Dinh Ngoc Minh Chau

2032300257

1. Distinguish between traditional accounting and accounting for sustainability

The basic concept of accounting is the process of identifying, measuring, recording,

and communicating economic information to demonstrate the business performance,
therefore, the users, which are managers, owners, investors, creditors can make
decisions to bring the most value for them. However, in accounting for sustainability,
companies will generate, analyze, and use money environmental and socially related
information in order to improve corporate environmental, social, and economic
performance. Therefore, sustainability financial accounting focuses on wider forms of
sustainability reporting that has 5 main capitals: manufacturing, financial, human,
social, and natural, based on the Triple Bottom Line: Economic, Social, and
Environmental.

2. List and describe the dimensions of accounting for sustainability.

Accounting for sustainability cover the measurement and reporting of the influence
on society as a whole not only the profits. Therefore, sustainability accounting pays
attention to the three main dimensions:
● Economic Prosperity: involves taking into account the natural and social
capital along with physical, financial, human, and intellectual capital.
● Environmental Quality: involves taking into account both the critical natural
capital (essential for life and healthy eco-system) and renewable, replaceable,
or substitutable natural capital.
● Social Justice: involves taking into account the social capital (trust between
businesses and society), which is an important key of sustainable capitalism.

3. The scope of accounting for sustainability

Every decision taken by an organization can have an impact on its long-term viability.
Impacts in the three areas of sustainability are sometimes imagined in isolation from
economic, social, and environmental factors, although they are in fact intricately
linked.

As a result, financial performance no longer stands alone in the context of social and
environmental sustainability.

In other words, a concept of intragenerational equity has been introduced to the

intergenerational idea of financial sustainability that underpins traditional accounting
practice.