The role of business: 2017 and beyond

Just over a year later the “State of Green Business 2017” report by GreenBiz, an organisation that focuses on sustainability, has identified as one of its top ten trends that “SDGs Become a Business Strategy”. This report affirms that the SDGs can become a bridge between society and business in order to engage with C-suite executives. Since the SDGs were announced, a multitude of guides, resources, case studies and tools have become available online so that companies can incorporate SDGs into their business strategies (e.g. sdghub.com). In addition, there are tools to connect the SDGs to existing sustainability reporting standards (SDG Compass) and industry standards (SDG Industry Matrix). However, the question remains as to what the business case is to adopt the SDGs as part of a business strategy?

At the 2017 World Economic Forum meeting in Davos, the Business and Sustainable Development Commission (BSDC), whose mission is for business to adopt more inclusive and sustainable business practices and renew public trust, launched a report on the size of the SDG opportunity[1] and a further report on the required investment.[2] The pursuit of the SDGs by business would unleash a US$12trn SDG “prize” in savings and revenues and lead to 380m new jobs. The SDGs would “require a mere US$2-3trn of additional investments per annum, out of a global GDP of approximately US$115trn” BSDC went on to say.

It is too early to say if the SDGs will be realised by 2030 or not, however there is already significant activity by business in the SDG space: 165 initiatives from 47 companies and organisations that cover 81 of the 169 SDG targets (48%) in more than 150 countries, per Business for 2030[3]. BSDC expects that realising the US$12trn SDG “prize” will significantly impact 53% of the 169 targets underlying the 17 SDGs[4].

Action on climate change and SDGs

In its report BSDC refers extensively to the interrelationship of the SDGs and the fundamental role of climate change action (SDG 13 climate action) in order to achieve all the SDGs. In its SDG scorecard, the Overseas Development Institute gives SDG 13 an F (for fail) and one of five SDGs that needs the most work[5]. In addition, a report by the UNDP, “Scaling Up Climate Action to Achieve the Sustainable Development Goals”, makes a critical point about the central, crosscutting role and impact that climate change has on all SDG goals. The SDGs cannot be achieved without action on climate that puts the world back on a 2-degree C or less pathway (the world is still on a 3-degree C pathway[6]). Without climate action and massive decarbonisation of the economy most of the SDG work would be undone by a hostile climate, the US$12trn “prize” not realised and 380m jobs not created.

Although climate action is one of the 17 SDGs this is insufficient, to ensure the world stays within 2 degrees C warming (as businesses focus on specific SDGs[7] [8]). To achieve this goal business (especially the most carbon intensive industries such as fossil fuels, utilities, chemicals, cement, steel, transportation, retail, and food & agriculture) and cities (where emissions are concentrated) need to collectively reduce global greenhouse-gas emissions by at least 2%/year starting this year to 2050[9]. This decarbonisation of the economy is an essential condition to achieving the other 16 SDGs. Otherwise none of the 17 SDGs will be achieved in all 5 regions of the world[10].

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The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views of The Economist Intelligence Unit Limited (EIU) or any other member of The Economist Group. The Economist Group (including the EIU) cannot accept any responsibility or liability for reliance by any person on this article or any of the information, opinions or conclusions set out in the article.