SASB_SDG

Business relationships in difficult times

Sustainability and business — Environmental Issues brief: Accounting for the Sustainable Development Goals

November 2021

Introduction

As highlighted in the Sustainability and business — The call to action: build back better report, AICPA^® and CIMA^® started a programme of thought leadership to explore accountancy and sustainability. This is part of a series of briefs exploring the topic of sustainability, business and the finance professional’s key role. These briefs will help organisations consider the sustainability issues, how to integrate them into their long-term decision-making and how to incorporate these issues into internal and external reporting.

This brief details the United Nations’ 17 Sustainable Development Goals (SDGS) and offers practical guidance on integrating them into your organisation.

The themes in this brief are based on a CIMA webcast given by Professor Ian Thomson FCMA CGMA, Director of the Lloyds Banking Group Centre for Responsible Business at the University of Birmingham. Held on the fifth anniversary of the ratification of the UN Sustainable Development Goals (SDGs) the webcast answered the questions: ‘where are we and how can management accountants help move us forward?’¹

Organisations and finance professionals have an important role to play in understanding their business impact and the opportunities for change across the three elements of Environmental, Social and Governance (ESG) that the goals encompass: 'that ending poverty must go hand-in-hand with strategies that build economic growth and address a range of social needs including education, health, equality and job opportunities, while tackling climate change and working. to preserve our ocean and forests'.²

What are the Sustainable Development Goals?

The UN’s Sustainable Development Goals are quite simply the world’s greatest business plan — the growth story of the century.

Paul Polman, former CEO of Unilever, and the Co-Founder and Chair of IMAGINE³

In September 2015, the United Nations established its 17 Sustainable Development Goals.

One hundred and ninety-three countries have adopted the goals with the ambition to tackle and achieve them by 2030. Each of the goals has specific targets that have been developed to address the full range of social and economic-development issues facing the world.

These amount to 169 targets, across the 17 goals, that require innovation and interdisciplinary thinking from many different actors, including governments, industries, sectors, communities and even finance professionals.

As Mariana Mazzucato highlights, in her book Mission Economy, the goals aim to address complex global problems,

They are problems without straightforward solutions. We must understand how social issues interact with political and technological ones, behavioural changes and critical feedback processes. Because of this complexity, it is important that these complex challenge are broken down into practical steps or targets.⁴

Mariana Mazzucato

The goals

1 End poverty in all its forms everywhere. This goal is split into five target areas.⁵

2 End hunger, achieve food security and improved nutrition and promote sustainable agriculture. The goal is split into five target areas.⁶

3 Ensure healthy lives and promote well-being for all at all ages. The goal is split into nine target areas.⁷

4 Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all. The goal is split into seven target areas.⁸

5 Achieve gender equality and empower all women and girls. The goal is split into six target areas.⁹

6 Ensure availability and sustainable management of water and sanitation for all. The goal is split into six target areas.¹⁰

7 Ensure access to affordable, reliable, sustainable and modern energy for all. The goal is split into three target areas.¹¹

8 Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. The goal is split into 10 target areas.¹²

9 Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation. The goal is split into five target areas.¹³

10 Reduce inequality within and among countries. The goal is split into seven target areas.¹⁴

11 Make cities and human settlements inclusive, safe, resilient and sustainable. The goal is split into seven target areas.¹⁵

12 Ensure sustainable consumption and production patterns. The goal is split into eight target areas.¹⁶

13 Take urgent action to combat climate change and its impacts. The goal is split into three target areas.¹⁷

14 Conserve and sustainably use the oceans, seas and marine resources for sustainable development. The goal is split into seven target areas.¹⁸

15 Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss. The goal is split into nine target areas.¹⁹

16 Provide access to justice for all, and build effective, accountable and inclusive institutions at all levels. The goal is split into 10 target areas.²⁰

17 Strengthen the means of implementation and revitalise the global partnership for sustainable development. The goal is split into five target areas.²¹

When they were first agreed in 2015 at the Sustainable Development summit in Addis Ababa, the SDGs had an esoteric quality. Many saw them as the province of multilateral development banks and international finance institutions, the latest do-good project of the now derided globalists — those who, in a less cynical age, were called humanitarians. But, as the SDGs have been translated into national objectives and adopted by leading, purpose-driven corporations, they have begun to come alive.²²

Mark Carney

Reflecting on the fifth anniversary of the goals introduction, in his book, Value(s), Mark Carney notes,

The goals, therefore, represent a
group of complex, interconnected
issues, facing the world that require
global collaboration and private-public partnerships to achieve them.

