Organizations all over the world recognize the need to align their strategic goals and initiatives with the UN Sustainable Development Goals and National Agendas. In this article, we’ll discuss the practical steps to implement the goals from high-level frameworks like SDGs to a company’s strategies.
Introduction to SDGs and National Agendas
In 2015, all member states of the United Nations adopted the 2030 Agenda for Sustainable Development1. The 17 sustainable development goals were implemented in the National Visions of many countries, giving a local context for the global development strategy.
According to the PwC survey2, 71% of businesses plan to engage with SDGs.
In this article, we’ll discuss:
- The reasons why organizations should implement SDGs and National Agendas goals
- The three levels of the alignment
- The way to work with targets suggested by the sustainable growth frameworks
- BSC Designer and our way to implement SDGs
- Executive summary
Three Pragmatic Reasons to Integrate SDGs or National Agenda in an Organization’s Strategy
Let’s discuss some practical reasons or expected results why any organization should implement SDGs into their strategy.
Expected Result 1: Understanding Driving Forces
The goals formulated in the SDGs or country’s vision are important driving forces for any organization. We can confirm this with a simple PESTEL analysis.
- The policies implemented on the governmental level affect the business environment directly.
Beside the basic capacity to anticipate legal changes, better understanding of the driving forces is a strong competitive advantage.
This gives us the first expected result.
Expected Result 1. Understanding important driving forces via the National Vision/Agenda.
By looking at the governmental goals from a time perspective, organizations can plan their future strategies.
The success of this approach can be validated with cost-saving achieved. For example, organizations serious about implementing energy-related goals from the sustainable growth plans (target 7.2), were more prepared for the 2022 energy crisis.
Expected Result 2: Facilitate Strategy Conversations with Governmental and Community Stakeholders
A comprehensive strategic analysis starts with identifying the stakeholders and their needs. Any organization deals with the government as a main regulator, as well as community as an “umbrella” stakeholder for other types of stakeholders, such as clients, employees, partners, investors.
Understanding the dependency between the organization’s goals and National Agenda will make the discussions with these stakeholders more productive.
Expected Result 2. Facilitating strategy conversations with governmental and community stakeholders.
Expected Result 3: Achieving Evidence-Based Sustainable Growth Quantified by the Value for Stakeholders
On the one hand, better integration with the Sustainable Development Goals contributes to the overall brand value, facilitates attracting and retaining environmental-aware talents.
On the other hand, the strategies of many organizations3 were compromised due to greenwashing practices when the marketing efforts were focused on looking environmentally friendly, while real implementation of sustainable policies was limited.
The risk of such misalignment can and should be avoided via quantifying the implementation of the sustainable goals by the value for stakeholders.
Expected Result 3. Evidence-based sustainable growth quantified by the value for stakeholders.
Another factor of achieving tangible results is strategy properly described4 by:
- Identifying risks,
- Formulating specific strategic initiatives,
- Allocating resources and
- Defining their priorities.
Let’s see how these ideas can be implemented in practice.
Three Levels of Alignment with High-Level Frameworks
Below, we will discuss three levels of alignment between the organization’s strategy and high-level frameworks like National Agenda or SDGs.
- Level 1. Basic alignment via organization’s vision
- Level 2. Alignment via specific goals
- Level 3. Alignment via goals and initiatives quantified by the value for stakeholders
Level 1: Vision Aligned with National’s Vision
One of our clients mentioned that their strategy supports the Nation’s 2030 Agenda. When we reviewed their strategic documents, we saw a clear reference to the “No poverty” goal in the vision statement of the organization.
It was a good starting point, but:
- From their strategy map, it was not clear what goals supported the National Agenda
- The value created for the government and community stakeholders was not quantified in any way and was not obvious.
The organization showed their awareness of the National Agenda (partially achieving the expected result 1 mentioned above), but they were not ready for more specific conversations with stakeholders.
Level 2: Specific Goals Support National Agenda
The UN’s “No Poverty” goal has 7 targets. In the case of the client, the National Agenda included some “localized” goals.
Our client adjusted their strategy map to include specific references to the goals that they were supporting.
- They used the initiatives tool to add rationale and expected outcomes to the existing goals to make the references visible on the strategy map.
- The supported goals were mentioned in the description of the items on the scorecard.
