Sustainable Development Goals: The role of business

The excitement around the launch of Sustainable Development Goals (SDGs) has reached stratospheric levels. The Pope and even Beyoncé are on board. The next 15 years will require a massive effort to deliver the goals - not least by companies that are expected to play a central role in delivery.

But very few businesses have really grasped what this opportunity means for them.

There are several things that make the SDGs quite different from their predecessors, the Millennium Development Goals (MDGs). One is their scope: the SDGs cover more issues for both developing and developed countries. Many of the topics, such as economic growth, are fundamental to business success.

A second major difference is the role of companies. Industry was one of nine major groups that helped develop the SDGs and the private sector will be looked upon as a crucial partner for achieving them. All this means that we can expect the SDGs to become the new, de-facto standard for businesses to design, measure and account for their contribution to sustainable development.

But Corporate Citizenship’s research indicates that, whilst awareness of the SDGs is remarkably high in business, the steps that companies can take are not yet clear. We undertook a survey of practitioners to tease out what plans were in place to respond to the SDGs. Hundreds of organisations from across the world responded. We found that the vast majority were aware of the SDGs, with only one in six practitioners working in CSR or sustainability roles saying their business was unaware of the goals.

However, a further quarter said that while they were aware of the goals, they had no current plans to do anything about them.  Another 40% said that, whilst they weren’t currently taking action, they were exploring the implications. This represents the largest group, adopting a ‘wait and see’ approach to the launch. Just one in five said that their company was currently involved in a collaboration on the SDGs.

So, whilst awareness of the goals is high (at least amongst companies responding to our survey), the implications are not yet apparent in the private sector. We think that this will change quite rapidly. The reason for our optimism is that the SDGs present something of a business opportunity for forward-thinking companies.

Business benefits

There are three business benefits. Firstly, the SDGs are a set of unmet needs that companies can help to solve. By innovating new products and services that tackle issues like hunger, health and climate change, businesses can grow their revenues faster. Just imagine the market potential for new innovations that deliver on clean water and sanitation or ensuring healthy lives for all.

Secondly, the SDGs are intended to inform future investment and public policies. The goals will target both private and public finance into the issues that matter. By focusing research and development on the topics that the world’s governments have deemed a priority, companies can swim with the tide and capitalise on the incentives that may follow.

Whilst it’s difficult to predict exactly what actions each one of the 193 countries will implement, legislation and investment around the world will be shaped to some degree. So businesses that align with the SDGs can enhance their license to operate by being active in the areas that regulators care about.

A third business opportunity comes from collaboration. The goals herald a new era of partnerships between companies, non-governmental organisations (NGOs) and governments. The challenges are simply too complex for any one sector to solve on its own. But these partnerships won’t just be about companies writing cheques.

If business is to help to bring about meaningful change, it will require complex, multi-layered partnerships around a shared set of priorities. Crucially, they will extend across the value chain and where each partner brings unique skills and strengths. Through these collaborations, companies can scale up their impacts and build stronger relationships. Effective partnerships involve shared learning; fresh insights for companies can help develop new solutions and open up new markets.

Opportunity knocks

So the business case is clear, but this has not yet been recognised by most companies. But as expectations mount, more companies will be expected to take action. So what can business actually do? The research carried out by Corporate Citizenship identifies four key opportunities…

Firstly, companies need to line up the SDGs and assess the implications for their business today. They should consider how existing policies, processes and programmes align with the goals, and identify any gaps. A rigorous assessment can identify risks that need to be mitigated and tangible opportunities.

Secondly the SDGs can be the stimulus for new action. Whether it’s launching a new community programme or revising the sustainability strategy, companies should ask: can delivery of the SDGs play a part? The business opportunity from the global goals means that this shouldn’t be an afterthought, but a central component of strategy planning. Using the SDGs to “inform strategy development” was the number one activity that practitioners in our survey said they expected their organisations to undertake over the coming years.

Thirdly, the SDGs can be a tool for target setting. With a high level of buy-in from so many global governments and organisations, it makes sense to consider the goals as part of setting new objectives, or reviewing existing ones. Fourthly, there is impact measurement – a growing priority for many companies. Having data helps to improve performance, and also to drive a more meaningful dialogue with stakeholders.  We have been using the SDGs as a framework for impact measurement with a number of multinationals in recent months. It throws up some fascinating challenges around measurement and opens up opportunities to develop better metrics.

Finally, there is external communications. How should the SDGs shape reporting? Given the rising stakeholder interest, we expect the goals to become a new standard against which more companies will align their reports, just as the MDG index (or GRI index) has been used by many to date. The SDGs are a springboard to re-orient the business outwards. They are a framework for telling the story of how company activity is contributing to global goals, shifting from thinking about ‘my world’ as a company to ‘our world’ as a planet.

So there is a clear business case for action. There are simple steps that any company can take. Whilst awareness of the potential is currently low, we expect that to change rapidly in the months and years ahead. But it won’t all be easy.

Addressing the SDGs will require some tough conversations on issues like inequality that not all companies are comfortable with. Nevertheless, the SDGs can provide a framework for business growth that is sustainable and has a genuinely positive impact on society. In the next fifteen years, we hope to see many more companies stepping up to the challenge and opportunity of the global goals.

Richard Hardyment is an associate director at Corporate Citizenship, a global management consultancy specialising in sustainability. Further information on Corporate Citizenship’s SDGs report can be found here.

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