Sustainable Development Goals - Implementation and Progress

By Professor Omneya Abdelsalam, April 2021

The United Nations Sustainable Development Goals (SDGs) were issued in 2015, and more than 190 countries pledged their commitments to achieve them. However, measuring the progress at country and firm levels has become a significant challenge for governments and organisations in developing countries, primarily due to data unavailability and a lack of know-how. The following describes three projects funded by the British Council’s Newton Fund and the Economic and Social Research Council Impact Acceleration Account (ESRC IAA), in which my team and I have been working with several organisations to raise awareness and build capacity towards the implementation of the SDGs.

START Microfinance Impact Case – The Three Stages

As part of its connection with the industry and aiming to create a successful impact case, the Ethical Finance, Accountability and Governance (EFAG) research centre engaged in a series of projects with the START Microfinance institution (hereafter START), located in Pristina, Kosovo. The institution’s overarching goal is participation in reviving and developing the economy of Kosovo by providing Islamic financial services in the form of loans. Our three-stage collaboration with START enabled it to expand its capacity building and adopt newly introduced Sustainable Finance concepts

In the first stage, we assessed START’s financial and social performance. As our key output, we generated insight into the institution’s strengths and risks while drawing management’s attention to the key findings. Specifically, our report highlighted the declining portfolio yield and profitability while providing an overview of the challenges in the operational context (i.e., Kosovo) and a proposal for alternative instruments specifically oriented towards increasing the institution’s market share. More importantly, we thoroughly examined START’s loan pricing and loan supervision policies to develop tailor-made solutions to increase profitability and efficiency. In particular, we analysed and revealed the factors causing clients to miss loan payments or default (non-performing loans); these factors were considered in the subsequent revision of START’s customer supervision and credit methodology. Beyond that, we also highlighted governance issues that could assist the institution in improving its transparency.

During the second stage, we focused on increasing START’s awareness of the SDGs and enabling it to build relevant capacity. We managed to quantify the overall value created and distributed by the institution in relation to the SDGs, thereby demonstrating to START that it has the potential to become a focal hub for sustainable development in the country. In addition, to increase awareness among START’s employees of their institution’s tangible outcomes towards the realisation of the SDGs, we linked the institution’s activities and outcomes with the relevant goalss. This led to the creation of a blueprint that serves as future reference when examining START’s contribution to the SDGs.

In the final stage, we introduced the concept of Integrated Reporting (IR), collaborating with START in preparing its first Integrated Report. More importantly, we endeavoured to prepare a report that quantified not only the use of START’s six capitals (Financial, Human, Intellectual, Manufactured, Natural, and Social and Relationship Capitals) but also how these capitals are transformed. Our main objective was to persuade START to embed the value creation process into its corporate philosophy, and we consider ourselves successful in this regard as we illustrated how its day-to-day operations contribute to the overall creation and distribution of value, both within and beyond the institution. In summary, we supplied START with specific tools (benchmarks and key performance indicators (KPIs)) to facilitate performance evaluation while broadening its knowledge on concurrent issues by linking the institution’s respective outcomes to both the value creation process and the SDGs.

Sustainable Development Goals in Multiple Organisations (Turkey) [2019-2020] [funded by Newton Fund – Research Environment Link Scheme]

In this project, we worked with multiple academic partners in Turkey to build their research capacity, establishing an SDG Implementation Network to ensure the project’s long-lasting impact. As a result of our work, these universities introduced sustainability courses and changed some of their policies to embed sustainability; one university is currently preparing to submit to the SDG-based Times Higher Education impact ranking. Meanwhile, we worked with Ibn Haldun University via the Sustainable Development Group International (SDGI) network, assessing their university policies to identify gaps and adjust their policies to embed sustainability. In addition, a considerable number of early career researchers and postgraduate researchers were mentored and inspired to write research papers and dissertations on SDGs in Sehir University (now merged with Marmara University). Furthermore, via the SDGI network, we worked with the Istanbul Chambre of Commerce, the Istanbul Chambre of Industry, and the Istanbul Development Agency as well as several Islamic banks to raise awareness of the SDGs and help them embed sustainability in their policies and practices.

Country and Firm-Level SDG Performance

Our research team is currently producing SDG performance reports at both country and firm levels. At the country level, we produce country-level SDG performance reports, the aims of which are threefold. First, we provide insights into the SDG performance of a specific country while also drawing comparisons at the global and regional levels. Second, we respond to the ongoing interest for firm-level SDG performance metrics by developing a comprehensive SDG scorecard drawing on data points from multiple databases. Third, we provide insights into the overall and individual SDG performance of listed firms and conduct comparisons with their peers around the globe. Collectively, we inform our readers of the SDG performance of the country in general, and of listed firms in particular, revealing areas with adequate performance and areas requiring further attention and effort by officials and the corporate world. These reports are currently communicated to the relevant policymakers.

At the firm level, we provide insight into the overall and individual SDG performance of globally listed firms at the national, regional and continental levels. We also conduct multivariate analyses and illustrate the factors influencing firm-level SDG performance of the largest 4,000 firms worldwide. Furthermore, we extend our results to capture the associations between various types of shareholders and SDG performance. For example, we have found that having greater stakes in a firm’s shares owned by individual investors, hedge funds and exchange-traded funds negatively affect firm SDG performance, while performance improves when pension funds, insurance firms, and sovereign wealth funds hold greater stakes. We also examine the association between SDG performance and firm market risk. Our research is providing much-needed empirical evidence for the United Nations Development Program, which has expressed an interest in partnering with the Durham team in taking this project further.

More information on the Centre for Ethical Finance, Accountability and Governance.

More information on Professor Abdelsala’s research interests.