On 25 September 2015, a process led by the United Nations (UN) resulted in the 193 Member States adopting 17 global Sustainable Development Goals (SDGs)1 seeking to end poverty, fight inequality and injustice, and tackle climate change by 2030.
The SDGs cover broad challenges such as economic inclusion, diminishing natural resources, geopolitical instability, environmental degradation and the multifaceted impacts of climate change. They define the agenda for inclusive economic growth through to 2030 and were developed with inputs from business, academia and nonprofit organizations globally.
Many companies have also been working to address environmental, social and economic issues. Leading companies have begun to recognize that they can only address the complex sustainability challenges by scaling up their efforts through collaboration with peers, industry and sector organizations, customers, governments, nonprofit organizations, and society. The SDGs provide a universal and visionary framework for this global cooperation and action, bringing all stakeholders together to proactively address and solve these challenges.
If the SDGs are to be met, business is likely to play a major role and may also have a lot to gain.
The business case
Companies are facing challenges that limit their potential to grow, such as scarce natural resources, weak financial markets, limited local buying power and lack of qualified talent. We see a clear business case for companies to harness the SDGs to create opportunities to address these challenges across four key themes: growth, risk, capital and purpose.
Business growth in general is tied to the achievement of the SDGs at a macro level; however, to take action at a local level, companies should identify how they can contribute to meeting the goals in a way that drives financial performance in the markets they operate in.
While SDGs Nos. 8, 9 and 12 refer directly to economic growth, employment, sustainable industrialization, innovation and sustainable production, many of the other SDGs also offer business advantages through expanding into new markets, attracting talent and reducing risk from operations.
For example, when beverage companies invest in improved watersheds by working to replenish the aquifer water they use, thereby also committing to provide access to clean water to people in those water-stressed regions, their strategy aligns with SDG No.6 – Clean Water and Sanitation. While providing water supplies to sustain their bottling franchises near those watersheds, they are also investing in their social license to operate and thus strengthen their brands in these communities.
All companies stand to gain from more resilient communities, reliable access to natural resources, and an educated and healthy population to support their workforce. By helping drive progress toward these outcomes and creating shared value, companies can help to secure their ability to generate capital and shareholder value over the long-term.
A report by the Business & Sustainable Development Commission revealed that sustainable business models related to the SDGs could open economic opportunities worth up to US$12 trillion and increase employment by up to 380 million jobs by 2030.2