Accounting for Stakeholders: Perspectives from Strategy, Entrepreneurship and Accounting

Abstract

Value creation stakeholder theory (VSCT) holds that optimal value for the firm will be created under conditions where the most value is also created for stakeholders. Analyses of risk, shared between the firm and its stakeholders, are central to VCST. Both firms and stakeholders take on risk when interacting with the other. Optimal risk taking for stakeholders requires that they have adequate knowledge related to their interactions with a firm, but established accounting practices and advances in non-financial accounting are deficient in that they do not provide all types of relevant information to all who take on risk. Further, firms need new organizational-level accounting concepts and approaches to enable stakeholder risk management for value creation. In this presenter symposium, the first paper will describe the theorized relationship between VCST and value creation stakeholder accounting (VCSA). VCSA is based on the proprietary convention, which better accounts for the potential for partnership and mutual value creation than do current accounting practices that are based on the entity convention. The next three papers offer critiques and possible extensions of the first paper from the perspectives of strategic management, entrepreneurship, and accounting scholarship. Together, the papers in the symposium seek to analyze and to engage critically with the ways in which accounting for stakeholders has implications for how value is created, accounted for, and distributed between the firm and its stakeholders.Accounting for stakeholdersPresenter: Ronald Mitchell; Texas Tech U.Presenter: Edward Freeman; U. of VirginiaPresenter: Michelle Greenwood; Monash U.Presenter: Harry J Van Buren; U. of New MexicoAccounting for stakeholders from a business policy and strategy perspectivePresenter: Robert A. Phillips; Boston U.Presenter: Joyce van der Laan Smith; U. of RichmondAccounting for stakeholders from an entrepreneurship perspectivePresenter: Saras D Sarasvathy; U. of VirginiaAccounting for stakeholders from an accounting perspectivePresenter: Robert Ricketts; Texas Tech U.