Getting back to normal means focusing again on the Sustainable Development Goals, otherwise known as the SDGs. Here’s how businesses can help us to meet our 2030 targets.
For everything that can be said about 2020, the one certainty is that it didn’t exactly go to plan. Governments had whole policy agendas thrown to the side. Many businesses abandoned growth plans in favor of survival. And we all, as individuals, essentially stopped living our lives as we intended.
The challenges of the past year are still looming large, but with the rollout of vaccines and a new occupant in the Oval Office, we’re seeing the first signs that we might be able to get back on track as a society as the year progresses.
Nowhere is this more important than progress towards the most ambitious of plans- the Sustainable Development Goals, or the SDGs. Agreed by the United Nations General Assembly in 2015, the SDGs set out a series of goals for the world to achieve by 2030. From eradicating poverty and hunger to tackling the climate crisis, the SDGs encompass the most fundamental challenges we face as a society. They are simple and daunting in equal measure.
Progress on the SDGs had been painfully slow, but they showed progress nonetheless. But 2020 was different. As Bill and Melinda Gates show in their recent "Goalkeepers" report, 2020 was the first year where not only did momentum stall for the majority of the SDGs - they actually fell several steps backwards.
It’s time to get back on track. We have 10 years to try and achieve these goals and, as with all of the great endeavors attempted by mankind, it won’t be achieved unless governments, businesses and individuals play their part. While much has been made of the role governments have to play, the role of businesses is too often overlooked.
For businesses to truly have an impact, they need to put the SDGs at the heart of their business strategy. The problem is that they rarely know how to do this effectively. The SDGs are often relegated to a phrase trotted out by executives and consultants that sounds profound until you dig a little deeper. This is unfortunate because, when done properly, these goals can genuinely help businesses to improve their impact and identify innovative opportunities for growth.
The approach that most businesses take is to pick a handful of SDGs and focus their corporate responsibility efforts around them. This is an old-fashioned approach that sees sustainability as separate to a company’s core operations. At best, this approach doesn’t have the desired impact, but, at worst, it serves as a public relations strategy that allows companies to avoid truly overhauling their sustainability.
The other problem with this approach is that it tends to steer a company towards maximizing the areas where they can have a positive impact at the expense of the areas where they should be addressing their negative impact.
The starting point for any business needs to be an honest assessment of their operations to understand both the positive and negative impact they have against each of the SDGs. If this sounds excessive, then you need to ask yourself if it’s really acceptable for a modern business leader to not know the impact they have on issues like poverty, inequality or climate change.
From here, a business needs to do three things to genuinely integrate the SDGs into their business strategy. The first is to set clear and specific targets, which may sound basic, but most businesses fail to do so. This is borne out by analysis of company reports, with research by PwC showing that while 72 percent of companies mentioned the SDGs only 14 percent mentioned specific targets associated with them.
To do this, a business should look at the sub-targets defined within specific SDGs to agree a tangible and relevant business target. For example, SDG 12, “Responsible Consumption and Production,” includes a sub-target to “achieve the sustainable management and efficient use of natural resources” by 2030. A business could address this by trying to move away from the use of unsustainable materials in their supply chain. Businesses can also access a UN database of indicators for all sub-targets that give examples of how you can measure progress.
But this is not enough on its own. A business needs to report against them and be transparent about its progress. This should be an annual process and include detail on the measures they took to reach them, their effectiveness, and what they plan to do in the year ahead. Given the opportunities and risks that such reporting will uncover and monitor, this is something that will matter to all stakeholders, including investors and business partners.
The third and final thing that businesses need to do is the most important. They need to place the value of meeting these targets on an equal footing to financial targets. They need to recognize and reward employees for success, not with token gift vouchers, but with bonuses and promotions. Well-run businesses that are properly incentivized towards targets will achieve them. If these targets are seen as secondary to financial targets, or a low priority for senior management, it’s inevitable that success will be lower.
As businesses look to get back on track, there is a financial as well as ethical case to make the SDGs a central part of their business strategy, with research showing that 78 percent of customers would change their buying behavior on the basis of whether or not a company has signed up to the SDGs. Put simply, in the long term only sustainable businesses will be successful.
This article was originally published by Triple Pundit