Science / Sustainable Development

Sustainable Development Goals and the Private Sector

Saving the world is going to cost us a lot of money.

Many people working in development, realizing this cold hard truth, have noticed the private sector – protecting troves of resources and piles of moneybags. The solution becomes clear, and the problems associated with it even clearer: can the goals of the private sector align with the common good?

How do we match the goals of the wealthy corporate elite with the goals of the United Nations development agenda? The solution lies in fundamentally altering the method by which the private sector is incorporated in the development process and in addressing the ways in which money is used to influence the implementation of development goals. This is the challenge that the UN must overcome if it wants its new set of development goals, tentatively named the Sustainable Development Goals (SDGs), to succeed.

The United Nation’s ambitious previous development initiative, the Millennium Development Goals (MDGs), were established in 2000 as the target towards which every UN member state would aspire over the course of the next fifteen years. These last fifteen years have seen a great deal of economic and social progress, but the MDGs have largely failed to deliver what they promised. A piece of this failure can be attributed to an undeniable lack of necessary funds.

In the past, the Group of Eight (G8) finance ministers agreed to provide these needed funds to the World Bank, the African Development Bank, and the International Monetary Fund to cancel debt owed by the poorest countries so that they could use their own resources to meet the goals of the MDGs. However, with the dwindling capacity for public funding and the growing might and resources of the private sector, the UN has taken a keen eye to the private sector’s wealth.

In an effort to encourage businesses worldwide to adopt sustainable and socially responsible policies, the United Nations Global Compact (UNGC), offers private partners of development the policy framework for the expansion, implementation, and discourse of sustainability principles and practices fundamental to the UNGC’s four core areas: human rights, labor, the environment, and anti-corruption.

Once a company has joined the UNGC, they are asked to make a regular annual contribution to support development goals. The goal of the UNGC is to enable the private sector to make choices that are beneficial to society insofar as they help build a more sustainable and inclusive global economy. These “benefits” seem to directly help the United Nations, but only seem to aid the private sector in furthering the aims of the UNGC.

The direct benefit conferred to the private sector is an opportunity to advance sustainability solutions in partnership with a multitude of international stakeholders. However, the degree to which the private sector has the capacity to influence these solutions is murky, and is cause for some concern given the history of partners seeking capitalistic ends in development.

The UNGC does not work to regulate the businesses it partners with, but instead serves as a forum for communication amongst governments, companies, and labor organizations. Once a company has declared its support for the principles, it does not necessarily mean that the UNGC recognizes that they have fulfilled the compact’s principles.

This is problematic. If companies have agreed to the UNGC’s principles, are now capable of influencing sustainability solutions, but have not demonstrated their adherence to said principles, then how will the UNGC ensure that their private sector partners will not subvert the principled public goals of development?

Coca-Cola, the delicious soft-beverage company with a fat wallet, has been a participant of the UNGC since 2006 and has been frequently alleged of drying up wells near its factories in India.  The most recent allegation comes from farmers in Mehadigang village in Uttar Pradesh, who must dig deeper and deeper for water, a resource that Coca-Cola uses without regulation in the area to create their product.

While these allegations are based largely upon speculation from community inhabitants who view the corporation as responsible for local water scarcity, the fact remains that the resource is slowly disappearing. Coca-Cola, as a UNGC partner, agreed to uphold the principles of the compact, but its continued operation near water-poor Mehadigang demonstrates a level of irreverence for the principles of the UNGC.

This type of corporate irresponsibility reflects poorly on the image of the United Nations, and raises serious concerns about the future of development with private sector involvement.

However, the private sector’s funds are critical to future development success and the idea of private funding for philanthropic work goes beyond the MDGs, SDGs, and UN. The SDGs will be met in 2030, yet the process of involving the ever-expanding private sector will continue to be necessary for global development. Reaching an agreeable outcome now will only make it easier for future development efforts and is essential for successful humanitarian initiatives. The United Nations and the private sphere must come to an agreement that ensures the spirit of philanthropic work is not tarnished by its need for economic support.