The Enabling Role of Digital Technologies in Sustainability Accounting: Findings from Norwegian Manufacturing Companies

Abstract

Sustainability accounting is an emerging research area receiving growing awareness. This study examines the role of digital technology in manufacturing companies’ sustainability accounting. To guide the research, we use a triple layered business model canvas, which supports the accounting of a manufacturer’s performance for the economic, environmental, and social aspects of sustainability. We present an explorative case study of four Norwegian manufacturing companies representing different industries. The findings from the study indicate that while accounting for economic values is well taken care of, companies do not perform comprehensive environmental and social accounting. Furthermore, we observed a shift from a focus on sustainability issues related to the internal manufacturing process to a focus on sustainability issues for the life cycle of the product. Even though the manufacturers are at the forefront with regard to automation and control of production, with extensive use of robots giving a large amount of data, these data are not utilized towards sustainability accounting, showing that sustainability and digitalization are seen as two separate phenomena. This study sheds light on how digital data available from applied Industry 4.0 technologies could enhance sustainability accounting with limited efforts, linking sustainability and digitalization. The results provide insights for manufacturers and researchers in moving towards more sustainable operations and products.

Business Model and Principles of a Values-Based Bank—Case Study of MagNet Hungarian Community Bank

“…In addition, contrary to the triple layered business model, our methodology retains the one-page concept [18,64]. Its application is further facilitated by the fact that it allows a simple, quick overview and does not require much data, which may play a major role in establishing sustainability accounting with the development of digitalization [65,70].…”

“…One of the latest, complex approaches including the economic, social, and environmental dimensions of sustainability [18,64] is the Triple Layered Business Model Canvas (TLBMC), which interprets the original BMC as the economic dimension of sustainability, adding two additional layers to it, the environmental layer, representing the life-cycle approach, and the social layer, representing the stakeholder approach [18,64]. The practical application of this model has already been tested in many sectors [18,[65][66][67][68][69][70][71]. Although we consider the new variations of the tool to be promising for the future, our goal is to specifically use the original BMC [58] which is a widespread and well-known business modelling tool that can stress the importance of sustainability issues in a transparent, distinct way even for mainstream economists, bankers and decision-makers.…”

An Empirical Framework for Assessment of the Effects of Digital Technologies on Sustainability Accounting and Reporting in the European Union

“…Sustainability and digitization have attracted special attention recently, as the main drivers of economic and social transformation. Sustainability represents the policy of an organization, country, or supranational body (such as the European Union or the United Nations) that involves a radical transformation of the economy and all human activities on with the goal of a sustainable society [1][2][3][4][5][6][7][8]. Therefore, using different approaches, organizations increasingly incorporate social and environmental variables [3] into financial and managerial accounting.…”

“…Sustainability represents the policy of an organization, country, or supranational body (such as the European Union or the United Nations) that involves a radical transformation of the economy and all human activities on with the goal of a sustainable society [1][2][3][4][5][6][7][8]. Therefore, using different approaches, organizations increasingly incorporate social and environmental variables [3] into financial and managerial accounting. Sustainability accounting and reporting (SAR) has received increasing attention in accounting research [6][7][8][9][10] based on the requirements of regulations that will be introduced in the future [11].…”

“…Whereas financial accounting is an old research field and is relatively rigid, owing to international standards and national regulations, SAR is a relatively new field emerging from managerial accounting that considers the environmental and social dimensions of sustainability instead of only the financial dimension [13]. SAR has two essential branches [3]: environmental accounting, which incorporates indicators regarding energy, water, waste, emissions, and carbon footprint, and social accounting, which incorporates indicators regarding other issues of stakeholder interest, apart from financial and environmental concerns [14]. Industry 4.0 has generated a digital transformation of the economy, creating a digital environment through the developed and implemented technologies, enabling the collection and processing of a massive amount of data with speed never experienced in the past [15].…”