The UN Global Compact’s Lise Kingo urges business leaders to stop the slide backwards on climate and the SDGs and urgently course-correct
None of us is immune to the rapidly shifting environment we all find ourselves in, and that includes the business sector. With the planet facing unprecedented climate change, wider social inequalities and human rights violations, the time for action is here and the time for talking is over.
As we close out 2019, today’s most progressive business leaders are looking even more seriously at sustainability. Most leaders fully understand that stakeholder engagement is no longer just about the next earnings season. Their actions send clear signals to their investors, their consumers and the watchful public about what their brand represents.
The private sector is turning a corner, and awareness is higher than ever before, but what’s really needed at this juncture is a deeper level of action as current business action just doesn’t cut it.
The SDGs offer to unlock more than $12tn in new market opportunities across industries from energy and agriculture, to health and urban development
For the coming decade, business will need to respond more to the communities in which they operate; to undertake a transformation on a scale not seen before. They will need to better align their business strategies with the 17 Sustainable Development Goals (SDGs) and the UN Global Compact’s Ten Principles – and faster.
The global community has one of the few opportunities left to get back on track to deliver on the 2030 Agenda for Sustainable Development.
For business, the opportunity should be clear. The SDGs offer to unlock more than $12tn in new market opportunities across industries from energy and agriculture, to health and urban development.
Progress in the private sector exists and change is under way; just not enough to drive the level of change needed. Business needs to challenge itself and look carefully and ask what more can be done.
Solid action and intent from the private sector exists, but business leaders claim that the lack of progress in sustainability is because the landscape has become far more complex than before.
This year’s UN Global Compact Progress Report and UN Global Compact-Accenture Strategy CEO Study revealed that companies have a firm grasp of policies in place on the Ten Principles (near 90%) and on the Global Goals (more than 80%).
The time has come for decisive action. Inaction is too risky. We must begin the Decade of Action
We heard businesses say they are keen to implement change. But CEOs also say they find it challenging to extend sustainability strategies across their companies and throughout the entire global supply chain. As complexity around sustainability rises, companies find it even more challenging to take action.
More worrisome is that in several areas we are actually going backwards. For example, there’s been a marked drop in companies implementing anti-corruption policies (from 61% in 2018 versus 55% in 2019).
We need to stop the slide backwards and instead need to course-correct.
So we’re challenging companies to step up in the lead up to 2030. The time has come for decisive action. Inaction is too risky. We must begin the Decade of Action.
We must all face the reality on where we are on the 17 Global Goals after four years. The planet faces two of the biggest challenges that need urgent and transformational action – the climate crisis and social inequality.
It’s clear business plays an important role, but also critical is meaningful integration into business practices. A majority of our corporate participants say they believe business could have a critical role in delivering the Global Goals (71%), while only 21% believe this is happening at the moment. So companies will have to become more serious and fully integrate the SDGs throughout the organisation and supply chain.
The “SDG Ambition” initiative attempts to address this disconnect between intent and implementation by offering deeper guidance to companies on how to turn risks into opportunities and how to deepen implementation across strategy, operations and stakeholder communications.
We’re already heading towards 200 companies aligning with a 1.5C scenario, and encouragingly these numbers are set to rise
The second initiative calls for the business community to set science-based targets aligned with keeping global warming to no more than 1.5C and also to aim for net-zero emissions by 2030. A low-carbon economy alone could offer $26tn worth of market opportunities and create 65 million new low-carbon jobs.
There is growing momentum as more and more companies commit to set science-based targets. We’re already heading towards 200 companies aligning with a 1.5C scenario, and encouragingly these numbers are set to rise.
Addressing gender equality is also critical. As a firm advocate for women’s workplace rights, we should all recognise that by closing the economic gender gap would add a further $28tn to global annual gross domestic product by 2025. An impressive figure but at the current rate of progress it’s estimated that it will take more than 200 years to close the economic gender gap – hardly progress.
For some companies, women’s equal representation at the board and senior management level are in reach, whereas for others, a target of 30% is still very ambitious. Based on current research, 30% is the minimum limit for giving women a fair opportunity to participate in representation and leadership, but also in terms of business performance and outcomes.
By working with companies on the Target Gender Equality initiative we seek to redress the imbalance. We can increase women’s representation and leadership in top management — and develop a conscious focus on including female entrepreneurs across the global supply chain. Deepening the level of action and integration within a company is essential, and a “new normal” for female representation must be established now.
And when we look ahead, would we all not benefit from identifying young business talent now to better serve people and planet. Of course we would, but ask yourself: are we doing enough? By identifying talent at an early stage, companies better position themselves to support sustainability objectives while also helping long-term business success.
There’s no more sitting on the sidelines. All companies will need to act more ambitiously in the coming decade of action
Now is the moment for businesses to step up. There’s no more sitting on the sidelines. All companies will need to act more ambitiously in the coming decade of action.
Young activists across the world are already calling for more ambitious action to transform the world. It’s about time we take our cue from them.
From here on, every company in every sector needs to move with the times, adapt or risk being left behind in a changing world. After all, it is the business sector that knows better than anyone that being left behind holds consequences. So it really is time we all become activists and align our priorities with the younger generation.
Lise Kingo is CEO and executive director of the United Nations Global Compact
This article is part of our in-depth Decade of Delivery commentary from sustainability leaders. To view all articles, please see our January 2020 digital magazine.
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