As prepared for delivery.
I am pleased to be at this year’s Responsible Business Forum among so many committed business leaders, key policy makers, and members of civil society, the media and the United Nations family. Over the next two days we will explore and develop partnerships to tackle persistent challenges to sustainable development and shape a better world by 2030.
I would like to take this opportunity to thank the Government of Singapore for being such strong champions of the Sustainable Development Goals, and for the country’s continuous support and partnership with UNDP.
Yesterday, I had some very good meetings with the Prime Minister and other cabinet members. At these meetings, the Prime Minister reiterated his country’s interest in leading the region and beyond, leveraging Singapore’s technical assets, financial resources, and political capital towards shared goals. UNDP is excited to engage Singapore on the SDGs and innovation, and that we have agreed on UNDP’s continued presence in Singapore; our partnership will focus on innovation, technology and development.
Globally and in the Asia-Pacific region, we are faced with both challenges and opportunities. Except for three countries; the region is now comprised of either middle or high-income countries. Asia-Pacific’s share in global GDP is now over 30 per cent and is expected to rise to 52 per cent by 2050.
The fight to eliminate poverty in the region has also made enormous progress. High and sustained economic growth is leading to a rapidly expanding middle-class. By 2030, two-thirds of the global middle class will be Asian.
However, greater material prosperity also brings with it a set of inter-related challenges. While the region’s middle-class is expanding, the divide between those at the top and those at the bottom of the income ladder has widened. Moreover, a growing middle-class will further increase the demand for natural resources. Such resource-intensive growth will further burden the environment with potentially devastating consequences. And aspects of the 4th industrial revolution, including artificial intelligence, bio-technology, quantum computing, and the Internet of Things are likely to transform entire systems of production, labor markets, and are already posing important governance issues. Urbanization, migration and the decline of trust in public, private institutions and multilateral mechanisms is influencing our ability to mobilize collective action in order to tackle these challenges.
The future, in a very real sense, is likely to be very different from anything we’ve seen before. The speed, underlying dynamics and complexity of today’s challenges are fundamentally different from previous eras in history. How we confront these set of inter-related challenges will have implications for generations to come.
The Sustainable Development Goals (SDGs) are our answer to these challenges. However, they are only achievable if all stakeholders, governments, civil society, academics and the private sector work together and take collective action. This gathering today at the Responsible Business Forum is the perfect platform for discussing all our contributions to the SDGs and how to implement, innovate and finance the SDGs, with a special focus on elements like Circular Economy, Climate Action, Food and Nutrition, Urbanization, and Business and Human Rights. Today you will explore concrete initiatives and partnerships, between the public and private sector and among private companies and learn and share experiences across your countries.
Without the private sector, the SDGs seem unattainable. In less developed countries, the private sector accounts for 60 percent of GDP, while generating 90 percent of jobs and 80 percent of capital inflows. Private companies are also indispensable in providing goods and services, financing social and economic investments through taxes, and creating innovative solutions to help tackle development challenges.
The business case for the private sector to invest in the SDGs is also clear. By developing new business models that lead to reduced emissions, promote gender equality, and eradicate forced labour in supply chains we are well on our way to meeting sustainable development targets. By investing in innovative approaches to agriculture, cities, energy and health, we engage the needs of the base of the pyramid, and while creating new economic opportunities valued at US$12 trillion. Hence, SDGs create new business opportunities.
In addition, an ever better educated customer base and civil society demands that certain standards are adhered to. In this way the promotion of goodwill and reputation of companies is intimately connected to the alignment of business practices with SDG directions – be it human rights standards or environmental impact. We know also that staff retention is higher in companies that are considered to have good track records in this regard.
An essential element of the role of the private sector in implementing the SDGs is the need for private capital to be channeled to the right businesses models and SDG related investment opportunities.
The good news is that we are seeing a growing number of private assets being managed under environmental, social and governance (ESG) standards, 26% or $22.89 trillion of all investment in North America, Europe and Asia. Europe leads the way but in Asia less than one percent falls under ESG. The real opportunity now is to both grow the value of assets under ESG standards, while moving these assets from a do-no harm approach to a positive engagement one. Niche markets such as impact investing and blended finance can help redefine opportunities, vehicles and instruments to support this change. For instance, if we were to allocate only 10 percent of the annual ODA to leverage private sector investments, we would mobilize an additional US$100 billion of financing annually for developing countries.
