KARACHI: The Association of Chartered Certified Accountants (ACCA) has questioned whether the traditional limited liability company remains fit for the future, saying its focus on shareholder returns can come at the expense of communities and the environment.
In a report titled ‘Building Future Business’, ACCA argues that current company structures prioritise financial results over wider societal impact and calls for models that measure economic performance as part of a broader web of factors.
Jason Piper, ACCA head of tax and business law, said the conflict between financial imperatives and the tangible effects of business on society and the environment “is too great to ignore”. He added that while the traditional company form was effective in protecting investors, it now risks distorting business and economic behaviour. Potential alternatives, he said, include B Corps and integrated reporting frameworks.
The report outlines a series of considerations for designing future business models, including identifying key stakeholders, defining value to each group, mapping flows of value from economic activity, and assessing alignment with legal forms and regulatory frameworks. It also addresses ethical considerations, reporting standards, trust and safeguards to protect stakeholder interests.
ACCA noted that business models are increasingly shifting from labour- and goods-based activity to a digital economy, characterised by energy-intensive, capital-heavy processes.Piper said: “Businesses can succeed financially while undermining the communities they operate in. Building Future Business examines what drives this distortion and how decision-making can be adjusted to better balance the interests of business and society.”
