The SDG Impact – The Entire Business Activities Required to be Reconsidered, Looking ahead to the Global Standards

Initiatives to achieve the Sustainable Development Goals (SDGs), adopted by the United Nations in 2015, have begun, being led by some international organizations, NPOs, and socially progressive global companies. The SDGs are now recognized so widely as common goals to almost all countries in the world that often seen are people who wear colorful lapel pins on which the colors of the 17 SDG icons are printed. The same is true for industries. Many corporate managers expressed their support for the SDGs and their willingness to contribute to them. However, there are still few companies that incorporate the SDGs initiatives into their actual business strategies, set concrete targets and objectives to achieve the Goals, and publicize their accomplishments.

On the other hand, various principles and guidelines have been announced by international organizations, governments, capital markets, industrial organizations, and so forth, from the viewpoints of environmental measures and corporate governance, and companies now operate their business under such conditions that those principles and guidelines must be followed. Furthermore, not a few corporate managers regard corporate activities themselves as something that will eventually lead to either the 17 Sustainable Development Goals or 169 associated targets when taking the above-mentioned business conditions in a broader sense. However, there is no definite standard that links business activities to the SDGs, and therefore it can be said that it is not possible to objectively assess the activities of companies from the perspective of level of contribution to the SDGs in the current situation.

What is promising in terms of assessment standards is the “SDG Impact.” The United Nations is aiming to formulate a certification standard that assesses whether or not specific activities of corporations have effect (= impact) on the achievement of the SDGs, and make it effective by the end of 2021. If this assessment system is internationally recognized and fairly operated by an appropriate certification body at some point, it should be possible to evaluate the assessment system of ESG investing [assessing and selecting companies to invest in consideration of not only conventional financial information but also environmental, social and governance factors], the behavioral guidelines of business associations or the like, and the “degree of contribution” of each of corporate activities in relation to SDG Impact. Use of common assessment standards will accelerate companies’ engagement in social activities useful for the SDGs.

If corporate activities are assessed according to a universal standard, the common sense of only “insiders of a company,” double standards, let alone the right to "remain silent" will no longer work.

The principle of the SDGs is to achieve a world in which “no one is left behind,” that is, the protection of the human rights of socially vulnerable groups or minorities such as ethnic minorities, women, children and the underprivileged populations, which is the core idea of the initiative. Therefore, negative assessment of human rights cannot be offset by any other items covered in the SDGs. In other words, the “personality” of a corporation is the first thing to be called into question throughout the entire business activities.


This Week’s Focus, May 28

Takashi Mizukoshi, the President