Why are the Sustainable Development Goals needed?

An alternative framework — ‘The Unsustainable Development Goals’

‘The Unsustainable Development Goals’ are a stocktake of the current state of the world and the biggest challenges it faces, from poverty and hunger to climate chaos and war.

There is global consensus that a lot of these things are unacceptable or highly problematic and that action needs to be taken. In response, the United Nations undertook a massive public consultation exercise and came up with the goals.
The SDGs cover a broad spectrum of issues, all intending to achieve a fair, environmentally friendly and economically prosperous world.

The SDGs are the opposite of the Unsustainable Development Goals: they are an aspirational vision for the future of our shared world. These SDGs have been agreed upon by national governments and have been integrated into policy-making, international agreements and conventions. They are forming a powerful new way of thinking about the challenges our planet faces, with high levels of buy-in at different levels — from individual communities to international alliances.

Organisations

Society’s expectations of corporations have changed over time, but corporations have failed to keep up. We are moving from a ‘shareholder perspective’ that became fashionable in the 1980s, back to a ‘stakeholder perspective’, and need to move to a ‘systems value perspective’ of long-term value creation.²⁴ The goals help organisations tell their sustainable value stories to multiple stakeholders and shift the focus from the short-term to
long-term value.

This needs to start with an organisation’s stated purpose. In simple terms, an organisation’s purpose provides the foundation for why it exists and what it does. As expectations of business change, organisations need increasingly to think about their wider societal impact and their ability to help build a more sustainable world. Profit is not a purpose, and organisations need to rethink the difference they make to society.²⁵ Embedding the goals into an organisation’s stated purpose helps build long-term resilience. They also engage with customers, consumers and investors who increasingly seek relationships with purpose-led organisations and brands with commitments to sustainability.

Finally, organisations need to reassess their assumptions around competition
and collaboration in the pursuit of innovative ways to achieve the goals. Johnson reminds us of the importance
of collaboration,

The most fundamental and inarguable forms of progress we have experienced over the past few centuries have not come from big corporation or startups. It has come, instead, from activists struggling for reform; from university-based scientists sharing their findings open-source style; and from nonprofit agencies spreading new scientific breakthroughs in low-income countries around the world.²⁶

Steven Johnson

The goals are consequently challenging how organisations, governments and multiple stakeholders approach collaboration in the ambition to build inclusive and sustainable economies. Mazzucato notes, 'to address the goals we need a very different approach to public-private partnerships from the one we have now. This requires a massive rethink of what government is for and the types of capability and capacity it needs. But, more importantly, it depends on what sort of capitalism we want to build, how to govern the relationship between public and private sectors and how to structure rules, relationships, and investments so that all people can flourish and planetary boundaries are respected'.²⁷

The business case

'Meeting the UN’s Sustainable Development Goals is a $12 trillion opportunity'.²⁸

This is a conclusion from the Better Business, Better World report from the Business & Sustainable Development Commission, published in 2017. It found that if just four sectors met the goals by 2030, the market opportunities could amount to $12 trillion a year.²⁹ The goals help organisations focus on the key global challenges ahead and in building business resilience. This includes managing reputational risks, building integrated thinking to organisational strategic decision-making and meeting stakeholder demands for greater transparency on
ESG factors.

Carney notes that the SDGs give organisations clarity and consensus to an ultimate goal of a sustainable economy.

