CSR and Accounting: Drawing on Weber and Aristotle to Rethink Generally Accepted Accounting Principles

• DOI: http://doi.org/10.1111/basr.12015
• Author: Ross Stewart,Janet Morrill,Nancy Christie,Bruno Dyck
• Date: 01 September 2013
• Published date: 01 September 2013

CSR and Accounting:

Drawing on Weber and

Aristotle to Rethink

Generally Accepted

Accounting Principles

NANCY CHRISTIE, BRUNO DYCK, JANET MORRILL, AND

ROSS STEWART

ABSTRACT

The purpose of this article is to discuss and provide an

alternative, less materialist–individualist approach to

interpret the four assumptions of generally accepted

accounting principles: economic entity, unit measure,

periodic reporting, and going concern. The article draws

from and builds on arguments first developed by Weber

Nancy Christie is an Associate Professor of Accounting, University of Maryland University

College, Adelphi, MD. E-mail: nancy4597@gmail.com. Bruno Dyck is a Professor of Manage-

ment, Department of Business Administration, I. H. Asper School of Business, University of

Manitoba, Winnipeg, MB, Canada. E-mail: bdyck@ms.umanitoba.ca. Janet Morrill is an Asso-

ciate Professor of Accounting, Department of Accounting and Finance, I. H. Asper School of

Business, University of Manitoba, Winnipeg, MB, Canada. E-mail: Janet.Morrill@umanitoba

.ca. Ross Stewart is a Professor of Accounting, School of Business and Economics, Seattle

Pacific University, Seattle, WA. E-mail: rstewart@spu.edu.

The authors would like to thank Dean Neu, Jeff Everett, Doug McKenna, Linda Thorne,

participants of the University of Manitoba-CGA Accounting Research Conference, the Asia

Pacific Interdisciplinary Perspectives on Accounting Conference in Singapore, and the Univer-

sity of Calgary Critical Accounting Research Conference for their helpful comments. Janet

Morrill gratefully acknowledges funding received from the Institute of Chartered Accountants

of Manitoba through the Centre of Accounting Research and Education at the University of

Manitoba. Bruno Dyck also thankfully acknowledges funding received from the Social Sciences

and Humanities Research Council of Canada.

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Business and Society Review 118:3 383–411

© 2013 Center for Business Ethics at Bentley University. Published by Wiley Periodicals, Inc.,

350 Main Street, Malden, MA 02148, USA, and 9600 Garsington Road, Oxford OX4 2DQ, UK.

and Aristotle to demonstrate how a materialist–

individualist moral point of view influences the conven-

tional interpretation of the four basic assumptions for

generally accepted accounting principles. We then

propose an ideal-type conceptual framework upon which

to critique mainstream accounting theory and to develop

alternative accounting theory that balances multiple

forms of well-being (including financial, but also social,

physical, spiritual, and ecological well-being) for multiple

stakeholders (including owners, employees, customers,

suppliers, competitors, neighbors, future generations,

and so forth).

INTRODUCTION

In recent decades, the relevance of the accounting profession

and the traditional financial reporting model has been aggres-

sively challenged. A large body of empirical accounting

research has documented a decline in the value relevance of con-

ventional accounting information in recent years (Balanchandran

and Mohanram 2011). Part of this decline may be attributable to

the increase in disclosures firms make outside of financial state-

ments: firms are increasingly reporting extensive nonfinancial

measures, and in many circumstances use them as an important

component of manager compensation (Ittner et al. 1997). Many

firms also have chosen to provide disclosures of their social and

environmental activities outside of the traditional financial state-

ments, and several external certification bodies have sprung up

outside of the accounting profession to provide assurance on that

information (Power 1997). These phenomena can be seen as

threats to the legitimacy and usefulness of mainstream accounting,

and they question the ability of the accounting profession to meet

the information needs of society with respect to measuring and

reporting corporate performance and question whether formal

accounting information has been marginalized (Hopwood 2009;

Matthews 1997; Wallman 1996).

In this article, we argue that these initiatives may appear

unrelated but are in fact piecemeal solutions to one underlying

problem: that the accounting profession has generally failed to

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