SDGs & Corporate Sustainability - Talk on ‘Creating A Better World: The Role of Corporate ASEAN in Driving the Sustainable Development Goals’:

Apr 27, 2016

En Salleh Hassan, Director, Professional Development and Corporate Governance, SIDC

Mr. Ramesh Kana, President of Global Compact Malaysia,

Esteemed speakers,

Distinguished guests,

Ladies and gentlemen,

Good morning.

My sincere thanks go to the Securities Industry Development Corporation (SIDC), Global Compact Malaysia, and the University of Nottingham for hosting this important discussion on “Creating a Better World: The Role of Corporate ASEAN in Driving the Sustainable Development Goals (or SDGs)”. It is very encouraging to see this strong turnout at such a high level in your companies. Last year was a watershed year for global development.  Member States reached major new agreements which set the global development agenda for a generation – across the 2030 Agenda, the Paris Climate Agreement, the Sendai Disaster Risk Reduction Framework, and the Addis Ababa Action Agenda on financing for development.  The 2030 Sustainable Development Agenda was shaped by many voices, including business, and applies to all.  This is certainly not an agenda just of governments.  Everyone has a role to play to ensure its full achievement.  I was therefore pleased to accept the invitation of the President of Global Compact Malaysia, Mr Ramesh Kana, to address you as members of the ASEAN business community on the topic of “SDGs and Corporate Sustainability”.

As business leaders, you know how crucial it is to have a vision and set goals and targets that are measurable, time bound and achievable. What has been common place in business for decades – was a first in development agenda setting at a global scale when Governments joined together in 2000 and adopted the Millennium Development Goals.  The remarkable results of this effort over the last 15 years spurred the United Nations to embark on a much more ambitious post-2015 agenda to succeed the MDGs; and last September, during the 70th session of the General Assembly, the current 193 Member States of the United Nations adopted the new global Sustainable Development Goals, and related targets and indicators for measurement of progress.  The new sustainable development goals aim to free humanity from poverty and want, leaving no one behind; to fight inequality and injustice; and tackle climate change by 2030 in order to shift the world on to an inclusive, sustainable and resilient path.

The SDGs were developed out of the most participatory and widespread consultation process in global decision-making.   As such, it is no surprise that we have before us, a truly comprehensive, very ambitious, universal and transformative development agenda that comprises 17 goals and 169 targets.  The private sector was fully part of that process, and one of the major stakeholder groups that helped shape the goals and targets of the 2030 Agenda. Representatives of international private sector organisations formed the Global Business Alliance for 2030 to channel the views of business organisations and associations, as well as, multinational corporations, and small and medium sized enterprises from across the globe in order to make effective, concrete and long-term contributions to the Global Goals.  The Global Business Alliance engaged actively with the Open Working Group on SDGs, the Intergovernmental Committee of Experts on Sustainable Development Financing; the Post-2015 Intergovernmental Negotiations; and the High-level Political Forum of the GA.

Businesses are therefore full owners of the SDGs.

With the agenda now agreed, people around the world want action.  Of course, Governments must take the lead in living up to their pledges and will continue to have a primary responsibility for financing and managing their own development, but it will not be enough.  The private sector is very much needed to drive its success.  Trillions of dollars of public and private funds are to be directed to the SDGs, and responsible businesses have untold opportunities to deliver, through the SDGs, solutions that are sustainable and generate growth and prosperity that is inclusive.

Many companies are already playing their part and taking responsible action for sustainable development, but we need many more to do so.  This new agenda has been launched in much tougher times than those which prevailed when the MDGs were launched.

Global economic growth is far from robust.  Growth has slowed in a number of the emerging economies which helped to spur growth in recent years, with spill over effects for many other economies.  A number of major developed economies are still experiencing slow growth.

We are also seeing major economic and social shifts driven by deepening globalisation and rapid technological progress, creating opportunities for some but profound challenges for others.  Changing demographics see some societies rapidly ageing while others have as many as two-thirds of their population under the age of 26.  In Asia and the Pacific, UNDP has noted in a new regional human development report launched only yesterday in Bangladesh, the population tripled in the last 65 years to 4 billion, forming the largest working population the world has ever seen.  This is an opportunity, a real dividend if we act now – immediately.  If we fail to to take measures, including to create jobs for the growing working-age population, we risk unemployment, frustration, instability and exploitative migration.

A significant number of countries are experiencing violent conflicts, causing loss of life, major development setbacks, and displacement of people on a massive scale.  A staggering 59.5 million people were forcibly displaced at the end of 2014, and half of these were children.

And we see an increase in the frequency and intensity of natural disasters, expected only to worsen with climate change if we do not meet and even improve upon the commitments made in Paris at the December UN Climate Conference.

So we need bold approaches, and strong and broad coalitions around the SDGs, for government commitment, while vital, is insufficient on its own.  As a major stakeholder in development, the way in which business does business will have a big impact on whether development is inclusive and sustainable.

For these reasons, it is important that we increase the understanding of efforts underway by the private sector, multiply them, and scale them up by expanding their reach and scope.   It is also important that we showcase contributions businesses are making to sustainable development, including by setting ambitious, long-term goals and engaging in cross-sector partnerships.  Such actions will help create a shared understanding of the private sector's role in delivering on the SDGs, including how business contributions to governance issues, such as anti-corruption, peace and stability, and the rule of law, can help advance the SDG agenda.

We want to stress the importance and encourage long-term goal-setting by businesses, aligned with the 2030 SDG time frame.

