Sustainable Development: the most important business of all businesses

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By Ignacio Álvaro, Specialist in Management and Leadership of Public Organizations and Development at the Comillas Pontifical University

With over 15 years of working in and studying sustainable development, from places such as Afghanistan to Honduras, from Madrid to Boston, I have learned that the traditional systems of cooperation found throughout international organizations and non-governmental organizations (NGOs) cannot meet the monumental challenges we face today. Questions and issues such as climate change or inequality do not only affect developing nations, but also the nations we called developed. Governments must work with companies and businesses in new and innovative ways to promote responsible private investment, public wellbeing and collective action.

Fortunately, within the context of the 2030 Agenda for Sustainable Development, the business sector has ceased to be considered a foreign element, or even an obstacle to sustainable development. It is an essential partner in achieving the Sustainable Development Goals (SDGs).

A report from the UN Sustainable Development Goals Fund (SDG Fund), “SDGs and the Private Sector”, that I edited, is based on the contributions of hundreds of companies and business in Africa, the United States and Europe. The report reveals that the majority of the companies are already working to incorporate the SDGs into their business plans and strategies. More importantly, all the companies recognize that their main way of complying with the SDGs is through their business activities. This represents a substantial paradigm shift regarding more philanthropic or assistance based strategies.

Sustainability in business activities is being transformed into an essential component that allows organizations to succeed and thrive.

During the last couple of decades, pushed by a society empowered by the ability to freely and easily access information, corporations and businesses have become more and more focused on making sure responsible practices and SDGs are at the core of their business strategies. As matter of fact, sustainability in business is an essential component which allows international organizations and business alike to succeed. This is reflected by a number of studies (National Bureau of Economic Research 2010 y MIT 2015) demonstrating that businesses adopting sustainable strategies and practices improve their competitiveness and have better medium and long-term economic results.

The SDGs serve as guidelines for businesses to assess and manage social, economic and environmental risk, while contributing to bettering their reputation, image and their strategic position in the world’s markets. This is especially relevant for small and medium enterprises (SMEs). According to the World Bank, SMEs represent half of the developing world’s workforce, and without a doubt will have the greatest impact on the SDGs.

For example, for an SME called “Cafetera SuperCafe” recognized in the report, the issues of payment of coffee laborers in Colombia was transformed into a development goal. Due to the problems that rural populations faced in trying to access bank services, the company had to find an innovative solution by utilizing SMS codes in order to pay the laborers. The key for the implementation of the SDGs in corporate strategy will be the ability to adapt to the context and situation within which each business operates.

One of the greatest challenges of the 2030 Agenda for Sustainable Development also tends to be one of its advantages: the universality of the agenda. The differences in values, norms, political systems, legislation, climate and geography between member states and pose some challenges when it comes time to act in a global context. The nature of universality entails diversity, which requires flexibility and adaptation. The good news is that businesses, due to their competitive natures, are in the best position to constantly adapt and learn from their experiences.

The business sector has become one of the most important means to achieve the Sustainable Development Goals

While there are not any particular guidelines or best practices that can be a applied to all cases, the report does provide some key points which have helped businesses to achieve positive results in their contribution towards the SDGs.

1. Focusing on local problems: The majority of businesses suggest promoting constant dialogue with internal groups and local communities. They try to understand the local issues and problems, to work jointly towards solutions adapted to those contexts.

2. Adaptation and learning: Many companies have found that is it possible to resolve complex issues only by adapting to the local context and learning about that context through experience.

3. Local and global alliances: Companies need to associate with public and social institutions in order to share learning techniques and increase joint initiatives and impacts.

4. Institutional collaboration: Governments and international institutions should increase their efforts in collaborating with companies, both at the operational and political level and at the local or global levels. There is a great opportunity to develop joint finance mechanisms, new technologies and negotiation models, all which promote innovation and which favor more inclusive and sustainable growth.

The SDGs are a set of great and significant challenges faced by governments, international organizations, civil societies and other businesses around the world. Working together, these challenges could be addressed in the next 14 years. The SDG fund, created thanks to an initial contribution by Spain, denotes a new strategy in how the joint cooperation of private and public sectors can help achieve the 2030 Agenda for Sustainable Development.

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