A Communitarian Approach to Constructing Accountability and Strategies for Sustainable Development - Core
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Issues in Social and Environmental Accounting
Vol. 1, No. 2 December 2007
Pp 217-242
A Communitarian Approach to Constructing
Accountability and Strategies for Sustainable
Development
Murugesh Arunachalam
Stewart Lawrence
Waikato Management School
University of Waikato, New Zealand
Martin Kelly
Association of Chartered Certified Accountants, New Zealand
Joanne Locke
Birmingham Business School, UK
Abstract
This paper explores some ideas for expanding the scope of corporate accountability and thereby
contemporary practices in corporate social reporting (CSR). Contemporary CSR practices have
been criticized for acting as a legitimizing device for profit-seeking entities possibly at the ex-
pense of the community. A communitarian correction to CSR practices suggests that account-
ability to the community is necessary for any accounting aimed at sustainability. The interpre-
tive methodology adopted in this study starts with a set of ideas or “pre-understandings” drawn
from extant literature on accountability and communitarian philosophy. These ideas provide a
theoretical lens for examining and understanding the participation of the Taupo business, farm-
ing and general community in formulating strategies for sustainable development.of the Taupo
District in New Zealand. Alternating between our pre-understanding and the empirical data, a
process known as “fusion of horizons” (Gadamer, 1975) in philosophical hermeneutics, is a
means by which theories can be developed.. This interpretive study indicates that meaning of
accountability can be extended beyond a narrow conventional sense portraying accountability
as a process of providing an account. Accountability also involves other dimensions such as
moral responsibility, cooperative enquiry, information sharing, transparency and joint responsi-
bility. From a communitarian perspective these dimensions of accountability emphasise the
centrality of community and communal values. Accountability for environmental and social
issues extends beyond the domain of corporations, and involves community participation.
Keywords: Community, Communitarian, Accountability, Sustainable Development and Coop-
erative Enquiry218 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
1. Introduction Drawing on the extant literature, we
construct a model of accountability
The issue facing the Lake Taupo District based on communitarian philosophy.
in New Zealand is the same as many These pre-understandings provide a con-
other places: how to achieve sustainable ceptual lens to examine and understand
management in a vibrant economy. The empirical data related to community par-
economic activity surrounding the larg- ticipation in developing strategies for the
est Lake in New Zealand has had detri- Taupo District of New Zealand. In a
mental effects on water quality. In order sense, the theoretical ideas are tested
to save the Lake from further degrada- against actual practice.
tion, the community discussed and
agreed on ecological priorities that The paper is structured as follows. Sec-
would guide decision making in the tion 2 provides a literature review of
area. CSR and common criticisms which have
been levied against contemporary CSR
The objectives of this paper are two- practices. Section 3 provides explication
fold: firstly to provide a theoretical of a communitarian approach to environ-
model of accountability involving com- mental and social accounting as articu-
munal values and the social process of lated by some scholars. Flowing from
cooperative enquiry; and secondly to these ideas we develop a theoretical
illustrate through empirical evidence model for a communitarian approach to
how in practice such a model may affect accountability. Section 4 describes the
the priorities assigned to economic model and explains the principles under-
growth, environmental protection and pinning it. Section 5 deals with the
social considerations by a community. methodology adopted. Section 6 pro-
The reported attempt to develop sustain- vides an illustration of aspects of the
able strategies for the Taupo community communitarian model that have become
helps us to reflect on the expanded operational in the Taupo District of New
‘accountability’ model. Zealand. The paper concludes with some
reflections on the communitarian ap-
Contemporary corporate social reporting proach to accountability.
(CSR) practices have been criticised for
not being genuine (Adams, 2002; Ad-
ams, 2004; Owen, 2005; 2. Corporate Social Reporting
Coupland ,2006, Gray, Deegan & Ran-
kin, 1996). Some scholars have sug- Corporate social reporting involves re-
gested a communitarian approach as a porting on social and environmental re-
way forward to overcome flaws identi- sponsibilities of corporations (Golob &
fied in current CSR practices (Lehman, Bartlett, 2007; Vuontisjarvi, 2006; Jen-
1999; Lawrence & Arunachalam, 2006). kins & Yalovleva, 2006; Douglas &
Murugesh Arunachalam is lecturer of financial accounting at the Waikato Management School, University of Waikato,
New Zealand, email: murugesh@waikato.ac.nz. Stewart Lawrence is Professor in the Department of Accounting at the
Waikato Management School, University of Waikato, New Zealand, email: slawrence@waikato.ac.nz. Dr Martin Kelly
is a Fellow of the Association of Chartered Certified Accountants, a member of the New Zealand Institute of Chartered
Accountants and also Joint Chairperson of the Department of Accounting, The University of Waikato, New Zealand,
email: kelly@waikato.ac.nz. Dr. Joanne Locke is a senior lecturer at Birmingham Business School in the U.K., email:
j.locke@bham.ac.ukM. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 219
Doris 2004; Moir, 2001; O’ Riordon, The lack information on negative im-
2000). Though annual reports used to be pacts of corporate activities arises be-
the major channel for reporting corpo- cause companies are concerned about
rate performance in these areas (Epstein public reaction to bad news (Adam,
& Freedman, 1994; Tilt, 1994), recent 2002). Negative information, such as
developments have seen web-based and non-compliance of environmental laws,
stand-alone reports becoming more may raise concerns among investors and
prevalent (Maughan, 2006; Musgrave expose the corporations to financial risks
Group, 2006; Coupland, 2006; WS At- (Deegan & Rankin, 1997). However,
kins Plc., 2005; Fliess, 2007). The devel- lack of disclosures of negative news
opment of environmental and social ac- “acts as a barrier to enlightenment and
counting has been centred on corpora- hence progress” (Puxty 1991,p.39). Ad-
tions reporting to their stakeholders, the ams (2002) considers contemporary en-
main stakeholder being equity owners, vironmental and social accounting prac-
creditors, customers, and employees tice as not representing “a genuine at-
(Goyder, 2007; Moir, CGA, 2005; 2001; tempt to be accountable” (p.224).
