The United Nations Sustainable Development Goals (SDGs) were adopted by U.N. member states in 2015 as part of the U.N.’s 2030 Agenda for Sustainable Development. The SDGs take a broad approach to solving the most complex challenges of the 21st century by setting 15-year targets to promote responsible and equitable economic growth, social inclusion, and environmental protection.
There are 17 SDGs addressing a wide variety of issues, including poverty, health, education, gender equality, economic opportunity, and climate change, among others. An overarching principle of the SDGs is to “leave no one behind,” which entails empowering and supporting the most vulnerable members of society.
Individual countries have primary responsibility for setting their own policies and plans for meeting the SDGs, supported by a global partnership and commitment across nations. Progress toward the achievement of targets is tracked using a set of global indicators, and an SDG Progress Report is published annually by the U.N. Secretary-General.
Climate change and the environment are critical themes across the SDGs. Several of the goals explicitly address these topics. For example, Goal #13 is to “Take urgent action to combat climate change and its impacts.” Goal #7 is to “Ensure access to affordable, reliable, sustainable and modern energy.” Other goals involve ocean conservation and biodiversity, which are directly impacted by a changing climate.
While many of the remaining goals do not incorporate climate change directly, almost all of them can be impacted in a positive way by mitigating climate change. For example, Goal #2 is “Zero Hunger,” which may be increasingly difficult to achieve should climate change impact agricultural productivity and water supplies. Goal #3 is to “Ensure healthy lives and promote well-being for all at all ages.” Again, because climate change disproportionately affects more vulnerable populations, it has an indirect impact on the ability to meet this goal. Malnutrition, poor sanitation and vector-borne diseases such as malaria are significant contributors to negative health outcomes in developing countries, particularly for children. Climate change makes solving these issues harder than it otherwise would be.
In order to achieve the SDGs, a significant increase in public and private investment will be required. The financing gap in developing countries is estimated to be at least $2.5 trillion annually.
The U.N. Secretary-General has published a list of 15 “Key Asks” for regulators, the financial industry, shareholders and others in order to help meet the elevated financing requirements. One of the asks of the financial industry is to “Engage with fossil fuel companies, divest from those unwilling to shift their business models toward low carbon trajectories, and scale up investment in renewable energy and energy efficiency." Meanwhile, shareholders are asked to “Increase demand for greener, more sustainable investments of their assets, and for greater sustainability disclosure to increase accountability and transparency.”
Though the financing gap is currently large, there is more than enough public and private capital available to close it. At One Day In July, our environmental investing strategy, and particularly the impact portfolio, is designed to channel our clients’ capital away from legacy “brown” energy companies and toward business models that are better aligned with the SDGs.
1. UN.org, Sustainable Development Goals.
2. United Nations Secretary-General's Roadmap for Financing the 2030 Agenda for Sustainable Development, 2019-2021, July 2019.