Critical Perspectives on Accounting (2003) 14, 533–552

Critical Perspectives on Accounting (2003) 14, 533–552doi:10.1016/S1045-2354(02)00162-4SILENCES IN ANNUAL REPORTSMICHELE CHWASTIAK AND JONI J. YOUNGAnderson Schools of Management, University of New Mexico,Albuquerque, NM 87131, USAIn this paper, we show how annual reports rely upon the silencing of injusticesin order to make profit appear to be an unproblematic measure of success. Inparticular, we examine the ways in which corporations silence the negative impact oftheir activities upon the earth, the hell of war and the beauty of peace, the spiritual,human and social impoverishment arising from excessive consumption, and thedehumanization of workers. Only by breaking silence and counter-posing corporatevalues with alternatives can we hope to free humankind from the limitations of profitmaximization and promote a world in which peace, happiness, respect for diversity,etc. take precedence to capital accumulation.© 2002 Elsevier Science Ltd. All rights reserved.Corporate annual reports are filled with accounts which celebrate corporate actions such as acquisitions, downsizing, spin-offs, globalization, increased marketshare, new and innovative technologies, outsourcing and the reduction of labor coststhrough relocating manufacturing facilities. Each of these strategies is justified interms of increased profit, irrespective of the consequences to others or the environment. The market imperative impels corporations to aggressively pursue capitalrealization and accumulation with minimal concern for social consequences. Accordingly, the negative repercussions from corporate profit maximization activitiesare seldom discussed in annual reports. No mention is made of the growing trashheaps of unneeded goods that result from corporate marketing efforts that encourage incessant consumption. No pictures are found of the children starving in urbanand rural ghettos worldwide as a result of corporate actions that contribute to anincreasing inequity in the distribution of wealth. Similarly, the pollution of our watersand the poisoning of our foods with pesticides are never highlighted. Such thingsare treated as externalities, as costs that fall upon society as a whole, rather thanas the responsibility of the entities that create them (Parenti, 1995).Further, the ways in which costs are socially constructed under capitalism reducelabor and things to their instrumental identity as means to profit. In conceptualizingworkers and the environment as abstract cost or resource categories, corporationsAddress for correspondence: Professor Michele Chwastiak, Anderson Schools of Management,University of New Mexico, Albuquerque, NM 87131, USA. E-mail: chwastiak@anderson.unm.eduReceived 15 August 2001; accepted 16 January 20025331045-2354/02/$ – see front matter© 2002 Elsevier Science Ltd. All rights reserved.534M. Chwastiak and J. J. Youngcan separate the harmful effects of their activities from the lives they impact. Theyare not eliminating the jobs of mothers and fathers, they are reducing an expense.They are not destroying a pristine landscape, they are increasing revenues. Thus,the dictates of profit maximization require that the social and environmental costsof corporate actions be masked in order to increase the acceptability of such acts.In this paper, we examine how corporate successes are built upon such silencedlosses by counterposing the corporate voice in annual reports with other voices. Inso doing, we highlight the unreported and unremarked in an effort to make it moredifficult, if not impossible, to engage in actions that harm and stunt life.In exploring the messages and silences in annual reports, we are building uponprevious research. Neimark (1992), Neimark and Tinker (1986) and Tinker andNeimark (1987, 1988) examined how General Motors’ annual reports constructedgender roles, rationalized the globalization of production, manufactured the relationship between the company and the State, and disciplined labor. Graves et al.(1996) demonstrated that images in annual reports bolstered the truth claims of corporate financial statements. Preston et al. (1996) explored different “ways of seeing”images in corporate reports in terms of their representational, ideological and constitutive roles. Each of these papers contributed to our understanding of the roleannual reports play in sustaining the corporate economy. However, none of thesepapers addressed the silences contained in annual reports. Before examining thesesilences in detail, we provide a synopsis of the theory underlying the empirical work.Theoretical OverviewThrough language we interpret the world. Language, however, is not a passive mirror which represents a concrete objective reality external to the social and historicalconditions of a particular time and place. Rather, language actively assists in constructing the circumstances in which we live. Language also acts to restrain andlimit these conditions as it is