The 2030 agenda
New York’s Climate Week offers a unique space for climate events and has garnered increasing attention for the past eight years. This year, events were held not only in support of an increasingly ambitious climate agenda, but also to shine a spotlight on the Sustainable Development Goals (SDGs).
Climate change impacts everyone and everything. One of the principal challenges facing the world, it must be taken into account across each of the wide-ranging environmental, social and economic themes that form the basis of the new SDGs. And of course, sustainable development is vital to achieving a low carbon future.
What’s also clear is that governments can’t tackle these challenges alone. The success of both the Paris Agreement and the SDGs requires a significant contribution from the private sector. A large and growing number of businesses are recognising that these challenges present them with significant opportunities. From showcasing their leadership in response to the new demands and markets that are being created, to ensuring a sustainable long-term future for their people, places and profits.
New business opportunities
These political developments are fundamentally shifting expectations for the private sector. Investors and purchasers are now calling on business to demonstrate how they are contributing to the SDGs.
Investors are beginning to use regulatory frameworks as guidelines to mitigate risk and move away from short-term profit maximization to long-term value creation. Investment firms have already begun to use the SDGs as the basis for their ESG analysis framework. This is significant. Mirova, the responsible investment division of Natixis Asset Management worth £2.9bn in AuM and £20.3bn in voting and engagement, has developed a scoring methodology to determine company impact on the SDGs, which in turn creates a sustainability ranking. Its funds increase allocations to those contributing to the SDGs, while at the same time excluding companies that do not.
Consumer behaviors and expectations are likewise beginning to change. A recent PwC report surrounding SDG business strategy found that 90% of responding citizens in their target group believed that business should engage with the SDGs. Recognizing the opportunity to engage meaningfully with stakeholders, the same report showed that 71% of companies were already planning how to engage with the SDGs in 2015.
Tracking progress
As the tried and tested environmental disclosure platform, backed by investors representing US$100 trillion in assets under management, CDP has institutional expertise in motivating and tracking business action in support of progress on international environment agreements. Unsurprisingly, CDP’s questionnaires on climate change, water security and deforestation have significant alignment with many of the SDGs including goal 6 on water, goal 7 on energy, goal 11 on cities, goal 13 on climate action and goal 15 on terrestrial ecosystems.
Disclosure through CDP enables businesses to showcase their contribution to the SDGs through their answers to certain questions. CDP can help companies to:
- Set a meaningful target: Private sector commitments are essential to achieving the SDGs and can be made more impactful through clear and collaborative target setting. Setting meaningful targets allows a company to safeguard future profitability, drive innovation and position itself as a leader among its peers. CDP is a partner in the Science Based Targets initiative and can support companies in setting an emission reduction target that will help them make the most meaningful contribution to preventing dangerous climate change.
- Track progress: To demonstrate real progress against the implementation of targets, progress needs to be measured and tracked transparently. CDP responses serve as a reliable and standardized source of data for tracking company, city, state and regional performance year-on-year. Businesses can use CDP’s disclosure platform to easily report to their stakeholders on annual progress toward their internal goals and contribution to the SDGs.
- Showcase success: Responding annually to CDP’s information requests provides businesses with an opportunity to showcase leading best practice. CDP is the main data provider to public commitment databases, such as NAZCA.
There’s a world of opportunity for businesses that are aligning their strategy with the SDGs. Both the public and private sector have recognized that we have entered a new regulatory and economic landscape where meaningful environmental action is the underlying imperative to financial success. Join those companies charging ahead, such as Unilever and SAB Miller, by aligning your business strategy with a sustainable future.