The Sustainable Development Goals are an economic, as well as a moral, imperative. Achieving the SDGs would mean greater productivity, increased labour supply and ultimately stronger growth. In short, they could pull the global economy out of its current malaise of secular stagnation.³⁰

Mark Carney

The goals, by their very nature, also require global collaboration, across organisations, sectors, industries, governments and countries. As Mazzucato highlights, they can unite diverse stakeholders in multidisciplinary thinking and action. 'One strength of the SDGs Is that they engage diverse stakeholders across the world. They identify internationally agreed grand challenges that have been chosen by broad and comprehensive consultation around the world. They offer huge opportunities to direct innovation at multiple social and technological problems to create societies that are just, inclusive and sustainable'.³¹

The move from short-term horizons to longer-term outcomes that the goals promote also have the potential to fuel sustainable prosperity, not just for organisations, but for all.

How to integrate the Sustainable Development Goals into an organisation?

The United Nation’s 17 Sustainable Development Goals lay out a coherent road map — widely embraced by the business community — for building a just and sustainable world. We have the technology and the brains to address our environmental problems, and we have the resources to reduce inequality. The question is not what should be done. The question is how. Business must step up.³²

Rebecca Henderson

As more investors and stakeholders demand SDG action and are holding organisations to report their impact on the goals, they create governance and accountability challenges. Organisations must, therefore, try to understand and account for their impact on the systems that contribute to the achievement of
the goals.

Bodies and stakeholders use your exhaust data to benchmark your organisation’s sustainability performance and test the robustness of your strategy. Exhaust data is simply the digital trail of ‘breadcrumbs’ organisations leave that stakeholders can then hoover up to increase their understanding of an entity’s sustainability performance landscape and long-term viability. One example is the World Benchmarking Alliance. It has assessed 2,000 of the world’s companies, measuring contributions to the SDGs and ranked the most influential.³³ The reality is, if you are not measuring and reporting on your organisation’s SDGs impact, somebody else is. Time to tell your organisation’s SDGs value story, that speaks to
multiple stakeholders.

It is important to remember that the goals are deliberately aspirational. They provide a framework for reasonable or responsible practice that governments, businesses and other organisations use. However, the goals can be difficult to translate from things designed for international treaties, ateinternational governments into different contexts, institutions, businesses, communities and regions.³⁴

The goals should not be thought of as a list of KPIs or a business scorecard. They do not stand in isolation: they represent underlying systems and grand challenges that require the engagement of a diverse range of organisations and stakeholders across the world. Therefore, organisations, finance functions and finance professionals need to think about the goals in a systemic light.

A Mindset for the goals: Systems and Integrated Thinking

Managers are not confronted with problems that are independent of each other, but with dynamic situations that consistof complex systems of changing problems
that interact with each other.³⁵

Russell Ackoff

A ‘systems thinking’ approach will help organisations when tackling the goals. Systems thinking is not a new approach and can be traced back to the work of Professor Jay Forrester at the Sloan School of Management, MIT in the 1950s.

It is an approach to problem-solving that views issues as part of a wider, dynamic system. In terms of the goals, it is the process of understanding how things influence goals individually and also one another as part of a whole. Take poverty as an example. It is connected to a whole range of other systems to do with welfare and economic development.

Dave Goulson, in his book, Silent
Earth: Averting the Insect Apocalypse, demonstrates the complete lack of systems thinking when understanding
the complexity of issues leading to biodiversity loss.

The lesson for working with the SDGs is to view the whole 17 goals as subtly interconnected, rather than purely focus on them individually and independent of each other. It is also important to be able to see the patterns of change and feedback loops between goals that together give the system of a sustainable economy its unique character.

The systems thinking approach helps in the breaking down of information silos within an organisation, and embedding interdisciplinary conversations externally with supply chains, scientists, policymakers and local communities.