Clarkson, 1995; Starik, 1995;). Corpora-
tions were given the privileged status of Some scholars criticise CSR practices as
“reporting entities” and environmental being grounded in libertarian models of
and social accounting is assumed to be a accountability emphasising economic
domain managed and controlled by cor- rationale, individualism and accountabil-
porations (Lehman, 1999). ity to self rather than accountability to
others (Lehman, 1999; Shearer, 2002).
CSR has been criticised to be reporting This makes “ethical all forms of exploi-
more on positive impacts (Adams, 2004, tation that do not imply actually depriv-
Gray, Owen, Adams, 1996) but with ing an individual of his or her free-
minimal disclosures on the negative im- dom” (Barque, 1993, p.11 in Shearer,
pacts of corporate activities (Deegan & 2002, p.561). Such an approach to ac-
Gordon, 1996; Deegan & Rankin, 1996) countability can be catastrophic in that:
or totally no disclosures of negative in-
formation (Gutherie & Parker, 1990). The lives of people, the existence of
Achieving organisational legitimacy has non-human life forms, the integrity
been the main motivation for CSR of ecosystems, and the sovereignty
(Deegan & Gordon, 1996; Deegan & of nations all are made subservient
Rankin, 1996; Guthrie & Parker, 1989, to the instrumental pursuit of profit
1990; Cormier & Gordon, 2001; Patten, or productive growth. (Shearer,
1992; Gray, Kouchy & Lavers 1995; 2002, p.563)
Brown & Deegan, 1998; O’Donovan,
2002; Deegan, Rankin & Voght 2000; Lehman (1999) is critical of contempo-
O’Dwyer, 2002; Deegan, Rankin & rary social and environmental account-
Tobin 2002, Adam, 2002). According to ing models which are based on proce-
these studies corporations use CSR to dural liberal frameworks. Lehman points
influence stakeholders’ perceptions of out that the liberal accountability enable
their activities and enhance their image corporations to legitimize their activities
with stakeholders. but fail to transform and make them ac-
countable for the environmental and so-220 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
cial impacts of their activities. society. For Schweiker (1993) giving an
account is one means by which individu-
Maunders & Burritt (1991) believe that als are constituted as moral agents:
environmental accounting has been in-
fluenced by those with “a vested interest “Giving an account is one activity in
in down–playing ecological im- which we come to be as selves and
pact’ (p.12). Cooper & Sherer (1984) particular kinds of communities
consider that the outcomes of such ac- through forms of discourse that
counting practices are “…essentially shape, guide and judge life regard-
political in that they operate for some ing concern for the common good,
groups in society and to the detriment of human solidarity and basic respect
others. (p.208). Gray et al (1996) consid- (p.235)
ers contemporary accountability prac-
tices as serving the interests of the most Accountability relationships become
powerful groups in society and therefore more complex when a society consists of
a source of anti-democracy (p.41). multiple stakeholder groups or commu-
nities with different interests and values.
In this complex situation a stakeholder
3. Broad Conceptualization of Ac- can be an accountor in one situation and
countability to Society accountee in another (Gray et al 1996).
Hence society is thought of as sets of
To overcome limitations in libertarian relationships between the different
model of accountability, some scholars stakeholder groups and there exists a
have suggested broad conceptualisations series of ‘social contracts’ between
of accountability (Cooper, 1992; Gray, members of society and society itself.
1992; Henderson, 1991; Lehman, 1995;
Lehman, 1999; Lehman, 2001; Maun- Lehman (1999) proposes a communi-
ders & Burritt, Gelfand, Lim & Raver, tarian correction to reform liberal ac-
2004; Green & Crowther, 2004, Democ- countability models. In the communi-
racy Watch, 2004; Cooper, 2004; 1991, tarian model, accountability relation-
Harte & Owen 1987). These scholars ships are formed at the community level
generally agree that organisations are and not merely confined within the pa-
accountable to society at large for the rameters of corporations. Lehman’s
impacts of their activities on the natural communitarian model envisages inter-
environment, culture and values of soci- change between all levels in a commu-
ety. Bebbington (1997) suggests the de- nity. This implies reporting on environ-
velopment of new forms of environ- mental and social impacts of corpora-
mental and social accounting which tions in order to empower the commu-
have “enabling, empowering and eman- nity to engage in critical enquiry of the
cipatory” (p.365) potential to create a impacts. Such enquiry enables the com-
“fairer and more just society” (p.365). munity to participate in statutory deci-
To take seriously obligations and ac- sion making processes to counter ad-
countability to society, Shearer (2002) verse impacts of corporate activities.
suggests “radical accountability” in
which interests and values of individuals We have captured the broad form of ac-
are subordinate to interests and values of countability articulated by these scholarsM. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 221
in figure 1 below. The role of the state is to facilitate the
process of cooperative enquiry and pro-
Figure 1 shows the accountability rela- vide regulations and policies to monitor
tionship between the community, private activities of corporations. The overall
corporations and the state. Private corpo- purpose of accountability is to safeguard
rations are accountable to the commu- the natural environment and community
nity for the impacts of their operations values According to Lehman (1999),
on the natural environment and commu- modern communitarian thought ac-
nal values. knowledges the importance of the role of
the state in providing structures to en-
The state collaborates with the commu- able civil society to evaluate critically
nity through processes of cooperative impacts of corporate activities and to
enquiry to make private corporations decide on the future of such activities.
accountable for their actions. Crucial The role of the state is confined to facili-
aspects of the process of cooperative tating the accountability and policy mak-
enquiry are dissemination of information ing processes in civil society without
to community and participation of its interfering in the processes. The state is
members in public meetings to debate on expected to be neutral. Modern commu-
issues of common concern to members nitarian thought implies some kind of
of the community. Private corporations interaction between state and community
report to communities on the impact of in formulating policy measures.
their activities on the environment and
society. However this broad conceptualization of
accountability is flawed in several ways.
