Gray, et al., (1991, 1996) accountability framework

Early work within SEA responded to a lack of accountability within business. Medawar (1976) for example saw SAing as being one dimensional and slow to respond to stakeholder needs. The original accountability model of Gray, et al., (1991, 1996) developed through the CSR agenda “as part of a process of evolution rather than revolution” (Gray, et al., 1991:17) and was based on a model of accountability using the principle and agent relationship (Figure 2.2).

Gray, et al., (1996) define accountability as a duty to provide an account and not always a financial account to demonstrate action that one is responsible for (see Figure 2.2). Another view of accountability is “concerned with the relationships between groups, individuals, organisations and the rights to information that such relationships entail” (Gray, et al.,

1997:334) (emphasis in the original).

Figure 2.2 outlines the generic accountability framework developed in Gray, et al., (1991, 1996) whereby two parties (the principal and the agent) are entwined in a relationship with each other. In simple terms the principal provides instructions to the agent who takes actions (or forebears from taking actions) with specific outcomes, an account of the actions (and in some instances the outcomes) are provided to the principal by way of an account.

The terms of the relationship (including the type of accounts provided) are mediated by an agreement of some sort between the parties. The agreement may be a formal contract specifying actions/outcomes and/or may include expectations drawn from the ‘social

contract’. The role of the account is especially important. In particular, the presence of an account suggests that there is a responsibility to do/not do something and by implication that the subject of the account is part of an accountability relationship. Accounts of actions, therefore, are not neutral devices. Rather, they potentially have ramifications for the whole terms of debate of the relationship between the principal and the agent (Gray, et al., 1987; Bebbington, et al., 2001).

The Gray, et al., (1991, 1996) model recognises that the account cannot be a perfect representation of reality, being only a partial, selective and a possibly constraining or narrow view. This accountability model tries to express a social relationship, the boundaries of organisation, language of the principal, moral values and the power of the subordinate.

There are problems with the Gray, et al., (1991, 1996) model in that aspects are missing, including recognition of the organisational context, the political context, power relationships or the ethical framework within which the organisation is working. Other aspects that need recognition are the reflexive (learning) aspects of accountability, the timing and cyclical nature of reporting and the resourcing issues for organisations (specifically third sector). These limitations are partly addressed in later work where Gray, et al., (1997) developed the polyvocal citizenship perspective (PCP) model taking SAing as a starting point and criticising accountability (and stakeholder) perspectives as currently being too static. Others who critiqued the Gray, et al., position from differing perspectives were for example, Puxty, Tinker and Lehman. A summary of these critiques developing the debates on accountability follows in the next section.

2.2.1 Early critiques of Gray, et al., (1991, 1996)

The early debates within the accounting academy around CSR arose from different views of how accountability could be achieved in order to address social justice whilst recognising and addressing power and control (see Figure 2.2). Recognising and understanding the early debates within SEA inform the development of empirical research and understanding of intended and unintended impacts of engaging in SAing practices.

Figure 2.2 Accountability Framework (developed from Gray, et al., 1991, 1996).

Puxty (1986) believed in the importance of specifying clearly one’s view of social processes when seeking to further the case of SAing. Puxty aimed his critique at social reporting as being largely of the voluntary self-reporting type as prevalent in the US at that time. As a result the link of CSR to our understanding and belief about the structure of society and the nature of social change (Puxty, 1986:16; Gray, et al., 1991) needed to be clearly understood.

Principal/accountee (stakeholders) Instructions about actions Relationship (contract) An account (the discharge of accountability) in financial and non financial terms Organisation (JSP) as agent/accountor (not an individual) Actions Outcomes What is missing? • Organisational context • Political context • Power • Ethical framework • Reflexive nature (learning) • Timing / cyclical nature of reporting • Resourcing issues Therefore how could these be included within an accountability framework?

What is included

• Different forms of account (financial and non financial) • Relationships • Reporting • Actions • Outcomes

The link between CSR, structure and nature of society is demonstrated through different conceptions of accountability.

