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The SDGs have inherently transformed the relationship between business and government by marrying economic growth and social gain. Image: sustainabledevelopment.un.org
Is Your Company Ready to Engage with the SDGs through Inclusive Business?
SDG engagement can take the form of a tested and decade-old concept: inclusive business. A new report helps companies assess how ready they are to incorporate it.
These are unsettling times.
The promise of globalisation is being increasingly eclipsed by political uncertainty and a rising tide of nationalism and protectionism. In listening to workers displaced by automation or communities who feel the squeeze of disparities in income and political capital, the world is beginning to recognise that progress has not only been uneven, but that the costs of globalisation in some instances might outweigh the benefits.
But this “globalisation hangover” should not serve as a backlash against the potential of global accords like the sustainable development goals (SDGs), which have inherently transformed the relationship between business and government by marrying economic growth and social gain. In fact, in the wake of sociopolitical unease, stakeholders around the world are obligated to commit to the brighter side of convergence, moving beyond rhetoric and into bold action that reaffirms a changing course. After all, successfully reaching the SDGs will require a Herculean effort, to the tune of $30-45tn (£24-36tn) in funding over the next 15 years — a daunting figure given that current estimates of public sector support hover around $2tn, just over 4% of the required funds.
Recognising the breadth of the challenge and with an eye to this holistic convergence, the 2030 agenda asks for more than just a pipeline of monetary support. Instead, it appeals to businesses, ranging from microenterprises to multinationals, to apply their creativity and innovation to solve sustainable development problems through their own initiatives and models.
As demonstrated in Uncharted waters: blending value and values for social impact through the SDGs (pdf), a joint collaboration between UNDP, the Istanbul International Center for Private Sector in Development, Business Call to Action, and Deloitte, the request is simple and the results are clear. Engaging with the SDGs is not just a show of societal good will — it is a move made by proactive, sustainable organisations. Making SDG alignment part of their core business can help companies generate new revenue, increase supply chain resilience, recruit and retain talent, spawn investor interest, and assure license to operate.
So, tactically, what does engagement, wherein companies marry purpose and profit, look like? And how can companies determine if they’re ready for this type of SDG engagement?
SDG engagement can take the form of an innovative but tested and decade-old concept: inclusive business. Inclusive businesses functionally aim to achieve the same ends as any other company, by driving revenue growth, creating value, and accelerating business expansion. Critically, however, inclusive businesses provide access to employment opportunities — and their associated socioeconomic benefits — to underserved populations as suppliers, distributors, retailers, and employees.
This integration is comprehensive; as inclusive businesses grow, so do the livelihoods of the individuals in their markets. As demonstrated in this report, numerous successful companies such as Unilever, Philips, and Novartis, have adopted this model, steadily growing their bottom lines through innovation and adaptation, while simultaneously stimulating progress toward the SDGs.
This model takes time to develop, so to ensure commercial viability and financial sustainability companies must first understand their level of inclusive business maturity – a proxy for readiness to successfully engage with the SDGs. Uncharted waters provides a transformative suggestion: companies across sectors and geographies, whether or not they already employ inclusive business practices, can benefit from and become true champions of this model. The report provides a clear diagnostic for companies at all stages to assess their maturity and readiness and take tailored steps to incorporating inclusive business into their core strategy. Ultimately, the report demonstrates that businesses’ growth and socioeconomic development can not only exist, but thrive, together.
This report and its findings are the next stage in the extended path to private sector engagement with the SDGs. More importantly, it serves as a stepping stone toward healthy dialogue that can provide more robust answers to questions in service of both businesses themselves and the global community in which they operate. After all, curing the globalisation hangover will require not just convergent thinking, but readiness for collective action. Are you SDG ready?
This article first appeared on The Guardian and is reproduced with permission.
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