Abstract
The COVID-19 pandemic highlighted and exacerbated pre-existing social, economic, and governance challenges while creating new complexities. More recent economic and geo-political developments such as the Russia-Ukraine War, global inflation surge and major adverse weather events have presented new challenges. As management accountants navigate these issues, they are positioned as key players in addressing immediate crises and fostering long-term adaptability. They can redefine their role to play an increasingly significant part in organisational resilience, tasked with ensuring that organisations are equipped to withstand and adapt to various disruptions while maintaining long-term, sustainable practices.
Resilience has been understood in different ways, including in relation to stability, recovery, adaptation, and growth. However, the lack of a unified framework has led to a “jingle-jangle fallacy” where different approaches to resilience coexist without clarity. While the literature on resilience reveals a range of framings and definitions across disciplines, it is commonly defined as the ability of individuals, teams, or organisations to adapt, recover, and thrive in the face of adversity. In this report, we apply this understanding as the lens for exploring the role of management accounting in building sustainability and resilience.
Management accounting scholars have long investigated the role of professionals and organisations in supporting decision-making in the context of sustainability strategy formulation and implementation, measuring and assessing sustainability, sustainability reporting and disclosure, supply chain sustainability, circular economy and resource efficiency.
Sustainability is defined here as a triple-bottom-line concept encompassing environmental, social, and financial viability. While links between sustainability and resilience are often acknowledged, empirical evidence remains scarce on how management accounting can effectively support both.
This report aims to provide insights and practical guidance to support management accountants and organisations in developing integrated approaches that effectively align sustainability initiatives with resilience strategies. The findings show two key themes:
1. The first theme highlights how organisations are evolving their management accounting practices to enhance resilience in response to external disruptions, focusing on dynamic budgeting, enhanced risk management, supply chain transparency, stakeholder engagement, and innovation.
2. The second theme sheds light on how organisations have integrated sustainability metrics into management accounting, providing a balanced view of financial performance alongside environmental and social responsibilities.
Although our study focuses on garment firms, the practices we document (such as managing complex supply chains, accelerating forecasting cycles, embedding ESG metrics, fostering cross-functional collaboration, and leveraging data-driven transparency) address challenges that are common to many industries facing volatility, regulatory change, and heightened stakeholder expectations. These findings reflect broader opportunities for management accountants in firms that operate across diverse sectors, particularly those with extensive supply chains, a mix of mass-market and premium positioning, and a growing need to integrate data analytics, ESG indicators, and scenario planning into their financial control processes. Accordingly, the insights and recommendations presented in this report can be adapted beyond the garment industry to support more resilient and sustainability-oriented management accounting practices across sectors.