The BusinessGreen Guide to the SDGs: SDG1 - No Poverty

James Murray
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The BusinessGreen Guide to the SDGs: SDG1 - No Poverty

In the first of BusinessGreen's exclusive guide to the SDGs, we take a look at how businesses will be impacted by SDG1 and the global push to eradicate extreme poverty

The UN's Sustainable Development Goals (SDGs) are the world's most important to do list. Their ambition and scope are so great that successfully meeting the goals would effectively resolve the vast majority of the social, economic, and environmental challenges the world faces, while opening up the path towards a century of health, prosperity, and security for the human race.

It sounds like hyperbole, but when you consider the SDGs in their entirety you can see it is anything but. They point to an end to extreme poverty and hunger, clean energy access for all, the resolution of multiple inter-locking environmental crises, the achievement of genuine equality and human rights, and decarbonisation at a pace and scale that would all but guarantee the emergence of a net zero emission global economy by mid-century - and all within 12 years.

As such the SDGs provide an invaluable matrix for any business and investors committed to tackling environmental and societal risks, seizing sustainable opportunities, and developing meaningful 'purpose'.

However, the sweeping nature of the SDGs, their comprehensive reach, admirable ambition, and attempt at an holistic approach to sustainable development, comes at a price. There are famously - or should that be infamously? - 17 SDGs, backed by a further 169 sub-targets and 304 indicators for assessing progress. The necessarily interconnected nature of sustainable development means many of these goals and targets overlap. Meanwhile, critics have argued much of the language is woolly, favouring development jargon over the clarity businesses and investors require.

As such, even well-staffed sustainability departments at global Blue Chip firms can struggle to navigate the SDGs, let alone smaller businesses that are keen to contribute to the goal's long term vision but often face more pressing challenges. Trying to work out the precise extent to which your clean energy microgrid investment in Sub-Saharan Africa or your sustainable agriculture pilot in Vietnam contributes to indicator 1.4.1 on the proportion of households with access to basic services, as well as indicator 9.5.1 on R&D spend as a proportion of GDP and indicator 13.2.1 on whether countries are delivering on their official climate action plans, is a daunting administrative and managerial task by any measure. 

The aim of the BusinessGreen SDG Hub, supported by BNP Paribas, is to provide businesses and investors with the information and analysis that can make it easier to engage with the SDGs and deliver on their ambitious goals. Over the next 18 months we will take a deep dive into each of the individual goals, but to kick off this week we will be running a business guide to the SDGs, providing an at a glance primer to the SDGs, why they matter for your business, and how they can inform your sustainability strategy. And we are starting, of course with SDG1.

SDG1 - No Poverty: End poverty in all its forms everywhere

The targets

SDG1 boasts five targets and two sub targets, as well as 12 indicators, all of which aim to tackle poverty and remove barriers to sustainable economic development.

1.1 By 2030, eradicate extreme poverty for all people everywhere, currently measured as people living on less than $1.25 a day.

1.2 By 2030, reduce at least by half the proportion of men, women and children of all ages living in poverty in all its dimensions according to national definitions.

1.3 Implement nationally appropriate social protection systems and measures for all, including floors, and by 2030 achieve substantial coverage of the poor and the vulnerable.

1.4 By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including microfinance.

1.5 By 2030, build the resilience of the poor and those in vulnerable situations and reduce their exposure and vulnerability to climate-related extreme events and other economic, social and environmental shocks and disasters.

1.A Ensure significant mobilization of resources from a variety of sources, including through enhanced development cooperation, in order to provide adequate and predictable means for developing countries, in particular least developed countries, to implement programmes and policies to end poverty in all its dimensions.

1.B Create sound policy frameworks at the national, regional and international levels, based on pro-poor and gender-sensitive development strategies, to support accelerated investment in poverty eradication actions.

 

Progress to date:

The most recent UN SDG progress report painted a mixed picture for SDG1, with long term progress in tackling absolute poverty hampered by continued cases of extreme poverty, especially in Africa and parts of Asia. Further progress is also being hampered by the limited reach of social security schemes and growing fears that current and future climate impacts will undermine development efforts, hitting the poorest countries hardest.

