APPLICATION OF SOCIAL ACCOUNTING PRINCIPLES TO STATE-OWNED ENTERPRISES

Information availability and disclosure are a precondition for effective governance of state-owned enterprises. The principles of social accounting are the tool that ensures information disclosure to the public about the operational environment of a state-owned enterprise and the justification for its achieved outcomes. Defined and publicly available goals are a characteristic feature of a good and effective practice of the management of state-owned shares. The research purpose is to study the development of social accounting principles and their application practice in the European state enterprises and, based on the research findings, to develop recommendations for ensuring the performance disclosure and transparency of state enterprises in Latvia. In the first part of the research, the authors pay the main attention to evaluating the business purpose of state enterprises in philosophical aspect. In the second part requirements for information disclosure and publication of state-owned enterprises in particular European countries are studied. At the end, the authors summarized the main research findings and develop recommendations for ensuring disclosure and publication of sustainability reports of state enterprises in Latvia. At least the large state enterprises should be assigned the responsibility to publish sustainability reports following the social accounting principles of Global Reporting Initiative. The monographic, analysis and synthesis methods have been used in the current research.