Editorial: Multi-capital accounting models: from infancy to teenage years

Multi-capital accounting refers to models that take into consideration not just economic data, but rather data on the environmental, social and human consequences of organisational activities over a given period. Because they focus on organisations, they differ in scope from national environmental or social accounts, as well as from product footprints. Consideration of non-financial dimensions is expected to better inform the user of the accounts on the non-financial “performance” of the organisation. As such, its development is very much associated with the pursuit of sustainable development.

The guest editors of this themed section have carried out research on multi-capital accounting for the last 12 years, in close relationship with practitioners from corporations interested in adopting this type of accounting as well as with consultants eager to add this service to their offer. many engaged researchers before us (Lamberton, 2000; Bebbington and Gray, 2001; Antheaume, 2004; Herbohn, 2005), our first attempts failed to transform the businesses for which we developed models, as the models were not used beyond the first experiments (Taïbi et al., 2020).

Nonetheless, the interest of practitioners in Europe remained high enough to enable the funding of several research projects focused on multi-capital accounting (through private contributions to foundations and European research funds). This themed section was initiated by the members of such a research project, created to develop an integrated multi-capital accounting model based on the concept of planetary boundaries (Rockström et al., 2009; Steffen et al., 2015) and social foundations (Raworth, 2018). Our aim was to enable organisations to evaluate how they contribute to the respect of these boundaries and foundations and to transform themselves accordingly. The final research seminar organised by the team was the opportunity to bring together multiple actors to reflect on two questions:

The contributions to this themed section derive from these discussions.

The title of this paper also stems from this context. After an infancy characterised by multiple relatively small-scale attempts from the academic and the consulting worlds in the 2010s, the field of multi-capital accounting practice has been shaped by the creation of large global alliances, involving major audit firms, multinational corporations and some research centres (such as the Natural Capitals Coalition, the Value Balancing Alliance or the International Foundation for Valuing Impacts) in the first half of the 2020s. Over the last ten years, some countries, for example, France, also witnessed the creation of dedicated research initiatives hosted by universities with both public and private funding (such as the ecological accounting chair and the positive business UNESCO Chair in Paris, the multi-capital global performance chair in Nantes or the triple accounting chair in Marseille).

This institutionalisation is aligned with the work carried out by sustainability reporting standard setters, although with a time lag. Following the creation of multiple projects, there has been a “consolidation” of previously separated private reporting standard setters under the umbrella of the International Sustainability Standards Board (ISSB) and the evolution of performance reporting regulation through the European Corporate Sustainability Reporting Directive (EU CSRD) (European Commission, 2022). The multi-capital accounting scene, now entering its teenage years, might also follow the same trend. It is already starting, as the International Foundation for Valuing Impacts, mentioned above, has now become part of the Natural Capitals Coalition, also mentioned above.

Multi-capital accounting (MCA) systems emerged in the wake of the diffusion of the IIRC (2013) integrated reporting framework and are a continuation of the full cost accounting models and environmental accounting attempts dating back to the seventies (Taïbi et al., 2020). MCA research is interested in the human interactions and processes in relation to the definition and commensuration of non-financial drivers of organisational performance. Non-financial dimensions, called capitals in all models this themed section refers to, can describe elements from nature (resources, climate stability, soil, biodiversity…), society (social interactions, education, health, infrastructure) or individuals (skills, creativity…). The data inputs are measured in monetary and physical units. They include legal compliance costs, taxes and fines paid. Others require an evaluation of social consequences such as life expectancy loss due to air pollution. This loss can also be expressed as a social or economic cost. Others can be flows of energy or raw materials used. The data outputs of MCA models include units of environmental impact or units describing social change, but also monetary values.

To account for non-financial dimensions, the models borrow from financial accounting concepts such as profit and loss or P&L (Kering), costs (Antheaume, 2004; Herbohn, 2005), value (Hendriksen et al., 2016) and capital (Rambaud and Richard, 2015; Ingram et al., 2024). While the concepts of flow and allocation are present across all models, their definitions vary depending on which systems view is dominant in the conceptors’ mind. The differences between the models are related to which side of the balance sheet the concept of capital should refer to. We have identified three broad visions:

1. The first vision is related to the International Integrated Reporting Council, which initiated the idea of accounting for multiple capitals. When it was created, in 2010, its purpose was to integrate different strands of reporting (financial statements, management commentaries, governance reports and sustainability reports). Capitals were described as resources or relationships the company needed to ensure its success. The extent to which these capitals were either depleted or replenished was presented as having an important impact on the long-term viability of an organisation. Businesses were required to present how they created value over different time horizons, by relying on several capitals. The focus was on showing what capitals were used and how in return an organisation contributed back to these capitals, created value for investors, employees, customers and society. It was criticised (Flower, 2015) for not meeting the sustainability reporting ambitions it had set itself, sparking a debate on whether it was too early to judge (Adams, 2015) or needed at all (Thomson, 2015). Ultimately the IIRC was dissolved in 2022 when it became part of the IFRS Foundation. Furthermore, this approach did not embed the idea of carrying capacities and it allowed trade-offs between different types of capital.

