Professional Documents
Culture Documents
ACCOUNTING AND
MANAGEMENT ACCOUNTING
Table of Contents
PROVIDE AN OVERVIEW OF THE ENVIRONMENTAL AND SOCIAL ACTIONS (POSITIVE
AND NEGATIVE) OF OPERATIONS REPORTED ON BY BHP.....................................................2
PROVIDE A COMPARISON OF THE QUALITY AND DEPTH OF ENVIRONMENTAL AND
SOCIAL PERFORMANCE INFORMATION PROVIDED WITH TWO OTHER FIRMS IN THE
MINING SECTOR................................................................................................................................2
COMPARE THE ESG ACTIVITY AND REPORTING OF BHP WITH THE ESG ACTIVITY AND
REPORTING OF CHARLES STURT UNIVERSITY..........................................................................3
CRITICALLY ANALYSE THE MOTIVATION(S) DRIVING BHP’S ESG REPORTING IN THE
LIGHT OF THE CRITICISM OF SOCIAL AND ENVIRONMENTAL REPORTING PRACTICES
IN THE EXTANT SOCIAL ACCOUNTING LITERATURE. DISCUSS THE ACCOUNTABILITY
OF CORPORATIONS FOR ENVIRONMENTAL, SOCIAL AND GOVERNANCE ISSUES...........4
PROVIDE AN EVALUATIONS OF WHETHER WIDESPREAD COMPLIANCE WITH THE
TEMPLATES SUCH AS THE UNITED NATION SUSTAINABLE DEVELOPMENT GOALS
(UNSDG) OR THE GLOBAL REPORTING INITIATIVE (GRI) REPORTING STANDARDS
BENEFITS POTENTIAL INVESTORS, CURRENT SHAREHOLDERS AND OTHER
STAKEHOLDERS OF THE FIRM.......................................................................................................4
REFERENCES:.....................................................................................................................................6
PROVIDE AN OVERVIEW OF THE ENVIRONMENTAL AND SOCIAL ACTIONS (POSITIVE
AND NEGATIVE) OF OPERATIONS REPORTED ON BY BHP
BHP incorporates sustainability as one of its core values whereby it mentions to prioritise health and
safety, environment, and communities. (BHP, n.d.). The activity of drilling, extraction, processing,
transporting, and consuming the mineral, oils and gas across the globe by BHP have severe impact on
environment and society. The approach it has adopted involves minimising the impact the operations
of BHP has on the environment and partner with the other organisations for developing a resilient
environment. The following are some of the commitments from BHP in its operations to manage the
risk to environment and communities in association with its operations:
1. Forbidding exploration and extraction of resources within the boundaries or adjacent to the
World heritage listed properties
2. Avoid disposal of mined waste into the water bodies, conserving marine ecosystem
3. Protecting the wildlife and ecosystem by not operating in the boundaries or adjacent to the
International Union for Conservation of Nature (IUCN) Protected Areas Categories I to IV
4. Launched water stewardship position statement in 2019 for water security and conservation
5. Announced a climate investment program worth US$400 million for 5 years for development
of technologies that could help in reducing emissions and carbon footprint.
6. Incorporating due diligence in human rights in supplier management process
7. Use of biofuel as an alternative fuel for transportation and distribution
8. Contributing in resettlement and rehabilitation projects in areas which are not required for
their operational purposes
9. Monitoring, detecting and mitigating air emissions, GHG emissions
A total of $93.5 million has been invested in FY 2019 for community and social development
projects. However, these commitments have not been appreciated universally and has been associated
with greenwashing. (Toscano, 2019)
The three firms from the mining sector compared are BHP, Rio Tinto and Glencore
The three companies although have managed to highlight the actions taken up by them to combat the
challenges for environmental and social sustainability Glencore has taken an edge in terms of the
quality and depth of information on the same followed by BHP which has developed a sustainability
report that can be further used as a source of reference to all the stakeholders. Rio Tinto is far behind
when the quality and depth of the information is concerned. The information on the partnerships and
stakeholders associated with environmental and social activities have been mentioned by all the three
companies.
COMPARE THE ESG ACTIVITY AND REPORTING OF BHP WITH THE ESG ACTIVITY AND
REPORTING OF CHARLES STURT UNIVERSITY
1. BHP
ESG score of 31 signalling low unmanaged ESG risk. (au.finance.yahoo.com, n.d.)