Figure 1
Broad Conceptualization of Accountability to Community
State
Regulates
Collaboration
Accountable to
Private Community
Corporations222 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
Private corporations still assume the pri- forms to provide explanations and
mary role of reporting entities and there- reasons for conduct (Munro, 1996,
fore the flaws of contemporary CSR Willmott, 1996, Roberts, 1996,
practices may also prevail in the broad Boland & Schultze 1996, Garfinkel,
conceptualization of accountability. Also 1967). We are concerned with the
the meaning of community, process of mode of account giving to the com-
cooperative enquiry and the outcome of munity.
the process remains abstract. The broad
conceptualization does not explain the 4. The underlying purpose of account-
factors which drive accountability. Pal- ability explains the significance of a
lot (1991) considers the communitarian particular model of accountability.
approach to accountability as remaining We want to know the significance of
in a skeletal and ambiguous form both in the communitarian model.
theory and practice. If the broad concep-
tualization is to be accepted as an appro-
priate pathway to accountability, it needs 4. Cooperative Enquiry
to address issues which are imperative to
any form of accountability. The issues According to Tam (1998) cooperative
are: enquiry requires that claims to truth be
evaluated or validated by a process of
1. Accountability arises from a contrac- deliberation involving the participation
tual relationship between the accoun- of members of society. The participants
tor (the person held to account) and of cooperative enquiry should have ac-
the accounteee (the person to whom cess to relevant information and be al-
accountability is due). In this rela- lowed to express their views and ques-
tionship the accountee has the right to tion the views put forward by other par-
receive information and the accountor ticipants without intimidation, threat of
obligation/ responsibility to supply persecution or stigmatization and be able
information (Gray, 1992; Tricker, to come to a consensus on the validity of
1983; Munro 1996). In this paper we a claim.
are interested in accountability rela-
tionships that involve the community. Debate and dialogue in the public sphere
is a crucial aspect of communitarian ap-
2. The subject matter of accountability proach to decision making (Lehman,
determines the types of information 1999). Taylor (1989) believes in a public
produced. In this paper we are inves- sphere committed to discussion and de-
tigating the type of information that bate. The purpose of debate and dia-
empowers the cooperative enquiry logue is to enable members of civil soci-
process. ety to be aware critically and deliberate
on issues of significance. Debate and
3. The mode of reporting is central to dialogue in the public sphere provides
the accounting process. Written re- easy access to the viewpoints of differ-
ports are an important form of ac- ent stakeholder groups and involves a
count giving. Several researchers process of negotiation and explanation
have extended the mode of account concerning the common good.
giving to conversation and verbalM. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 223
Figure 2
Role of Cooperative Enquiry in Communitarian Theory
Community
Partici-
pates in
Fundamental Princi-
ples of Cooperative
Enquiry
Process of
1. Mutual Responsibility Cooperative
2. Power Symmetry Enquiry
3. Information Symme-
Venue for
Critical Validating
enquiry truth
Developing
communal
values
The centrality of the process of coopera- existence of a community of individuals
tive enquiry in communitarian ideology who have common values and are will-
is the principal assertion of this paper ing to come together to deliberate and
and the fundamental basis for a commu- agree on values for their common good.
nitarian approach to accountability. The
role of the process of cooperative en- The epistemological stance assumed by
quiry in communitarian theory is shown communitarians is the discovery of ethi-
in Figure 2. cal values through the process of inter-
pretation and social construction of val-
The process of cooperative enquiry is a ues which exist in the “ways of life” of
hermeneutical process adopted by a members of a community. Under the
community to develop communal values social construction process members of
and enter into a critical enquiry of issues a community deliberate on their similar
which have an impact of these values. and different values and attempt to es-
The communitarian theory assumes the tablish a set of values which is accept-224 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
able to them. Basic assumptions guiding intelligible some aspects of their lives to
the process of cooperative enquiry are others in the social world is labeled the
the communitarian tenets of mutual re- universal aspect of accountability by
sponsibility, symmetry of power, sym- Willmott (1996):
metry of information and common good.
Communal values, once developed and …accountability is a widespread
accepted, form the basis for establishing phenomenon that occurs whenever
the common good and virtues deemed people strive to account for their
important for the well-being of members experience in the world (p. 24).
of community. An individual’s identity
is assumed to be shaped by the values of We turn now to an empirical illustration
the community to which the individual of this otherwise abstract communitarian
belongs. A set of communal values, once approach to accountability.
established, can in turn serve as bench-
mark for further cooperative enquiry.
This includes critical enquiry to chal- 5. Research Methodology
lenge existing systems and activities
which are detrimental to communal val- The regional authority, Environment
ues. The enquiry process also deals with Waikato (EW), organised public meet-
validation of truth claims i.e. assessing ings during the period July 2003 – Au-
claims put forth by members of a com- gust 2004 to discuss and design a strat-
munity to justify a certain course of ac- egy . The plan was known as the 2020
tion. Taupo-nui-a-Tia Action Plan for the sus-
tainable development of Taupo District.