Scientists tend to work in silos, focused on their own discipline. The climate change scientists warned of the impact of a disrupted climate, biologists talked about the consequences of loss of biodiversity, fisheries scientists warned of depleted fish stocks, ecotoxicologists studied heavy metal poisoning, or plastics pollution, and so on and so on. None of them could fully anticipate that all of these processes were interlinked, with synergies that no-one could predict.³⁶

Dave Goulson

In the accounting discipline, finance professionals might be more familiar with the concept of ‘integrated thinking’. Its roots are in systems thinking, and, in the early 2000s, the establishment of the International Integrated Reporting Council (IIRC) championed the concept.
The Value Reporting Foundation (established in 2021 with the merger of
the IIRC and SASB) defines integrated thinking as, 'the active consideration by an organisation of the relationship between its various operating and functional units and the capitals that the organisation uses or affects — inputs, outputs and outcomes'.³⁷

‘The capitals that the organisation uses,’ refers to the six capitals of integrated reporting that help organisations explain to stakeholders how they create value.

Financial — The pool of funds that is available to an organisation for use in the production of goods, the provision of services or obtained through financing
Manufactured — manufactured physical objects (as distinct from natural physical objects) that are available to an organisation for use in the production of goods or the provision of services
Intellectual — Organisational, knowledge-based intangibles
Human — People’s competencies, capabilities and experience, and their motivations to innovate
Social and relationship — The institutions and the relationships within and between communities, groups of stakeholders and other networks, and the ability to share information to enhance individual and collective
well-being
Natural — All renewable and non-renewable environmental resources and processes that provide goods or services that support the past, current or future prosperity of an organisation³⁸

Once there is an understanding on how the goals behave and relate in a system, it is important not to consider it a one-time activity. As the world continues to rapidly change, the choices and opportunities of an organisation to affect the goals evolve. The Value Reporting Foundation emphasises, ‘Integrated thinking should be seen as a continuous journey, one that evolves and one that continues to promote collaboration across all sections of an organisation.’³⁹

Steps to SDG accounting

To help, Ian Thomson and his colleagues at the Centre for Responsible Business developed a series of exercises and tools to bring the goals to life and to help embed them within an organisation’s governance; strategy; risk management; and metrics and targets.

They are high level and designed to get people thinking about the relationships that an organisation has with the systems underpinning the goals. Without the understanding that the steps bring, an organisation is at risk of cherry-picking specific goals that are easy to support, rather than prioritising the goals where it is most important to focus.

Step 1 — Purpose mapping

The purpose map is a way to understand the relevance of each of the goals and the relationship between an organisation and its wider ecosystem.

Start by categorising the goals by those:

That are part of the CORE
organisation activity
That are IMPORTANT to
the organisation
Over which the organisation
has INFLUENCE

Next, place each of the 17 goals onto a map, based on this analysis.

Finally, draw links between the goals to highlight any impact pathways (e.g., inputs, activities, outputs, outcomes and impacts).⁴⁰ For example, an organisation in the health and beauty industry might put goal 6 (clean water and sanitation) at its core, if part of the business is about providing sanitation products. Goal 14 (life below water) might seem less vital to the organisation, so it will be placed in one of the outer rings. But these two goals are linked and link to other goals, such as goal 13 (climate action).

Creating an SDG Purpose Map highlights the links between the goals and forces an organisation to ask the questions,

Do we do this?
Could we do this?
Should we do this?

Step 2 — Dependency, control and impact-mapping

This involves considering dependencies and impact. Organisations are dependent on a whole range of systems that link to each of the goals, such as health care, biodiversity and economic systems.

There is often a tendency to assume that systems will always continue as they are now. However, the COVID-19 pandemic has highlighted the dependencies an organisation has on wider systems, and how when something changes it affects the ability to continue with business
as usual.

Start by creating a table with four quadrants for goals:

Where the organisation has a dependency on
The organisation has some control over
The organisation positively affects
The organisation affects negatively

The goals should then be placed on the table. It is possible some goals might appear in multiple quadrants. This indicates a particularly complex goal/organisation relationship.

When doing this step, watch out for zones of ignorance or blind spots. These normally fall in the dependency and positively affected quadrants. Organisations tend to bias their decision-making to what they have control over, and, where there are negative affects.

