Towards social and environmental accounting and finance

2020-03-16 Gone are the days of short-term profit maximisation. The new Master's programme "Management & Sustainable Accounting and Finance" aims to bring business studies and sustainability science closer together.

In 1863 Friedrich Bayer founded a small company near the river Wupper, which produced basic materials for paints and fibres. Today, Bayer is one of the world's leading pharmaceutical and chemical companies. For a long time, its shares were considered a profitable investment - until Bayer took over glyphosate producer Monsanto and a huge wave of lawsuits rolled in on the company. "Although the merger was legal, the behaviour was considered illegitimate by the public and Bayer has since lost a massive amount of reputation. Listed companies today are branded if they are not managed in a socially and environmentally responsible manner," says Patrick Velte. The Professor of Business Administration, in particular Accounting, Auditing & Corporate Governance, therefore advocates a change of thinking in business administration research and teaching. Sustainability ought to be an integral part of business studies for future managers and consultants from the outset. Therefore, the new master's programme "Management & Sustainable Accounting and Finance" will start next winter semester at Leuphana. The programme can be studied in English, is international and research-oriented, and comprises six core modules of Sustainable Accounting & Finance in addition to three research modules, three management studies modules, three complementary seminars and three elective modules. The latter can also be combined from other Leuphana master's programmes. "The analysis of large data sets, primarily for assessing the sustainability performance of companies, is a focal point of the curriculum. Students write fewer exams, but more research-oriented essays," says Velte. To this end, Leuphana has a database for empirical seminar papers and final theses, which makes equally available financial data (e.g. return on investment) and sustainability information, e.g. CO2 emissions.

The programme "Management & Sustainable Accounting and Finance" therefore prepares students for career paths in professional practice, as well as for a doctorate. Sascha Brake is in his 3rd semester of the master's programme "Management & Finance and Accounting" and would like to do a doctorate at the Institute for Management, Accounting and Finance (IMAF) after graduation. "My economics bachelor's degree at Leuphana already had a strong methodological focus. This will be continued strictly in the master's programme. Empirical-quantitative studies as well as scientific writing and literature research were the main foci," he reports. He is particularly interested in sustainable business studies: "Empirical sustainable finance research is still comparatively young, although it is becoming increasingly relevant. Through "Fridays for Future", public pressure for a fundamental transformation of entrepreneurial business models is growing. In addition, there are a growing number of regulations that encourage companies to adopt sustainable corporate finance and reporting (e.g. climate reports). In his master’s thesis, Sascha Brake would like to investigate the effects of C02 performance on the value of a company. Patrick Velte not only regards sustainable accounting and finance as a corporate responsibility, but also recognises a great backlog demand on the part of practitioners. "Many executive and supervisory boards of German listed companies will have to significantly increase their sustainability expertise in the coming years by appointing Chief Sustainable Officers and Sustainability Committees. The demand for managers and consultants in Sustainable Accounting & Finance is therefore very high".

Prof. Dr. Patrick Velte, head of the new master's programme "Management & Sustainable Accounting and Finance" and master's student Sascha Brake.