Accountability is embedded within the Information for this paper was obtained
process of cooperative enquiry. Advo- by attending such community consulta-
cates of communitarianism generally tions and public participation pro-
believe that accountability involves grammes, forums and community group
processes of negotiation, explanation meetings which were held in the Taupo
and articulation in civil society to pro- District. Meetings were attended by the
vide a sense of belonging and under- researchers, and follow-up interviews
standing in the community arranged with influential groups such as
(Macintyre,1984; Francis, 1991; Wilson the District Council, Protecting Lake
1993.) The discharge of accountability Taupo Group (a group representing
involves more than the preparation and farming interests), Bird and River Pro-
dissemination of written reports to stake- tection League, and other active partici-
holders and includes modes of account pants in the process. Minutes of meet-
giving in the form of the spoken word ings, fact sheets, EW press releases,
that draws the attention of members of strategy reports, website information on
civil society to the social impacts of pri- Lake Taupo, research articles published
vate activities. Account giving also in- by EW and field notes were accumulated
cludes oral explanations and justifica- for subsequent analysis. The information
tions expressed in defending one’s inter- accumulated was examined using an
est during the public participation proc- interpretive approach which is grounded
esses. This making and giving of ac- in hermeneutic philosophy of Gadamer
counts where participants are rendering (1975). Our fore-knowlwdge (Gadamer,M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 225
1975) for the interpretive approach con- ery depend on a clean, clear lake (APR
sists of our understanding of broad con- Consultants, 2002a, 2002b). The lake is
ceptualisation of accountability to soci- being affected by excess nitrogen flow-
ety (paragraph 3 above) and understand- ing into the Lake from fertilizers, animal
ing of the communitrain process of co- effluent, septic tanks and urban storm
operative enquiry (paragraph 4 above). water runoff from the surrounding land
We interpret or make sense of the data (Marie, 2003). Environment Waikato
on the basis of these pre-understanding. (the Regional Council for the Waikato
In turn, the data provides evidence to Region) has identified intensive animal
validate, refute or modify our pre- farming as the main source of nitrogen
understanding. The interaction or alter- flows into Lake Taupo (Environment
nation between the data and pre- Waikato, 2001a). The pumice soils of
understanding or “fusion of hori- the surrounding land allow nitrogen to
zons’ (Gadamer, 1975) enabled us to leak into groundwater and bypass ripar-
create themes which interrogate the con- ian vegetation (Environment Waikato,
cepts of accountability, communitarian 2001a). The degrading water quality in
process of cooperative enquiry and sus- the lake has been causing algal booms
tainability The discussion in the follow- and health risks (Environment Waikato,
ing section is presented according to 2001b; 2001c; 2001d). Changes to pol-
these themes. icy decisions and local government
plans are necessary to halt the decline in
the water quality in the Lake
6. Illustration of Communitarian (Environment Waikato, 2001e). Scien-
Form of Accountability in the tific evidence (Environment Waikato,
Taupo District 2004a) estimates that nitrogen entering
the Lake from pastoral farmlands must
The issue facing the Lake Taupo District be reduced by 20% to maintain water
in New Zealand is the same as many quality at current levels. However any
other places: how to achieve sustainable policy change will have implications for
management in a vibrant economy. The land use, especially far ming
economic activity surrounding the larg- (Environment Waikato, 2000b). Local
est Lake in New Zealand has had detri- authorities acknowledge the importance
mental effects on water quality of consulting the Taupo Community be-
(Environment Waikato, 2000a, Marie, fore any change can be instituted
2003a). In order to save the Lake from (Environment Waikato 2001h).
further degradation, the community dis-
cussed and agreed on ecological priori- The issue at hand was not merely an en-
ties that would guide decision making in vironmental issue. The task of the policy
the area (Environment Waikato, 2001f). makers (Environment Waikato in its ca-
Lake Taupo, considered a national treas- pacity as the Regional Council) and stra-
ure in New Zealand, is the source of the tegic planners (Taupo District Council)
Waikato River and the main source of was to take into consideration economic
water supply for the greater Waikato and social considerations when address-
Region (APR, Consultants, 2004b). Sev- ing the environmental issue affecting
eral economic activities in the District Lake Taupo (Environment Waikato,
including tourism, recreation, and fish- 2000b). The question is whether the eco-226 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
nomic should be addressed within the Taupo District Council, Central Govern-
broad environmental dominion or ment Departments such as Ministry for
whether environmental considerations Environment, Department of Conserva-
are subservient to economic considera- tion and Ministry for Agriculture and
tions (Environment Waikato, 2000b). At Forestry (APR, 2002a, 2002b, Environ-
several Public meetings in Taupo it was ment Waikato, 2004a, 2004b, 2005 ).
pointed out that that any measures to The public realise the importance of tak-
maintain a clean clear lake should take ing into consideration the views and
into consideration farming needs and concerns of the diverse stakeholder
practical considerations (Environment groups in reaching any decision or strat-
Waikato, 2000b). egy to address the environmental issues
aff ecting the Taupo Distri ct
The public in the Taupo District is repre- (Environment Waikato, 2000b ). Follow-
sented by numerous groups with differ- ing are dimensions of a communitarian
ent interests, values and concerns (APR approach to accountability that emerged
Consultant, 2002a; 2002b). There are from our hermneutical exploration of the
“literally thousands of people, lots of data collected in relation to community
different ideas, and in some cases, dif- participation in the Taupo District.
ferent agendas in the Taupo Dis-
trict” (Interview 2004, Response from 6.1. Accountability Issues in the
Facilitator of Economic Development Taupo Community
Strategy Processes). But they have ex-
pressed an overriding mutual concern, a Though the Taupo Community consists
common interest, in the preservation of of multiple groups which have different
the water quality of Lake Taupo. An interests, they were willing to come to-
active particupaant of communal proc- gether to identify their common values
esses points out that : and engage in cooperative enquiry on
issues that threaten their common values
…we’re all in the community, what- (Taupe Accord, 1999, Environment
ever our primary responsibilities, we Waikato, 2004b). The central issue of
need to be thinking about commu- accountability is the pollution of Lake
nity outcomes, what’s good for us as Taupo and the impacts of the pollution
a community, and determining on communal values (Environment Wai-
whether or not we have an impact kato, 2001b, Environment Waikato,
on these areas, as value areas, areas 2004B). According to a member of
which the community does. If we LWAG “People are just realising that
have an impact then we should be the consequences of farming on the lake
part of the solution in some way. and having septic tanks draining in there
(Interview, 2003). has now destroyed or destroying the
Some of these groups include the busi- lake.” (Interview, 2004). The various
ness sector, various local community groups who acknowledge common val-
groups, the local Maori Tribe (Iwi) ues (Taupe Accord, 1999, Environment
known as the Ngati Tuwharetoa, the Waikato, 2004b,, nevertheless have di-
Taupo farming community strongly sup- vergent interests. Farmers are concerned
ported by Federated Farmers, environ- about their livelihood and economic vi-
mentalists, Environment Waikato, ability of their farms if restrictions areM. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 227
imposed on pastoral farming nitarian accountability (Lehman, 1999).