BHP reports all the activities under the ESG separately broadly classifying them into
Environmental- Sustainability case studies, closure planning, climate change, environmental
management, product stewardship and water stewardship
Social- People, community and social engagement, Introduction and approach, forum and
corporate responsibility, indigenous people, Respecting human rights and UK Modern
Slavery Act Statement, Human capability and social inclusion, Sustainable supply chain,
Working with integrity
Governance- Non-operated Joint Ventures, Regulatory information, Anti-corruption
compliance, Economic contribution and payments to governments Report, Governance and
transparency, Tax and transparency
With such detailed reporting of activities under each of the parameters BHP gives its investors and
shareholders information which would help them assess the company and its impact on environment
and society and make a socially responsible strategy for investment. The ESG reporting has been
audited by EY, a third-party organisation which assess how the company is performing in the domains
along with its authenticity.
2. Charles Sturt University
In its annual sustainability report CSU does not directly points towards ESG activities and its
reporting but have traces of ESG related activities. Being a signatory to United Nation’s
Sustainable Development Goals it has committed to work for the achievement of these goals
through its university operations.
Environment- Includes actions related to climate change, water management and GHG
emissions. The clean energy strategy of the university is one such example.
Social- This could be explained with the Community, staff and student Engagement programs
of the university
Governance- CSU is responsive to best governance practices through its LIFE approach
(Learning in Future Environment) which has 4 priority areas. Also, there is a ELMO learning
module on sustainability for staff.
The difference in the reporting of BHP and CSU is due to its audience. BHP is focusing on the
investors and its stakeholders which holds financial interest in the company whereas, for CSU the
report has to be viewed by the student, staff and community which do not necessarily hold financial
interest in the firm.
It is essential for the firm to consistently engage its shareholders, investors and other stakeholders
with the business and demonstrate the efforts and achievements attained for reaching common
objectives. This helps in building positive relationship with the external and internal environment.
(SearchCompliance, n.d.) ESG reporting helps in identifying investment opportunities. One of the
ways to assess the quality of a company is through its sustainability report. As these guidelines and
templates hold universal acceptance it becomes easy for not only the stakeholders, investors and
shareholders to compare the organisations with others across industries but also helps the companies
to leverage the competitive advantage. The employees of socially responsible companies tend to be
more loyal towards the organisation as they associate themselves with it. The most significant way in
which an organisation could project its discipline towards the environment, people and planet is
through the compliance of the GRI guidelines and UNSDGs as these are understood by all and widely
accepted. Moreover, for investors and shareholders these reports form a part of the risk assessment as
it is of utmost importance for them to know how the company is managing environment and social
externalities, and how it is dealing with the governance risk. It could be concluded that these
templates not only help the stakeholders but also the companies despite of them being voluntary.
REFERENCES:
BHP. (n.d.). BHP Sustainability Report 2019. [online] Available at:
https://www.bhp.com/investor-centre/sustainability-report-2019/.
Toscano, N. (2019). Recognising the impact of its mining, BHP backs an “unlikely” alliance.
[online] The Sydney Morning Herald. Available at:
https://www.smh.com.au/business/companies/recognising-the-impact-of-its-mining-bhp-
backs-an-unlikely-alliance-20190809-p52fie.html.
Our purpose Responsibly sourcing the commodities that advance everyday life Sustainability
Report Highlights. (n.d.). [online] Available at: https://www.glencore.com/dam/jcr:c7f6c5fc-
b275-4e12-9448-de5302805781/2019-Glencore-Sustainability-Highlights--.pdf [Accessed 16
Sep. 2020].
iotinto.com.
R (2018). Sustainability Reporting. [online] Available at:
https://www.riotinto.com/sustainability/sustainability-reporting.
BHP. (n.d.). Environmental Social and Governance (ESG) and Sustainability. [online]
Available at: https://www.bhp.com/investor-centre/esg-and-sustainability/ [Accessed 16 Sep.
2020].
au.finance.yahoo.com. (n.d.). BHP GROUP FPO (BHP.AX) environment, social and
governance (ESG) ratings – Yahoo Finance. [online] Available at:
https://au.finance.yahoo.com/quote/BHP.AX/sustainability/ [Accessed 16 Sep. 2020].
Czaplicki, J. (2019). What is ESG and why is it important? [online] Medium. Available at:
https://medium.com/carbonclick/what-is-esg-and-why-is-it-important-f9036bb96d66.