embedded in and embeds dominant discourses. Dominant discourses promote beliefs and values congenial to legitimating the prevailingpower groups in society by making the basic principles which sustain their powerthe framework for thinkable thought rather than the objects of rational consideration(Chomsky, 1987; Eagleton, 1991). Further, dominant discourses are a mechanismthrough which the injustices arising from an unequal distribution of wealth and powerare rationalized and justified. They do so by shaping our understanding of the world insuch a way that we are led to believe that “injustices are en route to being amended,or that they are counterbalanced by greater benefits, or that they are inevitable, orthat they are not really injustices at all” (Eagleton, 1991, p. 27). In constructing injustices as natural or equally beneficial, the dominant discourses increase the difficultyof questioning the underlying systems of power, as well as who gains and who losesfrom these systems (Hall, 1982; McLaren & Giroux, 1997).To illustrate the functioning of a dominant discourse, Galeano (2000, p. 19) recounts how a 1998 UNICEF report describes the problem of child hunger: “The lackof vitamins and minerals in the diet costs some countries the equivalent of more than5% of their gross national product in lives lost, disability, and lower productivity.” WithSilence535this description, child hunger exists only as a problem because it has an economicimpact and interferes with capital accumulation. Capital, not children, are seen asthe losers from child hunger. Constructing the problem in this way directs our attention away from asking why children are hungry and how existing conditions havecontributed to this hunger. As a result, actions that further the interests of the statusquo (e.g. increase the GNP in other arenas to make up for the unhealthy children) arethe ones that will receive the most attention. Solutions such as redistribute wealthso that children need not starve will rarely be considered.If continually confronted with the injustices created by the existing systems ofpower, it would be very difficult for us to participate in reproducing these systems.That is why injustices are silenced by the dominant discourses (DeLamotte, 1998;hooks, 1984; McKenna, 1992; Scott, 1988). These silences allow us to ignore moreeasily the distasteful and objectionable aspects of the systems in which we live.While silences are embedded in all forms of communication, we choose to examine the silences in annual reports in particular because the values of capitalism areblatantly celebrated in this space. These values drive corporate decisions concerning what and how we will eat, where and how we will sleep, our level of healthcare,etc. Within the pages of annual reports, we are mainly given the subject positions ofsupporters of capitalism in the role of worker, manager, shareholder or consumer.Other ways of being (e.g. parent, concerned citizen) are silenced and kept from ourview. Because reality is not co-extensive with the categories of discourse providedin annual reports, we can prevent the dominant discourses from being further embedded within our consciousness by breaking the silences and adding alternativevoices. With different accounts, the “non-natural” status of regarding labor as an expense and nature as a resource, for instance, would be more readily seen (McLaren& Giroux, 1997).It is by breaking or highlighting silence that previously closeted and unexpressedsubjects become openly political. Without books like The Feminine Mystique byFriedan (1963) or Silent Spring by Carson (1962) the mute plight of white middleclass housewives or our polluted lakes and rivers might never have been constructedas problematic and political movements which continue to reshape relations betweenmen and women and between humans and the earth might not have been realized.Thus, breaking these silences began to open alternative possibilities and enhancedour imaginative capabilities. While we have no illusions of having the political impactof these women, we believe the silences in annual reports must be addressed if weare to open a future of new possibilities. Only by breaking silence and counter-posingcorporate values with alternatives can we hope to free humankind from the limitationsof profit maximization and promote a world in which peace, happiness, respect fordiversity, etc. take precedence to capital accumulation. We acknowledge that thispaper alone is not enough to effect change. However, it is a beginning and we mustbegin somewhere.Corporations will not be the agents for change for their owners are the primarybeneficiaries from a capitalistic society and must reproduce it if they are to thrive.Similarly calls for social or environmental accounting that attempt to reconstructcorporate values within the dominant discourses are unlikely to succeed (Birkin,1996; Cooper, 1992; Hines, 1991; Puxty, 1991). As noted earlier, these discourses536M. Chwastiak and