Social accounting is the process of accounting for the social and environmental impacts of an organization’s activities. It goes beyond traditional financial accounting to consider other factors that can affect an organization’s bottom line, such as its impact on society and the environment.
Organizations use social accounting to measure and report their social and environmental performance in order to be more transparent and accountable to stakeholders. Social accounting can also help organizations identify areas where they need to improve their performance.
While traditional financial accounting focuses on financial data, social accounting takes a broader view that includes non-financial data such as environmental indicators or employee satisfaction levels. This allows organizations to get a more complete picture of their performance and assess their progress towards achieving their social and environmental objectives.
Organizations that adopt social accounting practices can use them to improve their environmental and social performance, build trust with stakeholders, and make more informed decisions about their business activities.