Abstract
Introduction
In organisational settings ranging from kindergartens to universities, this Special Issue on ‘Histories of Accounting in Educational Intitutions’ contributes to research on the roles and impacts of accounting as a social and technical practice within the context of educational institutions and changes to their systems of management and governance. The topics covered include investigation of resource allocations and accountability evaluations; aspects of financial reporting by educational institutions towards different levels of government and other stakeholders (such as private benefactors); exploration of linkages between accounting information, educational outcomes and roles, employing a critical view of the impacts of New Public Management; and aspects of accounting regulation.
The Special Issue comprises five articles written by authors drawn from Germany, New Zealand, Colombia and Italy. The time periods studied span the establishment of Enlightenment-inspired educational institutions in the twentieth century, the political turmoil before and after World War I (WWI), through to the most recent developments in New Public Management. The five articles deal with the use of accounting and its accountability reflexes at different levels of analysis, such as the individual (Detzen and Hoffmann), the local (Quintero, and Vannini and Sibilio), the national (Narayanan) and the social community (Sian, Magli, Nobolo and Guarini). A varied array of educational institutions are analysed, including universities and other tertiary education institutions (Narayanan; Detzen and Hoffmann), kindergartens (Sian et al.), girls’ schools (Vannini and Sibilio) and the public educational institutions of a municipality (Quintero). Diversity is also evident in the theoretical frameworks applied, which range across multifaceted aspects of accountability (Detzen and Hoffman), neo-institutionalism (Narayanan, and Vannini and Sibilio), legal perpsectives (Quintero) and stakeholder theory (Sian et al.).
The setting of educational institutions
Educational institutions are important both at the level of the individual (nearly all people spend a significant portions of their lives within educational institutions) and society (such institutions are fundamental in shaping all aspects of local, national and international communities). Educational institutions are relied upon to inculcate moral essence and ethical values in order to produce socially desirable behaviour, personality and character. They typically promote innovation, peace, equal opportunities and respect among individuals, societies and nations (Shrivastava, 2016: 24). At a more pragmatic level, educational institutions play important roles in modern economies by supplying qualified workers who support business and industry and promote technological development. This process also enables individuals to compete successfully in the labour market by developing the competencies and capacity for innovation sought within the global economy. Supporting business and industry means ensuring the relevance of knowledge and skills that can help countries to improve their economic prosperity, social cohesion and workforce development, responding to the dynamic processes of change in national productivity and growth (McKinsey Global Institute, 2017).
The responsible dissemination of technologies can contribute to health and wellbeing and social engagement and educational institutions should aim at designing technologies that result in new products, production processes and services for use (QS Asia News Network, 2018). Kromydas (2017: 1) argues that this perspective is linked to a mainstream view in the western world, as informed by the human capital theory, which sees education as an ordinary investment. That is, the main reason why someone consumes time and money to undertake higher levels of education is the high returns expected from the corresponding wage premium when entering the labour market (Becker, 1964, 1993). However, another notion of education perceives its purpose as being to ‘equip people to make their own free, autonomous choices about the life they will lead’ (Bridges, 1992: 92). While there might be an economic basis underpinning such choices, this intrinsic notion also recognises more subjective motivations, which are not necessarily affected by economic circumstances. This intrinsic notion informed the first universities established in Europe, such as the University of Bologna, where the term ‘academic freedom’ was introduced as the kernel of this culture (Newman, 1996).
As well as typically having unique historical origins, educational institutions attract significant income from diverse sources, giving rise to a complex nexus of accountability relationships. Although there is a tendency today for educational institutions to emphasise labour market driven policies – leading to competitive pressures for them to become market-place participants and instruments for economic progress – education still has the capacity to provide contexts for human development. The purposes and impacts of education on the economy and broader society have been transformed through time in various ways. However, institutional and policy dynamics differ not just over time, but also between countries and political regimes and therefore context cannot be neglected.
The ‘histories’ of accounting and the accountability link
Accounting research has only recently begun to spell out the accountability demands that educators and educational institutions are exposed to (Parker, 2011, 2013; Parker and Guthrie, 2010). Although performance measurement emerged as a major policy innovation within the larger neoliberalist orientation of educational institutions in many western countries in the 1980s (Peters, 1992), educational institutions have been exposed from the twentieth century to a wider system of accountability, performance benchmarks and evaluation criteria, and societal and political sentiments have been shown to influence educational work and institutions. Barnes (2019) argues that this ‘may not be confined to an openly hostile environment and/or confined to politically controversial areas of study’, but also applies to cases of conflict with powerful vested interests, such as the recognition of ‘academe’s autonomous status’ as opposed to the influence of the Church and the Emperor in the first established universities in Europe (p. 2).
