In a global context where implementation of the Sustainable Development Goals (SDGs) faces significant challenges, companies are standing out for their commitment to sustainability. Amid concerns about slow progress towards the goals, companies are demonstrating leadership by integrating sustainability into their business operations.
In a special report on SDG progress presented in July 2023, a worrying reality was revealed: only 15% are on track to be achieved. This news, presented during the 78th session of the United Nations General Assembly, emphasises the large gap between the goals set for 2030 and actual progress. While the SDGs are often associated primarily with government policies, there is growing recognition of the crucial role that business plays in achieving these goals.
In recent years, companies have been progressively adopting sustainable practices in their business strategies, aligning them with the SDGs. This trend is particularly evident in those companies that produce corporate responsibility reports in accordance with the Global Reporting Initiative (GRI), demonstrating a commitment to transparency and accountability on sustainability issues.
The European Union has been a driving force in this change, introducing regulations that require companies to meet sustainable standards or face sanctions. Examples of these regulations include the Sustainability Reporting Directive and the European Magnitsky Act, which prohibit European companies from sourcing from suppliers that violate human rights.
In addition, Spain is also strengthening its sustainability legislation by requiring equality plans, which are closely related to the SDG on gender equality.
However, while compliance with these regulations is an important step towards progress on the SDGs, a deeper cultural change within companies is also needed.This shift involves companies taking on their role as social actors and adopting sustainable practices not just out of regulatory compliance, but out of a genuine commitment to building a more just and sustainable future for all.
This change implies that companies take on their role as social actors and adopt sustainable practices not only out of regulatory compliance, but out of a genuine commitment to building a fairer and more sustainable future for all. This transformation is already underway and can be seen in changing mindsets. Jean Tirole, winner of the 2014 Nobel Prize in Economics, has highlighted the importance of what he calls the “economy of the common good”, where the market economy should not be an end in itself, but an instrument to achieve collective well-being. In this sense, businesses, as active members of society, have a responsibility to contribute rather than leaving this responsibility exclusively to civil society and public institutions.
Moreover, emerging investment trends also indicate a growing interest in corporate sustainability on the part of both civil society and investors. For this reason, it can be argued that sustainability goes beyond simply complying with regulations or acting for the common good; it also entails improvements in corporate reputation and performance.
In this context, it is relevant to highlight ESG (environmental, social and governance) investment criteria, which represent the measures that companies implement to promote sustainable and responsible behaviour. To assess these measures, companies align themselves with the Sustainable Development Goals in order to track their progress. The growing importance of ESG criteria among investors is evident, as investors no longer focus solely on profitability and earnings, but also value sustainability and corporate social responsibility.
According to Bloomberg (a global financial information and news company), global ESG assets are projected to exceed $53 trillion by 2025, constituting more than a third of the projected $140.5 trillion in total assets under management. However, while the main focus so far has been on the environment, there is growing recognition of the importance of social and governance factors. Consequently, emerging business areas such as regulatory compliance and corporate social responsibility are becoming increasingly relevant, as they function as elements that socially validate the company and contribute to enhancing its reputation.
The EU has also focused on promoting sustainable policies and practices within the corporate sphere, including legislative initiatives promoting gender equality and diversity, such as Women on Boards and transparency in financial compensation. However, one of the most innovative proposals has been the gradual incorporation of ESG criteria in corporate reporting, which will become a mandatory requirement from this year onwards.
However, a crucial step remains to be taken. Companies need more guidance to ensure that change in corporate culture is not merely superficial, but is genuinely embedded throughout the organisation, at all levels and in all operations, including the way business is conducted. The lack of leadership presents an additional challenge, especially for small and medium-sized enterprises, which lack the resources to make this transformation to a more sustainable business culture.
At rimsa, as a company committed to sustainability and sustainable development, we recognise the importance of these measures and are prepared to adapt to the objectives proposed by the European Union.
In summary, it is necessary to understand that the Sustainable Development Goals (SDGs) are not only an aspiration of governmental institutions and civil organisations, but are also relevant for business. A more equitable and sustainable society promotes greater growth and improved overall well-being. It is therefore essential to unite efforts across all social sectors to achieve this common goal.
Source: Expansion