This improved the readability of the strategy map. The strategy presentations (expected result 2 mentioned above) generated some interesting feedback from stakeholders.
Level 3: Goals and Initiatives Quantified by the Value for Stakeholders
To achieve excellence in alignment between the organization’s strategy and National Agenda, an organization needs to commit to a few specific and measurable goals.
To achieve this in practice:
- Quantify the performance of goals and initiatives by the value for stakeholders
- Align quantified value with a few sub-goals formulated in the National Agenda
- Split up most of the goals to the level of sub-goals quantified by the value for stakeholders
- Supported the goals with strategic initiatives, where value metrics were used as progress indicators
- Grouped the final set of goal into several functional scorecards
To make the achievements of the strategy execution more tangible and facilitate reporting to the stakeholders (expected result 3 mentioned above), the organization:
- Created a separate reporting scorecard to aggregate the KPIs from functional scorecards using a cascading function
- Formulated the total performance index that was calculated as weighted average of the KPIs from functional scorecards
With a weighted index, the priorities of the stakeholders were reflected on the strategy scorecard.
The linkage between the indicators on the reporting scorecard and their sources (functional scorecards) provided access to the deep contextual information.
Reporting by SDGs Targets is Not Possible Yet in General Case
In July 2017, the measurement part of SDGs was defined, adding 1-2 indicators for each of the objectives.
By definition, the goals of such high-level frameworks are highly aspirational. While there are various reporting standards that might work for self-assessment, reporting by SDGs 2030 targets is not possible in the general case5.
- Update: in 2023 EU introduced European sustainability reporting standards that in their essence are similar to the ideas of “Level 3” alignment discussed in this article.
At the same time, the UN encourages organizations (see the target 12.6) to “integrate sustainability information into their reporting cycle.”
What we can do is to follow the guideline of the UN about inclusive discussion and invite organizations, community stakeholders and policymakers to the dialogue that will make the reporting more meaningful in a case of specific challenge.
As an example, let’s take one of the indicators of UN Sustainable Development Goals formulated as:
- 1.4.1 Proportion of population living in households with access to basic services
The indicator formulated in this way is not suitable for reporting it directly:
- In supporting documentation, there is no unambiguous definitions of the terms,
- It is vulnerable to manipulations (see the standards example below),
- The indicator doesn’t consider some important contextual information (see resilience example below).
Let’s take “water” as an example of the basic service.
The Idea of “Access” is Ambiguous
What does it really mean to have access to water as a basic service?
- Is it tap water or some water source nearby a house?
- Having water just a few hours a day also fits the idea of “access”
These questions are not as obvious as they seem to be. For example, a study on use of electricity in India showed that there is gender inequality in the use of energy services within Indian households.
The Indicator is Vulnerable to Manipulations
Before, we were talking about bad KPIs and unexpected behaviors that they can induce. In this case:
- What standard should be applied to control the quality of the water?
- When should the standard be updated?
What if many indicators point to the red zone after updating the standards?
- Will the standards be still updated or
- Will the standards remain unchanged for the sake of keeping indicators in the green zone?
The Complex Context is not Considered
Following the example of water as a basic service:
- Some regions use the natural sources of freshwater (low initial investment and running costs)
- Other regions use desalinations facilities (high initial investment and running costs)
Both approaches are viable to supply the population with clear water, but the desalination infrastructure results to be more resilient in the drought periods.
Should we limit the measurement context to the normal periods only, or should we consider the increasing number of droughts, heatwaves and other climate change effects, and quantify resilience as a factor.
Invite Stakeholders to the Discussion
The shift to sustainable reporting is proposed in the goal 12.6 “Encourage companies …to integrate sustainability information into their reporting cycle.”
For some domains, like energy production, there are specific guidelines for reporting sustainability information. In most domains, there is no established reporting framework.
Our recommendation is to discuss with the stakeholders the complexity of the challenges (see the resilience example) to consider diverse opinions6 on reporting.
- Practice decomposition of the initial goal to get to the level of small, independent sub-goals that can be quantified by the value for stakeholders.
- Use those value indicators to create a shared reporting framework.
BSC Designer and SDGs
As formulated in our mission, we help organizations to be more effective in how they discuss, describe, and execute their strategies.