The provision of financial information, predicated on the adoption of accounting practices and sytems, is not only a means of discharging accountability but also a means of control, which can impact upon relations between stakeholders and the educational establishment itself as well as having wider social implications. While we currently witness ‘the insinuation of New Public Management philosophies into university missions and strategies’ (Parker, 2013: 24), other periods have seen different pressures on educational institutions. When considering accounting as a social practice, we directly or indirectly refer to accountability as a relational concept, with a multidimensional approach (Halachmi, 2002; Mulgan, 2000). This notion of accountability recognises the relationship between educational organisations and established powers (such as State, Church or funding bodies) and broader society, with the responsibilities and rights of the parties both contractually and morally defined and determined within the system. Educational institutions are charged with acting responsibly and being accountable (reporting on the responsible actions) to other parties whom they influence and can be influenced by (Power, 1994). Although different definitions of accountability exist (such as Busco et al., 2013; Gray and Jenkins, 1993; Jenkins, 2007; Mansfield, 1982; O’Dwyer and Unerman, 2007; Parker and Gould, 1999; Paul, 1991; Romzek, 2000; Samkin and Schneider, 2010; Unerman and O’Dwyer, 2007), Sinclair’s (1995) systematisation of different forms of accountability clarifies relationships, types of demands and ways of justifying a behaviour and actions.
Echoing Sinclair (1995), accountability can be divided into different forms, such as political, professional, managerial and personal. The political domain consists of obligations set by the state, government, or other politically affiliated organisations or individuals. It is analogous to a principal–agent relationship and ‘operates precisely in the opposite direction to that of delegation’ (Bovens, 2007: 455).
Professional accountability concerns ‘the sense of duty that one has as a member of a professional or expert group’ (Sinclair, 1995: 229). It entails an adherence to norms and values that any member of the respective professional group could be expected to follow. It may be most evident in ‘systems of professional peer review’, because fellow professionals might be most able to evaluate their peers’ application of expert knowledge and professional discretion (Mulgan, 2000: 559; Bovens, 2007).
Managerial accountability requires those with delegated authority to be answerable for producing outputs or for the usage of resources to achieve certain ends (Jenkins, 2007), and, thus, this form of accountability values cost effectiveness, efficiency and managerial autonomy (Parker and Guthrie, 2010). Glynn and Murphy (1996) define managerial accountability as ‘accountability by managers for the achievement of defined, and perhaps agreed, resource utilization objectives’ (p. 127).
Personal accountability relates to the self’s ethical and moral beliefs, acknowledging that one’s actions have an impact on others (Sinclair, 1995). Accountable selves also feel obliged to their personal values, and sanction mechanisms appear in the form of one’s conscience and feelings of responsibility and guilt (Mulgan, 2000). Personal accountability may shift, especially due to extreme demands for political alignment.
An overview of the contributions of this Special Issue
The nexus of accounting and accountability becomes most onerous when educators’ core values, such as freedom of research and teaching, are side-lined. Detzen and Hoffmann show how academics, as accountable selves, responded to Hitler’s ideology and external duties imposed on them, and how they transmitted their responses to such demands through the setup of educational activities. In this drastically changing societal and political context, they explore a German business school in the years leading up to and under the Nazi regime, which affected the lives of all German citizens. Their narrative is constructed around the festivities for the inauguration of the new dean, during which the outgoing dean reported on the institutional activities under his leadership, and the new dean outlined his vision for the subsequent years, and hence set accountability expectations.
Narayanan’s work explores how another (current) ideology (New Public Management) has permeated tertiary education institutions in New Zealand. His article adopts a historical perspective to examine the development, use, and impact of performance measures in those institutions. He links successive New Zealand governments’ reform of tertiary education to improve accountability to a deeper and richer understanding of performance measurement as a social, political and technical practice influencing changes in educational institutions. Under this regime, deans’ accounts are supplemented by a range of anecdotes to show the impact of the widespread demand for accountability on individual academics. Narayan is also keen to reveal a web of unintended consequences: the tensions, cynicism, and complications (such as creative compliance, manipulation and fabrication of results) that derive from the enormous pressure to meet the government’s imposed targets and measures of performance.
Still with a focus on New Public Management, Quintero’s article identifies how in 1976 the Colombian federal government gave public educational institutions in the Municipality of Medellín autonomy over the management of their monetary resources. Her study evaluates the historical development of accounting policies, which have impacted both the effectiveness of educational performance and the economics of school administration. She demonstrates a direct connection between the autonomy of educational institutions and state control and documents the increasing relevance of professional accountants and treasurers within the board of directors. In parallel, she reports the substitution of income and expense reports with more structured accounting information, such as financial statements aligned with the international accounting regulatory framework.
Similarly, Sian et al. consider the relationship between the presentation of accounting records, meetings with stakeholders, board representations and the survival of Asili di Carità (private kindergartens) in the municipality of Milan (Italy) before and after WWI. Historically, religious and charitable mobilisation was the driving force behind the establishment of these kindergartens. A variety of forms of funding available to them (and stakeholders, such as charities, religious orders, private benefactors and the public purse) explained how accountability and its enactment and discharge had an important role. Financial records and statements were produced to show not only whether the kindergarten was in surplus or deficit and its net asset position, but also how the funding and donations were used. When the Municipality of Milan became a significant source of financial assistance, a stronger representation on the board was sought in order to exercise a deeper influence on the kindergarten’s accountability and use of funding. This situation was reversed only when the kindergarten started relying again on donations from private benefactors.