However, this focus often leads to dependencies and positive affects being missed from the information systems. Consequences include missed opportunities in terms of where an organisation has the potential to have a positive impact and risks associated with blind spots to dependency cause and effect chains.

Step 3 — Lifecycle assessment

The lifecycle assessment helps an organisation understand the greatest impacts on a product and its relationship with the goals. Lifecycle assessment focuses on the three value-chain boundaries of an organisation,

Own operations — All activities within operations that an organisation has direct control.
Upstream — All activities, resources and products that an organisation has purchased from suppliers.
Downstream — All activities linked to direct, product use by end consumers and product end-of-life.⁴³

Start by considering the upstream, downstream and operational elements of the product lifecycle. Then map which goals are positively and negatively affected upon at each stage of the lifecycle.

Creating this matrix identifies whether the greatest product impact comes within,

the supply chain;
the organisation; or
the post-sale.

By adapting this relatively standard way
of thinking, an organisation gains a new understanding of the relationships between operations and the systems underpinning the goals.

Step 4 — SDG KPIs Matrix

This matrix helps to highlight the zones of ignorance for an organisation within its key performance indicators (KPIs) and targets. These functional blind spots within an organisation are where future risks and disruptors lie. If only a few SDGs are fully measured, others are partially measured and many are largely ignored, an organisation will have a misleading view
of its relationship with society and the planet. Decisions will then be made on partial data.

Start by looking at the organisational key performance indicators from the perspective of the SDGs and consider the extent to which the SDGs are measured or not. Each SDG should be assessed as to whether the organisation’s KPIs.

fully measure it,
partially measure it,
inaccurately measure it, or
miss it completely.

By considering the connectedness and misalignment between organisational
KPIs and the SDGs, an organisation can
sense-check that their information systems, decision-making processes, performance measures, incentives and sanctions and governance truly link back
to their stated purpose.

Step 5 — SDG Impact Evaluation Matrix

The SDG Impact Evaluation Matrix is a dashboard that helps an organisation see and understand the links between different potential scenarios and the SDGs. It creates a nuanced and rich understanding of the dynamics at play and the consequences of actions in these scenarios. In addition to identifying risks, it can also uncover many positive impacts that an organisation has or could potentially have.

Begin by sorting the goals. Start with the most relevant goals to the organisation, as identified in step 1 — purpose mapping.

Next consider the impact of a scenario on each of the goals. Rate whether the scenario’s impact on the goal is,

positive (green upward arrow),
less certain (amber arrow),
negative (red downward arrow) or
of no impact (remains blank).

Example scenario 1: If an organisation decides to pay a living wage to all employees.
This is likely to have a positive impact on,

Goal 8 (decent work and economic growth): indicated with a green
upwards arrow.

Its impact is less certain on,

Goal 15 (Life on land): indicated with an amber upwards arrow.

This is likely to have no impact on,

Goal 14 (Life below water):
remains blank.

Example scenario 2: If an organisation switches to electric delivery vehicles:
This is likely to have a positive impact on,

Goal 3 (Good health and well-being) — reduced air pollution.
Goal 13 (Climate action) — reduced greenhouse gas (GHG) emissions.

This is likely to have a negative impact on

Goal 15 (Life on Land) — possible biodiversity loss because the extraction of some of the resources used in manufacturing electric batteries can be highly damaging.

It is important to consider every goal for each action, as there may be connections that do not seem immediately obvious. Focusing on just four SDGs, for example, creates 13 zones of ignorance which are essentially future risks and potential disruptors. That ignorance is then built it an organisation’s evaluation systems and performance measurements creating areas of SDG unknowns.

Step 6 — A SDGs Tube Map

This approach, based on the concept of the famous map of London’s underground transport network, is a way of considering how elements of a system are connected. The map displays the route connecting the SDGs to the Unsustainable Development Goals (explored in the Why? section).

Routes connecting the two versions of each goal show the key elements that will ensure the world ends up with a positive version. The map concept helps identify the critical ‘stations’ or factors, such as education or purposeful leadership, which are necessary to achieve several goals and without which progress will be hindered. For example, to avoid climate chaos, key elements are education, leadership at every level, purposeful leadership and healthy ecosystems.

