Essay on Role of Finance in Promoting Social Change

Published: 2021-07-19 13:12:53
550 words
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Boston College
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Essay
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The well-being of nations has been associated with the wealth that a country can create. This property has been related to money, riches and worldly possessions, which has been translated into gross domestic production (GDP), and total national production (GNP). Nevertheless, it is becoming increasingly acceptable today that total domestic production is not able to provide the real information about the genuine well-being of populations.

The recognition that economic models, economic and financial policies need to be incorporate other factors than just stocks of capital and labor is now recognized by the united states, European nations in addition to some prominent names and personalities, including Joseph Stiglitz, (winner of the 2001 Nobel economics prize and Amartya Sen. (winner of the 1998 Nobel prize for work on developing countries).

To understand the role of finance in promoting social change, it also necessary to comprehend the concept of social accounting, which to this respect refers to the process of communicating the social and environmental effects of organizations industrial actions to particular interest groups within the society and the community as a whole. Typically, social accounting is used for business or corporate social responsibility (CSR), although any other organizations, including non-governmental organizations, charity organizations, and government agencies may also engage in social accounting.

Companies and other institutions, including non-governmental organizations, may publish annual corporate responsibility reports in print or online. Companies may seek to adopt a standard accounting format that is audience specific and appropriate for instance; there are organizations that may focus on inquiring from stake holders how they would like to receive reports on its website, others publish separate reports for its operations, while others produce reports regarding their sustainability.

How might you use accounting or finance to support this that you describe above

Described above is the idea of countries gross domestic production, which refers to the annual income of a country. The other issue highlighted is the subject of social accounting, which seeks to broaden the scope of accounting, either in the aspect of management control purpose or for accountability purpose.

Finance and accounting support these ideas by the fact that the proper funding and accounting practices can lead to a higher growth of a countrys gross domestic product as it will provide ways in which the country will be involved in more income generating activities that will drain resources from the country.

Consequently, there will be a higher growth in reference to ethical and sustainable positive social change as the gross domestic product of the country will be enough to comfortably sustain the needs of the citizens, in addition to providing sufficient resources for them and in this way promote the positive social practice.

The subject of social accounting, on the other hand, promote ethical and sustainable positive social change as it provides a rationale for clear accounting process within the organizations and enterprises within the nations. Consequently, such accounting and finance processes lead to0 accountability within the sector. B individuals operating within the system are therefore compelled to follow and adhere to the set standards and therefore positively increase the social criteria,

Further, the rise in the positive practice of the individuals within the organization further promote ethical and social change even within the entire society as the value of the workforce will be instrumental in affecting the whole community.

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