Headlines: January 10th, 2005

Ten years on from the Rio Earth Summit few government departments, agencies or local councils have mainstreamed sustainability and they do not systematically issue sustainability reports. The Summit recognized the crucial role of public service organisations in promoting sustainability, but with some exceptions they have failed to deliver. In contrast there has been a steady growth in sustainability reporting by listed companies.The wake-up call comes in a discussion paper published by the Chartered Institute of Public Finance and Accountancy ‘Advancing Sustainability Accounting & Reporting: An Agenda for Public Service Organisations’. The paper is designed to challenge and stimulate debate and thinking on sustainability reporting within the public services.

It describes a sustainability report as an assessment of performance achieved through a combination of: leadership; strategic partnering; stakeholder engagement; policy outcomes and the management of the organisation’s impacts on the local environment, social well-being and economic prosperity. It presents the case for placing sustainability accounting and reporting in the public services at the heart of the modernisation agenda.

The paper is critical of the lack of balance in the public sector between the efficiency agenda and environmental cost management. It argues that the Gershon report on public sector efficiency fails to identify the potential of ecoefficiency in relation to the public service’s financial ‘bottom line’.

One of the key differences between the public and private sectors is that to date, no ‘business case’ for sustainability reporting has been made in the public services. The institutional context in which UK public services operate, including inspection regimes, places little emphasis on rewarding sustainability and therefore such issues are pushed down the agenda.

The paper suggests an approach that uses existing improvement and performance management frameworks, including performance indicators, to mainstream sustainability reporting. Until public bodies respond to the challenge the ‘business case’ for sustainability reporting by the UK public services will remain an outstanding strategic issue.