SDGs (an acronym for Sustainable Development Goals) are important for businesses in general and for startups in particular because companies won’t be able to create value in the long term if natural, social, financial and manufactured resources continue to be eroded elsewhere.
That is why, while developing these 17 global goals – which are defined by a list of 169 specific targets – the United Nations were not only addressing public entities, such as governments, but also private ones like companies and families.
SDGs are designed as a “blueprint to achieve a better and more sustainable future for all” and were set up in 2015 in order to be reached by 2030.
These goals are not the first being developed by the UN, in fact, they constitute a natural development, but also an improvement, of the Millenium Goals (MDGs), a set of similar objectives that was signed in 2000 and have only partially been achieved.
These new objectives cover a wider range of areas and topics from economics to ecology, from governance to social justice.
Every goal is deeply linked to the others so that it is almost impossible to achieve one without working towards them all.
The 17 SDGs are:
1) No Poverty
2) Zero Hunger
3) Good Health and Well-being
4) Quality Education
5) Gender Equality
6) Clean Water and Sanitation
7) Affordable and Clean Energy
8) Decent Work and Economic Growth
9) Industry, Innovation and Infrastructure
10) Reducing Inequality
11) Sustainable Cities and Communities
12) Responsible Consumption and Production
13) Climate Action
14) Life Below Water
15) Life On Land
16) Peace, Justice, and Strong Institutions
17) Partnerships for the Goals.
Why more and more startups will be developed around SDGs
According to Forbes: “startup founders dream of giving society something it needs but hasn’t created yet—and doing it at scale”.
Here at GründerAtelier ”giving society something it needs” is one of the main features we look for in a business; in other words: we want to provide something that can actually improve human life.
And people’ lives can not be bettered in the long term – and probably not even in the short one, at least not to an extensive level – without considering the issues stressed by SDGs.
This is something that startup founders need to keep in mind if they want to create a long-term competitive advantage but, most importantly, if their real aim is to improve society through their services and products.
According to that, EY expects to see a redirection of investment flows – both public and private – towards the global developmental challenges framed around the SDGs.
Reuters reported that already 2020 saw a record influx of investor capital in ESG (Environmental, Social and Governance) funds, an umbrella term increasingly used for investments that seek positive returns and long-term impact on society and the environment.
This was bolstered both by the moral prospects of ESG investing in light of the COVID-19 pandemic and general positive financial results.
The UN estimates that the cost of achieving the SDGs will be approximately from US $ 3.3 to US $ 4.5 trillion per year.
It means that more and more venture capital firms and public funds will finance startups that have an impact in terms of helping to reach one or multiple SDGs.
This is both a challenge and an opportunity for startuppers who need financing in order to develop their ideas.
Are you aiming to produce an innovative product or service you are sure will have a positive impact on people’s lives?
Check out our Impact Investing Accelerator where we offer you help in order to develop into an investment-ready startup and we introduce you to our VC partners.
Which actions should be taken to develop a startup around SDGs?
Entrepreneurs should always think about the social impact of their business idea before developing a startup.
Those who follow are some general actions that should be taken, by companies in general and startups in particular, in order to comply with Sustainable Development Goals.
Identify and commit to the most relevant SDGs
As an entrepreneur, you should first identify which Sustainable Development Goals are directly or indirectly linked to your business (or simply to your business idea) and commit to their achievement.
Develop targets and KPIs
Having identified your priority SDGs and/or underlying targets, you should set your own targets and key performance indicators (KPIs) to monitor your company’s progress towards them.
Measure your results and communicate them
Setting a goal is useless if you do not measure results and make the proper adjustments where needed.
You have also to communicate your progress towards it both internally, to your people, and externally, to the other stakeholders.
Align your company values and culture
Aligning your company values and culture to the SDGs is also vital, as your business as a whole should reflect your commitment to the Goals.
This means that all your employees and collaborators at any level should be aware of the actions and behaviours they need to take in order to work towards the common goals.
It is unlikely that a single company – especially if young and/or small – can solve any of these problems on its own, so collaboration is a cardinal factor. This collaboration should be within sectors, across industries and also between countries, with special consideration for developing ones, which can provide a lot of opportunities.
These are simply general guidelines that can be applied to any of the Goals by any company/startup in any sector.
Some entrepreneurs may however need a deeper analysis of each goal, in order to understand if and how they can work for them.
Presenting our SDGs article series
Are you looking for deeper insight too?
If that is the case, you are in the right place.
In fact, we are going to develop a series of articles in which we will help entrepreneurs to understand how to develop their business idea and company culture, following one or more SDGs.
This in order:
a) to have a real positive impact on society, human lives and, more in general, life on Earth
b) to increase your chances of receiving funding from both private and public investors.
In each article we will analyze one sustainable development goal in-depth, advising you on some strategies to implement it as a business goal and/or in your company culture.
After that, we will also give you some tips to work towards it in your daily life and to encourage your company’s people to do the same.
We will eventually provide you with some virtuous examples of both startups that have successfully developed their businesses around SDGs and older companies that have adjusted theirs in order to be more sustainable and have a positive impact.
Willing to know more about this useful topic?
You will find a new SDGs’ article per week in our blog section “Creating Impact: a guide for Entrepreneurs to SDGs”, for a total of 17 articles, covering all of them.
If you are an impact-related startup that supports one or multiple SDGs you can apply to our Impact Accelerator where we will make you investment-ready and then introduce you to our VC partners.