We do it via our:
- Strategy execution software – BSC Designer
- Educational content on our website, and
- Free training on the strategic planning
Support Sustainable Grow with Strategy Automation Software
With a large number of non-profit organizations and universities among our customers, we contribute to the respective areas of SDGs indirectly by helping those organizations develop and execute their strategies more effectively with our software.
With BSC Designer, we help private companies to support their strategies and ensure economic growth. This matches with the 8.2 target of SDGs:
- Our goal: Build high-quality strategy execution software.
- SDGs on the strategy map: SDGs Target 8.2: Strategy execution software supports economic growth
- Details of SDGs: Goal 8 – Decent work and economic growth, target 8.2. Achieve higher levels of economic productivity through diversification, technological upgrading and innovation…”
- Value indicator: number of active users that unlocked key functions.
- Description of value indicator: We consider “active” a customer that used software for more than 1 year period. We consider “key” functions the strategy maps, a certain level of maturity on KPIs setup, an active use of strategy discussion functionality.
Educate Stakeholders on Disciplined Strategic Planning
Sustainable growth is not possible without a proper educational background. We see disciplined strategic planning as a keystone to better formulating and executing sustainable strategies.
Like explained in this article, organizations need to master such strategic planning skills like quantification and alignment to be effective in creating and communicating their strategies and sustainable development themes.
- Our goal: Provide free strategic planning training
- SDGs on the strategy map: SDGs Target 4.7: Disciplined strategic planning
- Details of SDGs: Goal 4 – Education, target 4.7 “By 2030, ensure that all learners acquire the knowledge and skills needed to promote sustainable development…”
- Value indicator: # of strategic planning patterns changed.
- Description of value indicator: Tangible impact of the training as measured according to the four-level model. Number of organizations where the actual change in behaviour (defined for specific training) was implemented after the training.
Support Organizations in Effective Performance Measurement
Performance measurement is one of the key components of disciplined strategic planning. We create high-value content and strategy templates for diverse business domains, helping stakeholders get started with their measurement efforts.
- Our goal: Create high-value content on performance measurement practices.
- SDGs on the strategy map: SDGs Target 12.6 – Integrate sustainability in reporting
- Details of SDGs: Goal 12 – Responsible consumption and production, target 12.6 Encourage companies, especially large and transnational companies, to adopt sustainable practices and integrate sustainability information into their reporting cycle…
- Value indicator: Weighted engagement index by content
- Indicator 1.1: The number of monthly visitors, 30% weight
- Indicator 1.2: Time on page, 70% weight
The Sustainable Development Goals by the UN are widely adopted by governments, public and private organizations. In this article, we discussed the expected results of such alignment from a pragmatic point of view:
- Expected result 1 – Extending the classical PESTEL analysis to better understand driving forces
- Expected result 2 – Facilitating strategy conversations with governmental and community stakeholders
- Expected result 3 – Achieving evidence-based sustainable growth quantified by the value for stakeholders
From the practical point of view, three levels of alignment were defined:
- Level 1 – Basic awareness via mission statement
- Level 2 – Alignment by the goals
- Level 3 – Alignment by the quantified goals and initiatives
As formulated in target 12.6 of SDGs, organizations are expected to implement indicators of sustainability in their reporting. We discussed the challenges of such reporting, possible solutions, and shared the way BSC Designer reports on sustainability indicators internally.
Reference to Some National Agendas
- South Africa’s National Development Plan Vision 2030
- Rwanda Vision 2050
- Côte d’Ivoire Vision 2040
- Uganda Vision 2040
- Ghana 2030 agenda for sustainable development
- Kenya’s Vision 2030
- Ethiopia’s Vision 2025
- Egypt Vision 2030
- Transforming our world: the 2030 Agenda for Sustainable Development, United Nations, 2015 ↩
- Sustainable Development Goals: are they business critical? ↩
- Screening of websites for ‘greenwashing’: half of green claims lack evidence, European Commission, 2021 ↩
- “Strategic Planning Process: Mission, Priorities, Goals, KPIs, Initiatives,” Aleksey Savkin, BSC Designer, 2019 ↩
- Business as Usual Will Not Save the Planet, Mark R. Kramer, Rishi Agarwal, and Aditi Srinivas, 2019, HBR ↩
- Accelerating 2030 Agenda Integration: Aligning National Development Plans with the Sustainable Development Goals, Tarek Katramiz and Mahesti Okitasari, 2021 ↩