i A STUDY ON SOCIAL AND ENVIRONMENTAL
ACCOUNTING, THE CORPORATE SOCIAL
RESPONSIBILITY: AWARENESS, BENEFITS AND PROBLEMS
FACING BY VIETNAMESE COMPANIES BY
LE THI HOA Graduation Project Submitted to the Department of Business Studies,
HELP University College, in Partial Fulfilment of the Requirements for
the Degree of Bachelor of Business (Accounting) Hons OCTOBER 2011
ii

DECLARATION OF ORIGINALITY AND WORD COUNT

I declare that this graduation project is based on my original work except for
quotations and citation which have been duly acknowledged. I also declare that it has
not been previously or concurrently submitted for any other courses/degrees at HELP
University College or other institutions. The word count is 9857 words.


Last but not least I would like to thank my friends especially those who stand side by
side help me from the beginning until completing this thesis.

iv

A STUDY ON SOCIAL AND ENVIRONMENTAL ACCOUNTING, THE
CORPORATE SOCIAL RESPONSIBILITY: AWARENESS, BENEFITS AND
PROBLEMS FACING BY VIETNAMESE COMPANIES
BY
LE THI HOA
OCTOBER 2011
Supervisor: Dr. PHAM DUC HIEU.
ABSTRACT

The social and environmental issues and the impact of them on the decision making
process have been increasingly given attention to the financial reporting. Over time
there are many studies about Social and Environmental Accounting that have
different views and arguments on the importance to the corporate report. In
developed countries, the social and environmental accounting has joined the financial
report and annual report; however it is still a new concept to Vietnamese enterprises.
The objective of this study is to assess the understanding of Vietnamese people on
the social and environmental concept, their implementation on companies in Hanoi.
In order to collect data for the research, questionnaire survey will be used as a
helpful method. The finding uncovers that although most people understand the
importance of social and environmental activities and having corporate social
responsibility reports, few of Vietnamese companies is able to quantify the cost and
benefits of social and environmental activities as in the financial report.

3 CHAPTER 3: RESEARCH METHOD 28
3.1 Research Objectives 29
3.2 Research methodology 29
3.3 Data sources 31
3.3.1 Primary data 31
3.3.2 Secondary data 31
3.4 Sampling 32
3.5 Research instrument 32
3.6 Limitation of the research 33
4 CHAPTER 4: RESULT AND DATA ANALYSIS 34
4.1 Introduction of Agribank and BaoViet Group 35
4.1.1 Introduction of Agribank 35
4.1.2 Introduction of BaoViet Group. 36
4.2 Description of Respondents‟ information 38
4.2.1 Description of respondents‟ age 38
4.2.2 Description of respondents‟ gender 39
4.3 Description and Analysis of respondents about the Awareness of Social and
Environmental Accounting 40
vii

4.4 Description and Analysis of respondents about the Implementation of Social
and Environmental Accounting: 43
5 CHAPTER 5: CONCLUSION 49
5.1 Conclusion 50
5.2 Recommendation 51
5.3 Limitation of study 53
5.4 Suggestion for future research 53
6 REFERENCES 55
7 APPENDIX 58

CSR
:
Corporate Social Responsibility
SEA
:
Social and Environmental Accounting
TBL
:
Triple bottom line
1

particular actions such as: environmental impact assessment, paying environmental
tax, classifying and treating solid waste, minimizing the costs on materials, fuel and
reducing the costs for waste. Especially in the background of international economic
integration and globalisation, the competition is fierce and fiercer, many enterprises
only concern on their short-term benefits and have decisions and actions with
negative impacts on the environment; as a result, they have to pay the penalty for
their actions when the consumers and the society boycott their products. This fact
forces the enterprises to consider the environmental and social accounting in the
accounting tasks of the enterprises.

3

CSR links the responsibilities of the enterprises with the society and links the
activities of the enterprises to the strict environmental and social standards, and
support the community in different manners. Accordingly, besides the criteria on
using advanced, clean, environmentally friendly technologies, reducing carbon gas
and toxic substances which may cause bad impacts on the ozone layer, and climate
change, enterprises are also required to be transparent in their production and
business activities and the leaders of the enterprises should be responsible for
explanations to relevant competent authorities. To implement CSR, first of all, it is
required to have high agreement within the enterprise, the conformity to the
regulations of the state and local regulations of the enterprises on enterprise
administration, local rules on control and audit activities and business ethnic.

Thus, CSR is not the thing that the enterprise can have immediately. This requires a
long run for both constructing and learning experience from mistakes in the past to
direct to the sustainable future. Then, besides financial statements, report on business
results, report on social responsibilities implementation of the enterprises, Corporate
Responsibility Report and Sustainability Development Report are the indispensable
documents in the annual report. For enterprises posted on the security exchange, this

trademarks such as Vinamilk, Dutch Lady have concerned and supported by the
consumers. Or HUB Café, a medium and small-sized enterprise is also implementing
CRS by creating a community library with more than 100,000 books serving for
customers. HUB Café is being constructed to become a place for sharing knowledge
5

and documents which is very useful for students and the research community to
organize exchanges and conferences on issues relating to study, working experience
and career.

