A rundown of November reports on business, SDGs and investing

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November was a busy month in the world of business and the sustainable development goals and the financing behind social and environmental challenges — at least if evaluated by the number of reports released.

It’s not always easy to keep up to date on the latest reports, white papers and research, so Devex Impact has taken a look at a host of reports released in November. Here’s the rundown on some of those reports.

Universality and the SDGs: A business perspective (62 pages)
Published by the Sustainable Development Goals Fund

Companies across all sectors worldwide, from Coca Cola in Nigeria to Bank of America, are engaging with the United Nation’s Sustainable Development Goals, but this work has its limits.

This report, which explores the idea of universality – that the SDGs affect everyone and are everyone’s responsibility – looks specifically at how the private sector views its participation. More than 75 percent of the 95 corporate participants surveyed for this report said they are integrating sustainability strategy into their corporate strategy. But some companies also report challenges to moving beyond corporate responsibility, including societal engagement and awareness and a lack of clear SDG indicators.

The report also offers some suggestions for what can be done to address some of those challenges, particularly where more information can overcome knowledge gaps.

Across the returns continuum
Written by the Omidyar Network, published by the Stanford Social Innovation Review

The Omidyar Network has analyzed its past investments to get at one of the key questions in the impact investing sector: is there a trade-off between financial returns and social impact? For those looking for an argument on one side or the other, it’s not in this report. Omidyar’s investments have shown there is no easy answer, that in some cases positive social impact does correlate to higher financial returns, but that it doesn’t always hold true.

What follows is a framework that the philanthropic investment firm lays out for investing across what it terms a “returns continuum” — from commercial investments on one end to philanthropic grants at the other — and how it determines when to take a lower than market rate return. The four criteria they consider are the market-level impact of the investment; the fact that sub-commercial investments can distort markets but could be used to help build necessary infrastructure; a comparison against a similar not-for-profit organization that would always be grant reliant; and the need to keep the same evaluation standards.

Sustainable signals, the asset manager perspective (20)
Published by the Morgan Stanley Institute for Sustainable Investing

This new issue brief based on an industry survey and in-depth interviews of more than 402 respondents at U.S. asset management firms found that a majority are now doing some form of sustainable investing, with about 89 percent familiar with the issue and 64 percent reporting that they believe it will continue to grow.

The study also found some key barriers to increased growth in investments that seek commercial rates of return alongside positive social or environmental impacts. Among them are: a lack of a standard industry definition for sustainable investing; a lack of industry metrics to measure performance; and the ongoing perception that sustainable investments equate to sacrificing financial performance.  

The research also found a considerable knowledge gap. Only 51 percent of respondents said they are confident they can explain the non-financial impacts of sustainable investments. The report concludes with recommendations for how to address some of the persistent challenges to enable future growth.

U.S. sustainable, responsible and impact investing trends 2016 (26 page executive summary, full version paid)
Published by US SIF:The Forum for Sustainable and Responsible Investment

This report takes a look at some of the latest data about sustainable, responsible and impact investing, or SRI investing. It found that the total U.S. assets under management that use SRI strategies grew 33 percent from the start of 2014 to the start of 2016, adding up to about $8.72 trillion at the start of the year. That amounts to more than one out of five dollars under professional management in the U.S.

The report explores some of the reasons for the growth: including achieving long-term returns, managing risks and a desire to help social or environmental advances.

Blended finance: Understanding its potential for Agenda 2030 (40 pages)
Published by the Development Initiative

This report focuses on how blended finance –the use of public or philanthropic funds to bring along additional private sector funding– can be used to finance the Sustainable Development Goals and help address the current funding gap.

The report, which tracked and monitored existing blended finance activities, found that more people are using blended finance, even if it remains a small piece of overall development funding, that middle-income countries have greater levels of blended finance funding and that it can sometimes be used in the poorest countries where traditional investors are hesitant to enter the market.

The writers had several recommendations for improving the use of blended finance, including a need for better data and transparency in blended finance deals to show revenues and evaluate global development impacts, and a need for standardized reporting.

Progress on the New York Declaration on Forests: Eliminating Deforestation from the Production of Agricultural Commodities – Goal 2 Assessment Report (58 pages)
Published by Climate Focus in cooperation with the NYDF Assessment Coalition with support from the Climate and Land Use Alliance and the Tropical Forest Alliance 2020

The New York Declaration of Forests, which was agreed to in 2014, outlines 10 global goals and subsequent global targets to stop forest loss and protect forests by 2030. The second goal is to “ Support and help meet the private-sector goal of eliminating deforestation from the production of agricultural commodities such as palm oil, soy, paper, and beef products by no later than 2020, recognizing that many companies have even more ambitious targets.”

This report explores progress towards that goal, and discusses a new framework for evaluation of supply chain efforts taken by public and private actors that the New York Declaration of Forests Assessment Coalition has developed. The focus of the assessment is on the four commodities that most drive agricultural deforestation: palm oil, soy, cattle and wood products.

The majority of the damage is done in a limited number of countries and the report outlines four criteria that will need to be considered to mitigate damage and end deforestation, particularly in those areas.

They are: Private sector commitments to eliminate deforestation from their supply chains are growing, commitments must be specific, measurable and effectively implemented, actors outside supply chains including financial institutions, governments and civil society all need to participate, and there is a need for data that will track global efforts.

Reporters Amy Lieberman and Jennifer Ehidiamen contributed to this article.

About the author

  • Saldiner adva

    Adva Saldinger

    Adva Saldinger is an Associate Editor at Devex, where she covers the intersection of business and international development, as well as U.S. foreign aid policy. From partnerships to trade and social entrepreneurship to impact investing, Adva explores the role the private sector and private capital play in development. A journalist with more than 10 years of experience, she has worked at several newspapers in the U.S. and lived in both Ghana and South Africa.