The Make-or-Break Decade for the SDGs has begun

GLOBAL GOALS 

GLOBAL GOALS 

YEARBOOK 2021 

YEARBOOK 

The 

make-or-break 

decade 

has begun

This publication is kindly supported by: 

Arab African International Bank 

Audi 

BASF 

Bosch Group 

CEMEX 

Control Risks 

Corteva Agriscience 

CWS Group 

HOCHTIEF 

Inditex 

iPoint-systems 

Khalifa International Award for Date Palm and 

Agricultural Innovation 

Knorr-Bremse 

MAN 

Merck 

Philip Morris International 

Sakhalin Energy 

Symrise 

Vonovia 

Wilo Group 

The Global Goals Yearbook is a product of macondo publishing GmbH in support of the Sustainable Development Goals, and the advancement of 

corporate sustainability globally. This publication is intended strictly for learning purposes. The inclusion of company names and / or examples 

does not constitute an endorsement of the individual companies by the United Nations. 

2 Global Goals Yearbook 2020

“ 

H.E. António Guterres 

UN Secretary-General 

Secretary-General’s remarks to the 

High-Level Replenishment Conference 

for the Peacebuilding Fund, 

January 26, 2021 

We need a renewed approach to 

multilateralism and international 

cooperation. 

An approach that goes beyond 

crisis response and boosts longterm 

investments in prevention 

and peacebuilding, hand-in-hand 

with our efforts to deliver the 

Sustainable Developments Goals. 

To secure a better future, we need 

to increase support to women and 

young people as agents for peace 

and stewards of inclusive 

development. Without their full 

participation, neither peace nor 

prosperity can be sustainable. 

Global Goals Yearbook 2021 

3

QUOTE 

3 H.E. António Guterres, 

United Nations 

Secretary-General 

LOOKING AROUND 

118 Redefining Multilateralism 

Garry Jacobs, 

Donato Kiniger-Passigli, 

Prof. Dr. Alexander Likhotal 

FRAMING THE DEBATE 

6 Sustainability Between Justice 

and Urgency 

Dr. Elmer Lenzen 

12 The Green New Deals: Europe 

and the United States in 

Comparison 

Jonathan Fordyce 

132 How to Revive Multilateralism in 

a Multipolar World? 

Josep Borrell Fontelles 

136 Open Societies versus Digital 

Autocratic Experiments 

Prof. Dr. Dr. Stefan Brunnhuber 

16 Measuring Stakeholder 

Capitalism 

Madeleine Hillyer 

20 Goodbye, Non-financial 

Reporting? 

26 Insights into the New 

EU Reporting Obligations 

Interviews with Christoph Töpfer, 

Kai Michael Beckmann, and 

Prof. Dr. Alexander Bassen 

34 A World Where Profits Are 

Derived from True Value 

Creation, not Value Extraction 

Interview with 

Julian Hill-Landolt 

38 What Does Good SDG 

Management Look Like? 


46 Is Covid-19 Slowing Progress 

Toward the SDGs? 

Yes, Say Experts 

Tove Malmqvist 

50 Phoenix Rising 

Frank Grice 

6Sustainability Between 

Justice and Urgency

ZOOMING IN 

38 

What Does Good SDG 

Management Look Like? 

LEAVE NO ONE BEHIND 

56 Audi 

58 Control Risks 

60 Khalifa International Award for Date Palm and 

Agricultural Innovation 

64 Merck 

66 Sakhalin Energy 

68 UNICEF 

CIRCULAR ECONOMY 

72 CWS Group 

74 The High Council for Sustainable Development 

(Nohaltegkeetsrot) Luxembourg 

50 

Phoenix Rising 

CO 2 

CLIMATE CHANGE 

78 Arab African International Bank 

80 Bosch Group 

82 CDP, ICLEI, WBCSD, We Mean Business Coalition 

86 Corteva Agriscience 

88 Knorr-Bremse 

90 MAN 

92 Symrise 

94 UNEP 

SUSTAINABLE CITIES 

118 

Redefining 

Multilateralism 

98 CEMEX 

100 HOCHTIEF 

102 Vonovia 

104 Wilo Group 

SUPPLY CHAIN 

108 BASF 

110 Inditex 

112 iPoint-systems 

114 Philip Morris International



Sustainability 

Between Justice 

and Urgency 

We are experiencing the allgoes-with-everything 

crisis: 