Tinker, et al., (1991:28) provide another view with a “social critique of the concept of ‘the middle ground’ that focuses on three aspects of the Gray, et al.’s approach: its relativistic philosophy, its conservative politics, and its avowed commitment to pluralism”. In other words these early discussions within the SEA academy developed differing views of whether CSR is nothing more than a mechanism that reinforces the status quo within a neo liberal democracy through its instrumental and prescriptive nature. A possible alternative to this reinforcing is the development of action through social and environmental discourse.

Discourse is viewed as a way to enable self-discovery and emancipation, through a process that dissolves domination through linguistic structures. Puxty (1991:43) believed that this could only be achieved if it “involves society itself in that process of dissolution.” Whilst CSR involves action (through reporting) it does not necessarily involve discourse, because in the reporting he was examining there was no discursive dialogue arising from the accounts as the reporting organisations were not seeking dialogue. CSR in the form viewed by Puxty would not “comprise any basis for dissolving the dominational and exploitative structures that are the cause of the problems they are addressing” (Puxty, 1991:44) rather discourse is needed to “subject commercial, political and industrial practice to criticism” (Puxty, 1991:44).

Puxty (1991) argued that there is a need for a more dialogical process aimed at developing understanding as a response to the criticisms of commercial, political and industrial practice. Unlike the CSR of the late 1980s and 1990s, it would be a SAing that would imply members of society sharing a mutual accountability as fellow citizens and as a result “social accounting would be part of social development.” Puxty (1991:44). These themes have been developed through the later work of (Gray, et al., 1996, 1997, 2006; Gray, 2002; Bebbington, 2007; Bebbington et al., 2007; Thomson & Bebbington, 2004, 2005; Tinker & Gray, 2002; Lehman, 2006, 2007a; Pallot, 1991; Williams, 1987).

The dialogic approach to accountability provides one possible way of changing current practice. These dialogic responses are needed to develop the discourse and actions to address current social and environmental issues facing society, one of those calling for

dialogic responses is Lehman, whose ethical response to Gray, et al., (1987, 1991, 1996) follows in the next section.

2.2.2 Lehman’s development of the Gray, et al., (1991, 1996) accountability position

Lehman (1995) responds to the Tinker critique of Gray’s middle-of-the-road thinking by using Rawlsian ethical theory. Lehman states that pluralism is a feature of modern democracy and by acknowledging self and relationships in the original position on accountability the charges of relativism made by Tinker can be addressed. Lehman (1995) also sees the notion of closeness and relationships as strengthening the argument for accounting being seen as a moral discourse. Lehman sees Rawls theory of justice, and the Gray, et al., (1987, 1991) position, as providing a “non-reductionist way to contextualise accounting. It transcends decision-usefulness to satisfy a necessarily larger range of accountability relationships” (Lehman, 1995:408)

Lehman’s work develops SAing research based upon Rawls and Habermas, by addressing the issues raised through “a new and accountable world through civil society” developed “through the community level not at the corporate level” (Lehman, 1999:227). This is where Lehman views “accountability, considered according to a communitarian model” as becoming:

“an enabling technology that creates an interchange between all levels in society with a view to representing the interests of all citizens, not just a select or privileged few….modern forms of accounting, however, tend to focus on controlling and representing organisational reality and pay little perceivable attention to the idea that a corporation’s activities impact on the choices available to citizens. It is well known that accounting focuses on providing decision-useful information that steers accounting away from its role of narrating business activities to the community (see Nelson, 1993; Arrington & Francis, 1993)” (Lehman, 1999:226-227).

SAing can provide a differing focus, that of narrating organisational activities to the community. In order for this to happen there needs to be a clear understanding of where accountability is being enacted, what form accountability takes, how it is enacted and the ethical assumptions underlying accountability.

The development of accountability at the practical level is evolutionary, but the ethical assumptions underlying accountability need to be recognised and understood as well. For Lehman & Burritt (1995) accountability in a democratic society needs to be understood at a practical level with recognition that “ethics provide the founding assumption for accountability” Lehman & Burritt (1995:169). The next section examines different contexts, forms and relationships of multiple accountability which then leads into the ethical assumptions that could underpin third sector accountability.