Organisations can use this concept and create their map to understand the elements that will be needed to achieve each SDG. It can help highlight which policies might be needed to meet certain goals, and which departments and teams need to be included in the conversation. For example, ensuring responsible consumption would require input from procurement to ensure that supply chains are ethical and sustainable. While gender equality would need to involve HR as well as leadership to ensure that messaging is consistent throughout the organisation.

The tube map example below is one Thomson with Business in the Community (BITC) developed. It shows routes through the different parts of the Responsible Business Tracker and highlights the types of policies and procedures that an organisation should have in place to ensure the goals are met. (More details on the Responsible Business Tracker are in the practical tools and resources section). The tube map concept can be changed to have departments, products, services or even regulations as ‘stations’. It quite literally creates a route map to achieving the goals.

These approaches and steps remind us that rather than attempting to make every goal relevant to every business, it is more powerful to consider the impacts of the business on the resilience of the underlying systems and feedback loops within which they operate.

Who will encounter the Sustainable Development Goals?

Finance professionals and finance functions all have an important role to play in understanding their business impact and the opportunities for change across the three core elements of environmental, social and governance (ESG) that the
17 goals encompass.

Finance professionals
Stefen Schaltegger, professor of Sustainability Management and head of the centre for Sustainability Management at Leuphana University, Lüneburg, notes that the goals present,

Global issues are thus ever more related to companies and seen as management requirement, which in turn challenges management accounting and accountants to reconsider their role, methods and processes.⁴⁸

Stefen Schaltegger

The skill set of a management accountant is highly relevant to helping organisations align with the goals. They also present an opportunity for management accountants to take a leading role. However, rather than having to invent new techniques to work with the goals, it is a case of adapting and recalibrating current practices. (See How to integrate the Sustainable Development Goals into an organisation? section)

Finance professionals are likely to be familiar with the concept of SMART measures: specific, measurable, attainable, relevant and timely. The goals, however, demand a slightly different way of considering performance.

It requires thinking about augmenting them with SIMPLE measures: strategic, interconnected, meaningful, purpose-driven, long term and educative. The SMART and SIMPLE framework can help in ensuring that the goals are understood more holistically.

Once the goals have been embedded within an organisation the roles finance professionals play will be diverse and valuable. Their primary tasks are likely
to include:

encouraging organisations to meet SDG requirements through improved innovation capabilities.
emphasising the importance of ethical behaviour throughout the value chain.
focusing more tightly than ever
on best practices in governance
and stewardship
driving the formation of
strategic partnerships.
helping organisations to base their corporate reports on the six ‘capitals’ of integrated reporting: human, social and relationship, intellectual, natural, manufacturing and financial.⁴⁹

Finance functions
Finance functions have an important and broad role to play in translating the goals into organisational value creation and preservation. It should not just be an exercise about reporting goal results as this has the propensity to become corporate greenwashing. The goals must become embedded into an organisation so that they lead to business model innovation, informed investment decision-making and the management of future risks and opportunities. It requires a shift from shareholder primary to understanding how the goals can help organisations build value and relationships with the wider stakeholder community. A systems thinking/integrated thinking approach will help here. (See A mindset for the goals: systems and Integrated Thinking in the How to integrate the Sustainable Development Goals into an organisation? section of this report.)

One way of demonstrating to stakeholders how an organisation’s strategy contributes to society is to identify and quantify impact pathways (e.g., inputs, activities, outputs, outcomes and impacts) through the business and link them to the corresponding SDGs.

Finance functions need to be driving this with a focus on the four lenses of governance; strategy; risk management; and metrics and targets. Together, the four lenses can help embed the goals across
an organisation.

Governance — What is the organisation’s governance around the SDG risks and opportunities?
Strategy — What are the actual and potential effects of SDG risks and opportunities on the organisation’s business model, strategy and
financial planning?

