
Consequently, unprecedented private and public funds are being devoted to projects perceived as “socially responsible”…all this without a clearly defined body of criteria for what constitutes such behavior and without much accountability for those self-interested organizations holding themselves out as “socially responsible” even for organizations which have traditionally been viewed in such terms.
The purpose of the Social Responsibility Audit is to validate corporate performance against generally accepted criteria and report to the stakeholders the extent to which the auditee organization “walks its talk”