climate change, pandemics, 

zoonoses, species extinction, 

shrinking resources, a 

widening gap between rich 

and poor, digitalization, 

disruptions in the economy, 

the rise of populists and 

autocrats, and so on. 


Publisher 

Global Goals Yearbook 

More and more people are realizing 

that business as usual is no longer an 

option. We need change, and we need it 

as quickly and as sustainably as possible. 

UN Secretary-General António Guterres 

therefore is calling for a “Decade of action.” 

Guterres, together with experts, 

politicians, and business leaders, knows 

that the 2020s are the make-or-break 

years for sustainable development. 

Despite some successes in development 

and environmental politics, progress is 

far from sufficient to achieve real sustainable 

development. While we now know 

relatively well what needs to be done and 

changed in many areas, the changes are 

not progressing fast enough. Until now, 

economics have largely ignored planetary 

boundaries and most sustainability 

problems. At least this is changing: Key 

concepts such as “purpose,” “growth,” 

and “value” are being rethought and 

reassessed. This, in turn, will radically 

change the rules of the game in business. 

A tension between ecological modernization 

on the one hand, and structural 

ecologization on the other, is increasingly 

shaping the sustainability debate. In the 

process, they become the reason for dispute: 

Representatives of a modernization 

agenda tend to focus on reform from 

within and therefore call for technological 

innovations and market incentives. 

Representatives of an ecological turnaround, 

on the other hand, argue that 

the fight against climate change must 

take precedence over everything else 

and call for disruptive sufficiency and 

degrowth solutions. 

Our Common Future 

At first glance, this is a typical discussion 

between different interest groups 

and their influence on current developments. 

At second glance, however, it is 

also a fundamental discussion about the 

question of who gets the sovereignty of 

interpretation over the shaping of our 

future. If the future belongs to our children, 

don’t they also have to decide about 

it? This implies the reinterpretation of 

the concept of intergenerational justice. 

The term is not entirely new, as it already 

appears in the most frequently 

quoted sustainability definition by the 

Brundtland Report Our Common Future 

from 1987: “Sustainable development 

is development that meets the needs of 

the present without compromising the 

ability of future generations to meet 

their own needs.” 

What is new, however, is the question 

of discourse sovereignty derived from 

this definition. The geographer, environmental, 

and urban researcher Sybille 

Bauriedl describes this very aptly: “For 

50 years now, the urgency of securing 

the long-term basis of human existence 

– and human existence itself – has been 

pronounced. The study ‘Limits to Growth’ 

(Meadows 1972) was only one wake-up 

call of very many. The Fridays for Future 

movement brought the increasingly comprehensive 

crisis diagnoses back onto the 

public agenda, calling for the sustainability 

goals of intergenerational equity and 

global justice. Since then, more and more 

terms have entered the environmental 

debate that are used synonymously. The 

most discursively powerful terms are 

currently ‘socio-ecological transformation,’ 

‘degrowth,’ ‘green growth,’ ‘just 

transition,’ and ‘climate neutrality.’ >> 


7

What these terms have in common is that 

they invoke the positive utopia of a world 

with prosperity for more people without 

irreversible environmental degradation 

and consider a shift toward emissionminimized 

modes of production to be 

possible. However, the paths to the goal 

are very different: They include a new 

social contract, common good economics 

instead of capitalist appropriation, 

or decoupling economic growth from 

environmental consumption.” 

“We have to ask ourselves why we live 

too much in today and for today,” German 

Chancellor Angela Merkel recently 

said. She recommended the Brundtland 

Report not only as a contract between 

generations, but also as a blueprint for 

a social contract and a goal of the state. 

