Accounting for the worth of employees: A new look at an old problem

Accounting for the worth of employees has long posed a challenge to the accountancy profession. Despite the attention it has received over the past 30 years, the subject has failed to develop much in the way of practical applications and as a result it is effectively a non-issue today. This is rather disturbing since the 1990s are a time when accounting for the worth of employees is probably more necessary than ever. The present paper seeks to rejuvenate interest in the subject and to see it returned to the research agenda. It proposes a third approach to the subject, one which overcomes the shortcomings of previous efforts and which constitutes a much needed breakthrough in its development. Underlying the paper is the belief that accounting for the worth of employees will benefit from a major paradigm shift away from the narrow economic-accounting perspective of the past, to a broader social scientific perspective, one which is consistent with a more strategic emphasis and the proposal to generate softer accounting numbers rather than those required to put people on the balance sheet.