Risk management — How does the organisation identify assess and manage SDG risks?
Metrics and targets — How are metrics and targets used to assess and manage SDG risks and opportunities?

There is also a need to find innovative ways of measuring, monitoring and evaluating organisational performance
by looking for new forms of evidence.

Finance functions occupy a unique position. Information and data within an organisation flies in many directions. However, they generally flow in and out of the finance function. This provides the finance function with numerous entry points of communication between itself, other internal business functions, supply chain partners and external stakeholders in the wider ecosystems. It can break down one-way communication that obscures complex problems the SDGs are trying
to solve.⁵⁰

The resulting collective diversity builds better strategic thinking, decision-making and leads to SDG innovation. Steven Johnson, in his book, Extra Life, notes,

Big changes in society often happen because a new idea in one field triggers changes in a seemly un-related field. Intellectual histories, for understandable reasons, tend to underemphasise these kind of casual leaps; the history of chemistry focuses on the chemists, while the history of epidemiology focuses on the epidemiologists. But the truth is that the new ideas introduced in these fields have a tendency to leap over these disciplinary barriers.⁵¹

Steven Johnson

The finance function is an important bridge between unrelated internal departments and external Interdisciplinary stakeholder groups when leading SDG innovation.

As organisations around the world are resetting the way they think about business value and the goals in an integrated way, it’s truly an exciting time
to be a finance professional.

Practical tools and resources for the Sustainable Development Goals

It can be hard to know where to get started when it comes to aligning an organisation with the goals. It is a work in progress, an evolving field in which organisations are constantly developing new techniques and frameworks. The following tools and resources can help organisations on their SDGs journey.

Future-Fit Business Benchmarks
Future Fit have developed an open source benchmarking methodology, starting with global challenges, and then working backwards to consider how businesses can measure and account for these challenges. The tool is particularly relevant to accountants as it includes familiar language and concepts, such as break-even analysis. The tool also gives characteristics of a resilient, sustainable business and how these can be mapped to the SDGs through a series of measures and risk indicators.

Future-Fit Business Benchmarks⁵²

Business in the Community’s Responsible Business Tracker
Business in the Community (BITC) is one of the leading sustainable business networks and they have created the Responsible Business Tracker. This measurement tool translates the SDGs into key business activities, which links the goals to different measures and attributes. The information inputted into the tracker is confidential, but BITC produces an annual report based on the aggregated information to give a view of the
lay of the land.

Business in the Community’s Responsible Business Tracker⁵³

G17 Eco’s SDG Tools
G17Eco has developed a range of open-source tools to help organisations map the SDGs. These tools include the Sustainable Development Global Accounting Principles, which map the SDGs against relevant frameworks such as Caron Disclosure Project (CDP) and indicates how impact might be defined and measured.

Another tool is the G17Eco’s World Tracker, which maps performance against the SDGs on a national basis. This can be particularly useful for understanding SDG impact across the whole supply chain. For a UK company selling mangos grown in India the tool allows an organisation to see India’s performance on the SDGs relating to water usage, and understand whether the organisation may be inadvertently causing issues elsewhere through its supply chain.

G17Eco’s SDG tools⁵⁴

World Benchmarking Alliance
The World Benchmarking Alliance has assessed 2,000 of the world’s companies, measuring contributions to the UN Sustainable Development Goals (SDGs) and ranked the most influential.

The SDG2000 list⁵⁵

FM magazine article — Translating the UN’s Sustainable Development Goals
This article explores the practical role management accountants have in helping businesses navigate the 17 U.N. SDGs.

Translating the UN’s Sustainable Development Goals⁵⁶

AICPA & CIMA Sustainability and Business Series — E, S, and, G introductions
These are introductory reports into ESG factors finance professional should build up their literacy.

Putting the E in ESG⁵⁷

Putting the S in ESG⁵⁸

Putting the G in ESG⁵⁹

What’s next from the AICPA and CIMA?

