The implementation of Sustainable Development Goals requires a major transformation of business. Many companies which regard corporate responsibility as a part of their philosophy only take the first steps towards global sustainability.
To make SDGs a success businesses are to be actively engaged in shaping innovative state, civil and commercial strategies of development. Gavin Power, UN Global Compact Executive Vice President and Chief of sustainable development and international affairs, provided insight into the role and some practical aspects of SDGs.
Global business, including Russian companies, sees SDGs as milestones for developing business strategies. Is it a logical outcome? Should business focus on corporate responsibility while governments and international organizations would be those who pursue sustainable development?
The scale of problems and ambitions is the main point of contact between business and nonbusiness. If companies, governments and international organizations go on to act on their own, neither of them will achieve success. 100% involvement is essential for significant impact.
Companies that go beyond isolation and act in terms of SDGs are authorized to cooperate as if they were in partnership with each other, civil society, other countries and the UN.
Where is the difference between companies that implement corporate social responsibility strategies and those committing to sustainable development values?
Companies which consider social responsibility as business philosophy undertake not to do harm. It may imply the ten principles of Global Compact or other fundamental principles in the sphere of human rights, environment protection and other aspects. Although this is a framework for responsible companies, it is just the first step.
Those who enter new level of sustainable development, connect business and global agenda which is beneficial for communities and markets all over the world. Such companies seek for innovative decisions, join public-private partnership, strives to initiatives beyond following only ethical standards.
Lets take for example SDG 6 «Clean water and sanitation». Companies of the first level contribute to reduction of water pollution during manufacturing. But clean water challenges are more complicated, so the second level companies participate in formation and modernisation of water resources management and water cleaning systems and create partnerships for this purpose. It shows a step from «Do no harm» to complex participation to SDGs achievement.
How can we help companies understand SDGs which seem too vague and abstract?
The first thing to understand is that SDGs is not something brand new. They reflect problems which companies faced for man years: climate changes, lack of water and resources, gender inequality, health care issues, poverty etc.
SDGs imply not a revolution but a call for broadening sustainable development agenda and its evolution. But now business has a structure, specific aims and indicators which help to use SDGs for action and impact evaluation.
How can we evaluate the impact of achievemnts in the sphere of SDGs?
When it comes to evaluation systems, they are still being created. Today we can evaluate responsible business policy in the spheres of human rights, ecology as companies report their progress. But we still do not know how to evaluate business impact on society and environment.
Now companies report, for example, how many people have accessed clean water, safe food, education through their efforts. But it is ususally not standartised and represent only special aspects.
I communicated with many institutional investors who want to learn how to evaluate their investments impact on society. They consider SDGs as a convenient benchmark which shows the contribution of an investor in problem solution.
I think that creation of system allowing to evaluate achievements in sustainable development area is the near term. We will develop reporting platforms with regard to SDGs as they allow to use qualitative and quantitative data.
We will have to do great work with criteria so that companies could act and report on those SDGs which were chosen as a priority.
Which advantages of SDGs should economies draw attention?
First of all, there is an obvious long-term perspective - it will be easier for markets and societies to develop and move forward. As for short-term perspective, there are many opinions including the one that it is more beneficial for business to work in destructive context. But such approach is short-sighted.
An attempt to put into practice "the winner takes it all" principle will not work in such context. In the end, companies do not benefit from crisis and destructive processes in the society.
Any business needs viable consumers, reliable consumer base, fulfilled employees, harmonious local communities, efficient governments which prevent corruption and create infrastructure.
National governments, which will be the first to develop national action plans and specific SDGs promotion mechanisms, will benefit a lot.
Economies, which will include more companies committed to SDGs, will attract more investments. Major investors are interested in future markets, so the sustainability aspect is becoming crucial.
For example, in the Principles of responsible investment (PRI) we cooperate with investors with portfolios of billions dollars. They are ready to invest into growing markets of different countries, but they need to be sure that these countries apply and promote the ideas of sustainable development as such economy sectors and companies are more profitable and fulfilling.
Source: "Strategy" journal