THE ROLE OF FINANCIAL ACCOUNTING IN CORPORATE SOCIAL RESPONSIBILITY (CSR) REPORTING

Abstract

Emphasizing the integration of accounting principles to increase the transparency, dependability, and credibility of CSR disclosures, this paper explores the vital part financial accounting plays in corporate social responsibility (CSR) reporting. As stakeholders—including investors, consumers, and governments—search for verifiable data on the social and environmental effects of corporate activity, demand for open and comparable CSR reports has grown in recent years. The paper investigates how financial accounting techniques including materiality, consistency, and verifiability might improve CSR reporting, so raising stakeholder confidence and helping long-term corporate sustainability. From voluntary, qualitative disclosures to standardized, quantitative models such the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB), the article examines the development of CSR reporting. It looks also at how using financial accounting ideas might enable companies to measure the financial influence of CSR initiatives by producing quantifiable results consistent with their corporate goals. By means of thorough case studies of top companies—Unilever, Microsoft, and Patagonia—this article shows how the inclusion of financial accounting into CSR reporting improves the credibility of CSR disclosures and strengthens corporate reputation. The results imply that companies who include financial accounting in CSR are more suited to show the value of their social and environmental investments, therefore fostering better decision-making, more involvement of stakeholders, and sustainable development.

This study offers a thorough framework for including financial accounting into CSR procedures, therefore contributing to the increasing corpus of knowledge on CSR reporting. It also draws attention to the advantages and difficulties of this integration, therefore guiding future directions of CSR reporting.

Keywords: Financial Accounting, Corporate Social Responsibility, CSR Reporting, Transparency, Stakeholder Trust, Global Reporting Initiative, Sustainability Accounting Standards Board