The Inclusion of Sustainability in the Accounting Curriculum

Current Offerings

To better understand how widespread sustainability courses are among accounting curricula, the authors searched the course catalogs of all colleges and universities in the United States that grant undergraduate or graduate accounting degrees to determine whether the accounting department currently offers a stand-alone course in sustainability reporting at either level. Of the more than 900 universities with undergraduate or graduate accounting programs, only 17 list a course entirely devoted to sustainability. The courses and their catalog descriptions are provided in Exhibit 1.

To ascertain the importance of accounting students’ learning goals related to sustainability accounting, the authors also polled instructors of sustainability accounting courses as to why they believe this topic is important for accounting students. Catherine Milburn, who teaches “Integrated Reporting for Socially Responsible Strategies” at the University of Colorado Boulder’s Leeds School of Business, provided some insight:

The Lack of Sustainability Courses

Despite the growing demand for CPAs with sustainability measurement and reporting knowledge, fewer than 2% of universities offer accounting courses in these areas. Through interviews with accounting faculty and CPAs, several potential explanations for the low supply of sustainability accounting courses emerged.

First, many schools may not have the faculty, time, or financial resources available to create and teach an entire course about sustainability reporting in accounting, although faculty may still include some of these issues throughout the curriculum. For example, in response to demands from the profession, many accounting programs have added a standalone professional ethics courses in recent years, while others have integrated ethics into existing courses. Likewise, sustainability reporting is also taught in places as part of an existing accounting course.

Second, the lack of instructional resources may be a barrier to the adoption of a new topic or creating an entirely new course. Since sustainability accounting is a relatively new subject, textbooks and other course materials may not be easy to find.

Third, it is possible that U.S. employers do not yet demand that graduates have sustainability reporting knowledge. Milburn notes that while “general employers value students that are aware of current trends and can discuss coherently sustainability issues,” CPA firms do not yet look for students with direct and in-depth sustainability knowledge. To explore this possibility, the authors asked Amanda Kraus, a manager in the climate change and sustainability services group of Ernst & Young, about her experience with sustainability accounting knowledge. During her graduate accounting program at the University of Wisconsin–Madison School of Business, Kraus developed a passion for sustainability and pursued a Certificate in Business, Environment, and Social Responsibility. As a new graduate, she initially joined Ernst & Young’s core assurance group, and after three years, she interviewed for and transferred to the firm’s climate change and sustainability services group, a specialty assurance practice. Amanda said, “The skills I learned in core assurance provided a foundation that, when combined with my CSR [corporate social responsibility] background, has provided excellent opportunities for my career.”

The Outlook for Sustainability Courses

Although sustainability courses in U.S. accounting curricula are currently scarce, there are some indications that this may be changing.

First, textbook publishers have in recent years developed several instructional resources devoted to sustainability reporting metrics. While the first text in the list below was published in 2010, the other three reflect the subsequent growing demand for sustainability accounting materials:

• Hopwood, A., J. Unerman, and J. Fries, Accounting for Sustainability: Practical Insights, Routledge, 2010.
• Bebbington, J., J. Unerman, and B. O’Dwyer, Sustainability Accounting and Accountability, Second Edition, Routledge, 2014.
• Thostrup, J., Investor Oriented Corporate Social Responsibility Reporting, Routledge, 2014.
• Sisaye, S., Ecology, Sustainable Development and Accounting, Routledge, 2016.

Although published before the more recent initiatives in sustainability reporting, the 2010 textbook could still be relevant in today’s classroom, as it provides instructors with a set of interesting case studies. The three newer textbooks discuss and explain the most recent voluntary disclosure rules and their application in various settings (Bebbington et al. 2014), sustainability metrics for investors (Thostrup 2014), and the relationship between ecology, sociology, anthropology, and business (Sisaye 2016). All of the books focus on international standards but include country-specific discussions as well. Notably, Ecology, Sustainable Development and Accounting includes a section on the application of the ecological framework to the U.S. government.

Furthermore, some financial and managerial accounting textbooks provide related sustainability reporting content in certain chapters. A sample includes:

• Kieso, D., J. Weygandt, and T. Warfield, Intermediate Accounting, 15th Edition, Wiley, 2014.
• Garrison, R., G. Chesley, R. Carroll, A. Webb, and T. Libby, Managerial Accounting, Ninth Edition, McGraw Hill, 2012.
• Braun, K., and W. Teitz, Managerial Accounting, Fourth Edition, Pearson, 2014.
• Whitecotton, S., R. Libby, and F. Phillips, Managerial Accounting, Third Edition, McGraw-Hill Education, 2016.

With instructional resources becoming increasingly more available, educators may find the task of developing a sustainability accounting course less daunting.

Second, though the current U.S. market for sustainability services provided by CPAs is growing, it is relatively small compared to its European and Australian counterparts, and therefore has considerable room to expand. This is especially true as investors begin to place more emphasis on the importance of sustainability information. Based on a 2015 survey published by Ernst & Young (“Tomorrow’s Investment Rules 2.0,” http://bit.ly/1qecoNz), nearly 60% of investors consider CSR or sustainability reports essential or important when making investment decisions. This represents an increase of almost 25% from 2014. As more investors rely on sustainability reports for their investment decisions, the market for accountants trained in sustainability will continue to grow. Kraus commented that “as CSR reporting increases, the role of the CPA will be important to add credibility and integrity to the information. Since we specialize in this area, CSR knowledge is a requirement. We audit against the GRI [Global Reporting Initiative], GHG [Greenhouse Gas] Protocol, etc., so knowledge of these frameworks is important.”

As this area expands and matures, accounting students will be more likely to benefit from courses that emphasize these sustainability frameworks and guidelines. Exhibit 2 summarizes the most common frameworks and guidelines that are likely to be included in current and future sustainability accounting courses.

Though large international firms would naturally seem to be interested in global accounting trends, such as the move to increased sustainability and corporate social responsibility disclosure, the topic is of interest to smaller national firms as well. Chelsie Cheney, director of strategic initiatives at Eide Bailly LLP, a top 25 national CPA firm, commented, “It is a wonderful idea to expose students to all types of reporting, as it may identify a connection to the accounting profession they hadn’t considered before. Sustainability reporting, as well as other non-financial reporting items, continues to gain momentum as consumers show increasing interest and are willing to back companies that are socially responsible.”

Finally, if future sustainability accounting course offerings are based on current student demand, it is likely that more sustainability accounting courses will be forthcoming. Milburn’s course at University of Colorado Boulder has had a wait list for the past three semesters.

Global trends in sustainability disclosure and reporting provide an impetus for educating accounting students in sustainability accounting issues. With the increasing demand for sustainability reporting and materials to teach sustainability accounting courses becoming more readily available, the authors expect courses to become more widespread.