Sustainability Accounting and Social Issues

A. Public Trust
From the perspective of business leaders, declining trust in business constitutes a top
concern. Executives may worry that public displeasure may result in increased government
regulation, a decline in customer confidence and corresponding sales, or even a “brain drain”
of more top college graduates choosing a future outside the corporate world. Business leaders
may wish to avoid negative press coverage, out of concern that negative media accounts will
encourage more regulation; a concern that appears to be well founded.
Public trust in business is more closely related than ever to larger issues of trust in
broad societal institutions. The crisis of trust in business appears to be particularly concerned
with ethics, business integrity, and corporate responsibility, rather than with business
efficiency or economic viability.
The Three Core Dynamics of Public Trust
a. Mutuality
Mutuality connects directly with the core purpose of business as a form of social
cooperation that creates value for people
b. Balance of power
Balances of power, the second core dynamic of public trust, are equilibriums which
ensure that one party or group is not able to unfairly impose its will upon another
c. Trust Safeguards
Mandate fairness in the presence of intractable power imbalances and to require
reparations when vulnerable parties have suffered abusive behavior
B. Relations with The Government
In CSR, the government actually has an interest in implementing Corporate Social
Responsibility, as stated by Steurer who gave several reasons why the government has an
interest in the issue of Corporate Social Responsibility.
1. First, it is in line with the concept of sustainable development (sustainable
development). The first motivation is related to foreign policy such as human
development programs.
2. Second, the CSR policy is considered an interesting complement to other regulations,
for example in Indonesia in the Limited Liability Company law, in which the
government can show its concern for social and environmental issues even though
this regulation on corporate social responsibility only gets a very small portion of it.
3. Third, CSR implementation is still limited to a voluntary basis, so the government
needs to emphasize so that CSR implementation will get more focus from the
company.
4. Fourth, many approaches in implementing CSR use the concept of a partnership
program (partnership program) so that it will open up the potential for wider
community involvement in sustainable development. This is closely related to
managing relationships and roles with broad stakeholders, such as government
businesses and civil society.
C. Relationship with Suppliers
 Good purchasing practices are an integral part of small business success, and few
factors are as vital in ensuring sound purchasing methodologies as the selection of quality
suppliers. Indeed, finding good suppliers and maintaining solid relations with them can be an
invaluable tool in the quest for business success and expansion. In fact, a business can only
be as good as are the suppliers with whom it works.
Here are the foundations for building better relationships with suppliers:
1. Communication
Effective, open two-way communication is at the heart of any strong business
relationship. If you don’t talk to your suppliers, you can’t learn enough about them to
build mutually beneficial arrangements.
2. Respect
A mutual appreciation and willingness to consider the needs and opinions of the other
party clears the ground for suppliers and buyers to work in ways which maximise the
interests of both.
3. Openness
An essential part of effective relationship building is being open and honest with one
another. Sharing information and being transparent about intentions and goals again
increases the likelihood of reaching agreements which benefit everyone.
4. Fairness
Business relationships break down when one party or the other feels they are not getting a
fair part of the bargain. Ensuring all benefits are split straight down the line is crucial to
making a “You scratch my back” approach work for all involved.
5. Trust
All of the above help build trust. Trust is the cement which will hold a strong relationship
together, affording suppliers and buyers the confidence in one another to seek innovative
ways to working and problem solve together.
6. Flexibility
To make a relationship a success, you need to be prepared to change the ways you work
to accommodate the other party. Very rarely will two organisations strike the perfect
accord straight away. Strong relationships take time and a willingness on the part of both
parties to listen, to adapt and to embrace innovation as a means of improving.
D. Relations with Consumers
Businesses are now facing the challenge of creating an excellent customer experience
that's consistent across every interaction. To achieve this, many companies are now focusing
on how they manage their customer relationships. Building strong customer relations is a
great way to develop customer loyalty and retain valuable, long-term customers.
One way to build a good relationship with consumers is through a CSR program. The
form of the CSR program is the use of environmentally friendly and harmless materials. As
well as providing clear information and instructions regarding the correct use of the
company's products, including information on spare parts and sales services as well as other
information that consumers should know.
E. Relations with Local Communities
 Community engagement is one of the key pillars of corporate social responsibility
(CSR), alongside the concern with the workplace, the marketplace and the environment.
Community involvement can take many forms. For example, some businesses choose to:
 support a local charity with financial contributions
 sponsor a local event
 organize clean-up events
 volunteer in local schools or community projects
For most businesses, it makes commercial sense to get involved in community-based
CSR related to our product or service. This lets us use your expertise, and show the human
face of your business at the same time.
F. Relationship with Employee and Their Families
Employee relation are some of the main factors that influence employee satisfaction
and engagement. Therefore, many companies today invest more resources to improve
employee relations and keep their workplaces healthy. Companies with good employee
relationships enjoy many benefits:
1. Employee engagement
Employee relations play a crucial role. It has been proven that companies with better
employee communications have much higher rates of employee engagement. 
2. Employee satisfaction
Employee engagement is often related to employee satisfaction. Less engaged
employees are less satisfied. Poor employee relations can be one of the main causes
for that.
3. Employee productivity
Employee satisfaction and engagement boost employee productivity. Companies with
well-structured employee relations enjoy higher productivity, revenues and profits.
4. Employee retention
High employee turnover is one of the biggest problem companies face today. The cost
of an employee leaving is significant. Therefore, many employees try to avoid that
expense. Employee retention can be improved in many ways. Employee relations is
one of them. Employees who feel like they don’t know what is going on in the
company feel frustrated and isolated. As a result, they feel insecure and often consider
new job opportunities.
G. Relations with Investors
The company is responsible for shareholder satisfaction. Companies must be able to
convince shareholders, where company managers monitor all business decisions and ensure
that the decisions taken are in the interests of shareholders.
However, it does not rule out the possibility for shareholders to be actively involved
in influencing the company's management policies. In general, shareholders who play an
active role are company investors who have large amounts of shares. Thus, shareholders will
hold company executives accountable for the dissatisfaction they get.