Focusing on the Global Goals increases competitiveness
Part of a series of business columns in Danish newspaper Fyens Stiftstidende.
Author: Camilla Haustrup Hermansen, Director of Business Development at Plus Pack and Chair of the Climate Partnership for waste, water and circular economy.
In September 2020, it is 5 years ago since the heads of the world’s states and governments met and adopted the UN 17 Sustainable Development Goals (also called SDGs or Global Goals) as a framework for global sustainability towards 2030. Today, the SDGs make their mark on existing markets and create completely new markets too, while citizens, institutions, organizations, governments and companies design and develop new solutions and partnerships to ensure a more sustainable future.
The status is that 193 countries have undertaken the commitment to pursue the SDGs. Legislation has been amended to promote the goals. Requirements from consumers, investors and customers are influenced by the major global challenges. Therefore, a company whose core business and strategy are not sustainable can risk reputation as well as demand, unless it is willing to take greater responsibility for the world that surrounds it. An increasing number of Danish companies meet customers’ and business partners’ requirements for reporting how their company work tactically and strategically with the SDGs. Furthermore, it is no longer unusual that they demand increased responsibility with regards to business development before signing a new contract. In addition, employees expect that their workplace contributes to developing society positively, and children and young people work with the SDGs in institutions and schools. As such, the 17 SDGs, 169 targets and related indicators can support companies in identifying the business opportunities and risks of the future and not least outline expectations as well as requirements for the social contract of the future.
According to the internationally acknowledged guidelines of the UN and OECD, a company must perform due diligence by clarifying policies and processes to identify the fields in which the company can have a negative impact on social and environmental conditions as well as prevent and mitigate potential negative impact. It must also account for and document its actions. This means that today a company need to be in control of internal practices when it comes to how its activities influence people and the environment. This applies to the business itself as well as to business partners, suppliers and customers. Luckily, this also means that Danish companies have a unique starting point for being competitive in new sustainable markets. This is due to the fact that the Danish business world is already assisted by applicable legislation and framework in the economic, social and environmental fields, which are all interdependent in the SDGs.
Furthermore, Denmark is usually well ahead others when index values are being measured across the 17 SDGs. That is because every year, the governments of the 193 countries are required to report on the progress they have made in their efforts with the SDGs. In addition, a big number of international and independent reports are published with accounts on the best-performing countries with regards to the implementation of the goals.
In the recent international report World Competitiveness Ranking 2020 prepared by the World Competitiveness Center (IMD), Denmark as a country and Danish companies are among the best in the world in terms of national sustainability efforts and the companies’ focus on the SDGs.
It is worth mentioning that this is the first time that criteria related to sustainability and the SDGs are taken into account in the report. This reveals how important it is to focus on the SDGs and incorporate the related efforts into the core business if a company is looking to increase its competitiveness. On the contrary, one might say that the report confirms that Danish companies have a great potential to become pioneers in solutions, products and partnerships which can promote sustainable development as well as the global transition to a green, circular economy. In the report by IMD, Denmark has been ranked #2 among the top countries in several fields that can be considered as competitive advantages unique to Denmark; a resilient economy, openness to trade, law and order, social responsibility, absence of corruption, retraining opportunities for professionals, motivated employees and environmental legislation.
That is to say that the SDGs contribute to the competitiveness of the companies and the leading position of Denmark on the global market. Who knows, perhaps a day will come when not only those 193 countries but companies too will be required to report on their efforts in fulfilling the SDGs, including sustainable efforts perceived, measured and weighed in a broader social context?
The SDGs are sufficiently specific and wide-ranging for all players in society to be able to relate to them, work with them and possibly contribute to realizing them. Each company must focus on the goals for which it has the greatest potential to provide concrete solutions, products and service that can solve the great global challenges, while ensuring a sustainable global development at the same time. In other words, you should get started with working strategically with sustainability now. The responsible business of the future lies in the SDGs.
Click here to see the World Competitiveness Rankings 2020 results.