Social Statements: A Proposal for a Social-Value Balance Sheet and Profit-Loss Statement
Measuring what companies owe society, not just what they earn
Companies today hide their social and environmental damage in their accounting — treating it as free. Researchers have designed a new dual reporting system, modeled on profit-and-loss statements, that forces firms to measure and disclose their actual impact on relationships, communities, and the world. The method assigns numerical scores to a company's social ties and actions, making social value as visible and comparable as financial value.
When companies only count money, they systematically ignore pollution, broken communities, and eroded trust — costs that everyone else pays. A standard social balance sheet would make harm visible to investors, regulators, and the public, giving markets real information for the first time. This could shift which companies attract capital and which face pressure to change, making social responsibility a business requirement rather than an optional add-on.