Another Italian case, by Vannini and Sibilio, refer to a girls’ school in Florence (conservatorio) and how it applied accounting practices and adopted structural and accountability arrangements of similar organisations that were active in the same educational sector in order to promote its own legitimacy. In turn, these arrangements influenced the ability of the conservatorio to respond to internal and external information requirements, facilitating a system of control that evidences the role of isomorphic pressures in homogenising the conservatori and their accounting and decision-making practices.
Some final remarks
The contributions featured in this Special Issue show the interconnections between accounting and accountability in educational institutions, across a variety of historical periods and in a diversity of settings. We believe that this Special Issue not only confirms that educational institutions play a significant societal role but emphasises the ubiquity and diversity of accountability issues in connection with accounting information, practices and systems.
The societal role of educational institutions relates to the learning they enable and foster for current and future generations, which will impact upon their social status and overall life chances. The articles in this Special Issue outline how this societal role and the rise and expansion of educational institutions are often directly linked to the rise of particular groups, classes or ideologies within a specific setting, as they gain power or influence. The concept of accountability is explicitly joined with the use of accounting and its applicability in different organisational contexts, but it also potentially introduces new perspectives on the theme, such as the relationship between academics’ selves and totalitarian measures.
The five articles of this Special Issue provide much variety both in space and time. They are based in very different locations, thereby expanding our knowledge of accounting in educational institutions to other countries and continents and contributing to our understanding of specific cultural, social and political settings. They analyse accounting in different types of educational institutions, such as kindergartens, business schools, universities and tertiary education institutions, and schools for specific categories of people (conservatori). Finally, the studies featured herein are set across different time periods in the nineteenth and twentieth centuries: they cover the establishment of the first structured private schools in Italy in the nineteenth century, the spread of totalitarian ideologies after WWI, the economic, social and political distress before, during and after WWI, and the more recent global evolution and spread of New Public Management ideology. Hence, the contributions published in this Special Issue strongly affirm that the link between accounting and accountability was apparent and multifaceted in different places, contexts and times.
As a result, we believe that this Special Issue achieves three main objectives. First, the collection of articles in this issue is a clear display of the diverse educational settings in which accounting and accountability operate, thereby showing how that link manifests and impacts on the political and economic viability of educational institutions. Second, this issue of the journal brings awareness to how groups, interests and ideologies can be identified as operating and recognised as influential in the management of educational institutions at different levels of analysis: educators’ behaviours and responses to externally imposed pressures, board’s representation of the social community of reference, and the organisational presentation of accounting information, dean’s accounts, visions and reports of their institutional activities, and the government-driven set up of educational activities at the local or national level. Third, with the historical study of accounting in educational institutions, accounting history researchers can reveal how the link between accounting and accountability originated, developed and changed, thereby offering strong potential to strengthen our understanding of contemporary debates, issues and concerns in educational institutions. By offering a diversity of contexts and time periods in which the interplay of accounting and accountability has been explored in educational institutions, this issue opens several opportunities of future research in this arena.
Future studies may involve a wider array of educational institutions, featuring, for instance, colleges and high schools, military schools, seminaries, boys’ schools and professional institutes. A focus on public versus private educational institutions and reforms may help to understand gaps in, or the assimilation of, common educational values and accounting practices. The opportunity to focus on educational institutions established for specific educational purposes (such as military training or theological preparation), gender (boys’ versus girls’ schools) and social classes (diplomatic and medical schools restricted to noble or bourgeois classes, professional schools devoted to lower working classes, and similar) may reveal interesting accounting and accountability connections within specific sectors of the society and their development or evolution, and the current features and reputation of specific professions, including the accounting profession. The multifaceted relational concepts of accountability can also be used to identify the link between established powers and the ‘manageable self’ in relation to both the educational institution and the individuals.
Although the contributions of this Special Issue deepen the individual accountability dimension through analysis of educators’ behaviours and actions in response to increasing ideological, political or managerial demands, less attention has been devoted to the students as individuals or as a cohort, and the social impact of educational institutions in general. Further opportunities may involve contributions from China, Japan, Northern America, India, Africa and the Middle East, which would expand our knowledge of cultural, social and political values around education and related accounting developments besides Europe, Australasia and Southern America, as featured in the current Special Issue. Examination of timeframes prior to the nineteenth and twentieth centuries would be useful to aid understanding of the establishment of core educational and accounting features in the very first educational instutitutions and clarify the interplay among and within powerful actors’ influence, such as the Church and national States or Empires. Some attention should also be given to the spread of western countries’ educational reforms and related accounting innovations across the world as means of colonisation and imperialism, and how this may have triggered instances of inequalities and exclusion as opposed to equal opportunities and promotion of inclusion. The possibility of interpreting accountability and accounting in educational institutions with theoretical lenses other than neo-institutionalism or New Public Management would help to diversfy the theoretical perspectives and methodological approaches to this narrative.
Finally, in concluding this Editorial we take this opportunity to thank all of those who enabled this Special Issue to come to fruition, including the authors of all submitted papers, the referees, and the Accounting History Editors for the responsibility and opportunity with which they entrusted us.