"While extreme poverty has been reduced considerably in the past decades, there are pockets of the world where it still stubbornly persists," the UN said in its overview. "Detailed analyses reveal that certain groups are much more affected by poverty. Ending poverty requires universal social protection systems aimed at protecting all people throughout their life cycle, and targeted measures to reduce vulnerability to disasters and address specific geographical areas within a country."

Overall there has been considerable progress in recent decades with data for 2013 showing the number of people living below the international poverty line of $1.90 a day at 2011 PPPs had fallen by a third against 1990 levels. However, that still leaves nearly 11 per cent of the global population, or 783 million people, below the official poverty line.

There has been a global revolution in care for the elderly, with 68 per cent of people above retirement age now receiving a pension, but social security schemes have not been extended as effectively to those of working age who are statistically most likely to experience extreme poverty. Only 45 per cent of the world's population was effectively covered by at least one social protection cash benefit in 2016, which means four billion people are left unprotected. Moreover, 28 per cent of persons with severe disabilities receive disability cash benefits, 35 per cent of children worldwide enjoy effective access to social protection, and 41 per cent of women giving birth receive maternity cash benefits.

Last year also offered a timely reminder on the link between poverty and climate risks, with economic losses attributed to disasters jumping to over $300bn, in large part due to three major hurricanes impacting the US and the Caribbean.

 

Business implications

SDG1 is arguably the most wide-ranging of all the goals, taking in almost all the other economic and infrastructure-related goals through both direct poverty targets and inclusion of an indicator on the proportion of population living in households with access to basic services. As such the implications for businesses are significant even if they are hard to boil down to an easily digested Powerpoint slide.

Businesses and investors have an obvious general role to play in delivering on SDG1 through the generation of economic activity and the creation of employment. But they also have more specific enabling and supporting roles alongside governments through improvements to climate and supply chain resilience, adherence to labour rights, and the acceleration of microfinance schemes.

Business risks

SDG1 is one of the goals where it is easiest to deploy the caricature of unfeeling corporations to paint businesses as barriers, rather than enablers of progress.

Specifically tax avoidance policies could be interpreted as undermining government efforts to meet targets relating to the extension of social security.

However, beyond these reputational risks there are a raft of other risks that would arise for businesses if the SDG1 targets are not met.

A failure to deliver on the goals risks undermining future demand from emerging markets that have delivered two decades of progress tackling poverty, but now face a major challenge maintaining that progress. Meanwhile, a failure to meet the goals on climate resilience and social security could present significant supply chain risk for businesses as economies struggle with climate impacts and potential social unrest.

The reality is meeting the targets will be hugely challenging, especially in the light of the recent UN update warning climate impacts are contributing to an increase in hunger amongst the world's most vulnerable communities.

There is also a risk businesses ignore how SDG1 sets targets for all countries and conclude it is simply a developing world agenda. It would be easy for firms with a presence confined to industrialised nations to focus on the extreme global poverty goals and gloss over the target requiring a halving of the proportion of men, women and children of all ages living in poverty in all its dimensions according to national definitions.

And there is a risk for businesses that could arise from the way SDG1 is interpreted by governments. For example, target 1.4 and its language on "equal rights to economic resources", and "ownership and control over land and other forms of property" could be interpreted as a call for welcome reforms to make it easier for poorer communities to improve their lot, or it could be seen as cover for the kind of sweeping nationalisation programmes that are usually regarded as anathema for business leaders.

Business opportunities

As the same time, SDG1 is a goal where businesses have a central role to play in driving progress and opening up new markets.

At the most obvious level, successful poverty eradication will put more money in people's pockets, creating more active consumers and driving demand for goods and services, especially in the emerging economies that are likely to be the engine room of the global economy for much of this century.

Such programmes also promise to alleviate security risks that would otherwise be amplified as climate impacts intensify.

In addition, SDG1's call for improved access to basic services, including the specific foucs on microfinance initiatives, should create massive new market opportunities for the private sector, either through infrastructure development or the provision of such services.

Moreover, businesses have an opportunity to highlight how existing corporate sustainability initiatives, especially in the agricultural supply chain, are supporting SDG1 and wider poverty eradication programmes by enhancing incomes and improving prospects for people around the world.

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