Just take a look at the Paris Accords. Companies played huge, albeit, behind-the scenes, role in helping the negotiations and agreement. Industrial and commercial players are a huge part of the problem. Without question they must help lead us to better commerce.
Their support, despite wavering from Washington, tells us that the data, science and economic formulas around building a resilient, green economy is right on target. We are on the right path. We can literal smell success each step of the way.
The United Nations’ sustainable development goals include eliminating extreme poverty and tackling climate change CREDIT: YURIKO NAKAO
BY Mike Scott
Businesses and experts explain why companies are aligning with the UN’s sustainable development goals – and what’s in it for them.
In September 2015, 193 world leaders signed up to the United Nations’ sustainable development goals (SDGs), which outline what the world needs to do to bring about sustainable development by 2030, including eliminating extreme poverty and hunger, tackling climate change, reducing inequality, and putting sustainable water supplies, energy sources and industry in place.
The Business Commission for Sustainable Development says that meeting the 17 goals, which are underpinned by 169 targets,
could create almost 380m jobs and opportunities worth $12trn (£9trn) in sectors ranging from affordable housing and energy efficiency to circular economy models and advances in healthcare.
But for these opportunities to be harnessed – and the targets met – business involvement will be crucial. In a 2016 paper on how companies can help deliver the global goals, the commission said that to date, most businesses have barely registered the importance of working sustainably, but there are signs of change.
Create value
Consumers today expect companies to do more. There’s also growing pressure from investors to act. Steve Waygood, chief responsible investment officer at Aviva Investors says: “As an investor, we look after pensions that might not be drawn down for three to four decades, while, as an insurance company, we’re exposed to many of the issues covered by the SDGs. It’s up to long-term investors to encourage companies to take action.”
Companies are also recognising the business case for embracing the goals. They're beginning to understand that the way to create value for investors is to create value for society, explains Jose María Ortiz, managing director of development consultancy, Palladium.
“Twenty-first century capitalism is about doing well by doing good.
If you’re a big multinational, you’re not neutral. You have to contribute.”
The corporate world has moved away from seeing sustainability as being in competition with core business strategy, says Martin Chilcott, the chief executive of supply chain platform, 2degrees.
“There’s not just a competitive advantage, but a massive downside if you don’t do these things,” he explains. “We’re seeing more companies stating publicly the SDGs that they’re addressing.”
Aligning with business goals
One of the first things that enterprises need to do is to work out how the SDGs fit in with their existing sustainability plans. The SDGs
are both a call to arms for the business community, and a framework for how to make progress.
Property developer, Hammerson, looked at how the goals fit in with its strategy
to be “net positive” in carbon, water, resource use, and socio-economic impacts. Many companies say that it’s important to focus on the goals that are most relevant, or material, to your business.
For Hammerson, there are only four that are the most material for the firm, including affordable and clean energy, and decent work and economic growth, says Louise Ellison, head of sustainability at Hammerson.
She adds that it’s about focusing on what the business is already doing. “Sustainability is a huge subject. Unless you’re very clear on
what you can do, you can spend an awful lot of time and resources focusing on things that aren’t that effective.”
Simon Boas Hoffmeyer, sustainability director at Carlsberg, agrees, saying that while it’s easy to say that we have to work towards them all, it’s important to deal with those to which businesses can make the biggest contribution. “If everything is important, ultimately nothing is,” he says. “For us, the goals are the world’s biggest materiality assessment.”
The challenges
The goal that many companies find most difficult to get to grips with is the 17th SDG, “Partnerships for the Goals” – which requires partnerships between governments, the private sector and civil society.
But for many, this is one of the most important goals. “It's a recognition that many of these challenges, such as climate action and life below water, are challenges of the commons,” says Mr Chilcott.
“No matter how big you are, on your own, you can’t address them; you can only do so by working together. The ideas of partnership and collaboration are central [to] the SDGs.”
A number of industry groups have sprung up to co-ordinate this collaboration. “The SDGs serve as a framework for much of the work that we do with members – they help structure our initiatives,” says Ignacio Gavilan, sustainability director of the Consumer Goods Forum. “We try to set up targets that are more aggressive than the SDGs, but based on their philosophy. For example, we have a goal of ending deforestation by 2020.”
Common Ground is an initiative set up by six biggest advertising firms specifically to address the SDGs.
“It’s an opportunity to align ourselves to this global agenda and it
has given us a clear focus,” explains Frank Krikhaar, global CSR director at Dentsu Aegis Network. As part of the initiative, it works on a pro-bono basis with an anti-malaria charity, Malaria No More, and Stop TB, to raise awareness of the issues around these diseases.
But acting on these commitments and making sure that they’re effective is the tricky part. To that end, Gold Standard, a certification body, has launched a new scheme to certify business contributions
to SDG targets, and in September, a group of investors, including Aviva, is to launch an alliance to benchmark company performance.
“Benchmarking will provide clear parameters in which a race to the top can take place,” says Mr Waygood. “It will provide companies with direction and awareness of the gap between their ambitions
and current performance.”
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