Social and environmental impacts assessment in the economy for the common good

Abstract

Traditional corporations handle their decision-making process according to a goal consisting in the generation of economic value, that is to say, the maximisation of the company value for the shareholders, maximisation of the economic added value, maximisation of profit, and so forth. Nevertheless, in recent years, a set of organisations that do not prioritise the creation of economic value have appeared, although they are not non-profits. Indeed, they pursue the generation of economic value, but at a level that guarantees their long-term viability. At the same time, their main objectives are not linked to this economic value, but are linked to the generation of positive social value or to the reduction of negative environmental impact. These “new” organisations, commonly referred to as hybrid organisations, need a tool to assess the social and environmental impacts they are generating, in order to guide their decisions concerning the goals they have set in these fields. In contrast to the accounting area, there is no generally accepted method to quantify the social or environmental impacts of a project, an activity or an organisation. Therefore, deeper research is required in this line. In this paper, we analyse the items that the matrix of the Common Good Balance Sheet (MCGBS) requires for its calculation and classify them according to their relevance for assessing social and environmental impacts. This allows us to evaluate whether these items (and, ultimately, the MCGBS) can be used as a means to quantify the social or environmental impacts generated by an organisation.