Safaricom has joined the push to scale up private sector investment for sustainable development in a bid to finance the Sustainable Development Goals (SDGs).
The UN has announced that 30 influential leaders from the corporate world will work together over the next two years to free up trillions of dollars from the private sector to finance the SDGs.
Co-chaired by Oliver Bäte, CEO of Allianz, the Global Investors for Sustainable Development (GISD) Alliance was convened by Secretary-General António Guterres.
Increasing Rich-poor Divide
Safaricom joins the Johannesburg Stock Exchange, Bank of America, Citigroup, ICBC, Infosys, Investec, Santander, UBS and other prominent international corporations in the group.
“We face widening inequality, increased devastation from conflicts and disasters and a rapidly warming Earth. These leaders have seized our sense of urgency, recognizing that our pace must be at a run, not a crawl,” Guterres said.
He added that the Alliance is committing to cooperate across borders, across financial sectors and even with their competitors.
“Because it is both ethical and good business sense to invest in sustainable development for all people on a healthy planet,” he added.
The High-Level Dialogue on Financing for Development held during the recent UN General Assembly brought to attention the urgent need for increasing government spending on crucial sectors such as health, education, infrastructure and climate change.
Most developed countries have not met their commitments to ODA, while factors like poverty, corruption, and tax evasion limit domestic resources in developing countries.
The development finance needs are estimated at trillions of dollars per year, and even if funding from all public sources is maximized, there will still be a significant shortfall, making financing from the private sector imperative.
“Given the current state of the world in terms of growing inequalities; rising carbon emissions; growing global hunger; rising unemployment and social discontent, business leaders must play a larger role in ensuring their companies take the lead in societal transformation through business processes and services and not just through philanthropy,” said Michael Joseph, CEO, Safaricom.
No Shortage of Money
The UN’s research suggests that there is no shortage of money from the private sector which could be invested in sustainable development.
However, a combination of factors, including the policy environment, incentive structures and institutional conditions, tend to discourage the kind of long-term commitment that is needed.
The Alliance aims to use their expertise, influence and business acumen in devising ways to stimulate long term investment in development and speed up progress towards achieving the SDGs.
Over the next two years, the group will deliver solutions to unlock long-term finance and investment in sustainable development both at the company and system-wide levels.
It will also mobilize additional resources for countries and sectors most in need while also finding ways to increase the positive impact of business activities.
The group will also align business practices with the 2030 Agenda for Sustainable Development.
This move comes amidst a growing recognition in the corporate community that the continued success of their companies is inextricably linked to a sustainable future for the world.
The Secretary-General has established a timeline for actionable results over the life of the Alliance. Its work will be coordinated by the UN’s Department of Economic and Social Affairs.