Sustainable Business Models
Sustainability Development Goals, also known as SDGs, are a collection of 17 global goals set by the United Nations General Assembly. SDGs cover all three areas of social, environmental and economic sustainability, including gender equality and education, water and sanitation, and urbanisation and poverty. Nowadays, various organisations, businesses and authorities around the world, have committed to achieving SDGs, not only to have a better influence in society, but also to cultivate better, more influential and equitable working environments.
Businesses are capable of making significant impacts through all SDGs. As more and more organisations consider SDGs not only as part of their corporate social responsibility (CSR) strategy but also as a solid business opportunity, it is important to understand that SDGs offer a vital framework in terms of how businesses are perceived by customers, suppliers, authorities and civil society.
More specifically, a study by Corporate Citizenship, a sustainability consultancy, indicated that 81% of consumers, especially millennials, believe that businesses are key players in achieving SDGs, and that a lack of business action in SDGs poses a serious trust issue.
Looking at the 17 established SDGs, it is evident that ‘Decent work and economic growth’ (no.8), ‘Industry, innovation and infrastructure’ (no.9) and ‘Responsible consumption and production’ (no.12) pertain directly to economic and financial growth. However, the remaining 14 SDGs goals can also offer various opportunities by enabling businesses to expand into new markets and territories, attract talented employees, as well as reduce risks of operations.
In fact, a report by the Business & Sustainable Development Commission shows that sustainable business models, in regards to achieving the SDGs, can not only provide numerous economic opportunities worth up to US$12 trillion, but also increase employment by up to 380 million jobs by 2030.
There are 6 steps organisations should follow in order to benefit from sustainable business models and accomplish SDGs:
- Identify ways that SDGs relate to the business
- Develop targets and practices for each SDG
- Build the company’s sustainability and corporate strategy
- Establish business opportunities
- Build collaborations with other organisations
- Assess, report and be accountable for the business’ actions
By doing so, businesses can have a significant impact on achieving SDGs. Engaging in social, environmental and economic sustainable business models can transform business strategies, their products and services, and the markets they operate within. Additionally, successful execution would also influence the perception of stakeholders’, including customers and public authorities towards the values of their business.