Sustainability: how fmcg can help save the world in 17 steps

It can’t be easy getting 193 countries to agree on anything, let alone how to save the world. So UN secretary-general Ban Ki-moon will be a happy man as adoption of the post-2015 Sustainable Development Goals (SDGs) draws near.

All 193 UN member nations, including the UK, are expected to sign on the dotted line and pledge to achieve 17 goals (made up of 169 individual targets) at the UN headquarters this weekend.

Five years of dogged intergovernmental negotiations, public consultation and private sector feedback led up to the final draft, so there is every confidence the SDGs will be adopted. 

Once formalities are over, they will deliver a blueprint for sustainable international development until 2030, succeeding the Millennium Development Goals (MDGs) that expire at the end of 2015.

Far more than an agenda to alleviate poverty the goals will shape sustainable development as much here in the UK, as in developing nations tackling a far broader agenda than their predecessor. So how will the UN deliver on that blueprint? And what has it got to do with the UK fmcg industry?

The SDGs are not legally binding or backed by sanctions, so the UN will have to rely on world leaders to keep their commitment to them. Countries will be expected to shape future public policy in line with the SDG goals and report progress back to the international community at interim reviews (the period between reviews is currently undecided). Exactly how the UK government plans to play its part remains unclear. When contacted by The Grocer, the Department for Business, Innovation & Skills would only say the UK “will implement and comply with the SDGs domestically” and use a “coordinated approach”.

Malcolm Preston, global head of sustainability services at PwC, anticipates the introduction of “regulation or incentivisation” for businesses in areas where the government is most “serious” about progress. Gender equality and health are two likely targets.

Fmcg shouldn’t wait for government and instead take the lead, says Budgens retailer Andrew Thornton. “Business is the biggest force in the world that could make a positive difference,” he says. “We as business leaders have an opportunity to make a difference, and we need to because we can’t go on the way we’re going at the moment.”

Sustainable grocery

Sustainability is already high on the agenda in grocery and has been for years. The SDGs won’t mark a “radical revolution” for the sector, says Mike Barry, director of sustainable business at M&S, but “another step on the journey”. The retailer has already achieved 47 of 100 commitments on sustainability in its own Plan A. These include a 60% reduction in packaging used for home deliveries, 100% of fish sourced sustainably, and a 36% improvement in energy efficiency.

Director of Sainsbury’s brand Judith Batchelar believes the supermarket’s 20x20 sustainability plan is also “well aligned” with the SDGs, “including our environmental and sourcing commitments”.

“We believe that the business case for sustainability has never been stronger,” she adds. “We will continue to focus on our sustainability commitments and take action to support the goals.”

Batchelar adds Sainsbury’s has worked on a course with the GLA to help prevent worker exploitation among vulnerable workers across its UK and global supply chain, and improved water efficiencies via a project in Kenya. Both projects are in line with the expectations of the SDGs. Pressure to invest in a broad spectrum of sustainable projects like these will only increase with adoption of the goals.

Of Ban Ki-moon’s new 17 goals, those of most relevance to the fmcg industry are those around sustainable production and consumption, climate change, and gender equality.

“It’s an incredibly ambitious and broad agenda,” says Natalie Samarasinghe, executive director of the UN Association. “But I think it’s rightly so because the MDGs were criticised for focusing only on some aspects of sustainable development.”

Fairtrade Foundation public policy manager Barbara Crowther agrees. “The whole frame has shifted,” she says. “We’ve got a much more comprehensive set of goals. That makes it much more complex, but much more relevant to a wider group of stakeholders.”

And the government will expect fmcg to assist it in achieving these aims. “There’s been recognition that countries can only do so much to deliver on such an agenda,” says Samarasinghe. “If we are going to achieve these very ambitious goals we desperately need the private sector to be committed.”

Yet only one third of companies are currently considering the impact of all relevant SDGs, according to a survey by PwC. “I suspect that if you went to a lot of businesses and mentioned the SDGs they wouldn’t know what you were talking about,” believes Preston.

That could be a costly mistake. A company that aligns its business strategy with the SDGs will be able to more easily comply with any forthcoming regulation from governments looking to achieve these international sustainable targets, Preston points out.

As a result “forward-looking” fmcg businesses shouldn’t wait for government to intervene, believes Crowther, and “should be taking a look at that agenda, assessing their current CSR strategies and thinking how we align ourselves to this”.

Good on eco-targets, poor on gender equality

The Fairtrade Foundation has been working with grocery brands and retailers to assess their sustainability plans against the backdrop of the SDGs to identify gaps. Many score well on eco-targets but poorly for gender equality, or rights, Crowther points out.

As well as “avoiding a burden of regulation” it makes “good business sense to act in these spaces”, says Barry. It creates a common framework for grocery to walk towards, he adds, and encourages collaboration .

“The UK retail sector has worked very hard on sustainability issues,” he adds. “But as hard as we work we recognise that after an initial 25% of improvement in any sustainable area it gets harder to do on your own. You need collective action. So businesses need to become more literate and savvy on which 10 to 15 goals they can meaningfully contribute to, and be smart in terms of who they partner with.” The CGF, IGD and BRC will all have frameworks and collaborative efforts that companies can sign up to, he adds.

Fmcg must be prepared to demonstrate its progress toward the goals too, urges PwC, which could involve reporting new data on sustainability.

Data needed to measure each of the SDGs is still being thrashed out by the UN. In June 2015 experts recommended 100 stats to map progress toward the SDGs, the result of 18 months of consultation with NGOs, businesses, and statisticians. These won’t be formally adopted in time for the New York conference, though, and the UN says work is still “ongoing”. Whatever the final outcome there will “definitely” be more reporting expected from fmcg, believes Chris Brett, global head of corporate responsibility and sustainability at agribusiness Olam International. “The biggest challenge will be measuring your impact,” he adds.

Paying the bill

Finding the cash to pay for the SDGs is also a big challenge. The UN estimates it could cost $11.5tn a year, or $172.5tn over the 15-year timeframe to achieve its aims. Despite countries agreeing a financial plan at the international conference in Addis Ababa, “a lot of work still needs to be done” to source all the money needed at both a UK and international level, says Samarasinghe.

The action plan from the July 2015 meeting included a recommitment from countries to the target on aid of 0.7% of gross national income (GNI). States also pledged to collect more taxes and fight tax evasion to raise funds. Aid will be a vital factor but greater demand for the private sector to invest will be crucial, says Samarasinghe. Crowther adds that UN funding may be available for public-private partnerships launching projects to achieve the SDGs, but governments will increasingly look to business to plug the gap.

Ultimately though she hopes fmcg will see the SDGs as an opportunity, not a burden. “Those best able to articulate how they are contributing to the SDGs are going to be best placed both in terms of building public confidence and partnering with government,” she says. “Governments everywhere will be looking to the business community as partners in this effort.”

And who can blame them? Faced with the colossal challenge of saving the world in 17 steps, they’ll need all the help they can get.