J. J. Youngreproduce the existing systems of power and, as a consequence, cannot be used toreflect critically upon them (Horkheimer & Adorno, 1993). As Lorde (1984, p. 112)states, “. . . the master’s tools will never dismantle the master’s house. They mayallow us temporarily to beat him at his own game, but they will never enable us tobring about genuine change.”In the following sections, we examine the ways in which corporations silence thenegative impact of their activities upon the earth, the hell of war and the beauty ofpeace, the spiritual, human, and social impoverishment arising from excessive consumption, and the dehumanization of workers. These silences are not intended tobe exhaustive, but rather are illustrative. Our objective is not to reveal every silencein annual reports, but rather to demonstrate how injustices are sustained throughsilence. To show this the unmasking of any injustice would have sufficed. While othersilences might have been more salient for another researcher, these are the injustices that significantly concern us. If war and environmental destruction are notstopped, the planet will no longer be able to sustain life. As teachers, we see andexperience the repercussions of training youth to be private consumers rather thanpublic citizens, and as workers ourselves we feel the limitations placed upon humanity from being disposable cogs in a bureaucratic wheel. In confronting suchinjustices and harms, it is difficult to suppress passion and maintain a neutral toneand, to some, the paper may sound angry.To explore earth silences, we examined the annual reports of companies in industries that are frequently associated with extracting resources from the earth andusing plants and animals as commodities: mining, property development, energy,agribusiness, meat, and food processing. For peace and war, we chose companiesthat benefit most directly from the business of war, defense contractors. For silencesrelated to consumption, we looked at media, consumer product, financial service,waste management, pharmaceutical, and airline companies. For worker silences,we considered the references to workers contained within the reports of the companies selected for other silences. Again, we did not intend to provide an exhaustive orcomprehensive survey of industries or companies that we believed would perpetuateparticular silences. Instead, we sought sufficient empirical evidence to illustrate ourmain point: the celebration of market share, profit, etc. depends upon the silencingof other things of equal value. While we expected to find, for instance, consumptionsilences permeating the annual reports of media companies, we also encounteredother silences—demonstrating how there is no one-to-one correlation between silences and industries. We present our empirical results in the remaining sections ofthe paper.Earth SilencesEarth as commodityIn order for industrialization to become a way of life, our conception of the earthhad to be radically transformed from that of a living, generous mother to dead,exploitable matter (Berry, 1988; Merchant, 1983). With this transformation, natureno longer had needs of its own, but was rather a limitless provider for humankindSilence537(Plumwood, 1993). In order to maintain this alienated relationship, a discourse ofdissociation and domination had to permeate our consciousness. We consider ourselves no longer of nature and this perspective has led, in part, to our failure to carefor the planet (Plumwood, 1993). Instead, as illustrated by the following quotes fromannual reports, the earth is bought, sold, and stripped of its resources in the nameof progress and the search for profit:BHI has a large and varied inventory of land with a low cost-basis. The company continuallystrives to employ each parcel at its highest and best potential use. In some cases, thisis agricultural. In others, consistent with the demands of the marketplaces, developmentactivities are pursued to add value. (Alexander & Baldwin, 1991, p. 12)Upon completion of these processes, and assuming no delays caused by legal appeals,aggressive development programs will be undertaken to bring these new properties intoproduction. (Battle Mountain Gold Company, 1995, p. 7)This objectification of the land denies the fact that we need nature to stay alive.We do not stand apart from nature but are part of it. So as we strip the earth of itsresources, we not only scar it, but scar ourselves as well (Berry, 1998; Griffin, 1978;Suzuki & McConnell, 1997). By polluting the earth, spoiling its streams, devastatingits forests and farmlands, we destroy our home and impair its ability to sustain usin the future. Even though, we are on the brink of ecological disaster, we seem tobelieve that it will never come, that somehow the very earth we desecrate will saveus (Griffin, 1992). However, unless we change our ways, the free air we breathe andwater we drink will be unfit for life, and clean water and air will become a luxury