Dirk Raith (2020):
Preprint on Researchgate
Abstract. Materiality” in reporting is about what counts. In non-financial reporting, it has become a key principle lately. Reporting in that field is still largely voluntary, and the materiality principle is supposed to balance the perils and promises of such an approach. While its need, as a principle, is therefore usually agreed upon, its actual meaning remains to be contested. The article exemplifies these claims based on an indepth analysis of the recent European Union’s Directive 2014/95/EU on non-financial reporting, including its history and conflicting interpretations. Indeed, true to the EU’s 2011 “new definition of CSR”, the 2014 directive contains two different takes on materiality: one focusing on risks, shareholders and the business case, the other one focusing on impacts, stakeholders and the social case for CSR. The paper links these two views to those typically expressed in the GRI Standards for sustainability reporting and the IIRC’s <IR> Framework for integrated reporting, respectively. Fundamentally, it is to convey that the contest for materiality is actually a contest by proxy for CSR – for a “new spirit of capitalism” that’s either increasingly financialized or else more deeply embedded in the moral fabric of society. The paper makes an effort to highlight that theoretical and ethical dimension and to trigger a much-needed critical debate on the issue.
Extract. « 3 CSR – a “new spirit of capitalism”?
The theoretical framework I am going to apply to underpin my argument is based on Luc Boltanski’s and Ève Chiapello’s landmark book on The New Spirit of Capitalism (Boltanski & Chiapello, 2018 ). I will briefly recap their theory, then follow Chiapello’s modifications to it that allowed her to accommodate more recent expressions of that spirit (including CSR) and to apply it to accounting and financialization in particular. Eventually, I shall argue that the contest for materiality – as a contest by proxy for CSR – is actually an indication of a new spirit of capitalism in the making. I did provide the historical background for that argument in the last chapter. I will provide supporting evidence for it in the ensuing chapters. So, what do Boltanski and Chiapello (hereinafter B&C) actually mean by the term “spirit of capitalism”? Formally, they do not depart much from Werner Sombart’s (1987 ) and Max Weber’s (2002 [1904/05]) classical takes on the subject: By capitalism, they mean “an imperative to unlimited accumulation of capital by formally peaceful means” (Boltanski & Chiapello, 2018, p. 4), by its spirit “the ideology that justifies engagement in capitalism” (ibid., p. 8). They then also argue that capitalism needs such an ideology, apart from the material benefits it grants, to provide labourers and capitalists alike with “attractive, exciting life prospects, while supplying guarantees of security and moral reasons for people to do what they do.” (ibid., 25, also 16, 485f; cf. also 2005, p. 164) Yet, given that it cannot produce that spirit out of its own resources, they argue, capitalism also “needs its enemies, people whom it outrages and who are opposed to it, to find the moral supports it lacks and to incorporate mechanisms of justice whose relevance it would otherwise have no reason to acknowledge.” (idem, 2018, p. 27; also 2005, p. 163) So, what B&C describe here is a dialectical relationship between capitalism and its critique – yet not the way Karl Marx had initially conceived of it, in terms of a revolutionary sublation of capitalism into socialism, as a result of antagonistic (and eventually violent) class struggle (Marx, 1971 [1843/44]). Rather, they point to criticism’s functional role, as a “motor” (B&C, 2018, p. 27) or “principal operator of creation and transformation” (ibid., p. 489) of the spirit of capitalism that at the same time “legitimates and constrains the accumulation process” (ibid., p. 24ff) – with the effect of contributing to capitalism’s very resilience: “It is probably this surprising capacity for survival by absorbing part of the critique that has helped to disarm anti-capitalist forces.” (ibid., p. 27; cf. also 2006, p. 163) It all boils down to a “dialectical model of change … wherein capitalism transforms itself by integrating critique.” (idem, 2018, p. xvii)1 B&C, in their book, went to great lengths to reconstruct that process of normative change, for France, based on an in-depth study of management literature from the 1960s up until the 1990s. In that context, they constructed two ideal-types of criticism which they called the “social” and the “artistic” critique, both focusing on distinctive faults of capitalism, resp., and triggering distinctive changes in the capitalist spirit (cf. ibid., p. 38f). Also, they did tie in with an earlier approach developed by Boltanski and Laurent Thévenot (2006 ) that had distinguished six “cities” in the sense of normative “conventions” or “supports” (B&C, 2018, p. 22f – “Cités” or “justificatory regimes” in B&C, 2005). Each of these “economies of worth”, as they are also referred to, is directed towards a particular expression of justice or the common good, including a particular “principle of evaluation” and corresponding “tests” in order to establish a person’s respective value or “greatness”, in that particular “city” (idem, 2018, p. 22ff). B&C’s later research did produce yet another “Seventh City”, the so-called “projective city” (ibid., p. 103ff – “Projects-Oriented Cité” in idem, 2006). » (p.5-6)
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