The 70th session of the United Nations General Assembly kicked off this week, where member states from around the world gather in New York City. Climate change, the refugee crisis, and Syria are expected to lead the agenda, but it’s also worth taking a look at the UN’s Sustainable Development Goals, a broad and ambitious blueprint unveiled last year detailing global development between now and 2030.
Fortune just released the 2016 “Change the World” list of 50 industry leaders that are tackling major societal problems through sound business investment, and as a result, over time, many are seeing real bottom line results.
The “Change the World” list is an illustration of what the UN envisioned — that companies would play a critical role in advancing the objectives of its Global Goals, which include responses to challenges, such as global migration, the environment and poverty. To drive progress, $2.5 trillion annually in new investments will be needed. The private sector could make a difference, but executives will need to focus on three things: concentrate resources where the firm can make the biggest difference; create compelling business incentives to take on an issue; and partner with government and nonprofits.
Use resources wisely
Each global challenge outlined by the UN contains resolvable challenges that companies can address.
Consider the problem of post-harvest food loss. Over one-third of food grown worldwide is lost between the time it is harvested and consumed. If this issue were resolved, the amount of food recovered could feed an additional 1.6 billion people, stimulate economic development, and alleviate pressures on the environment. These problems, however, are solvable; they stem from poor handling, inadequate storage and transport of produce.
One company equipped to help is Nestlé, which for the last 10 years, has halved the amount of food waste generated in its processing facilities. Nestlé, which is ranked #5 on Fortune’s list, honed its operational approach to support rural farming communities where it sources raw materials and provided extensive technical assistance on practices that reduce post-harvest loss. With a unified strategy, Nestlé made its own operations more effective and cost efficient, lifting the income of farming communities, and increasing global food security. By selecting the problems where it is realistic to expect a successful outcome, we can shrink complex, systemic challenges to a palatable scale—and benefit a company’s bottom line.
There must be a business incentive for a company to dedicate significant resources to social challenges. GSK, a company that topped the Change the World list, has spent years identifying the health challenges that also promise new market opportunities. The company will soon increase access to medicine in several emerging and frontier markets by releasing patents of drugs initially too expensive for these communities.
Businesses cannot—nor should they—solve these challenges alone. One of the UN’s goals calls for strengthening global partnerships between private companies, governments and nonprofits.
These alliances are not easy to form, but we have seen success stories that can be models for future partnerships. Take for instance, MasterCard (one of only nine companies appearing on the “Change the World” list twice), which is working to connect 500 million people previously excluded from formal financial services. With 2 billion adults living without access to mainstream financial tools and services, there is an urgent need to speed up the creation of commercially viable products and services globally. Yet, MasterCard, as a corporation, cannot do this alone. To develop new products and services for thousands of new communities, MasterCard works with NGOs, foundations, trusts, financial institutions and countless other organizations.
The second Global Engagement Forum, held in April of 2017, will encourage deeper collaborations into strategies for a path of shared value moving forward. At the gathering, private, public, and social sector actors will focus on solvable problems and how they can be addressed by collaborating in both traditional and non-traditional ways.
The challenges captured this week and within the goals represent both enormous market failures and business opportunities that the trailblazing companies on Fortune’s list illustrate. The challenge and the solution, in this case, are the same: to figure out which manageable task—or solvable problem—to address first, ensure there is incentive to resolve it, and to find the right partners to bring an idea to fruition in the marketplace.
Deirdre White is CEO of PYXERA Global, an international non-governmental organization based in Washington, DC, that advises companies and individuals on corporate social responsibility through tri-sector partnerships. The firm does not currently represent the companies mentioned in this article.