2. The second vision is closely related to mainstream economics where capitals are assets an organisation owns or to which it has a right of use. At the country level, this is exemplified by the UN System for Integrated Environmental and Economic Accounting (La Notte, 2024). At the organisational level, this is the case of True Value (Hendriksen et al., 2016), the Value to business framework (Stuis et al., 2025), the Impact Account conceptual framework (IFVI and VBA, 2025), the Impact Weighted Accounts (Impact Economy Foundation, 2022). These models refer to natural, human and social capitals as stocks on which “entities rely […] using and converting these resources through their activities into outputs.” (Stuis et al., 2025, p. 2). The stocks the entity controls must remain sufficient to ensure regular flows. However, the concepts of thresholds or carrying capacities, are not explicitly used to support this vision.

3. The third vision frames capitals as liabilities, as long-term debt incurred by the organisations for using collective resources and deteriorating them through their use. This is the case of the CARE (Rambaud, 2024) and LIFTS (Gibassier, 2025) MCA models. In this light, a threshold or a carrying capacity, can be defined as maximum systems-level deterioration, with an allocation of responsibilities. For example, we can consider how much water can be extracted from a water table in a specific region and what should be done to restore it back to a “healthy” level. This implies defining what is a « healthy » level, using scientific knowledge and through discussions. In these discussions, the river can be considered as a legal entity, with a right to be represented. It can mean giving less water rights to corporations, aligning the quantities drawn with natural replenishment capabilities or restoring targeted ecosystems to improve the rate of replenishment. Who does what and who pays for what needs to be defined for each entity to act accordingly and to account for it. As such, these models highlight what should be done to preserve non-financial capitals. As corporations become accountable for the maintenance of human and natural capital, they become stewards of non-financial “budgets” allocated to them (Österblom et al., 2022). They embed a consideration of carrying capacities (Arrow et al., 1995) into the accounting.

While these visions rely on accounting concepts commonly used in practice, the actual frameworks chosen to measure these elements are framed by ontological preconceptions of human–nonhuman relations, by the role and responsibilities of public and private organisations in socio-natural systems and the level of accountability to consider.

For example, accounting systems that consider manufactured capital as a possible substitution to natural capital destroyed in the process of creating economic value are described as serving “weak sustainability”, when refusing this substitution is described as strong sustainability (Pearce and Turner, 1990; Pelenc and Ballet, 2015). In a weak sustainability framework, bees destroyed by pesticides could be replaced with miniature drones or all crops depending on bees could be genetically engineered to become self-pollinating, thus creating new market opportunities and solving the problem of service deterioration. On the other hand, a strong sustainability approach would consider this ecosystem re-engineering as an irreversible debt towards natural capital.

Although one can build bridges across the three visions, we hold the view that MCA comes closer to accounting for sustainable development if the model is not just a record of stocks and flows, but if it also includes natural and social thresholds. This helps express corporate accountability for the well-being of humans and nature, beyond legal boundaries, to include the entity’s area of influence. It can thus serve the goal of double materiality analysis introduced by the EU CSRD (European Commission, 2022).

MCA models developed by practitioners and researchers are in essence rooted in environmental science to evaluate organisational consequences on the environment. Birkin (1996) and Milne (1996) highlight the need to acknowledge the “burden” that human activities impose on the environment and to account for the respect of natural “carrying capacities”. Early multi-capital attempts by Lamberton (2000), Rambaud and Richard (2015), Taibi (2019) or later ones such as Gibassier (2025) consider sustainability as a system-level condition. It needs to be translated at an organisation-specific level and include the concept of carrying capacity. Other proposals, such as the “True Value” methodology (Hendriksen et al., 2016) fail to incorporate this concept, mostly because they rely on the cost of externalities to value impacts and translate all non-financial dimensions into one monetary unit. The externality model and its underlying economic optimum philosophy, does not align well with a respect of carrying (or assimilative) capacities and can lead on the contrary to “a total destruction of the environment’s assimilative capacity” (Pearce, 1976). By expressing all impacts at the economic value of actors’ utility, this valuation commonly obfuscates physical realities.