(Environment Waikato, 2000b, Marie, The Taupo Community has been en-
2003b). The tourist industry wants to gaged in cooperative enquiry processes -
maintain clean water quality in the lake in the form of public meetings and fo-
to cater for recreational activities like rums organised by local authorities and
swimming and fishing (APR Consult- community groups - to address the pol-
ants, 2002a, 2002b, Environment Wai- lution of Lake Taupo (Taupo Accord,
kato, 2004b). There are conflicting inter- 1999; APR Consultant, 2002a; 2002b;
ests between animal farming and tour- Environment Waikato, 2004a; 2004b;).
ism related activities as commented by Community meetings have become ven-
an interviewee “Continuing animal ues for reporting and debating the im-
farming in the district will create good pacts of animal farming (Participant ob-
district income, but threaten tourism in- servation in 2020 Forum and LWAG
come because the lake is going to be meeting).
polluted” (Interview, 2003). Developers
support less polluting residential devel- Several public meetings organised by
opment in opposition to farming activi- Environment Waikato related to the two
ties (APR Consultants, 2002a, 2002b). projects for developing strategies for the
Environment Waikato wants to prioritise protection and management of Lake
above all else the safeguarding of the Taupo and its catchments. These strate-
Lake (Environment Waikato, 2004b). A gies are the Protecting Lake Taupo Strat-
Planning Officer from the Taupo District egy (Environment Waikato, 2004a) and
aptly points out that: the 2020 Action Plan (Environment
Waikato, 2004b). Environment Waikato
people are concerned about various initiated the development of the
different things, some might be con- “Protecting Lake Taupo Strategy” in
cerned about productive land being 2000. The aim of the strategy is to pro-
taken out of existence, some will be tect the water quality of Lake Taupo.
concerned about the effect on their The strategy is the outcome of consulta-
enjoyment of land, some might be tion with the Taupo community, local
concerned about increased traffic and central government agencies and
and loss of amenity they expect in scientific and research organizations.
the rural, they expect the rural area The formulation of the 2020 Action Plan
to be quiet and not busy (Interview, was undertaken over the period 2001 –
2004) 2004 (Environment Waikato, 2004b). A
significant aspect of the formulation was
The cooperative enquiry processes pro- a communitarian process of cooperative
vide a suitable setting in which to dis- enquiry known as the 2020 Forum. En-
cuss the diverse interests in relation to vironment Waikato prepared and distrib-
common values andpriorities. uted scientific and other information to
engage the Taupo Community in the
6.2. Theorization of Accountability As Forum (Participant Observation, 2020
A Process of Cooperative . Forum 2003-2004). The first debate and
dialogue session of the forum involving
Social processes of cooperative enquiry members of the Taupo Community com-
serve as the primary venue for commu- menced in July 2003. A monthly debate228 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
and dialogue session took place (every able and responsible for safeguarding
last Thursday of each month commenc- the common good, to address the pollu-
ing July 2003 until September 2004) tion and make collective decision on
until Environment Waikato produced the policy measures to counter the pollution.
2020 Action Plan in October 2004. The The way to discharge this form of re-
purpose of the forum was to address the sponsibility is by participating in the
issues relating to protection and manage- processes. Accountability relationship is
ment of Lake Taupo and the sustainable implied during these processes when
development of its catchments. One of there are members who do the answering
the researchers was able to attend all the and providing information (the account
debate and dialogue sessions of the 2020 giver) on the one hand and members
Forum and monthly meeting of LWAG who question, listen and receive infor-
over a period of 18 months.. mation on the other hand.
Community meetings were also organ- Accountability has new meanings i.e. it
ised by Lakes and Waterways Action means more than traditional or conven-
Group on a monthly basis to discuss tional concepts of accountability. It is a
matters which are of significance to the more holistic approach involving differ-
Taupo Community (Participant observa- ent parties. Some groups have direct im-
tion attending LWAG meetings in 2003- pact, others no impact but the whole
2004). This group has a good representa- community is involved. There is a sense
tion from various stakeholder groups in of moral responsibility to the community
the Taupo District (LWAG minutes of and this is discharged in several ways
meetings and participant observations). e.g. participating in community meetings
At the same time as Environment Wai- in the accountability process, giving
kato started community discussions opinions, answering, critically examin-
through the 2020 Forum, the main ing an issue because of a sense of ac-
agenda for the Lakes and Waterways countability. Various parties which par-
Action Group were centred around is- ticipate in the enquiry processes can be
sues on protecting Lake Taupo and the seen as parties attempting to form com-
sustainable development of its catch- munitarian accountability relationships
ments (Participant Observation 2003- in the Taupo District. One aspect of ac-
2004). countability which involves most of
these groups is the preparation and dis-
Participation of members of the Taupo semination of information to the com-
Community in the cooperative processes munity.
is motivated by a sense of responsibility
towards a common concern. Account- 6.3. Communal Values As The Basis
ability takes place when various commu- for Accountability
nity groups engage in a collective dis-
cussion to debate, seek and give expla- The values of the Taupo community
nation on the issues. It is the moral re- were identified through various surveys
sponsibility of the members of the com- and community consultation pro-
munity to participate in these processes, grammes undertaken by Environment
to take accountability for the common Waikato during the period 1998–2004
good – Lake Taupo – and to be answer- (Taupo Accord, 1999; APR Consultants’M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 229
2002a; 2002b; Environment Waikato, nutrients from farmlands in the sur-
2004a; 2004b). Environment Waikato rounding catchments.
