A report published this week by DNV GL and the UN Global Compact (UNGC) has found that 75% of companies who join the UNGC initiative are taking action towards advancing the UN Sustainable Development Goals (SDGs) – but, almost two years in, companies are still struggling to understand how best to report on their progress towards the SDGs. With best practice still emerging, and expectations rising, how do corporates use reporting to demonstrate that they are contributing to the SDGs?
This question is of particular interest to members of The Consumer Goods Forum (CGF). Through CGF initiatives, members are working on 10 of the SDGs, including those related to taking action on climate change (Goal 13), taking care of the earth (Goal 15), improving nutrition (Goal 2), the well-being of consumers (Goal 3) and providing decent work for all (Goal 8). And, of course, Goal 17 - developing mechanisms and partnerships to reach the goals – is at the heart of everything the CGF does.
Reporting Progress Towards the SDGs
The most common form of reporting currently amounts to pointing out where the current strategy/approach aligns with the Goals (often by attaching SDG logos to existing content). This is acceptable as a starting point, but is in danger of becoming a greenwashing, box-ticking exercise, unless followed up by a more detailed analysis.
There are, of course, examples of companies that have adopted a more detailed approach: PepsiCo is acting on the Goals that tie closely to its products and operations; HP is mapping its business and sustainability activities against the SDGs for reporting purposes; and SABMiller is compressing the 17 goals into five material sustainable development priorities for its business. Unilever’s Sustainable Living Plan business strategy supports the SDGs, and the company links brands to specific Goals.
The UN Global Compact and the GRI are in the process of developing guidance for Business Reporting on the SDGs, which will hopefully help increase robustness in reporting on the SDGs.
In the meantime, talking in terms of broad headline Goals helps to get the conversation started, but companies can only really understand their potential contribution by looking at the 169 underlying targets. Examples of such targets include Goal 8.7 and the need to take immediate and effective measures to eradicate forced labour, and Goal 12.3 that targets halving per capita global food waste at the retail and consumer levels and reducing food losses along production and supply chains.
A materiality process should be the starting point to determine which Goals and targets are most relevant for a particular company. Each target should then be reviewed to understand what impact you could have, and how you can shift the dial on issues such as poverty and income, etc., and what metrics you can set that will have some influence of meeting the targets. Identifying who you need to work with, ie what partnerships you could form, to further progress against the Goals is an important part of this process.
Using a Science Based Targets approach for metrics would help ensure alignment with best practice. Independent assurance of progress against the Goals would then demonstrate robustness of approach.
Businesses that align their priorities with the SDGs are more likely to have resilient, long-term business strategies. If communicated correctly, the SDGs also provide a common language with which to engage your stakeholders. Sustainability reporting has evolved considerably in the last decade, as companies become more aware of the legal and reputational risks associated with greenwashing. The approach towards communicating on the SDGs should be no different.
Here at DNV GL, we look forward to learning more about what actions companies are taking to meet these goals during next month’s Sustainable Retail Summit in Montreal, where we’ll see how companies are working with stakeholders to move forwards on topics such as food waste, forced labour and consumer health and how they are implementing business strategies that lead to positive change and get them closer to achieving their SDG targets.
This post was written and contributed by:
Jason Perks & Priti Hoffmann