Francis West, Head of Private Sector Policy & Advocacy at Unicef UK discusses how companies can move beyond ‘cherry-picking’ Goals by shifting away from the traditional approach to materiality within corporate sustainability. This interview forms part of a series entitled ‘Leader Insights: Business Action on the Sustainable Development Goals’. The full series can be accessed here.
Q. Last year, Corporate Citizenship undertook research that showed that whilst many companies know that the SDGs exist, they are not all clear on what they can do about them. What do you think is the role of business in contributing to the SDGs?
The private sector can help achieve the SDGs by driving inclusive economic growth, creating decent jobs, increasing access to essential services and developing innovative products that meet social needs. An approach that harnesses core business operations and supply chains is essential if we are to deliver a framework that includes vast ambitions ranging from ending abuse, exploitation, trafficking and all forms of violence against children, to achieving full and productive employment and decent work for all.
There is a risk, however, that the sheer number of SDG targets (there are 169) could encourage an outdated approach to CSR, where companies might cherry-pick the goals to which they want to contribute. This is not to suggest that businesses should address all goals, but instead they should prioritise action according to the salience of the impacts that their business has on people. This requires a shift away from the traditional approach to materiality within corporate sustainability that focusses on impact or risk of stakeholder concerns on the business. It’s by design rather than luck that the UN Guiding Principles on Business and Human Rights, and their central concept of human rights due diligence, provide a blueprint for how to operationalise that shift. The due diligence process of identifying, preventing, mitigating and accounting for impacts on human and child rights across business operations and supply chains should result in a tangible action plan for a business, which can then be cross-referenced with SDG targets.
While full implementation of the Guiding Principles on the part of businesses would contribute greatly to the achievement of the SDGs, if we are to realise the transformational change implied by the Goals, there needs to be much more than a mapping exercise of existing commitments (and this goes for both public and private sectors).
Q. One of SDGs (17) focuses specifically on partnerships. Are you detecting any new trends in terms of how corporates have engaged with UNICEF or the broader non-profit since the launch of the Goals?
We have certainly seen an appetite to engage on the SDGs, an immediate interest in Goal 17 and a recognition that the Goals can help encourage cross-sector collaboration. SDG 17 on partnerships does represent an opportunity to brigade collaborative action on human and child rights challenges further down complex supply chains.
Most businesses we work with at Unicef UK understand the need to address impacts on children that their business either cause or contribute to. We see more challenges with respect to those issues that a business is linked to by a business relationship. For a tour operator or travel agent, this might mean being linked to child labour via the fruit and vegetable supply chain in the hotels and accommodation that they offer to their customers, or to the children selling trinkets to hotel guests on the beach; for a consumer goods company with supply chains heavily reliant on migrant workers, there may be a link to exploitative conditions characterised by employers withholding employee passports or workers paying upfront fees to secure a job.
In any of these scenarios, the problems faced are deeply embedded, many tiers down the supply chain, are often undetected by ethical auditing processes, and reflect systemic flaws and challenging cultural norms. They are not problems that businesses can face down on their own and there may be little reward in doing so. They demand collective, multi-stakeholder action, which the energy behind the SDGs can catalyse.
Q. What can the private sector do to engage with NGOs more effectively to address global challenges?
Be transparent about the challenges faced in business operations and supply chains and demonstrate a willingness to assess how your own company’s business model, purchasing practices and other actions can contribute to these issues. Doing so should result in recognition on the part of civil society actors that such issues are systemic and that a will to affect change must be met by constructive criticism rather than knee-jerk condemnation.
Such openness may result in sector specific partnerships – for instance in the travel and tourism industry to determine the actions that might be considered as ‘policies to promote sustainable tourism’ under target 8.9. Alternatively, cross-sector partnerships (the creation of which hits various targets under Goal 17) could focus on specific issues. The Global Partnership to End Violence Against Children is one example of an initiative that has been established to address a specific target within the SDGs (16.2), and could form the basis for business collaboration to define the policies and practices that could end entrenched problems within supply chains, such as trafficking and exploitation of children.
All of this is not to devalue traditional social investment approaches to engaging with NGOs. But these too can be more effective if shaped by high quality human rights due diligence process. This is very clear from the experience of the telecoms company Millicom. After conducting a child rights impact assessment across its supply chain with Unicef, birth registration was identified as a significant blocker to children in their supply chain realising their rights. As a result, Millicom supported the creation of a new SMS service in Tanzania that allows parents to register new births as well as those of children under five on any mobile phone, straight to a centrally-run database.
Q. What new opportunities do the SDGs present for businesses who wish to engage with NGOs and non-profits on global challenges?
The SDGs represent the biggest opportunity to scale action on business and child rights since the UN Guiding Principles on Business and Human Rights were unanimously endorsed by the UN Human Rights Council in 2011. The UNGPs require engagement with human rights experts, who tend to reside in NGOs. While business and human rights is often viewed as a negative ‘do no harm’ agenda, the UNGPs and their emphasis on business responsibility throughout the supply chain are truly innovative and the consensus garnered behind them represent a once in a generation opportunity for collaboration between business, civil society and government.
More specifically, the SDGs offer a platform for more collaboration between business and civil society on advocacy towards Government where human and child rights are not being upheld. There are of course some instances where conditions in countries where global value chains are based mean that companies cannot act unilaterally. In these instances, collaborative advocacy with competitors and others can enhance social impact. A good example of this is when H&M and other major retailers lobbied the Cambodian government to raise wages in the garment sector.
Much has been made of the need for an ‘enabling environment for business’ in the SDGs. Perhaps companies advocating for regulation to raise standards around some of the most intractable rights issues in global supply chains suggests that businesses have a role in shaping that environment for the better.
Q. One of the particular stakeholder groups we are looking at in our research is millennials – those born between the early 1980s and 2000. They might be employees, but also consumers and indeed the entrepreneurs and investors of the future. How do you think businesses should be engaging with this influential demographic on global issues?
As consumers, millennials need to recognise that goods and services that are produced to higher ethical standards can result in higher prices. While businesses ought to factor the cost of ensuring human and child rights in supply chains into purchasing practices, millennial consumers must expect to do the same. Mechanisms like the Corporate Human Rights Benchmark increasingly offer consumers the information to buy from businesses according to performance on supply chain challenges. What’s more, Government is encouraging consumers to do so, with the Home Office Guidance to the Modern Slavery Act explicitly calling for consumer pressure on brands that do not fully adhere to the requirement to set out the steps being taken to address slavery and trafficking in supply chains.
This trend towards more responsible consumerism appears to be reflected in the investor community, particularly amongst younger investors. Evidence suggests that young investors are more than twice as likely as their older counterparts to want their investments screened based on environmental, social and governance factors by their wealth management providers. This growing interest in responsible investment depends on the disclosure of due diligence and management tools that allows investors to move capital towards more sustainable, responsible organisations and strengthen the long-term ethical sustainability of the financial system. For technology savvy millennial consumers, employees and investors, transparency on business performance is an expectation and is key to unlocking their influence and resources in pursuit of the SDGs.
Corporate Citizenship would like to thank Francis for contributing to the Leader Insights Series. Francis has worked in business and human rights at a number of international development charities as well as in public affairs roles in the technology sector. He holds an MSc in International Development & Security, with a specialisation on corporate social responsibility in post-conflict contexts. Francis can be found @FrancisWest1 on Twitter.