How more companies are moving on the new revenue streams tied to the UN sustainable development goals.
In September, UN member states will adopt 17 Sustainable Development Goals (SDGs) for the next 15 years — including ambitious targets to end world poverty, achieve gender equality, and combat climate change. It will be a watershed win for society if the global development community can significantly move the needle on any one of these issues. But there's also a hidden opportunity for people running businesses to cash in on the huge market potential in solving the most pressing issues of our time.
When a business innovates to solve a social issue profitably, that shared value approach is more sustainable -- it will make greater impact for both the business and society. And the SDGs are the most tangible way to date to find business opportunity in social problems. In a recent interview with Devex at the Shared Value Leadership Summit, FSG cofounder and shared value leader Mark Kramer commented:
"This is a new revenue model for business. You can actually quantify the market potential of for-profit business to meet the needs of the SDGs. Getting business to understand that this is about new markets, new business opportunities, and new business models — instead of charity or the mandate of the development agencies, the government, and the NGOs."
Many organizations are already catching onto this trend. GSK, Anglo American, and the Coca-Cola Company are all making plans to incorporate the UN's global development agenda into their strategies. "We'll look at the SDGs as part of the overall context of what we're doing as we think about shared value broadly, but also as we think about our consumer broadly," comments Mary Merrill, who direct strategic initiatives for Coca-Cola's Sustainability Office.
And although these multinationals recognize the potential to grow their business on social issues, they're also transparent about needing help from other sectors to get it done. "There's recognition that we can achieve mutual impact with the right partnerships," says Dr. Allan Pamba, who leads GSK's engagement efforts with East African governments to improve medicine and vaccine delivery.
The shared value benefit to Pamba's business is clear — improving healthcare access in rural areas brings GSK more business — but other industries, for example in the energy sector, are finding opportunities in making the right on-the-ground connections. Christian Spano of Anglo-American explains his company's early-days strategy for effective SDG partnerships:
"What we're trying to do now is share with core participants — the UN, other mining companies, NGOs, and so on -- capturing their understanding on what they think our core role is in this process [of delivering on the SDGs]... We're gaining clarity on what level of support we need to put in some areas and where we need to allow others to play a bigger role but we stay connected... In that way for each dollar we put in we get maximum impact, allowing others to join the process."
With the September deadline looming, it's apparent that more companies will jump at the opportunity to tackle these huge global issues with new business models — making a huge impact on both their own bottom lines and society as a whole.
UPDATE: Add Philips to the list of companies doubling down on SDGs. Yesterday the company announced on Guardian's Sustainable Business blog commitments to Goals 3 (health), 7 (energy), and 12 (sustainable consumption) to align with their key businesses in those issue areas. This news arrives while Philips was named #34 on the new Fortune "Changing the World" list, along with 50 other companies featured for their efforts in addressing major social problems as a part of their core business strategy.