Merkel believes that this broader view 

also provides a good justification for the 

current court decisions on climate issues. 

Generational justice – from a 

factual concept to a controversial 

concept 

Hans-Jürgen Urban and Christoph Ehlscheid 

presented an excellent essay on intergenerational 

justice in 2020, excerpts 

I quote below: “Intergenerational justice 

is a core vocabulary of the contemporary 

debate on the present and future of the 

welfare state. Terms such as ‘generational 

solidarity’ and ‘generational war’ provide 

a framework within which a variety of 

interpretations of generational relations 

operate. 

“Welfare state discourses often speak of 

‘welfare state generations.’ This refers to 

the ‘exchange and interrelationship of 

age groups linked by flows of benefits 

and funding.’ Accordingly, the employed 

from the middle generation finance the 

retirement income of the older generation 

in the form of pensions and annuities 

from their earned income through 

contributions and taxes. 

“The concept of ‘equity’ is also ambiguous. 

The theories of philosophers John 

Rawls and Michael Walzer have been 

particularly influential. According to 

Rawls, the task of justice theory is to 

find ‘principles of social justice’ on which 

a society can agree .... Best known for 

this is his dictum of ‘justice as fairness.’ 

Constitutive of Rawls’ concept of justice 

are two principles: According to the 

principle of liberty, everyone has an 

equal right to the same endowment of 

basic freedoms; and according to the 

principle of difference, economic and 

social inequalities are permissible only if 

they confer the greatest possible benefits 

on the least advantaged.” 

To whom do we owe solidarity? 

Rawls is also one of the most important 

representatives of modern contract 

theory. The models of fair and 

intergenerational justice are based on a 

common idea of a social contract. This 

is understood as a concept to morally 

and institutionally legitimize statal systems. 

Every citizen automatically joins 

this contract by birth or naturalization. 

And therein lies a problem for some: 

“Why should we feel bound by a social 

contract that we have never actively 

signed? To whom do we owe solidarity 

in the first place?” asks economist Marcel 

Fratzscher provocatively in an interview 

in the weekly ZEIT, and he answers this 

himself: “We have noticed by now that 

we live in a global world. None of the 

major challenges today, neither the 

climate crisis nor the pandemics, can 

be solved nationally; they do not stop 

at borders. So we can’t be indifferent 

to what people are doing in Asia, for 

example. Today, however, two-thirds 

of the world’s population live there, 

almost 40 percent in China and India. 

Climate protection helps them, too; it 

helps even more the countries in Africa 

that are poorest, and in those countries, 

in turn, the very poorest. They’re the 

first to be hit by the droughts and the 

floods, so we owe them solidarity.” 

From the discourse of inequality to 

the discourse of generation 

Back to Hans-Jürgen Urban and Christoph 

Ehlscheid: “The new capitalism is 

not only more unequal and individualistic 

than its predecessor. It is also in 

a systemic ‘economic-ecological pincer 

crisis.’ Capitalist economic growth 

has mutated from problem solver to 

problem driver. While it traditionally 

contributes to increasing prosperity and 

defusing social distribution conflicts, 

today it forces the unequal distribution 

of income and wealth and the overexploitation 

of nature. It promotes social 

division by increasing the wealth of the 

rich and at the same time pushing more 

and more people into precarious living 

conditions. And it takes up so much of 

nature’s resources that its regenerative 

capacity is overtaxed. Therefore, traditional 

strategies to stimulate growth do 

not lead out of the crisis, but further 

into it. 

“Instead of this, the idea of an inclusive 

concept of justice includes not only intergenerational 

money flows but also 

the distribution of other social goods in 

any generational balances in the sense 

of Michael Walzer, and combines the 

justice criteria of the respective spheres 

of distribution into an integrated distribution 

model with as few contradictions 

as possible: 

► Securing the standard of living as a 

cross-generational promise of benefits 

► