On the occasion of the event “Economic Profitability and the 2030 Agenda in Business” to be held tomorrow in Zaragoza, we were honored to interview Cristina Sanchez, who holds the position of Executive Director of the Spanish Global Compact Network. In this exclusive conversation, Cristina shares her perspectives and insights on the importance of the 2030 Agenda in the business context and how companies can play a crucial role in achieving the Sustainable Development Goals while boosting their economic profitability.
Can you share with us a bit about your experience and your role as Director of the UN Global Compact in Spain? What do you expect from this conference?
Leading the leading organization in corporate sustainability in Spain is a source of pride for me. My experience over the years allows me to be optimistic, because sustainability is in a good moment, but it also requires us to rise to the challenges of the environment and the needs of companies. In today’s case, it is always a pleasure to bring together business leaders such as Ibercaja and representatives of the region such as the Aragonese Development Institute. Aragon is also a community with which we have been collaborating closely for years in the promotion of business sustainability. Today we would like to present our latest publication and news for the coming months, which strengthen the binomial between profitability and sustainability. We also hope that this event will inspire more companies to follow this path and understand how sustainability is not only essential to address global challenges, but also an opportunity for economic success and local progress.
We have just celebrated the 8th anniversary of the sustainable development agenda. In your opinion, are we on track to meet the targets set by the SDGs and where are we?
We are at a turning point where the actions we take now will determine the success of the 2030 Agenda. While it is true that the status of the 2030 Agenda at the halfway point is at a critical juncture – only 15% of the 169 targets that make up the SDGs are making satisfactory progress, 48% show moderate developments and 37% are experiencing a lack of progress or even backsliding. – and that we are dangerously close to the limit set in the Paris Agreement – global warming already stands at 1.1°C above pre-industrial levels. – We have not yet reached the point of no return in both frameworks are impossible to achieve. It is important to insist on this: a more sustainable future is still achievable, and we must multiply actions to make it happen. Right in the middle of the journey, we cannot give up. All the efforts we make to do so will lead us to a better future. Therefore, regardless of whether or not the Goals are achieved, this is the path we must follow.
Which Goals or targets have experienced the greatest progress in all this time?
Globally, some of the SDGs that have experienced the greatest progress are: SDG 3, in which 146 of 200 countries are on track to achieve the target related to child mortality. Also relevant is the progress recorded in SDG 6 and SDG 7, which show improvements in access to drinking water and electricity. In fact, regarding the latter the proportion of the world’s population with access to electricity has increased from 87% in 2015 to 91% in 2021 and the share of renewable energy is growing. These advances demonstrate that commitment and action can lead us towards a more sustainable future, but they also remind us that we must increase our efforts and work together to overcome the remaining challenges.
How can the 2030 Agenda serve as a guide for companies in terms of economic profitability and sustainability?
The 2030 Agenda sets out a way forward for companies to become what we call “companies of the future”. It drives new business models that will be the predominant ones in a few years and in which multiple economic opportunities are enclosed as in the case of the food sector, where the value of business models based on organic products in Spain was €2,752 million in 2021, and is expected to increase in 2030 to €5,122 million, almost doubling its value. In addition, this UN framework can help companies to manage risks related to sustainable development, which will undoubtedly result in cost savings in the medium and long term. A commitment to the SDGs can also help attract committed consumers and encourage innovation. Overall, the 2030 Agenda provides a valuable roadmap for companies looking to prosper economically while contributing to a more sustainable future.
What are the main challenges and opportunities companies face in aligning their goals with the 2030 Agenda?
In addition to those I have highlighted above, committing to sustainable transformation can also help generate partnerships with other actors, including large companies looking for sustainable suppliers, and accessing contracts with the public sector that increasingly include sustainability criteria among their clauses.
It is also important to mention the attraction of private investors. Concerns about future crises associated with environmental issues such as climate change, coupled with a growing public awareness of sustainable development, have led investors to shift their attention to responsible portfolios. Economic profitability and Agenda 2030: sustainability as a synonym for business for companies”, work on sustainability has a positive impact on indicators with an economic component such as productivity, the reduction of economic risks and profitability. Specifically, with regard to the latter, the publication refers to several studies that support the relationship between sustainability and profitability, in which, among other data, it highlights that companies that have made a strong commitment to sustainability have achieved results 11% higher than those of their competitors in the stock market.
As for the challenges, if we speak globally, the greatest challenges at the corporate level are still found in the fight against climate change, especially to achieve the emission reduction targets; in SDG 5 on gender equality, which is considered one of the priority areas in our country; and in the management of human rights in the supply chain. These areas are, in fact, the protagonists of our accelerator programs, in which we try to guide companies on strategic issues in a practical way through training and advice from experts.
What is the role of collaboration between different sectors and organizations in achieving the Sustainable Development Goals (SDGs)? Is progress being made in these partnerships between governments, the private sector and civil society?