In other words, MCA studies whether these dimensions should and can be translated into a common unit and referred to a higher-level objective; and how this could be done and reported. As such MCA researchers contribute to the literature on social and environmental accounting (SEA). They question not only reporting practices, but also the framing, implementation and associated visions of sustainable development, corporate impacts and accountability. Central to this enquiry is the nature of the information produced and its ability to inform corporate trajectories for sustainable development. Following academic frustration with SEA research’s inability to efficiently address sustainable development challenges, Bebbington and Larrinaga (2014) call for accounting research to position itself in sustainability science. They frame the latter as an approach that widens the object of research beyond organisational boundaries, includes “a transdisciplinary approach” and considers the consequences of its application on individuals, societies and the environment [Bebbington and Larrinaga (2014, p. 396)].

Within this stream of research, social and environmental impact data is not enough if they are not related to the ability of ecosystems and society to remain viable and withstand the consequences of these impacts. This derives from the idea of social and environmental thresholds, beyond which irreversible effects may occur. Some thresholds are global, such as for climate change, with a maximum quantity of greenhouse gases that can remain in the atmosphere while limiting global warming. Others are more local, such as for freshwater use, with a maximum quantity of water that can be withdrawn from a river or a given level of biodiversity that needs to be preserved. Respecting these thresholds implies an allocation of responsibilities at the level of organisations.

Beyond a reframing of accountability, MCA for sustainability should help organisations question their practices and identify relevant actions to bring the impact of their activities below given thresholds. Therefore, what corporations prioritise should not be driven by costs, but by thresholds to be respected. Costs obviously need to be considered, but as a second step, to identify the cheapest course of action which leads to the required thresholds. Papers from this themed section explore the gap between this desired state and current research and practice.

Alcouffe, Boitier and Jabot propose to consider multi-capital accounting as an innovation. They review 68 articles from 21 peer-reviewed journals which they analyse from the perspective of an integrated model on how innovations are disseminated, adopted and implemented. The implication of many stakeholders: companies, researchers, governments, NGO’s is key to the dissemination and legitimacy of innovations such as MCA and a first step to adoption. First adopters will implement MCA because they perceive benefits in terms of legitimacy, power, new knowledge or response to stakeholder pressures. Further implementation will take place only gradually, as changes are made to the regulatory environment, as organisational routines are changed and as pressure from stakeholders increase. The authors conclude that MCA methods are still at an early stage of dissemination and that the path they will take in the future depends on critical factors. These include:

• a better understanding of what MCA is by practitioners and how it impacts existing ways of functioning, to better analyse the benefits and think of a way forward for adoption;

• supportive approaches by regulation authorities;

• a better understanding by society of the benefits that MCA can bring in terms of transparency and trajectories towards thresholds-based sustainability; and

• the role of researchers in actively reaching out to the above stakeholders, to disseminate knowledge and increase MCA legitimacy.

In his article, Louis Dupuy presents the point of view of an economist on muti-capital accounting. He reviews the conceptual and practical foundations of sustainability from a macro-economic and a micro-economic (firm level) perspective, in the field of economics. Based on this review he draws up a list of four questions that MCA models should address and reviews four MCA models in the light of these questions. The first question is how these models take into account existing stocks of resources. The second question is how physical constraints are considered, at a global level or translated at the entity-level in relationship to such concepts as planetary boundaries, social foundations, thresholds, …). The third question is what type of path to sustainable development the foundations of each MCA model imply for businesses. The fourth question is the type of signals (in terms of price or otherwise) that each model sends to create the change that is embedded in each model’s assumptions. The main points are summarised in Table 2 of his article. In a nutshell he concludes that existing MCA models have so far been proposed as second-best solutions, because existing regulation or institutions were not sending the signals needed for companies to evolve towards the consideration of capitals and thresholds-based sustainability. If, as he suggests, the prime interest is the preservation of a stock of natural or social capital, this objective may take precedence over a given business’s existence, at a higher level of governance than the company’s level and not through company level accounting. Therefore, he suggests that the appropriate level for multi-capital accounting would be at the level of ecosystems or regions, where resources should be managed. This leads us to consider the research on ecosystems level accounting as a promising avenue for research (Feger and Mermet, 2017).

Finally, Christophe Sempels proposes to transform MCA models into forward looking instruments and shows that a path towards thresholds-based sustainability is possible. He examines the potential of multi-capital accounting not as a tool to be accountable for an organisation’s past performance, but as means to project it into a sustainable future. Instead of providing dispiriting evidence that no existing organisations has been or is sustainable, given the current rules of doing business, multi-capital accounting has the potential to help design business models that contribute to keeping the use of natural capitals within planetary boundaries. MCA would provide the data and insights that are needed to gain a holistic view of the inter-dependencies that exist between the various types of capitals. MCA can help frame the issues. For example, a car manufacturer would no longer frame the future in terms of selling more electric cars (which might reduce GHG emissions but increase water consumption, resources depletion and biodiversity loss). The issue would become defining a business model that respects all thresholds while generating enough revenues to maintain the company’s existence. Top management teams would thus be challenged to design a strategy that can make a business viable within these constraints. They could be more prone to consider, for example, making fewer, longer-lasting cars and encourage car sharing. MCA would again be used to test and quantify the impact of these alternatives.