onlythe rich can afford (Plumwood, 1993).The impending ecological disaster is further exacerbated by the over populationof the planet by humans. Yet, in corporate annual reports, population growth isdescribed in terms of expanding market opportunities for their goods and services:First births represent approximately 40% of total birth, or over 1.5 million births annually,which provide a solid consumer base for our product companies. (Huffy Corporation, 1991,p. 22)Worldwide, there are 1.7 billion women between the ages of 10 and 49. In 30 years, that figure will surge by nearly 50% to 2.5 billion, with most of the increase occurring in developingcountries. (Tambrands, 1996, p. 6)Population growth may imply economic expansion. However, it also portends deforestation, stresses on the water table, increased energy consumption, overcrowding,less cropland, decreased marine life, destruction of wildlife habitats and more waste.The end result of overpopulation will more likely be global warming, rapid spreadof infectious disease, starvation and extinction (Brown et al., 1999; Engelman, 1997;McKibben, 1998) rather than the unlimited market expansion anticipated in corporateannual reports.Human intervention in natureWe not only believe ourselves to be apart from nature, but we also believe thatthrough active intervention we can improve it (Griffin, 1978; Merchant, 1983). In538M. Chwastiak and J. J. Youngaddition, rational, technical man presumes that scientifically derived knowledge isalways superior to that derived from other means (Aronowitz, 1988; Fox Keller, 1985).We use our scientific discoveries to “improve” the earth by enhancing its short-termproductivity with mechanized products and chemicals. This is illustrated in the following quotes, in which the replacement of traditional farming with industrial agricultureis valorized and made to appear as an inevitable outcome of human progress:Mr. and Mrs. Cui have cultivated their farm’s soil for 45 years. Initially, they cared for theirland with organic material and plowed with oxen. That has changed. Today they rely on abalanced mixture of crop nutrients to replenish the soil and have replaced the oxen witha tractor. . . . They are pleased with the progress of their farm. Their story is not unusual.China is able to produce enough food for nearly a quarter of the world’s population withless than 10 percent of the earth’s arable land. China also is the worlds largest importer ofconcentrated phosphates and potash crop nutrients. (IMC Global, 1995, p. 7)There are few uncultivated areas that have fertile soils and are not presently forested orsubject to erosion. To increase the area of land available for cultivation would require massive clearing of forests, causing vast destruction of wildlife habitat and biodiversity. Theshort-lived and limited agricultural gains would never justify the environmental damage.We have no alternative but the most vigorous pursuit and development of science-basedagriculture. (IMC Global, 1996, p. 3)These celebratory accounts fail to describe the cumulative effects of agro-industrialinnovation: habitat destruction, monocultures, varietal specialization, soil erosion,and pollution of water supplies (Goodman & Redclift, 1991). Subjecting agriculture toreturn on investment criteria means that natural ways to replenish the soil and protectagainst pests, such as crop rotation and plant diversity, give way to monoculturesand artificial fertilizers in order to maximize the only measure of relevance—profit.Yet, these practices carry unmeasured costs. For example, monocultures with theiremphasis upon a single strain of corn, soybean, rice, etc. reduce biodiversity and,as such, invite disease and pests (Shiva, 1997). Artificial fertilizers, like phosphatesand potash, may temporarily boost yields, but leave crops nutritionally deficient andleach into water supplies (Fox, 1986). In sum, while technical agriculture may boosta corporation’s bottom line, the long-term consequences for the rest of us may bedevastating.Engineering lifeAs stated before, subjecting agriculture to return on investment as a measure of valuedecreases the natural diversity of plants (Shiva, 1997). Thus, what is profitable forcorporations in the short-term may impoverish society in the long-term. Considerthe following quotes from the biotech (and agribusiness) industry which describethe engineering of life primarily as an opportunity for profit and sales:The seed strategy calls for increasing sales of the growing number of genetically engineeredseeds. These revenues will further complement the company’s core business of selling andapplying nutrients and herbicides. Additionally, the sale of genetically altered seeds requiressignificantly greater agronomic knowledge. IMC AgriBusiness has this knowledge and isable to provide it as a value-added service. (IMC Global, 1996, p. 29)Silence539One such hybrid, Corn Belt Dent (characterized by a depression or indentation in the crownof the kernel), is