Know your SDG 1 from your SDG 17. Sustainable Development Goals explained and why investors should care – a quick guide.
The United Nations’ Sustainable Development Goals are a “blueprint to achieve a better and more sustainable future for all”. The UN describes them as a “call for action” to “promote prosperity while protecting the planet”.
Read on for what the 17 goals are and what Schroders’ Global Head of Sustainable Investment has to say about them.
They were adopted by all UN Member States in 2015 as part of the 2030 Agenda for Sustainable Development to address global challenges. They were developed from the Millennium Development Goals.
Andrew Howard explains: “It is important to recognise that the global challenges described by the SDGs have been building up over several decades. The SDGs are a framework to guide ideas and innovation towards tackling those challenges.”
Each of the SDGs has around 8-12 targets so there are more than 150 in total. They range from “enhancing the use of enabling technology... to promote the empowerment of all women and girls” to increasing “substantially the share of renewable energy in the global energy mix”.
These targets have specific indicators to measure progress, of which there are more than 200. For example, to measure progress against the target to reduce global maternal mortality, the global maternal mortality ratio is an indicator.
The UN’s own progress report for 2021 has warned that “the global community is at a critical moment in its pursuit of the SDGs”.
It said the coronavirus pandemic was “threatening decades of development gains, further delaying the urgent transition to greener, more inclusive economies, and throwing progress on the SDGs even further off track”.
It is often said that investors big and small have a part to play in meeting these global goals.
Andrew Howard, Schroders’ Global Head of Sustainable Investment, explains: “While originally intended for governments and policymakers, the SDGs have evolved into a universally recognised framework, being used by both the public and private sectors. Both play a key role in developing solutions.
“As investors, the SDGs help us understand where to deploy capital and how to ensure the capital we deploy is aligned.”
Andrew Howard says: “The SDGs can also offer a way of understanding how investments align to an investor’s personal values. A wide array of solutions have appeared in the form of SDG-focused funds and measurement and reporting tools.
"However, it can be difficult to pick out which solutions offer new ways of thinking with meaningful outcomes versus products and tools that have simply been rebranded without much fundamental change.”
He adds: "In the face of this challenge, we are developing a proprietary framework that aims to fill this gap. It will sit alongside our suite of investment tools including SustainEx, our proprietary tool to measure impact."
Not only that. As owners of companies, investors have a voice – a unique opportunity to hold them to account and encourage them towards more sustainable business practices.
Andrew Howard explains: “If we are to drive positive change, investment alone is not enough. Engagement is a critical component of an investor’s success in achieving positive, meaningful outcomes for society.”
Issued in the Channel Islands by Cazenove Capital which is part of the Schroders Group and is a trading name of Schroders (C.I.) Limited, licensed and regulated by the Guernsey Financial Services Commission for banking and investment business; and regulated by the Jersey Financial Services Commission. Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested. This document may include forward-looking statements that are based upon our current opinions, expectations and projections. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements. All data contained within this document is sourced from Cazenove Capital unless otherwise stated.
The value of your investments and the income received from them can fall as well as rise. You may not get back the amount you invested.