We will continue to watch the sustainability space and play a central role in its development. We will ensure that the journey towards the development of global standardised comparable ESG metrics and non-financial reporting is not at the expense of closing any future sustainability debate and innovation. We aim to achieve a balance of sustainability reporting and assurance alongside data driven insights so that resilient organisations and finance professionals can address future prosperity, planet and people challenges.

'We believe that we will see profound changes in the next few years in the work of management accounting and public accounting to embed new practices and standards relating to sustainability. AICPA and CIMA will continue to provide education and guidance to all areas of the profession, ensuring that it is ahead of this transformation. It’s truly an exciting time to be an accounting and finance professional'.

Andrew Harding, FCMA, CGMA
Chief Executive — Management Accounting Association of International Professional Accountants

Endnotes

Endnotes

I. Thompson, 5 Years of the UN Sustainable Development Goals: Where are we and How can Management Accountants Help Move us Forward. Webcast, 25 September 2020.
Make the SDGS a Reality (Accessed 6 September 2021).
J. Elkington, Green Swans: The Coming Boom In Regenerative Capitalism (Fast Company Press, New York: 2020). p.19.
M. Mazzucato, Mission Economy: A Moonshot Guide to Changing Capitalism. (Allen Lane, London: 2021). p.110.
Goal 1: End poverty in all its forms everywhere. (Accessed 6 September 2021).
Goal 2: Zero Hunger. (Accessed 6 September 2021).
Goal 3: Ensure healthy lives and promote well-being for all at all ages. (Accessed 6 September 2021).
Goal 4: Quality education (Accessed 6 September 2021).
Goal 5: Achieve gender equality and empower all women and girls. (Accessed 6 September 2021).
Goal 6: Ensure access to water and sanitation for all. (Accessed 6 September 2021).
Goal 7: Ensure access to affordable, reliable, sustainable and modern energy. (Accessed 6 September 2021).
Goal 8: Promote inclusive and sustainable economic growth, employment and decent work for all. (Accessed 6 September 2021).
Goal 9: Build resilient infrastructure, promote sustainable industrialization and foster innovation. (Accessed 6 September 2021).
Goal 10: Reduce inequality within and among countries. (Accessed 6 September 2021).
Goal 11: Make cities inclusive, safe, resilient and sustainable. (Accessed 6 September 2021).
Goal 12: Ensure sustainable consumption and production patterns. (Accessed 26 September 2021).
Goal 13: Take urgent action to combat climate change and its impacts. (Accessed 6 September 2021).
Goal 14: Conserve and sustainably use the oceans, seas and marine resources. (Accessed 6 September 2021).
Goal 15: Life on land (Accessed 6 September 2021).
Goal 16: Promote just, peaceful and inclusive societies.(Accessed 6 September 2021).
Goal 17: Revitalize the global partnership for sustainable development. (Accessed 6 September 2021).
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Integrated Thinking: A Virtuous Loop
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Report authors:

Professor Ian Thomson, FCMA, CGMA
Director

Banking Group Centre for Responsible Business
at the University of Birmingham

Dr. Martin Farrar
Associate Technical Director
Research and Development — Management Accounting

Association of International Certified
Professional Accountants

Lloyds Banking Group Centre for Responsible Business

The Centre was established in 2017 as a partnership with Lloyds Banking Group, Birmingham Business School and the University of Birmingham to work with business innovators, academics from all disciplines, regulators and agenda setters to redefine what it means
to be a responsible business. This is based on impact-oriented research projects, robust evidence and expert insights from business leaders, change-makers and innovative thinkers. The Centre creates important new understandings of business and its place in a responsible and sustainable world and translating our research findings into useful knowledge for business. Our research involves challenging business thinking and practices to achieve more responsible outcomes in the context of global and local challenges, such as the UN Sustainable Development Goals.

Our research focusses on four areas

Responsible business decisions and actions
Responsible performance measurement, accounting and accountability
Responsible business risks and foresighting
Responsible use of AI and digital transformation

We integrate our findings from these four areas to build new understandings of responsible business and responsible business ecosystems.

Lloyds Banking Group Centre for Responsible Business

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