SDGs and the private sector: Creating a win-win scenario

End poverty. End Hunger. Provide full employment.

These are just three of the items on humanity’s greatest wish list — the new sustainable development goals, expected to be finalized by the United Nations this fall.

It is impossible to imagine coming close to achieving these goals, and the 14 others, without the private sector. With the sector accounting for 90 percent of jobs in developing countries, and foreign investment outpacing development assistance four to one, business has a critical role to play in achieving the SDGs.

But exactly how private sector engagement happens is still open to debate. As we finalize the SDGs this year, we need ensure that private sector investment, expertise and measurement tools are aligned with this historic development push.

Improving coordination

As a nonprofit specializing in business solutions to poverty, TechnoServe works with a broad range of corporations, donors, governments and nongovernmental organizations on initiatives combining business and social objectives. And while the details may vary, we’ve found that the most successful partnerships always start with a strong sense of shared responsibility for mutually agreed-upon, specific outcomes.

Already, the SDG process has made great strides on this front. While the Millennium Development Goals were formulated by U.N. member states with limited outside input, this time companies were invited to actively consult with the U.N. on the post-2015 development agenda.

But from a business perspective, important challenges remain. “Sustainability is core to our business strategy,” explains Andy Wales, sustainable development director at SABMiller, which has mapped its own initiatives on this front against the draft SDGs. “But sometimes suspicions remain about business motivation among governments and NGOs, and we need to build stronger relationships to dispel those.”

Much of this work will happen at the country level. For instance, governments can develop a “one-stop shop” for coordinating with the private sector on the SDGs, advises The United States Council on International Business, which represents the U.S. private sector in U.N. sustainability deliberations through the International Chamber of Commerce and the Global Business Alliance it coordinates. The U.S. State Department’s Office of Partnerships is a potential model.

“Governments should involve business in the planning stages of their SDG implementation plans, not only at the implementation stage,” says Ariel Meyerstein, USCIB’s vice president of labor affairs, corporate responsibility and corporate governance. “They can then work together to identify key ‘starting line’ issues for immediate attention.”

For their part, in order to maximize both commercial benefits as well as social impacts that align with the SDGs, businesses need to ensure that they fully incorporate sustainability goals into their core business operations and not, for instance, just their corporate social responsibility departments. Kellogg Co., for instance, has instituted programs to encourage participants at multiple levels of its supply chain to adopt practices and technologies that encourage agricultural sustainability, understanding the long-term benefit to its own business.  

“We are working closely with supply chain partners, industry allies and local governments to address issues in the SDGs like relieving hunger, improving food security and nutrition and promoting sustainable agriculture, in areas where we live, work and source,” said Diane Holdorf, Kellogg chief sustainability officer.

The measure of success

If “what gets measured gets done” (as we believe at TechnoServe), then aligning corporate and SDG indicators may be one of the keys to achieving the SDGs. Several multinational corporations like Coca-Cola, Nestle and Kellogg, already report against targets covered by the SDGs, such as environmental impact, women’s empowerment or hunger relief.

But many more businesses have yet to develop comprehensive sustainability commitments and plans. And companies will only face increasing public pressure to account for how their work in developing countries is contributing (or not) to development.

If the SDG indicators can be formulated so that companies can set sustainability commitments related to their core business, measure progress, and report against them in line with the SDGs, the private sector should feel increasingly comfortable making public sustainability commitments.

To encourage this alignment, the U.N. can tap existing corporate frameworks and reporting mechanisms, and engage businesses more closely in developing the SDG indicators.

“Evaluation and accountability against quantifiable metrics for the SDGs are essential to drive progress,” says Wales of SABMiller. “Business thrives in such a culture — in fact, it is the most effective institution in that regard. So businesses should be involved in helping to create this framework, with consideration of how business processes and data collection can contribute.”

For instance, TechnoServe has found the Shared Approaches Framework (now being developed and tested by leading food companies and NGOs coordinated by the Sustainable Food Lab) to include useful indicators for a variety of stakeholders when assessing sustainability in smallholder supply chains, a key area of our work to improve farmer productivity and livelihoods.

And The Sustainability Consortium, a nonprofit with more than 100 members that include NGOs, academic partners and corporations like Wal-Mart, Coca-Cola, and Marks & Spencer, has developed common standards for sustainability measurement across a range of consumer categories. “There are many lessons that can be learned from these collaborative efforts that could be applied to the SDGs,” suggests Beth Keck, senior director for women’s economic empowerment at Wal-Mart.

In addition, the U.N. Global Compact, the Global Reporting Initiative and the World Business Council for Sustainable Development, are developing toolkits that will map SDG targets to GRI’s corporate sustainability reporting framework, in order to help companies track their contributions to the U.N. goals.

The way forward

Getting this right in practice won’t be simple, of course. For instance, it’s unlikely that one measurement framework per goal will work for every company — ultimately, different sectors may have to develop their own frameworks and aggregate impacts at an industry level, with the U.N. aggregating at a global level.

Verification is another challenge — who will confirm the accuracy of all this data, and how? And how do we best engage companies in places like China, or small and growing enterprises in developing countries themselves?

These questions — and others — can only be meaningfully addressed with urgent engagement of leading businesses by the U.N. to make sure the SDG indicators are business-oriented and that shared measurement frameworks can work. We now have a unique opportunity to drive even more companies to build on the growing volume of corporate sustainability commitments, an essential factor in achieving some of the most ambitious development visions ever created.

While we have made great strides on this front in recent years, it will take unprecedented cooperation to achieve unprecedented progress.

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