Partnerships between different actors play a crucial role in achieving the Sustainable Development Goals. This collaboration leverages the diverse expertise and resources of multiple stakeholders, resulting in a more effective and efficient approach to addressing global challenges. It also fosters innovation, broadens the scope of initiatives, promotes shared responsibility, and has a greater impact on promoting sustainable solutions and influencing policy changes needed to achieve the SDGs.
As to whether or not progress is being made in this way of working, we could say yes. In fact, SDG 17 is in 5th position in the ranking of SDGs most worked on by the IBEX 35 and in 6th position in the case of Spanish companies adhering to the Global Compact. However, progress varies by company type, while IBEX 35 companies have significantly increased their commitment in this area, with 80% reporting the establishment of partnerships in 2022, compared to 57% in 2021; Spanish companies in general have experienced a slight stagnation in the creation of partnerships to achieve the SDGs, with a decrease from 48% to 44% in 2022. This highlights the importance of promoting greater collaboration across all sectors to effectively address sustainable challenges.
How can companies, both large and small, effectively engage with the 2030 Agenda? it should not be forgotten that almost 99% of Spanish companies are SMEs. What actions can a small or medium-sized company take?
Companies, both large and small, can effectively contribute to the 2030 Agenda by taking a number of key actions. First, it is essential that companies familiarize themselves thoroughly with the SDGs and set concrete and measurable targets in line with them. From there, they will be able to define the actions needed to achieve them and constantly monitor progress. These are basically the steps found in the reference guide for contributing to the 2030 Agenda: SDG Compass.
Additionally, as executive director of the leading sustainability initiative I would like to highlight two more aspects that I consider crucial in this process. On the one hand, the commitment of top management and the awareness of the entire workforce. These are essential to create an organizational culture oriented towards sustainability and to achieve a real transformation of the business model. On the other hand, it is important to emphasize that sustainability can be implemented gradually and adapted to the resources available; it does not require drastic changes immediately. This is a message that must get through to SMEs, since most small and medium-sized companies perceive sustainability as an unaffordable investment due to a lack of economic and human resources. We say to them: yes, it is possible, even if it is little by little with less ambitious actions. Furthermore, at the UN Global Compact Spain, we are committed to their transformation and we help them in the process. That is why we have available an open web space with more than 90 selected resources and good practices to improve the integration of the SDGs and the Ten Principles in small and medium enterprises.
Which are the SDGs most worked by Spanish companies?
According to our report Communicating Progress 2022, IBEX 35 companies prioritize the environmental and economic Goals, with SDG 13 on climate action, SDG 8 on decent work and economic growth, and SDG 9 on innovation and infrastructure at the top of the ranking. Meanwhile, among Spanish companies adhering to the UN Global Compact, the social goals continue to have a strong presence, with SDG 5 in first place along with SDG 8 and SDG 3 on health and well-being in third place.
What are the main obstacles faced by companies in Spain and globally when trying to integrate sustainability into their operations and strategies?
Based on the conclusions drawn from our comprehensive consultation on SDGs, the main obstacles companies face when integrating sustainability into their strategies are lack of internal resources (45%), few incentives to contribute to the SDGs (28%) and the absence of tools and resources to facilitate the contribution to the SDGs (28%).
From the United Nations Global Compact Spain we try to help them with this third demand, through the edition of guides and publications that contribute to increase their knowledge about sustainability, tools that help them to improve the integration of sustainability within the company and training at both basic and advanced level so that all entities, regardless of the level of knowledge they have.
What trends and developments do you see in the relationship between companies, economic profitability and the 2030 Agenda in the coming years?
According to our latest report, I could cite five: first, sustainable finance will gain prominence, with investors and financial entities prioritizing sustainable projects, which reduces financing costs for companies. Secondly, companies will focus on adopting sustainable business models to generate competitive advantages, while innovation in sustainable processes and materials will be an important factor. In addition, sustainable supply chains will be strengthened to increase resilience and profitability, and greater attention will be paid to employee well-being to boost productivity. These trends will not only promote sustainability, but will also influence the economic profitability of companies in the context of the 2030 Agenda.
What advice would you give to companies that are just starting their journey towards sustainability and achieving the SDGs?
At this point, the important thing is for the company, whatever its nature and size, to commit to sustainable development and to do so by following a structured process that helps it to identify its impact on the matter, to establish specific objectives and to carry out a process of monitoring, evaluation and improvement. And, of course, to advocate staff training on SDGs so that each and every employee can work on these aspects on a day-to-day basis in the workplace.
What would be your main message to companies and society in general in relation to economic profitability and the 2030 Agenda?
The main message is that sustainability and profitability are not mutually exclusive goals, but are closely interconnected. The 2030 Agenda offers a path to a future in which companies can prosper economically while making a meaningful contribution to social well-being and the environment. This framework is, in fact, an opportunity for companies, and those that can see it will be the best positioned in the years to come.