now the staple of the corn refining industry. And the evolution of corn isfar from over. Corn seeds are still being developed and specially tailored to consumer andindustrial needs, and it’s a sign of that evolution that American Maize received patents fornew genetically engineered strains in 1991. (American Maize-Products Company, 1991,p. 9)Bio-engineering provides the means for corporations to colonize and monopolizeone of the last frontiers—life itself (Rifkin, 1998; Shiva, 1997). While corporationswill reap the profits of bio-engineering, it is the rest of society and the natural environment that will pay the costs. Potential risks include health hazards to humansfrom transgenic crops, “biological pollution,” species domination of the ecosystemand unanticipated gene transfers from one species to another (Fox, 1992; Rifkin,1998; Shiva, 1997). Not only are the biological threats of such a world unknown,but the moral and ethical implications are as well. In a future biotech world, wouldwomen and nature simply provide the raw materials to which capital would addvalue (Mies & Shiva, 1993)? Such issues and possibilities are not discussed withinthe pages of annual reports that describe biotechnology primarily in terms of itspotential contribution to profit.Animals as commoditiesAs noted before, to corporations, plants are only of value if they can be transformedinto a profit making activity. Similarly, animals only have worth if they can be raisedand slaughtered efficiently. Our anthropocentric system of thought, which deniesnature and animals any intentional and mind like qualities, has removed ethicalrestraints against treating other creatures cruelly (Devall, 1988; Fox, 1986, 1992;Shiva, 1997). This coupled with capitalism, which reduces everything to its instrumental value, allows us to construct animals as production units whose well beingis secondary to the goal of profit maximization (Fox, 1986). This is evidenced in thefollowing quotations from annual reports:Additionally, we have the capability to increase our current slaughter from 36 million birdsprocessed per week (our current volume) to 44 million birds per week with minimal capitalexpenditure. (Tyson Foods, Inc., 1996, p. 4)Our Bladen County plant, now killing 16,000 hogs a day will expand to 24,000 daily thisfall. The Bladen County plant is the most modern facility of its kind. (Smithfield Foods, Inc.,1995, p. 5)Our raw material is unmatched by anyone in the country for consistency in the muscling andleanness of the animal . . . the Company’s vertical integration program means that most ofits meat comes from pigs produced on Company-owned farms, or on farms operated bylong-term suppliers who use superior genetics and the most advanced and consistentbreeding practices, coupled with minimal-medication programs and strict control over feedingredients. (Smithfield Foods, Inc., 1995, p. 10)This matter of fact detailing can only occur by silencing the pain and suffering ofthe animals involved. Selective breeding severely compromises animal welfare. Forinstance, cows which are bred for superior leg muscle conformation cannot calveexcept by caesarian section. The legs and lungs of chickens and turkeys raised for540M. Chwastiak and J. J. Youngmeat are severely stressed by their fast growth, leading to respiratory infections andpainful ulceration of thighs and breasts (Johnson, 1996).Further, while the companies blithely indicate their intention to expand their “killcapacities,” they fail to report the experience of the slaughterhouse for the humansthat work there and the animals that are killed. Eisnitz (1997) graphically describesthe torturous conditions under which the animals are slaughtered. Animals are hungupside down and thrash about as they await their slaughter. Cows may have theirheads skinned before they are dead. This violence gets absorbed by the humanworkers as well. One laborer reported how by the end of the night, everyone in theslaughter house was yelling at everyone else and the abuse did not end at the factorydoor but was also taken home to the family (Eisnitz, 1997).Peace and WarPeace is bad for businessIn 1989, as the Berlin Wall fell, most of the world’s people rejoiced at this historicstep towards peace. Yet, this was not celebrated in corporate annual reports of USdefense contractors. Instead they discussed the end of the Cold War in terms of itsimpact on lost contracts, sales, and markets. As illustrated below, a step back fromnuclear annihilation was bad for business:Although the broad diversity of our Defense Electronics business provides significant strengths in a time of defense budget…What does the Chwastiak and Young article say about environmental disclosures in annual reports?Explain in no more than one paragraph how annual reports can silence injustices.Explain in one paragraph why profit is a problematic measure of success. In your answer, give three examples from the Chwastiak and Young (2003) article. Silenced injustices