However, in Vietnam, it should be admitted that after what happened to Vedan, Tung
Kuang, Vinamit we should remind about the construction and execution of social
responsibility of the enterprises. Because, only after the cases became on public, the
management agencies tried to find out the solutions while the consumers and the
society had to suffer from consequences. With information about the impacts on the
environment, ecology and social life of most of people, the view about dividend
distributed from the profit that the enterprises gain from avoiding wastewater
treatment should be reviewed, this will have direct ratio to the ratio of consumers
who refuse to use the products and services provided by these enterprises. This fact is
unavoidable. The Vietnamese enterprise community has not yet paid attention to the
implementation of CSR with typical examples such as: wastewater treatment, failing
to conform to the obligations of the enterprises to the state budget, commercial fraud,
production of counterfeit goods, and circulation of goods with poor quality. Another
example is that the enterprises waste, lose or use ineffectively the investment capital
from state budget which is actually the tax payments from the people and enterprises.
Regarding to the environmental pollution in Vietnam, in order to complete in the
global economy, the enterprises are required to ensure that their operations will not
cause any negative impacts on the ecological environment; it means that their
production procedures must be environmentally friendly. This is an important
criterion for the consumers because the fact of environmental pollution caused by the

of the Vietnamese enterprises at the present is information which leads to the
situation that the enterprises do not know where to start jobs relating to CSR. To
promote the implementation of social responsibility of the enterprises, the best
solution is to establish an association or organization in charge of monitoring and
consulting the enterprises. The state should issue policies supporting for enterprises
to implement CSR.

1.3 Problem Statement

Recently the public is watching closely to pressing cases of violating business ethics
and destroying the environment and health at serious level such as milk with
melamine in China or discharging untreated wastewater directly to Thi Vai River by
Vedan Company in Vietnam. The wrong-or right of the above cases are clear.
However, for the society and thousands of operating enterprises, the issue of
Cooperate Social Responsibility (CSR) is set up and requires to be discussed
seriously in terms of policy argument and practice.

What should a company do to be evaluated by the society as a good company with
sustainable development? What are the responsibilities of the state management
agencies? Which level should the law regulate about the corporate social
responsibility? Whether or not the consumers in developing countries have fewer
rights and or they are vulnerable or they are not provided with sufficient rights and
means or fail to use sufficiently the rights and means given to them to protect their
legitimate benefits? Instead of some enterprises which have applied CSR policy and
ethnic rules, we normally base on top-down approach while the suppliers apply the
8

ethnic rules when they are required from the customers other than they develop CSR
themselves to expand their market share. This may require the enterprises to apply
many different ethnic rules, depending on the number of customers that they are

international organisations such as WTO, ASEAN, etc. This circumstance causes
radical changes of the business‟s perception of most companies that they have to
consider both internal and external environments. Therefore, the concept of
traditional accounting, which the accountants deal with only the issues that take place
within the organisation itself or between it and its suppliers or customers, has to
change to the modern view, in which they have to adapt to a new social climate of
community accountability to all stakeholders.

Vietnam nowadays has been facing with financial difficulties such as the high rate of
inflation. Many companies are striving to reduce their expenses by actions to infringe
legal rights of employees and pollute the environment. They are not aware of the
consequence to the whole economy and the negative impacts to their business‟s
performance in the long term. Some companies consider the implementation of
social contribution and environmental preservation as a part of their advertisement
strategy or charity activities. Consequently, their business reports mainly focus on
the financial issues and the cost of CSR activities is taken from their profits rather
than considered as an initial expense.

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1.4 Objectives and Scope of Research

Objectives of Research:
- To investigate the understanding of people about CSR and Environmental and
Social Accounting in Vietnamese companies;
- To understand the current implementation of CSR and Environmental and Social
Accounting in Vietnamese companies.

Scope of Research:
- Research conducting place: Agribank and Bao Viet Group, Ha Noi, Viet Nam.

make it easier to follow. These sub-sections are listed in the beginning of each
chapter.
12 2 CHAPTER 2: LITERATURE REVIEW

This chapter analyses the information of accounting theory, CSR, social and
environmental accounting, and their application in practice. The concepts and
theories related to these issues will be indicated as the background of the research.
Chapter 2 includes the following parts:

2.1. Accounting theory
2.2. Corporate Social Responsibility
2.3. Social and Environmental Accounting
13 2.1 Accounting theory

2.1.1 Definitions and objectives of accounting

Accounting is a comprehensive discipline and it is difficult to explain satisfactorily
through any single definition. According to The American Accounting Association,
accounting is defined as
1
:

"the process of identifying, measuring and communicating economic
information to permit informed judgments and decision by users of the

iii) To ascertain the financial position of the business: The businessman is
not only interested in knowing the operating result, but also interested in
knowing the financial position of his business i.e., where it stands. In other
words, he wants to know what the business owes others and what it owns,
and what happened to his capital-whether the capital has increased or
decreased or remained constant. A systematic record of various assets and
liabilities s facilitates the preparation of a statement known as balance sheet
(position statement) which answers these questions.
iv) To provide accounting information to interested parties: Apart from the
owners, there are various other parties who are interested in knowing about
the business firm, such as the management, the bank, the creditors, the tax
authorities, etc. For this purpose, the accounting system has to supply the
required information.

1

15 The theoretical framework of the research is emerged from the scope of accounting,
the accounting as an information system, and the role of accounting theory to reflect
the concept of people about accounting and accountability.

Figure 2.1: The theoretical framework of the research

The scope of accounting is to look for the transformations in the ways in which
accountants assess and report corporate performance. With the development of the
sustainability agenda which embraces not only environmental and economic
dimensions but also social and ethical dimensions or what we call now is „triple
bottom line‟ of sustainable development. This means that business people and

"…the corporations continued existence requires the support of the
stakeholders and their approval must be sought and the activities of the
corporation adjusted to gain that approval. The more powerful the
stakeholders, the more company must adapt. Social disclosure is thus
seen as part of the dialogue between the company and its
stakeholders."
(Gray et al, 1995, p. 53)