What to Watch This Week: Integrating the SDGs into Business Strategy
A recent webinar from Sustainable Brands listens to corporate leaders discuss implementing the Sustainable Development Goals into their brands, with themes of “collaboration” and “purpose”.
Sustainable Brands (SB) believes that the UN’s Sustainable Development Goals are an important framework for sustainability and value creation. Last month, SB hosted a webinar called, “Bewildered by the UN SDGs? Corporate Leaders Share Benefits of Integrating the Goals into Your Brand Strategy”. Featured speakers included Claus Stig Pedersen, Head of Corporate Sustainability at Novozymes; Charlene Wall-Warren, Director of Sustainability at BASF; and James Sullivan, Head of the Global Sustainability Center of Excellence at SAP.
Tamay Kiper, SB’s Sustainability Projects Manager, kicked off the conversation with an overview of the findings from a recent survey of SB’s member companies. Of the 39 member companies surveyed (representing 63% of SB’s corporate member network), 67% said they are actively addressing the SDGs.
The Goals most frequently addressed are:
- Goal 13: Climate Action
- Goal 6: Clean Water and Sanitation
- Goal 8: Decent Work and Economic Growth
Least frequently addressed Goals are:
- Goal 1: No Poverty
- Goal 16: Peace, Justice and Strong Institutions
- Goal 10: Reduced Inequalities
Interestingly, of the member companies that are addressing the SDGs, only about half — 56% — are involved in partnerships with NGOs.
The three most common approaches to addressing the SDGs are:
- Setting goals that are consistent with the SDGs
- Educating or engaging employees
- Incorporating into business plans
The least common approach is educating suppliers.
Claus Stig Pedersen followed with his description of Novozymes’ sustainability journey, which began in 2000 when Novo was split into three independent companies. In the beginning, sustainability was all about managing Novozymes’ brand reputation. In 2009, the company began to think about how it could support its customers’ brands with sustainability. Then in 2015, sustainability became aligned with the UN’s Global Goals.
However, Novozymes’ SDG integration actually began in 2012, when the company was involved in the development of the Global Goals. The UN’s desire for company involvement was a change from the previous Millennium Development Goals and gave companies the ability to help create goals that were relevant, meaningful and actionable. In 2014 Novozymes used the draft goals to inspire its plan. Today, the company’s purpose is sustainability.
To further operationalize the SDGs, Novozymes developed 15 impact categories from the 169 targets, with tools to assess and connect Novozymes solutions to Global Goal impact.
This innovation pipeline (pictured below) demonstrates the link between business development and the SDGs. The company uses its tools to understand which of the opportunities in the pipeline are most promising in reaching the Global Goals and, therefore, represent the best prospects for business development and growth. Novozymes also considers how to attract partners — policy makers, influencers, etc. — who can can accelerate solutions and help bring them to market with speed.
Mr. Pedersen concluded:
“We believe the Global Goals are going to rise a big wave of change in the coming decades… that will influence the markets, what consumers want, and therefore, what successful brands look like.”
Next, Charlene Wall-Warren explained how BASF, a founding member of the UN Global Compact, has been integrating the Global Goals into its brand strategy. BASF contributes to the success of the SDGs by minimizing impacts along the value chain as well as through its products and services. It examined materiality issues across the SDGs and found strong alignment. BASF has set a series of targets along the value chain, and wants to grow how it contributes to accelerators down the value chain — with a target of reaching 70% of suppliers.
BASF identified six focus areas — the SDGs on which it can have the most impact. Ms. Wall-Warren touched briefly on Goal 6: Clean Water and Sanitation as an example of how BASF analyzes its contribution towards this goal.
BASF uses the SDGs as a framework for integrating sustainability into management, providing “Sustainable Solutions Steering” and materiality assessments into the future. The SDGs also provide the opportunity for BASF to collaborate with key stakeholders to create real impact.
Next, Jim Sullivan talked about SAP’s approach to integrating the Global Goals. According to him, “It all starts with purpose.” We love his succinct and compelling purpose fact sheet.
SAP aspires to improve billions of people’s lives. And yes, purpose and profit can co-exist. Its business strategy is built around these global mega trends:
SAP uses four KPIs to manage company performance. The first two — Growth and Productivity — are used by almost every other company. But SAP has determined how to monetize its second two KPIs — Customer Loyalty and Employee Engagement — so that they improve profits rather than being considered cost centers.
Similar to BASF, SAP has created six areas of impact under its focus areas of Economy, Society and the Environment. Its duel strategy combines sustainable operations and enabling customers to create social progress, economic development and environmental impact.
The slide below shows how one solution with one customer can have real impact; expanding that solution to 350,000 customers could have a huge amplifier effect.
Mr. Sullivan concluded by talking about the importance of collaboration. He said that 83% of companies are showing strong collaboration across the board — from competitors to peers to startups to employees. “We believe that most iconic businesses of the future will be those that collaborate to advance humanity.”
“Purpose is a strategic imperative in business. Collaboration is the next wave of purpose” — Radley Yeldar, Fit for Purpose 2016
With a few minutes remaining for questions and discussions, Ms. Kiper asked: “Why are companies aligning their goals with the SDGs? What are some drivers for companies?”
Mr. Pedersen explained that the Global Goals are a historic agreement that will be prioritized politically, and they are a fantastic forecast on where business opportunities will arise. Even if only half of the SDGs are realized, they are still the best business forecast we’ve ever had.
Ms. Wall-Warren discussed the growing role of marketing in increasing stakeholder awareness and acceptance of the SDGs, and Mr. Sullivan talked about how integrated reporting can lead to collaboration and a larger level of impact.
Ms. Kiper wrapped up the webinar by highlighting some of the additional resources SB offers. Our favorite is the Top 5 Tools to Tackle the SDGs.
“This member-exclusive report highlights the top tools for addressing the SDGs as identified by SB. All of these tools are free and publicly available. SB provides our own assessment of each tool, and guidance on where it could be most useful on your company’s SDG journey.”
The top five tools include:
- SDG Compass
- SDG Industry Matrix
- SDG Selector
- Business for 2030
- FutureFit Goals
If you have the time, check out this informative webinar in its entirety.
You can also download the presenters’ slides here.