identified three broad categories of com-
munal values: environmental, commer- Another environmental value is the aes-
cial and cultural (Environment Waikato, thetic worth of Lake Taupo and its sur-
2004b). These reflect the three crucial roundings (Environment Waikato,
elements of sustainability. The 2020 Ac- 2004b). The community want the wil-
tion Plan specifically mentions that the derness, scenery and geological features
economic and cultural values are inher- of the area to be protected from inappro-
ent in the environmental values priate development. The major human
(Environment Waikato, 2004b). A brief threat on these aesthetic values is urbani-
discussion of the community values sation which increases destruction of
which are presented in the 2020 Action natural areas, restrictions to legal access,
Plan follows. visual and noise pollution, destruction of
unique geological features, overcrowd-
6.3.1. Environmental Values ing and congestion.
The prominence of environmental values On a regional scale, Environment Wai-
in the Taupo Community and a strong kato was seeking a mandate from the
preference for preserving the Lake was Waikato community to enforce policies
reported in surveys conducted by Envi- to protect the natural environment
ronment Waikato. According to a sur- (Environment Waikato, 2001b). In No-
vey undertaken in the year 2000 vember 2000, public participation in the
(Stewart, Johnston, Rosen and Boyce, form of a survey of 1873 people in the
2000) 90% of the urban community and Waikato Region gave a strong mandate
91% of the rural community consider to Environment Waikato to take action
preserving the water quality of the Lake on environmental issues affecting the
as the most important issue for the region. The survey revealed a strong
Taupo District. The survey also reported environmental ethic in the region, the
that 78% of the respondents want the community’s awareness of environ-
protection of Lake Taupo to occur ahead mental issues and its unwillingness to
of development. allow activities that harm the natural
environment. The community did not
The community wants clear and clean wish to compromise environmental qual-
water in Lake Taupo in order to main- ity for economic growth. Environmental
tain a range of ecosystems and natural issues that were considered increasingly
habitats which support flora and fauna in important were water quality in local
the Lake; for trout fishing; to support streams, rivers and lakes. The commu-
recreational activities; for safe drinking nity was concerned about water pollu-
water that continues to meet the New tion from industries, towns and farm
Zealand drinking water standards; for runoffs. People rated the environment as
safe swimming; and for a weed-free lake more important than economic growth.
to reduce harm to the ecosystem The Taupo community does not accept a
(Environment Waikato, 2004b). The deteriorating lake, though at a slow rate,
major threat to the water quality in the and it was important to adopt stronger
Lake is groundwater carrying nitrogen measures to save the Lake.230 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
6.3.2. Commercial Values decision making related to environ-
mental management. The Maori tribe
Commercial activities which are recog- wants to improve communications with
nised as contributing to the economic government agencies and to be recog-
development of the Taupo District are nised as treaty partners in resource man-
animal farming in the catchments, tour- agement and decision making processes
ism industry based on the Lake’s natural in the Taupo district. The tribe also
features and values and the hydropower wants to reduce adverse impacts of ur-
schemes (Environment Waikato, 2004b). banisation on Lake Taupo and protect,
The Taupo Community realise the im- enhance and restore sacred places like
portance of continuous economic devel- burial grounds. The values of the Maori
opment that provides long-term employ- Community are also stated in its envi-
ment and business opportunities. At the ronmental management and strategic
same time the community wants eco- plans (Ngati Tuwharetoa Maori Trust
nomic development that builds on com- Board, 2002; Nga Hapu Ongati Tuwha-
munity. This includes protecting the lake retoa, 2000).
and its catchments from further degrada-
tion and preserving these natural re- The main threat to the cultural values of
sources for future generations. The 2020 the Maori tribe is the confusion about
Action Plan has described the duality of the roles and responsibilities of govern-
this development strategy as Eco- ment agencies and the lack of partner-
Development. ship between the Maori tribe and gov-
ernment agencies in the management of
The major threats to Eco-Development the natural resources of the Taupo Dis-
are degradation of water quality in the trict.
lake due to inflow of nutrients from
farming activities, diversification of land Non-Maori people also form a large por-
use, fluctuating Lake levels due to hydro tion of the population in the Taupo Dis-
power schemes, lack of infrastructure, trict. The Europeans own many busi-
tourism expansion which causes over- nesses and farm land and are an impor-
crowding, noises, littering around the tant part of the Taupo Community.
lake and lake side development such as However the 2020 Action Plan does not
motels, hotels and restaurants resulting link Non-Maori and other cultures to the
in loss of scenic and landscape values. cultural values of the Taupo Commu-
nity. Hence attempts to use cultural val-
6.3.3. Cultural Values ues in the interpretation of sustainability
are limited to the culture of the local
Cultural values have been related to the Maori tribe only and this may not repre-
beliefs of the Ngati Tuwharetoa, the sent a holistic interpretation of sustain-
Maori tribe in the Taupo District ability.
(Environment Waikato, 2004b). Accord-
ing to the 2020 Action Plan the Maori 6.4. Integrated Sustainable Develop-
tribe asserts custodial and customary ment Strategies Setting Benchmark
rights and sovereignty over Lake Taupo. For Evaluating Future Activities.
The tribe holds a holistic view of the
environment, which is at the core of its Since the late 1990’s Environment Wai-M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 231
kato and Taupo District Council with the The 2020 Action Plan (Environment
support of the Central Government, Waikato, 2004b) presents the values of
community groups and other sectors the community, threats to the values and
have developed several strategies for the ways to manage these issues. It focuses
future development of the Taupo District on what needs to be done in addition to
(Apr Consultants, 2002b; Environment the current work to reduce the threats to
Waikato, 2004a; 2004b). Three main the communal values. It outlines the new
strategy reports containing the outcomes actions to be undertaken by various
of public participation and cooperative agencies to assist the community to pro-
enquiry processes have been published tect and enhance the communal values.
to date i.e. Taupo District Economic De- Key agencies which were given the
velopment Strategy (APR consultants, mandate to address theses actions in-
2002b), 2020 Action Plan (Environment clude The Tuwharetoa Maori Trust
Waikato, 2004b) and Protecting Lake Board, Environment Waikato, Taupo
Taupo Strategy (Environment Waikato District Council, Department of Conser-
2004a). These strategies reflect the com- vation and Department of Internal Af-
munal values, in particular the commu- fairs. The Action Plan identifies an
nity’s strong preference for protecting “action manager’ – i.e. an agency – for
the water quality in the Lake. each new action. Each agency is to take
a lead in coordinating the actions by in-
The Taupo District Economic Develop- cluding community groups and other
ment Strategy (APR Consultants, 2002b) agencies in carrying out the actions.