Incorporating environmental and social considerations, to define a trajectory towards environmental-social-economic systems sustainability, highlights challenges both for MCA design and its use in management. We do not claim to be comprehensive, but we propose five main avenues for future research in accounting for sustainability through MCA.

The first one relates to the nature and scope of accountability. Are corporation accountable for their direct actions only or for the ones they enable as well? Should we consider responsibility through the legal frame of contracts and thus expand the scope of accounting to its first-level suppliers only or to the whole value chain? Which definitions of responsibility should be considered? If MCA is used on a voluntary basis only, expanding the scope of accountability forces organisations to look beyond their operations and to consider the impact of all the choices they make in terms of supply chain, product design and purpose of the value their deliver to customers. In a world where MCA would be more widespread, should organisations just focus on their operations? MCA corporate accounts would then become the elementary bricks of regional or national MCA systems, depending on the appropriate geographical level required to manage the thresholds. Current implementation of the Science Based Targets Network (SBTN) (2024) guidance on freshwater calls for accounting at basin level for example. Research on the processes leading to targets set by enough actors of the basin to enable actual respect of environmental thresholds are still to be published.

This brings forth the second avenue, which is the definition of the temporality to consider. Should MCA models continue to consider outcomes of past activities over the short-term (one financial year) or should they incorporate past activities over the long term? One can consider that, in the past, some corporations benefitted from economic conditions that enabled them to become wealthy without any consideration for sustainability. Should their past activities give them less rights in the future, to the benefit of new organisations? On the contrary one could also consider that MCA should have a forward-looking dimension and grant rights based on future impacts. For example, when one accounts for greenhouse gas emissions, the amount of CO_2e calculated is based on the global warming potential that one year of emissions will have over the next 100 years. Other environmental indicators such as water consumption or air pollution do not embed future consequences in their calculation but merely describe a flow. Although some thresholds already partially embed future consequences, further research is needed, bringing together environmental and management sciences to better understand the level of prospective required for systems-level sustainability and its application at lower levels.

The third avenue for research is the translation of systems-level thresholds into corporate-level “budgets”. International climate negotiations have already developed several methods which have been operationalised in Absolute Environmental Sustainability Assessment research projects (Ryberg et al., 2018; Hjalsted et al., 2021; Ryberg et al., 2020). Based on Life Cycle Assessment methods, they downscale Planetary Boundaries (Steffen et al., 2015) at the level of the entity assessed. By testing several allocation methods for downscaling, they highlighted the ethical dilemmas and justice issues (Gupta et al., 2023) related to the choice of the method. The method also impacts strongly the results in term of ability to remain below its allocated share of planetary boundaries. These issues have also been explored by Jabot (2023) as he discusses how to make planetary boundaries operational from an accounting point of view.

Fourth, given the ambiguity and complexity of the results, how should they be presented to help decision-making? Which technical substrate could help make sense of the results and drive action? Which data source (sectoral or country average or specific, financial or physical flow) can make MCA models fit for decision-making? This also raises the question of how MCA for sustainability could have an impact on financial materiality.

Finally, which actors should be involved in these arbitrations? What consequences would these choices have on the accounting models, reporting standards and institutional dynamics? How would they be negotiated? And most of all, can they help us realign the Earth trajectory towards a safer state for humanity?

Interdisciplinary research bringing together researchers in the fields of politics, sustainability science, accounting and psychology is needed to address these avenues for research. As suggested by Adams and Larrinaga (2019), contributing to an actual global progress towards sustainability could be better achieved through engaged research.

After an infancy of one-off experimentations, MCA has entered its teenage years, in a context of environmental crisis (Richardson et al., 2023). This themed section highlights ways it could reach maturity with the contributions of practitioners and academics, through engaged, transdisciplinary research groups. Indeed, complex questions such as the ones raised by MCA in practice, are considered best solved by interdisciplinary research (Wasieleski et al., 2021), generating new theoretical, practice and policy change-oriented accounting research outputs.

We would like to acknowledge the contribution of Delphine Gibassier who headed the research chair on this topic for four years and initiated the project of this themed section. Our thanks also go to all the members of the chair who contributed to the organisation of the workshop before the themed section and to other related activities, Eugénie Faure, Mathilde Pernias and Hind Hsissou, as well as Clément Carn, Laure Gaschignard and Emmanuelle Cordano. Thank you also to the reviewers of the three papers we are presenting. Finally, we are grateful to Carol Adams for accepting to host this themed section in SAMPJ.