Responsible Business Report Finds High Risk of “SDG Washing”
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The 2018 issue of the Responsible Business Trends Report examines how sustainability is being integrated into business strategies.

Over 80% of respondents’ companies are currently mapping or integrating the SDGs into business strategy, but 56% of these companies are not measuring their contributions to the SDGs.

16 May 2018: Ethical Corporation has released its fourth annual ‘Responsible Business Trends Report,’ examining how sustainability is driving corporate strategies and quantifying sustainability impacts. The 2018 report also looks at how the SDGs and Paris Agreement on climate change, respectively, are driving business strategy.

To generate the report, Ethical Corporation surveyed over 1,500 business professionals in a range of roles and sectors around the world, with 70% coming from Europe and North America. The survey identified how companies and business leaders are seeking to transform operations and outputs in order to deliver on the SDGs and Paris Agreement.

Among the findings, over two-thirds of corporate-brand respondents indicated that their company is integrating the SDGs into business strategy, which the authors note represents a significant and consistent increase in the two years since the Goals’ adoption in 2015. Of the remaining third of respondents, half indicated that they do not intend to do this in the future. Regionally, businesses in Europe and Asia-Pacific feature higher rates of integration than those in North America.

On the stage of SDG integration, 82% of respondents noted that they are currently in the mapping stage or integrating the Goals into business strategy. Only 12% claimed that the SDGs have been integrated across departments with clear goals set.

Despite this incomplete integration, the report finds that over half of respondents’ companies are using the SDGs as a framework to report on and communicate sustainability impacts. Thus, the authors underscore a risk of “SDG washing,” with companies using the SDGs as a communication tool “without much actual adaption to strategy or measurement of their impact towards the Goals.”

Indeed, 56% of respondents’ companies are not measuring their contributions to the SDGs. These findings are consistent with recent reports by the World Business Council for Sustainable Development (WBCSD) and KPMG.

On the primary SDG with which companies are engaging, the reports finds SDG 13 on climate action to be the clear leader across Asia-Pacific, Europe and North America, with roughly two-thirds of companies in each region identifying SDG 13 as that which they engage in the most. The report also finds promising scope for climate action by US cities, states and corporations alike, highlighting the #WeAreStillIn movement as an important convergence of like-minded actors in response to the US announcement of its intention to withdraw the country from the Agreement. While respondents primarily see governments as being the most influential actors in ensuring that the Paris Agreement is met, over one-third felt that companies will be most influential. The report indicates that the vacuum of climate leadership from the US federal government has increased expectations and placed an onus on business leaders to carry climate objectives forward, as 68% of respondents report expecting their respective companies to “take a lead in helping meet the Paris Agreement.”

Similarly to previous years, responses show that there is still much progress to be made. In particular, businesses are struggling to measure the return on investment (ROI) of sustainability activities. However, 75% of respondents stated that “their CEO is convinced of the value of sustainability,” a slight increase from previous years. [Publication: Responsible Business Trends Report 2018] [Press Release] [Survey Dataset]

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