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Six Capitals, or Can Accountants Save the Planet? Rethinking Capitalism for the Twenty-First Century By Jane Gleeson-White, W.W Norton & Company, Inc., 2014, 978-0-39324667-4, 304 pages, $26.95 hardcover, $12.99 ebook
Reviewed by Stanley Goldstein
Editor's Note: On November 23, 2015, the NYSSCPA and FAE, in partnership with the New York Hedge Fund Roundtable, will host a breakfast meeting on sustainability reporting at the Society offices at 14 Wall Street. On May 5 and 6, 2016, they will present their first annual conference on sustainability. Author Jane Gleeson-White, IÎRC Chairman Mervyn King, and AICPA President and CEO Barry Melancon will be featured speakers at the event.
Jane Gleeson-White's previous book, Double Entry (covered by this reviewer in The CPA Journal, April 2013, p. 12), is the beautifully written history of accounting from its beginnings in Venice in 1494 to its contributions to our current prosperous economic system. Double Entry ended with a plea to accountants to become the heroes of sustainability and save the planet-because only we can do it. Six Capitals, her current work on sustainability, tells us how.
The author's thesis is that we need action to save our planet-now. Gleeson emphasizes integrated reporting as an essential component of our new thinking: A demand that we count six types of capital-not merely financial, manufactured, and intellectual but also human, social/relationship, and natural-when assessing the output of an enterprise. According to the author, who hails from Australia, CPAs aie the heroes of this story and will be far into the future.
Integrated Reporting
Integrated reporting-disclosing all the information the investing public deserves to see-is the key to what the author defines as "a concise communication of value over time." The integration process calls for the inclusion of nonfinancial information and externalities, which will affect the fortunes of the enterprise in years to come. Integrated reporting is becoming institutionalized, and has been recently mandated in France and South Africa
For example, Puma, the German sporting goods manufacturer, reported that it had used up $198 million worth of natural resources (its profit was $255 million). Infosys, an Indian technology consulting firm, valued its "human-capital externality" at $1.4 billion. Much of the theoretical undeipinning...