When the world came together in September 2015 and adopted the Sustainable Development Goals (SDGs), it put into action a roadmap to achieving a better world by 2030. The SDGs can be thought of as a comprehensive checklist for development; a blueprint for our children’s future. They issue a call to action for schools and education, for well-functioning health systems, for access to sustainable energy, food security, water and sanitation, along with goals for good governance and justice for all.
It is really important to not only consider what businesses can do for the SDGs, but also what the SDGs can do for business. Since the release of the SDGs, the discussion was mainly about businesses living up to the aspiration of the SDGs. What can they do to deliver on that vision? But actually, we have to think about using the SDGs as a framework to guide the way we think about sustainable development and who is responsible for what.
What must business leaders do to prevent the SDGs from becoming just another item to check off exercise buried in an index at the end of a sustainability report?
The first step is to make sure that businesses go beyond simply putting together another reporting framework, where they list what they are doing and retrofit that with the SDGs. They need to start exploring how to change their entire business model to one aimed at achieving sustainable development. Corporations that have begun to pursue the SDGs see business advantages unfolding that will reap benefits in 2017 and beyond. They are expanding markets, attracting talent and eliminating some risk from operations. “Every business will benefit from operating in a more equitable, resilient world if we achieve the SDGs,” said Unilever CEO Paul Polman, whose huge multinational has integrated pursuit of the SDGs throughout its business operations and who is co-founder of the Global Commission on Sustainable Development.
The SDGs point to a different way of thinking about sustainable development. We can no longer just think about increasing global output; it has to be about how we are distributing our output while minimizing our environmental footprint.
If the SDGs’ purpose was to encourage businesses to report their CSR without changing business factors around their sustainability in particular, then its premise has no solid foundation.
We need to look at the SDGs as though it is about shared responsibility. It is not just about what governments should be doing to achieve these goals, but how all stakeholders – notably, the private sector, change their practices and behaviors in serious and impactful ways.
It is encouraging to see a mobilization towards accepting that the private sector has a critical role to play in achieving the SDGs. The question however, is no longer whether companies should apply the SDGs, but how they should go about and do so.
The most prominent guide for business action on the SDGs is provided by the SDG Compass, which outlines five key steps to “assist companies in maximizing their contribution to the SDGs”: (1) understanding the SDGs, (2) defining priorities, (3) setting goals, (4) integrating, and (5) reporting and communicating.
In October 2016, United Nations Secretary-General Ban Ki-moon announced the launch of a new platform for scaling up innovative finance solutions to support the achievement of the Sustainable Development Goals by 2030. The Secretary-General, in an address to the high-level finance gathering, said, “This global initiative can support the identification and piloting of innovative finance instruments that can drive investment and support well thought-out SDG interventions.”
For Judith Rodin, President at The Rockefeller Foundation, “While there are many pathways forward to achieve the SDGs, one thing is clear: business as usual is not an option to close the $2.5 trillion annual funding gap in developing countries alone. To realize the SDGs we need to foster a new era of collaboration and coordination…”
This justification was to reinstate the importance of public-private partnership and hones on the idea that a large share of the resources needed to fund the new agenda will come from the private sector - businesses, foundations and investors. Governments will need to implement policies that align larger shares of private flows to the SDGs. The challenge for the private sector is to move towards inclusive and sustainable business models - thus going beyond the concept of philanthropy and voluntary corporate social responsibility - without undermining profitability.
In this issue, we will look at how businesses can achieve this new move and the focus on SDG intervention given the right framework within businesses themselves, solutions lie in innovation, new business models, and the right leadership. This needs to be combined with better regulatory frameworks, smart public incentives, and changes in consumer demand.
In order to foster these changes, the private sector can be supported to invest in sustainable development in sectors and countries where it is more difficult due to weak regulatory environments, perceived high risk or other factors. Moreover, the principles of sustainable development should be better internalized in market processes (either demand or supply) via endogenous changes in business models and via a shift in consumers’ preferences (Business Call to Action is an example of such a movement).
Author: Responsible Business – Beirut
Source: Responsible Business