Delegate to Achieve the SDGs

New Zealand often punches above its weight on important international matters.

Why, then, when the UN adopted the Sustainable Development Goals (SDGs) in 2015, are the SDGs not very well known in New Zealand?  Yes, New Zealand also formally adopted the SDGs.  Yes, there was a one day forum in Wellington in April 2018.  Yes, the goals are to be achieved by 2030.  But where is New Zealand’s coordinated strategic planning to deliver on the goals?  It is a bit lacking.  Where is the ubiquitous discussion on SDGs?  It is a bit lacking.

This article proposes a solution for New Zealand.

But before getting to this, it is important to understand the context, of which there are four main elements.

First, the history.  The SDGs are the second set of international goals, following on from the Millenium Development Goals (MDGs).  The MDGs were made up of 8 goals focused on social issues in developing countries to be achieved by 2015.  The MDGs were not wholly achieved.  However, they do appear to have had some good success, e.g. halving the number of people living in extreme poverty, and being used as momentum for the SDGs.

Second, the differences.  The SDGs are made up of 17 goals focused on universal issues in all countries.  Governments, like New Zealand’s, are expected to tailor their domestic and international agendas and policies to work towards achieving the SDGs by 2030.  The goals (like no poverty, zero hunger, and affordable and clean energy) are ambitious, particularly for developing countries.

Third, the motivation.  This should be as simple as New Zealand being a good international citizen and a member of the UN.  But it should also permeate our moral obligation to humanity – both to our and future generations.  And it should also deliver positive outcomes to developed countries like New Zealand, not just be a way of raising the bar for developing countries.  Also, even if the SDGs are not wholly achieved, they should deliver a raft of positive outcomes and be a platform for post-2030 goals.

Fourth, SDG#17: Partnership for the Goals.  All the SDGs are important, but this goal is the most important.  Why?  Because achieving the remaining 16 SDGs requires co-ordination, partnership, and funding on a global scale.  Failure to wholly or partly achieve SGD#17 will reduce the potential to be able to achieve the other SDGs.

Herein is the problem.

The UN estimates that achieving the SDGs by 2030 will cost USD 3.3-4.5 trillion per year, and other estimates put the figure closer to USD 7 trillion per year.  Best case, this translates to a funding gap of about USD 2.5 trillion per year.  A shortfall of trillions (not billions) of dollars per year.  If this gap is not bridged, then the world will not achieve a lot of the SDGs.

Existing ideas for solving the funding gap seem to focus on the private sector picking up the tab.  In turn, the emerging thought seems to be on things like blended finance and social bonds.  These are all good ideas, but they are piecemeal.

What is needed is a helicopter view of the whole supply chain.

The UN is basically an international organisation to pursue a better world.  States become members of the UN, and give effect to this with their respective governments.  Governments need to deliver on the SDGs for the people.

The last part is sub-optimal.

The New Zealand government, in its two or three online pages on the SDGs, says things like “achieving the SDGs will require a cross-government effort … [with] government agencies [to review] the [SDGs] and their alignment with government priorities.” and “the private sector and civil society can also help and are engaging with government agencies on the SDGs.”

It sounds good, but the government is assuming sole responsibility for delivering on the SDGs when it is not wholly resourced for it nor always best placed to deliver it.  Further, the government only has six policy priorities – woefully inadequate, and meaningless as one sentence bullet points.

The solution should be that the government, the private sector and civil society work together to progress and achieve the SDGs.  The government should delegate responsibility to the private sector and civil society, thus leveraging funding, resources and governance.  A key tenet of governance (and management) is the ability to delegate.  The SDGs are so ambitious that the government simply cannot afford to try to deliver and fund the SDGs on its own.

 

This is the governance and finance gap in the SDG supply chain in New Zealand (and maybe throughout the world).  It is also why coordinated strategic planning and ubiquitous discussion on SDGs seems to be lacking at present.

The solution for New Zealand is simple: add SDGs (and any replacement UN goals) to legislation and governance processes to leverage the private and civil society.  The proposal has three parts:

Part 1: Empower companies and similar organisations by:

• Adding a requirement in the Companies Act for all companies to declare, in accordance with a guideline document, which SDG/s they are pursuing (if any), in their annual return to the registrar.
• Adding a requirement in the Companies Act for companies that are required to publish an annual report to include a meaningful and material progress report on which SDG/s they are pursuing in accordance with the guideline document, or a meaningful and material statement about why they are not pursuing any SDG.
• Adding a requirement in the Charities Act that all charities must be aligned with at least one SDG, in accordance with a guideline document, and report meaningful and material progress annually or have their charity status revoked.
• Investigating adding similar requirements to legislation (that requires reporting) related to limited partnerships, trusts, charities and any other organisational structures.
• Collaborating with organisations like the NZX and the Institute of Directors with a view to adding company alignment with SDGs to publications like the Four Pillars of Governance Best Practice.
• Possibly, in time, providing a small tax break to companies that are aligned with an SDG and are reporting meaningful and material progress towards that.

Part 2: Enact SDG legislation that aims to:

• Make it mandatory for New Zealand to comply with voluntary UN SDG progress reports.
• Make one minister responsible for SDGs.
• Establish a ministry or stand-alone government department as the knowledge hub and administrator of SDG matters including those delegated by the government to the private and civil sector.
• Direct that department to publish the guideline document referred to in Part 1 such that directors know how to make proper declarations.
• Possibly, in time, allow that department to certify companies and other organisations as being aligned to an SDG (with annual reassessment), or delegate this to the established UN Global Compact process.
• Require all regulatory impact statements to also have regard for the SDGs.
• Require any more holistic reporting or investment metrics, like Treasury’s emerging Living Standards work to also link to the SDGs.
• Require any policy initiatives and investment decisions to progress only if they advance progress towards a particular SDG or are not applicable to any SDG.

Part 3: Amend the education curriculum:

• For the years covered by compulsory schooling to make SDGs a core part of the curriculum.

If these solutions are progressed, then discussion on SDGs in New Zealand will happen at homework time, at the dinner table, in the office and at the board table.  The government can then co-ordinate strategic planning, and transparently promote areas ripe for public, private or civil investment.  Overlaying all of this will be good reporting metrics and feedback loops.

The vision, in a perverse kind of way, should be to blur the line between a for-profit company and a for-purpose charity, and for consumers to buy goods and services from companies that are closely aligned to a purpose which takes humanity closer to one of the SDGs.

The spinoff benefits should be that the economy becomes more diversified and resilient to shocks, that the government creates and promotes an SDG governance industry, that New Zealanders gain lifestyle improvements in areas relating to the SDGs (despite already being a developed country), and New Zealand increases the export of its SDG solutions (and repackages them as such) to the world.

These are fairly strong second-order benefits, which should be achievable at very little cost to the government.  Private and civil sector costs should also be marginal, but should help those organisations to pivot to better compete in tomorrow’s changing world.

Wouldn’t it be great if, at the next World Government Summit or UN conference, the New Zealand government could be a keynote speaker on how it is punching above its weight on the SDG#17 – Partnership for the Goals.

The pitch would be that by enacting smart legislation and policies, the government delegates to private and civil society the missing SDG governance and funding elements to create a whole-of-society approach (not just a government approach) to achieving the SDGs.