acknowledges all the values of the
Taupo Community and supports ac- The Protecting Lake Taupo Strategy
tivites that protect and enhance Taupo (Environment Waikato, 2004a) is an
Districts lakes and waterways. The strat- outcome of several years of community
egy asserts that future economic devel- participation in public consultation proc-
opments in the district should ensure that esses organised by Environment Wai-
the environment is protected but not to kato to find solutions that protect Lake
the extent that growth is stifled unneces- Taupo and maintain the local economy
sarily. The strategy has identified strate- and community. It comprises a frame-
gic objectives, high priority actions, lead work of ideas that are intended to assist
agencies to implement the strategy and the Taupo community in developing
the time frame for implementation. Ar- more specific solutions to reduce the
eas covered in the strategy include busi- amount of nitrogen flowing into the
ness development, Maori economic de- Lake. To achieve the 20% reduction in
velopment, agriculture, education, en- nitrogen load the strategy suggests
ergy, forestry and tourism. The Lake changes to farm management and land
Taupo Development Company was uses in the surrounding catchments of
formed by the local authorities to coordi- the Lake. Nitrogen reducing options for
nate the implementation of the strategy, farm management include changing feed
to update the strategy document, coordi- regimes to reduce the amount of nitro-
nate the lead agencies and checking with gen excreted by stock and changing the
them on progress and reporting publicly mix of stock in farming systems to re-
on the progress. duce the overall amount of nitrogen
leached from a property. However these232 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
techniques will be more costly to operate activity that affects the natural environ-
and impinge on the economic well being ment. Clause 6 Part 1 of the First Sched-
of the farmers. Therefore the strategy ule in the RMA provides opportunities
also recommends conversion of the use for any person to make submission to
of land from animal farming to other the Regional Council on a proposed pol-
activities that yield low levels of nitro- icy statement or plan that is publicly no-
gen while providing returns comparable tified under Clause 5 of the First Sched-
to traditional farming returns. The alter- ule.
natives include forestry and switching to
horticulture. The strategy also proposes Based on the facts and arguments pre-
rules to implement a nitrogen cap in the sented at the hearing local authorities
catchments. These rules require that ex- make decisions related to approving or
isting land uses do not increase their ni- rejecting a proposed plan or activity
trogen leaching above current levels. A (Mitcalfe & Lang, 2002 ). A copy of the
nitrogen tax is being considered on ac- decision is sent to all submitters allow-
tivities which cause increases in nitrogen ing submitters the opportunity of appeal-
flows compared to existing levels of ing against the council’s decision in the
flows. The strategy provides guidelines Environment Court. Section 120 of the
to monitor future activities in the catch- Resource Management Act
ments in that it serves as a document for 1991provides the right of appeal to the
the community to compare future activi- submitters (RMA, 1991). The appeals
ties with the options proposed in the against the resource consent decisions or
strategy. appeals on plans or policy statements are
made to the Environment court. The
6.5. The Submission, Hearing and Ap- Ministry for the Environment provides
peals Processes Environmental Legal Assistance Scheme
for appellants (Mitcalfe & Lang, 2002).
The submission and public hearing proc- The Environment Court, also known as
esses are other means by which commu- the Planning Tribunal, is a specialist
nities in New Zealand can participate in Court set up under the RMA and con-
cooperative enquiry on activities that sists of Environment Judges and Envi-
affect the natural environment such as ronment Commissioners (Mitcalfe &
land, beds of lakes and rivers, coastal Lang, 2002).
marine area and on activities that dis-
charge contaminants into the environ- On 9 July 2005 Environment Waikato
ment (RMA, 1991, MFE, 2003). Further, publicly notified a Proposed Waikato
communities can also have a say in rela- Plan Regional Variation (Environment
tion to proposed changes in plans and Waikato, 2005). The proposed variation
policy statements of local authorities is an outcome of consultation with the
(Mitcalfe & Lang, 2002). The submis- community which was undertaken by
sion and hearing endorsed by the Re- Environment Waikato in its attempts to
source Management Act 1991 (RMA) in form the various strategies discussed
New Zealand. Section 96 of the RMA above. The purpose of the variation is to
allows any person to make a submission protect water quality in Lake Taupo by
to a consent authority about an applica- managing land use and nutrient dis-
tion for resource consent to carry out an charged to land in the catchments whereM. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 233
it may enter surface water or ground wa- maintain relevance of the Action Plan to
ter and subsequently enter the Lake. The all sectors of the Taupo Community.
variation document which is publicly
available contains background informa- The JMG is expected to meet on a quar-
tion and explanation on the pollution of terly basis to receive reports from the
Lake Taupo and related issues and pro- key agencies on actions being under-
posed policy measures, implementation taken, completed or planned and to de-
methods, environmental results antici- bate and dialogue on community con-
pated and details of how to make a sub- cerns on the values identified in the
mission. 2020 Action Plan. The JMG appears to
be mainly represented by government
The Taupo Community was given until agencies and local authorities. The only
2 September 2005 to lodge submissions link between the JMG and the commu-
on the proposed variations (Environment nity at large is the representation by
Waikato, 2005). During the submissions Lakes and Waterways Action Group.
period Environment Waikato received This group reports to the community
136 submissions from individuals, com- during its regular monthly meetings.
panies, Maori tribal community, envi- Feedback from the community is con-
ronmental groups, another regional veyed to the JMG through the represen-
council, industry groups, central govern- tative of the Lakes and Waterways Ac-
ment, community groups, territorial au- tion Group.
