In June 2015 – ‘IMPACT’– a landmark Report authored by DNV GL was launched in the UN General Assembly. The report is an assessment of the impact of the UN Global Compact over the last 15 years and the progress that has been made towards its vision of a sustainable and inclusive economy. Based on resources that included interviews with over 200 business and civil society leaders, we believe it is the most complete and authoritative view of the history of the corporate sustainability movement so far.
Our evaluation adopted a model for assessing change which was framed around three interconnecting levels – recognising that progress must happen across all three levels simultaneously if transformative change is to be achieved. The three levels were:
a) Dominant worldviews (the attitudes values and beliefs that shape our understanding of business and the economy).
b) Corporate operating environment (key drivers such as regulation, finance and education)
c) Corporate practices (company activity that aligns with the 10 UN Global Compact Principles).
The corporate world we describe in 2015 is radically different from the picture in 2000 when the Global Compact was launched. At the outset only a very few leading companies acknowledged the challenges of sustainable development, whereas today over 8,000 businesses have signed up to honour the Global Compact’s 10 principles. In fact, by March 2015, 58 million people were employed by signatory companies, a group that includes 25% of the FORTUNE Global 500.
However, while much has been achieved and there is an undeniable momentum, it is equally clear that we need to move up a gear if the Global Compact’s vision of a sustainable and inclusive economy will be met by 2030.
In making our recommendations for what business, the Global Compact and others should do next, we drew heavily on the impending Global Goals for Sustainable Development (SDGs), a new resource that was being prepared and that companies will be able to draw upon to support their business strategies, while contributing to a sustainable and inclusive economy.
On 25-27 September world leaders adopted the SDGs as part of an ambitious plan to eradicate poverty, fuel inclusive growth and protect the environment, at the United Nations Sustainable Development Summit. Focusing on 17 global goals, the post-2015 development agenda is an important long-term framework that will define new ways of doing business while supporting prosperity and societal needs. With a record participation of over 150 heads of state and government and a speech by the Pope, the SDG Summit is set to be a historic event.
The SDGs are broad ranging in their scope and are intended to build upon what has been achieved through the Millennium Development Goals (which ended this year). In contrast to the MDGs, business has been closely involved in the development of the SDGs – and business is expected to play a central role in achieving them. This is where we see a great opportunity for companies that are serious about driving change – and recognise that meeting the SDGs will support their longer term business success.
The final part of IMPACT describes our views on pathways to a sustainable and inclusive economy. Our recommendations followed the ‘three levels’ model that underpinned our assessment, meaning that transformative change will only happen if company activity is supported by an external operating environment that encourages them and where the dominant worldview recognises the benefits that will be accrued by acting more sustainably. You will see from the summary below, committing to the Global Compact and adopting the SDG’s form a key part of these recommendations to business.
Leadership companies should now actively support the process of creating national plans to implement SDGs, supporting governments and other actors to overcome the inevitable obstacles and create a road map that will inspire others to become involved.
It is encouraging to see the business community so actively involved in the development of the SDGs. By improving the alignment between business and global priorities, we should expect to see the level of engagement from business increase and a greater chance of progress on global challenges.
By adopting the SDGs and contributing to creation of national plans, companies will minimise their exposure to a broader range of risks, identify new business opportunities and increase their resilience and efficiency.
The next generation of leaders will be defined by how companies respond to the opportunities created by the SDGs. A first step for any company that is serious about its sustainability mission will be to assess how its current strategy aligns with the breadth of issues covered by the SDGs and identify the inevitable gaps. Being able to understand how the SDGs offer an opportunity to benefit your organisation is critical to support the business case for adopting the goals – and will define the leadership agenda for years to come.