Through the Looking Glass: Tying Performance and Materiality to Corporate Purpose

Journal of the British Academy, 10(s5), 87–123 2022

38 Pages Posted: 7 Jun 2023

See all articles by Judith C. Stroehle

Judith C. Stroehle

University of St Gallen

Kazbi Soonawalla

University of Oxford - Said Business School

Marcel Metzner

University of Oxford - Smith School of Enterprise and the Environment

Date Written: August 26, 2022

Abstract

By making use of the purpose definition set out by the British Academy’s Future of the Corporation programme we argue that performance relates to purpose in two dimensions. Firstly, purpose sets the frame of long-term success and defines materiality for an organisation both from a single and from a double materiality perspective. Secondly, performance in relation to purpose needs to measure profitability net of negative externalities. We review and discuss the current landscape of non-financial reporting and measurement frameworks on how they lend themselves to the determination of materiality on the one hand and to the accounting of externalities on the other hand, in order to achieve an approximation of performance in relation to purpose. We conclude by discussing how materiality and measurement viewed through a purpose-lens could help an advanced understanding of performance in practice for sustainable finance, corporate governance and management decision-making.

Note:

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Keywords: Non-financial measurement and performance, materiality, corporate purpose, sustainability accounting.

JEL Classification: M14, M40, A13

Suggested Citation

Stroehle, Judith and Soonawalla, Kazbi and Metzner, Marcel, Through the Looking Glass: Tying Performance and Materiality to Corporate Purpose (August 26, 2022). Journal of the British Academy, 10(s5), 87–123 2022, Available at SSRN: https://ssrn.com/abstract=4456656

Judith Stroehle (Contact Author)

University of St Gallen ( email )

Müller-Friedberg-Strasse 6/8
St. Gallen, 9000
Switzerland

Kazbi Soonawalla

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain

Marcel Metzner

University of Oxford - Smith School of Enterprise and the Environment ( email )

United Kingdom

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