In early 2018, as we launched the new UNDP Strategic Plan, we promised to embark on a transformation into the world’s most forward-looking, most widely networked development organization, one that could deliver 21st century solutions to the complex development challenges countries are tackling – whether eradicating poverty, overcoming economic crises or navigating massive transitions.
UNDP with its 24 offices across the Asia-Pacific region has been working with the private sector in the 36 countries we are covering to collaboratively tackle some of these issues. At this year’s RBF we have private sector partners from the big countries in the region like China, India and Indonesia; but in the smaller economies, the private sector is playing a crucial role as well and we are happy to have partners from Bhutan, Cambodia, Fiji, Laos, Maldives, Papua New Guinea, Sri Lanka, Vietnam and others who are attending this conference along with our country office management. I am inspired by the leadership demonstrated by the private sector in this region to move forward on the SDGs. UNDP has been working with over 100 companies across the region and last year we delivered USD 10 million in joint initiatives.
We have recognized with the SDG Impact initiative that a 5-7 trillion SDG funding gap cannot be closed by development aid alone. The private sector has the potential to unlock significant investment and economic opportunity for the SDGs. UNDP’s SDG Impact initiative aims to help bridge a portion of that gap. UNDP is uniquely placed to provide a unifying vision and “seal” for what it means to invest in the SDGs, is well-equipped to produce investor data and insights, and well-situated to collaborate with the private sector at the country level. SDG Impact is a one-stop shop for investors of all types - from profit-seeking to purely philanthropic organizations - to access the information, tools and resources they need to understand investment principles that enable progress on the SDGs. SDG Impact provides investors and businesses with the clarity, insights and tools required to support and certify their investments.
But the private sector is not only contributing financially, it is also putting their network and expertise to work in efforts to contribute to the SDGs. I would like to highlight several areas of existing partnerships:
First, we are working with partners to integrate the SDGs into their business and unlock new business opportunities. We have been working with Cisco Systems since 2000 to train students in Least Developed Countries (LDCs) for jobs in the internet economy, and now we are looking at ways to develop programs which will positively impact the SDGs in the areas of innovation, connectivity, infrastructure, agriculture and climate change. We have also been working with IKEA in India to bring employment and entrepreneurial opportunities to over a million women in India.
Second, we are promoting innovation while scaling up partnerships. For example, in China we are working with Coca Cola on a series of drinking water safety technologies. We are also working with Tencent on Big Data research for poverty and livelihood development solutions, as well as a global platform on innovation. We understand that new technologies and innovation emerging from the private sector and governments, can tackle development challenges at scale. Blockchain, big data, internet of things, and artificial intelligence are changing the way we identify development solutions. UNDP sees the centrality of innovations and is already partnering with private sector to use these new technologies and innovation for development. Here at the Forum, you can have a conversation with UNDP’s Innovation Ambassador for the Asia Pacific region, Sophia, who will speak to the importance of innovations and technology for the integration of the SDGs.
Thirdly, we are catalyzing opportunities to promote responsible business practices in operations. For example, we are exploring ways to work with IKEA and other companies on aligning the SDGs with their supply chains. We are also looking at ways to provide incentives to the private sector to drive human rights considerations throughout their companies from the farm, factory and up to the highest levels of management.
Fourthly, unlocking capital by offering a selection of investment ready opportunities. UNDP is prepared to engage with companies and the financial industry to support the proactive engagement of private capital for the SDGs and invest in high impact areas. To facilitate this UNDP is testing ideas and has established impact investment platforms and promoted Islamic Finance for measurable environmental and social results.
These are just a few highlights that can be further explored in the forum over the next couple of days. Our time is now, and as we shape 2030, we must plan together for the long haul.
On behalf of UNDP, I would like to thank our partners at the Responsible Business Forum, Global Initiatives and the venue host, the Marina Bay Sands of Singapore for working with us in shaping an exciting and sustainable agenda for the next two days.
I commend you for your commitment to contributing to the SDGs and to creating innovation for sustainable growth. We need your voice to shape the narrative further, that being responsible is not only right for business, but also good for business.