Finance is also essential.  Money isn’t everything but it is a necessary ingredient in required measure.  Multilateral Development Banks and the IMF have indicated that to meet the investment needs of the Sustainable Development Goals, the global community needs to move the discussion from “Billions” in ODA to “Trillions” in investments of all kinds: public and private, national and global, in both capital and capacity. All available resources must be drawn on for the new agenda.

Understanding the very large investments required, we must see a significant increase in business investments more geared to accelerating broad-based and sustainable development – in quality education; infrastructure; water, urban planning and citizen participation; sustainable cities and communities, among others.  Innovative financing mechanisms for sustainable development like impact investing and green bonds, which combine public and private resources, as well as Islamic finance mechanisms also will play a role.

We are encouraged by the early actions on the SDGs we see here in Malaysia, starting with the leadership of the SIDC and Global compact Malaysia to build awareness and momentum around the global goals, and similarly in other countries in ASEAN.   To build awareness on the SDGs, Astro, Malaysia’s media powerhouse, featured the Global Goals immediately after their adoption last year; many radio channels and also telecom providers promoted and encouraged people to get involved in the goals; and we see SDG video clips being shown on the Express Rail Link here in KL.  Businesses have caught the ball and are running, but much more needs to be done to get more people and organisations on board, and to move beyond awareness raising and short-term CSR activities to longer-term goal setting, aligned with the SDG implementation timeframe, to help deliver development solutions for people and achieve the future we want, as expressed through the SDGs.

The SDGs have reframed sustainable development; and as well corporate responsibility and sustainability.  Indivisible and intertwined across economic, social and environmental dimensions, the SDGs show us how interconnected sustainability really is; and how the sustainability of businesses is contingent upon the sustainability of the planet, its people and its resources. The sustainable environment that the SDGs aim to create, then, is imperative for the sustainability and resilience of businesses themselves.

Companies large and small can contribute in myriad ways toward SDG achievement: as advocate, innovator, adviser and provider of skills and capacity development, mobiliser of action, partner, financier, social investor, and technology developer and provider.  The opportunities are boundless as more and more companies around the world find the SDGs appealing as a new and profitable way to define, promote and expand their businesses.

A recent survey conducted by Price Waterhouse Coopers found that businesses see their greatest impact and opportunity in the areas of the SDGs that will help drive their business growth – finding solutions to social problems, making a profit while simultaneously benefitting society and business performance, and in this way creating solutions that are scalable. Based on this survey, 70% of businesses plan to embed the SDGs within the next five years.  This is very promising.

The SDGs are already effecting very interesting changes in the way that businesses are working with the United Nations to address the world’s most pressing development challenges, and we welcome this shift. The UN Global Compact, for example, hosts together with UN partners a number of global issue platforms that drive individual and collective business action related to specific sustainable development challenges. The UN Global Compact also helps corporate participants and Local Networks navigate entry points to working with the UN through events, relationship-building initiatives and tools like the UN-Business Action Hub, which helps stakeholders to find partners.  Global Compact Malaysia, is an excellent platform and resource for local businesses, and where there is not a local network in ASEAN, I would strongly encourage its formation. 

Another example is the SDG Fund.  The SDG Fund is the first development cooperation mechanism created by the UN Development Programme (UNDP) in 2014 on behalf of the UN system, to facilitate business partnerships for joint development initiatives with governments, civil society and UN agencies. It is a multi-partner facility funded by governments and open to other public and private donors interested in advancing sustainable development through UN coordination. A Private Sector Advisory Group, comprising business leaders of major companies from various industries worldwide, channels the views of companies to better harness the expertise and the in-kind potential of the private sector. These business leaders are helping to build a roadmap for how public-private alliances can provide large-scale solutions for achieving the new SDGs.

For example, Microsoft finding that it can benefit from the neutrality of international organisations, launched 100 “digital hubs” in partnership with the British Council in schools across six countries in sub-Saharan Africa, introducing ICT as a new way of learning for teachers and students; and in collaboration with UNHCR rolled out a standardised system for refugee registration called proGress, in 82 countries. Whereas, H&M in collaboration with the International Labour Organisation (ILO) carried out a unique tripartite capacity building project for governments, suppliers and supplier employees in Cambodia to be replicated in Myanmar and Ethiopia - towards well-functioning industrial relations at factory, industry and national levels. These are examples of strategic partnerships and corporate efforts that can more effectively contribute to attainment of the SDGs whilst advancing the interests and growth of businesses.

There are many other avenues for private sector engagement with the UN and on the SDGs, but I will not expand further on these ideas as I believe Dr Puvan Selvanathan will be speaking in more depth along these lines in addressing “SDGs Strategies for Private Sector”.

To conclude, I will take a note from a recent Forbes article[1] which concluded that the 2030 Agenda is very good news for the corporate community and companies must pick its shots – from the goals that are industry specific and others that can be supported by every company regardless of its industry.

The SDGs offer much promise and numerous opportunities for the private sector in Malaysia, ASEAN and the world over.  I hope that you will drill deep into the goals, targets and indicators and see how they connect up to your industry, business activity and operations; and how the SDGs can be used as a guide for moving from short-term profit maximisation to long-term value-creation via alignment to public priorities. The United Nations Country Team in Malaysia, which consists of many different UN programmes, funds and agencies, and UN Country Teams across ASEAN member States are ready to work in partnership with you to create decent jobs; make education and other basic services accessible and improve their quality; create solutions to our planetary limitations and environmental challenges; improve standards of living; ensure sustainable use of natural resources; end discrimination; and provide equal opportunities. Responsible business is good for business and good for people, planet and prosperity. The discourse is important as Kana said, but even more inept to take action. Let’s all do something to create a better world.

Thank you.