Opening Statement at Regional Conference on Aligning Corporate Sustainability with SDGs
Delivered at the Regional Conference on Aligning Corporate Sustainability with SDGs in Bangkok, Thailand
Mr. Mukhisa Kituyi, Secretary General of UNCTAD,
Datuk Seri Mohamed Iqbal Rawther, Chair
ESCAP Business Advisory Council (EBAC)
Members of the ESCAP Business Advisory Council,
Representatives of the Global Reporting Initiative & OECD,
Ladies and Gentlemen,
Welcome to this Regional Conference on Aligning Corporate Sustainability with the sustainable development goals (SDGs), organized in collaboration with the OECD, the Global Reporting Initiative (GRI) and our ESCAP Business Advisory Council (EBAC).
The United Nations system and our Member States are now fully geared to negotiate and adopt in 2015:
- A universal set of SDGs with associated targets;
- A new framework for the financing of development, which is one of the most critical means of implementation for the emerging global development agenda; and
- A new global climate agreement, with specific climate actions.
In all three of these areas, business has a key role to play to help ensure success.
The private sector is the engine of development for both industry and the services sector. Private enterprise drives the allocation and use of resources and productive processes, generating jobs and impacting both social welfare and the environment. This is why the actions of business are so critical for sustainable development.
Consequently, the Asia-Pacific corporate sector, irrespective of company size, needs to lead on sustainable development by ensuring that business decisions and production processes are aligned to better balance economic, social and environmental considerations.
Corporate sustainability calls for responsible and responsive leadership – recognizing that what is good for a company must also be harmonized with what is good for our people and the planet. This creates real value, grounded in human, natural and social capital.
Company management teams need to mainstream sustainability in their corporate strategies, and encourage sustainable production, consumption and procurement, along with the use of technologies that promote resource efficiency and productivity, while also promoting workforce diversity with the skills and innovation necessary to achieve sustainability.
Corporate governance frameworks, which protect shareholder value, need to be reinforced to allow for scoring of business models and practices to evaluate compliance with sustainable development imperatives. This will require frameworks for enhanced corporate disclosure of core social and environmental metrics beyond profits and dividend returns. In their oversight functions, Boards of Directors which are involved in the due diligence of corporate strategy, finance and other key functions, should also be assessing sustainability at the company level.
Our Asia-Pacific corporate sector should strive to adopt inclusive business models and to invest in industries which have the potential to create more and better jobs through the application of innovative technologies and processes. Business should extend a broader range of social and economic services to marginalized communities, helping to lift them into the mainstream of the economy and society.
For its part, the public sector must take a more active and substantive role in incentivizing responsible corporate behavior. Among others, this would involve establishing supportive policy environments; creating incentive frameworks for business to support adoption of sustainable development approaches; improving access to sustainable technologies; rewarding de-carbonization; as well as encouraging renewable energy use, energy conservation and efficiency, while imposing strict penalties for industrial wastage, pollution and similar environmental noncompliance.
The public sector can also leverage action through amendments to company legislation, with the proactive participation of securities regulators. At the same time, we hope that Environment and Labor Ministries can work more creatively to nurture corporate responsibility, and to assess and enforce compliance with policies and standards. Public sector authorities should be proactively encouraging corporates to promote impact investing.
To ensure real progress in implementing the SDGs, we also need business to actively innovate and adopt technologies to provide solutions, and to channel funding for investment into key SDG areas. Public-private partnerships will be critical for business to play an even larger role in the advancement of science, technology and innovation, which are key enablers for sustainable development.
Within our region, there has been progress on a number of fronts. For instance, the practice of mainstreaming sustainability into business operations has increased over the past decade. More than 1500 companies in the region have already joined the United Nations Global Compact and committed to implementing its principles. However, sustainability mainstreaming remains more common among larger export-oriented companies which operate at the higher echelons of international value chains and are obligated to raise their standards of compliance to penetrate export markets. Commitments to the SDGs however require all companies, export-oriented or not, to work differently and to commit to the future we want.
The Global Compact and other key corporate social responsibility (CSR) instruments such as the OECD Guidelines for Multinational Enterprises, the GRI’s Sustainability Reporting Framework, and the ISO 26000 Guidance on Social Responsibility, all offer guidance on how to integrate sustainable development into business operations.
Financial intermediaries and investors also need to adopt more responsible behavior, to encourage companies seeking finance to demonstrate corporate sustainability commitments and results. In this context, the United Nations-supported Principles for Responsible Investment offer guidance on improving environmental, social, and corporate governance of investment portfolios, while a number of reporting instruments offer support by illustrating the ways in which finance drives corporate sustainability performance, and thus facilitates accountability.
In conclusion, as we draw closer to the final negotiations on the post-2015 development agenda, and the landmark summit being hosted by the UN General Assembly in September, it is our joint responsibility to support the next phase of global development. This entails real action as well as ongoing monitoring and review, to achieve better results for the future we want by 2030.
Standing at the heart of all production and consumption, business is already making good progress but must do more to integrate sustainability throughout operations, and in every business and investment decision made.
Your role, as the captains of regional commerce and industry, will be critical in driving the transformations we need to ensure a future Asia-Pacific without abject poverty, with reduced inequalities, in which people have safe and healthy work environments and are paid decent compensation.
We look forward to your perspectives on how business action can be best aligned and channeled to ensure that it works in support of SDG achievement.
I thank you.