From Abstract to Action: How the SDGs Can Help Businesses and Vice Versa
Franziska Sinner | Dec 3rd 2015

Humanity’s greatest wish list has now been finalised and agreed on by the United Nations: The new Sustainable Development Goals (SDGs) are here – and here to stay for the next fifteen years. We know that they will be forming the basis of investment decision making for the public sector, but what do they actually mean for business?

As such, the SDGs do not explicitly talk about the role of the private and the for-profit sector. Nonetheless they extend the conversation and action on sustainable development beyond governments to include other agents of change such as businesses, cities, citizens and civil society. Where the preceding Millennium Development Goals (MDGs) were largely government-orientated, the 17 new SDGs indicate that the private sector needs to be on board as an active partner in order to make progress on the global agenda for sustainable development.

Measurable, time-bound and quantitative targets – staple ingredients of decision-making in the business world, but frequently argued to be missing from the current SDGs. The private sector plays thus a vital role in translating the abstract, qualitative language of the SDGs into effective implementation of change on the ground.

Corporate stakeholders should be seen as the link between the high-level goals and the concrete implementation path: Being highly focused and performance-driven, global organisations can turn aspirations into facts on the ground, constantly monitoring and measuring performance in order to gain efficiency and ensure success. Furthermore, businesses themselves have options to turn to when carrying out this practical translation work: Solutions for project finance, for the measurement and monitoring of sustainability action, and for finding the ideal match for a public sector partner are already available. The most prominent ones such as renewable energy certificates, the quantification of co-benefits of climate reduction projects and insetting are just a few of the many viable alternatives out there.

Various examples already show that engaging in sustainable practices reflect positively on the entire business, way beyond the bottom line. One of the beacons of hope has been the palm oil sector, which has long struggled with the reality of having to draw most of its lifeline out of deforested land. While the sector still faces challenges due to the complexity of its supply chains, companies are taking significant steps to decrease the environmental impacts of their business. One key development is that most of the procuring power for palm oil is now committed to deforestation-free supply chains, making a huge contribution to climate change mitigation, to biodiversity and to sustainability.

Improving standards and mitigating risks along the supply chain is not only confined to the palm oil industry: Switzerland’s largest retail and wholesale company Coop struck up a multi-stakeholder collaboration to reduce deforestation and decrease emissions along its supply chain. This was done by investing in a community-based project from South Pole Group that distributes efficient cookstoves to local Maasai villages in Kenya. People from these Maasai villages currently represent the majority of the employees at Oserian Flower Farm, the Kenyan-based producer of Fair Trade certified roses that exports flowers to Coop Switzerland. Coops efforts translated into reducing deforestation along the company’s supply chain and maximising school attendance of Maasai children: Maasai girls who before had to spend two days a week to collect firewood are now able to attend school without interruptions. The project activity has also given rise to employment opportunities for stove distributors, assistants, and other related jobs in Kenya.

Despite the ambiguous language, some of the key objectives outlined by the SDGs – such as ensuring access to water and affordable energy – are also among the most pressing issues for businesses operating in the 21st century. With global price fluctuations in energy costs, moving towards using or generating renewable energy will insulate a smart corporation against unexpected instability and risks. Shrewd companies will be able to invest profits made from renewable energy generation back into their business and ensure the wellbeing of the resources their future depends on. The failure to adequately manage corporate energy can leave a company vulnerable to risks, such as changing regulations, legal requirements and price swings.

While there is ample room for the SDGs to help businesses and vice versa, there needs to be a robust regulative and legislative framework in place that allows for tradeoffs (not all 17 SDGs can always be achieved simultaneously) but builds a basis to hold businesses accountable for their actions. Unsustainable business practices must to be punished and positive innovation should be incentivised. Looking at the bigger picture, it becomes clear that the environmental and social challenges described by the SDGs can only be solved through constructive partnerships with company stakeholders, the public sector and the wider society.

The next challenge is to move beyond business as usual: Sustainability within the private sector has to shift from CSR storytelling to changing corporate norms and values and stimulating new business practices to inform policy agendas. By contributing to the agenda advocated by the SDGs, business can move from pure sponsorships to policy development and to international standard-setting. Finally, they can acquire a more focused direction on how to boost the quality of their own sustainability goals into a pivotal tool for sustainable competitiveness.

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