Q&A: New UN Global Compact CEO Sanda Ojiambo on changes to come

WASHINGTON — Sanda Ojiambo took the reins at the UN Global Compact in June, stepping in to lead the world’s largest corporate sustainability initiative as it works toward a new strategic plan and contends with a growing number of other efforts. “I think there are shifts that we will need to make in this business strategy, but I think they're going to be very important shifts,” she told Devex. “I also think that another big shift in focus for the compact is striking that pragmatic balance between delivering business benefit — that I think we do very well — to also delivering societal transformation.” Ojiambo is the first African CEO of the Global Compact and the first with a development background. She came from Safaricom, where she was head of sustainable business and social impact, and previously worked for CARE International and the U.N. Development Programme in Somalia, in addition to the International Planned Parenthood Federation’s Africa region. Devex spoke with Ojiambo about the new strategy, the changing landscape of corporate sustainability, and what’s next for the UN Global Compact. This conversation has been edited for length and clarity. UN Global Compact is developing a new strategy. What is it focused on? I think there's three key opportunities for the compact. The first is to continue to grow its membership. There are some underrepresented areas around the world globally, and we need to continue to grow our footprint around the world to be truly a global compact. I think we need to be more inclusive around midsize and small enterprise as well. The vast majority of the world's economies are actually driven by MSMEs, and I think providing value to them around the [UN Global Compact’s Ten] Principles is very important but also recognizing that a lot of our large companies actually incorporate these MSMEs through their value chains and supply chains. So it's just really solidifying those linkages across business. And I think the third for me is then looking at how do we apply this integration of the SDGs [Sustainable Development Goals] into business in a lot more of a practical way. Because I find that a lot of companies ask how, and our reports show that the CEOs understand the SDGs; they're just not sure how to integrate them into business, how to make those important business shifts. One criticism of the sustainability movement and of Global Compact is that it’s been focused on large multinational corporations, while the majority of the world’s companies are small and medium-sized enterprises. You mentioned SMEs; how do you plan to engage them? Sometimes at the point when you're trying to disrupt, you need significantly large businesses to do that. I think the kind of group of companies that have gone out and taken the lead fully acknowledge that there is a need to make that shift now. How can that shift happen? I'm just going to talk about three things. “You could be a small or medium-sized company. Pick the one SDG that you feel is going to give you the most impact. The compact is here to help guide you in that process.” --— Sanda Ojiambo, CEO, UN Global Compact I think the first is to look at those global and leading companies that are out there. What is happening in the supply chains and what is happening in the value and sales chains? Because I'm very sure that every large company, multinational, has footprints around the world. So one of the probably lowest-hanging fruits for the Global Compact, in terms of that tipping point into the SME sector, is asking companies to very carefully elaborate their supply chains and value chains. And I'm very sure that that footprint extends into medium-sized companies and smaller enterprises that exist in a variety of countries around the world. So for me now, taking a supply chain or value chain approach to the work that we do is going to be critical. The second is really to examine the local networks and the work that they do. At present, we have 68 local networks around the world. My desire is to see that expand. The third — and I'll talk about the program and guidebook that we just launched today, which is the SDG Ambition guidebook on designing business systems. The question that everybody keeps asking, large and small, is: How do you integrate the SDGs into the business? One of the responsibilities, and one of things that the Global Compact does very well, is produce guides and guidance to help companies do this. So I always say, you know, you don't have to pick all 17 SDGs. You could be a small or medium-sized company. Pick the one SDG that you feel is going to give you the most impact. The compact is here to help guide you in that process. How much will the changes in corporate commitment or action on social or environmental issues actually translate to boosting investments in the world’s poorer countries? Does UN Global Compact have a role in ensuring it does? I don't think enough has been done about documenting what this business-meets-societal-transformation model looks like. There are some businesses doing some really good work, and I'm just going to talk about perhaps just four areas where I see opportunities for us. The first actually is in sustainable finance. You know, just recently we launched our CFO Principles. And, you know, one of the key things here is to look at how SDG financing becomes a reality. … Once we have the financing at scale and in the right place, I think this can impact foreign direct investment. It can also help impact or shape development financing. I think we'll be able to see that shift. So for me, I think one of the biggest opportunities is the shift from SDG funding to SDG financing that is taking place. It will put the resources where we need to have some of this transformative action. Second for me is, again, looking at what role our local networks can play. And I think being in sync with country teams but also just being in sync with what's happening on the ground provides that opportunity. So if we have businesses attuned to the shifts that we're trying to make, they should be part of some of the transformation that happens. The third thing … is really technology. ... I think technology will continue to play a very key role in driving forward development benefits into developing countries. I think the challenges here are really just making sure there is adequate connectivity, access to devices, and that sort of thing. The last one I want to say is really around documenting. I would like to see us focus a little bit more on how we document what works around corporate sustainability, because we need case studies that will apply to being taught at Harvard Business School but also being taught in a small MSME capacity-building workshop out in developing countries. A key criticism of the Global Compact over the years is that it is a voluntary institution. Do you think the compact should require a certain measurable standard from its members? The fact of the matter is you could approach a lot of the work that we do by compliance methodology. I think the challenge of compliance is that you're not really sure if you're ticking a box or if you have a real leadership commitment and whether or not these issues that you are addressing are driven all through the business. So I support the approach that we have, because what we call for is a leadership commitment towards change. Some work that is in progress is: Perhaps make our reporting a little bit more metric-based, a little bit more clear for you to track what the progress is, because, of course, what doesn't get measured doesn't get managed. And you'll see that, in our upcoming communication-of-progress … review, we do want to have reports that are a little bit more structured so that you can measure progress as you go along. But I do think, you know, more and more the world over, the awareness of sustainability issues is at all-time high. And I think that businesses will slowly make that shift. And I think with that shift, we'll get more members and just more participation and engagement. I'm not necessarily for compliance at this point in time, because I think it takes away really what are the moral leadership elements of what we're trying to shift and change in the work that we do.