IIRC, UNCTAD, WBCSD and NBA: The role of business in achieving the Sustainable Development Goals

26 April, 2018

Following a joint event hosted on 23 April 2018 by the United Nations Conference on Trade and Development (UNCTAD), the International Integrated Reporting Council (IIRC), the World Business Council for Sustainable Development (WBCSD), and the Royal Netherlands Professional Association of Accountants (NBA), the four organizations have released the following statement:

As organizations committed to sustainable development and transparency, UNCTAD, IIRC, WBCSD and NBA, joined forces to hold a stakeholder dialogue on April 23 at the UN Headquarters in New York. The dialogue focused measuring private sector contribution to the attainment of Sustainable Development Goals (SDGs). The event affirmed the role of business in helping to achieve the SDGs, drawing inspiration from Goal 17 and the need for co-operation and partnerships.

The SDGs provide business with a framework to translate global needs and ambitions into business solutions helping companies to better manage operational and regulatory risks while also unlocking potentially historic market opportunities. In 2017, the Business and Sustainable Development Commission’s Better Business Better World report pointed to USD 12 trillion of economic opportunities that could be opened up annually if the ambitions of the SDGs are realized by 2030.

Many businesses are already starting to mobilize around this agenda, and details with regard SDG-related performance are also starting to find their way into corporate reporting. The 2017 edition of WBCSD’s Reporting Matters analysis found that 79% of studied companies mention the SDGs as part of their sustainability disclosure. However, challenges still remain with regard to how contribution to the SDGs can be more substantially integrated into corporate strategy and reporting.

Moving forward, we encourage business’ to align their value creation models with the SDGs and use relevant metrics to measure and communicate on performance (short term and long term). In order to achieve this and provide stakeholders with confidence, there is a pressing need for relevant and reliable information about business’ contribution to the SDGs.

Corporate reporting has an important role to play in communicating performance against the SDGs, providing information for capital markets and national governments to assess how companies are contributing to the Goals and integrating them into their business.

As more businesses integrate the SDGs, significant investment flows will be directed towards sustainable business models.  To that end, leveraging mainstream corporate reporting as a means of communicating SDG integration is critical. In this way, the SDGs will not become a new layer of reporting that adds to the existing burden, potentially impeding decision-making because it’s difficult to isolate the material information. Rather, the SDGs will become a new way of demonstrating growth, progress and long-term value.

It is important for governments to encourage companies to report on the SDGs through their existing mainstream corporate reporting requirements. The metrics provided by UNCTAD’s core indicators can offer a baseline level for governments to use.  However, in many countries, we note that reporting has advanced beyond baseline measures and we would encourage further integration of financial and non-financial information to present a more coherent view of company performance.

In this regard, greater collaboration between organizations who are developing and issuing guidance for increasing the reach of the SDGs to corporate audiences is very important. Such collaboration and alignment will enhance measurement, innovation and performance.

The world is placing a great deal of attention on the SDGs and is focused on measuring the private sector’s contribution.  The required scale will only be achieved when companies and governments invest energy in making SDG integration clear and simple for key decision-makers, making the knowledge and acceptance of the SDGs a pre-requisite for doing business.

By working together, governments, companies and investors will be able to ensure that reported information is both relevant and reliable for informing decision-making and capital allocation.

Tatiana Krylova, UNCTAD said: “Enterprise reporting has a critical role in the 2030 Agenda for Sustainable Development as it can enrich and enhance the SDG monitoring mechanism by providing   stakeholders with means to assess the economic, environmental and social impacts of companies on sustainable development. However, further efforts on integration of sustainability information into companies reporting cycle, enhancing quality and comparability of sustainability reporting are needed to facilitate that role. Current work of the Intergovernmental Working Group of Experts on International Accounting and Reporting (ISAR) of UNCTAD on selection of a limited number of core baseline SDG indicators would assist companies and policy makers, as well as other stakeholders, to deliver reporting on the private sector contribution to the SDGs in a consistent and comparable manner.”

Peter Bakker, President and CEO at WBCSD said: “The SDGs provide business with a powerful agenda for the future we want. By carefully considering how their strategy and actions can impact the SDGs, companies are able to better manage their risks and unlock historic opportunities – all while helping to move the world towards the delivery of a more sustainable and inclusive future. This event underlines the importance of measuring companies progress against the SDGs in corporate reporting.”

Richard Howitt, CEO, IIRC said: “The United Nations has identified the integration of reporting as a critical target for achieving the Sustainable Development Goals. Businesses who commit to the SDGs will not simply be contributing to the global goals for the sake of the planet, but at the same time helping to ensure the stability and sustainable development for the business itself.  The IIRC’s vision includes sustainable development at its heart and so we believe it is timely to demonstrate how integrated reporting can be harnessed by those organizations whose strategy is to align to the SDGs. I encourage greater integration of initiatives aligned to the SDGs to accelerate adoption by business and investors into their core activities.” 

Paul Hurks, Director International Affairs, NBA said: “The increasing quest by investors for corporate reporting on SDGs emphasizes that SDG information is in fact pre-financial information. Inclusion of SDGs in business’ strategy is inevitable for business to keep a long term license to operate in sustainability terms but implicitly also to keep the business viable in financial terms.”