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Five Steps Businesses Must Take To Reach Their Sustainable Development Goals

UN Sustainable Development Goals are for organisations of all sizes - how can yours chip in?

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UN Sustainable Development Goals are for organisations of all sizes - how can yours chip in?

Guides

Five Steps Businesses Must Take To Reach Their Sustainable Development Goals

UN Sustainable Development Goals are for organisations of all sizes - how can yours chip in?

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In 2015, the United Nations introduced its Sustainable Development Goals (SDG’s) to the world. National governments are responsible for meeting the UN’s set targets on 17 different global sustainable development issues, by the year 2030.

These 17 goals attempt to make a positive change for people and the planet by tackling global challenges such as, poverty, gender equality and climate change, amongst others.

Though the overall responsibility to reach these lies with national governments, the effort to create a sustainable future by reaching these goals is not achievable without the combined effort of businesses and organisations as well.

In fact, the long-term success and survival of many industries depends on the achievement of one or more of these SDG’s. Therefore, it is important that organisations actively look to contribute towards these issues and help governments to reach these goals.

However, very few organisations can or should aim to contribute to all of these SDG’s, and in any case it is simply not feasible to tackle all, especially those that are not directly related to the organisation. Instead they should tackle those aligned to their strategy.

To successfully contribute to the relevant SDGs in the most effective way, businesses must embed these SDGs into their organisations thinking and reporting, using the integrated reporting process to incorporate these goals into the structure of the business.

But, what steps can businesses take to contribute to the achievement of these SDGs, whilst also benefiting their own organisation in doing so?

Determine the sustainable development issues relevant to the organisation

As previously stated, though it is likely that many of these issues could affect an organisation, it would prove difficult and simply not beneficial for a business to attempt to contribute to all 17 of the UN’s SDG’s.

It is important that an organisation identifies exactly which of these goals are directly related to their current or potential products, services and business practices and the type of impact they could have.

Contributing to these goals could either increase or decrease an organisation’s value, directly – by creating new business opportunities, or indirectly - through the quality of relationships with stakeholders or by influencing the availability, quality and affordability of multiple capitals.

Organisations should encourage stakeholder engagement, drawing upon the expertise of their board and governing bodies, to ascertain which of these SDGs are most likely to create an opportunity or risk for the organisation.

Identify how these sustainable development issues affect value creation

After identifying which of these SDGs directly affect the organisation, it is important not only to understand whether or not they will be a risk or opportunity for the business, but also to identify the level of impact that these issues could have.

An organisation must engage with its internal and external stakeholders to identify, evaluate and prioritise which SDG’s are the most important and therefore deserve the most attention.

For example, organisations that trade globally are likely to experience a significant impact from sustainable development issues such as the environment and poverty in trading countries, therefore the importance of developing products and services or investing to tackle these issues, is likely to be of higher importance compared to others.

Therefore, when planning their approach to the SDGs, organisations must determine how to reduce the risks and increase the opportunities that could arise from sustainable development issues by contributing to those that create value for the organisation and its stakeholders.

Develop a strategy to contribute to the SDGs through the business model

After identifying and prioritising the sustainable development issues that may affect a business, an organisation should develop a strategy to contribute to these, aligning it with their business model.

An organisation’s strategy should identify how to tackle and manage specific sustainable development risks and how to maximize their opportunities, for the business.

This should set out the specific objectives and methods that will support the relevant and significant SDGs, and should include short, medium and long-term targets that must be achieved by the organisation.

For example, if a company is looking to tackle climate change, they may look to develop products which have a low carbon footprint or services designed to help others reduce their carbon footprint. The impact of these contributions can then be reviewed over set, specific periods of time.

Develop integrated thinking, connectivity and governance

Though contributing to the specific sustainable development goals is imperative, over time many of these goals may change in importance, and new issues may arise that previously did not affect the organisation.

An organisation may find that evolving societal expectations and natural resource limitations could cause certain sustainable development issues to become more or less important to their organisation.

An organisation must have a sound governance and relationships with its stakeholders in order to link the organisation’s strategy and business model with changes in its external environment.

This will allow an organisation to adapt their contribution to specific SDGs in accordance with changes in external factors, to ensure they are always contributing to not only the most important sustainable development issues relevant to their business, but also the ones that create the most value too.

Prepare an integrated report

An organisation should then create an integrated report, which states the sustainable development issues that they have been contributing towards and discusses the impact theses have had on the organisation and stakeholders.

This report should show how the organisation’s contributions have helped to tackle these issues, and also articulate the value these contributions have created for the business, in the short, medium and long term. This also aids decision making which maximises value to the organisation and its stakeholders.

For organisations, following these five steps are a must to contribute to these sustainable issues, not only tackling the issues that may directly risk an organisations practices and existence, but also seizing new opportunities to increase the organisations value creation and capital.

Carol Adams is Professor of Accounting at Durham University Business School. Click the link to download her report on the Sustainable Development Goals.

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Five Steps Businesses Must Take To Reach Their Sustainable Development Goals

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