thority, tourism and recreational group
and others (Environment Waikato, 6.7. Dissemination of Information and
2005). The submissions addressed over a Two-Way Reporting Process
820 matters related to the pollution of
Lake Taupo. Information reported to the community
was mainly scientific in nature
6.6. The Joint Management Commit- (Environment Waikato 2004a, 2004b).
tee The information was mainly provided by
Environment Waikato, Central Govern-
The Joint Management Committee ment Departments, such as Department
(JMG) was set up in the Taupo District of Conservation, Ministry of Agriculture
to monitor the implementation of strate- and Forestry, Ministry for the Environ-
gies and progress on the action plans ment, etc and the Taupo District Coun-
that were identified during the commu- cil. The information was reported during
nal processes (Environment Waikato, community meetings, consultation, sub-
2004b). The JMG comprises of repre- mission and hearing processes, science
sentatives from various interest groups expo in the form of fact sheets, bro-
in the Taupo District including Lakes chures, complete reports, minutes of
and Waterways Action Group, Depart- meetings and power point and video
ment of Conservation, Environment presentations (Participant observation
Waikato, Taupo District Council, Maori during 2020 Forum, 2003-2004). An-
Tribal Community and Department of other medium of reporting includes web-
Internal Affairs. The task of the JMG is sites created by Environment Waikato
to ensure that the actions identified in and Taupo District Council containing
the Action Plan are carried out and to extensive information including scien-234 M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242
tific and economic research findings on forum could then take the informa-
the issues related to pollution of Lake tion back to their groups and share it
Taupo (Environment Waikato, 1999- with all their people and they come
2007) . The purpose of providing infor- back and report at the next forum so
mation is to enable members of the com- there is a cycle developed through
munity to participate in the cooperative giving out information to the stake-
enquiry on the pollution and in a way holder representatives they would
making the community accountable for share it with their groups and they
the common good. Community groups will bring comments back in the
such as farmers association – Lake next meeting
Taupo Care and Fonterra – and Lakes
and Waterways Action Group also pro-
vided some information to the pubic but 7. Conclusion and Reflection
information from these sources were
minimal when compared to the abun- The illustration of the Taupo Commu-
dance of material provided by local au- nity indicates that a communitarian ap-
thorities, in particular Environment Wai- proach to accountability becomes opera-
kato (Participant observation during tional when community groups partici-
LWAG meetings and 2020 Forum, 2003 pate in the local government policy mak-
-2004). ing and planning process. The distinctive
features of a communitarian approach to
The reporting process in the Taupo accountability discussed in this paper are
Community is a two-way process in that reporting to communities, critical en-
information is disseminated to various quiry by members of public on private
groups during the processes of coopera- activities, a lead role for the state (in the
tive enquiry and representatives of these illustration it refers to local authorities
groups in turn report this information to and central government departments) in
their respective organisations. In subse- the reporting and facilitating critical en-
quent community meetings, the repre- quiry, focus on communal values, and
sentatives report on their groups’ views symmetry of information to empower
and other information related to the issue communities. The process provides a
being discussed. This process aims to venue for enquiry on activities that af-
induce dialogue in the community. The fect communal values.
facilitator of the 2020 Forum made the
following comments on the reporting Accountability takes the form of report-
process during the 2020 Forum: ing and sharing of information in the
community; debate and dialogue in the
…to empower everyone that was community with some groups providing
there with information that can then explanations and others seeking clarifi-
be taken back to their groups and cations and querying; establishing
shared with their groups so the pre- benchmarks, roles, responsibilities and
senters who gave updates on the strategies and monitoring performance
latest of the scientific research and of agencies assigned key responsibilities
the findings of their investigation to manage and protect lake Taupo and
that information was presented to communal values. The communitarian
the forum each representative in the approach to accountability assigns a fa-M. Arunachalam, et. al. / Issues in Social and Environmental Accounting 2 (2007) 217-242 235
cilitating role to the state in order to with a willingness to share information,
bring more accountability to the commu- discuss and find solutions on issues that
nity. The state takes the responsibility to affect communal values.
prepare and disseminate information to
the public on issues that affect commu- We hope the communitarian framework
nal values such as environmental and will inspire private and public organisa-
social impacts of private activities. In tions to include community views and
addition the state provides appropriate communal values in developing corpo-
structures for a critical evaluation of rate governance strategies and making
these issues in the public sphere. This policies for corporate social reporting.
can take the form of debate and dialogue The model complements calls by re-
in forums and public consultation pro- searchers to consider accounting and
grams organized by the state. In this accountability as a social phenomenon
process members of civil society are involving the wider community and to
engaged to decide on the fate of activi- construct critical and democratic path-
ties that have negative repercussions on ways to accountability and strategies for
communal values. Accountability can be sustainability. The illustration of com-
enforced when private entities or indi- munity participation in the Taupo Dis-
viduals take part in community delibera- trict shows that the scope of accountabil-
tions and attempt to justify their activi- ity for the natural environment and soci-
ties in order to avert policy outcomes ety can be expanded beyond contempo-
that are detrimental to their legitimacy. rary CSR practices. It shows joint ac-
countability of a community, private and
The significance of the communitarian public corporations to each other.
approach to accountability is that it en-
hances citizen participation by creating
awareness and enabling members of a References
community to participate in a critical
enquiry on common issues. This ap- Adams, C. A. (2002) “Internal organisa-
proach also allows for more symmetry tional factors influencing corpo-
of information in that the community rate social and ethical reporting.
can gain access to information which Accounting , Auditing and Ac-
may not be disseminated by contempo- countability Journal, 15(2), 223-
rary models of accountability. The pri- 250.
mary purpose of the communitarian ap- __________ (2004) The ethical, social
proach to accountability is to safeguard and environmental reporting-
the common good and not the private performance gap, Accounting
interest of a limited number of members Auditing and Accountability
in the community. Journal, Vol 17 No 5, 731-757
APR Consultants, (2002a) Taupo Dis-
This case study illuminates a wider trict Economic Development
meaning for accountability. Account- Strategy – Economic Overview
ability in the community denotes a re- (Draft for Public Comment)
sponsibility on the part of members of Taupo.
the community to participate in _______________ (2002b) Taupo Dis-
a network of interactive relationship trict Economic DevelopmentYou can also read
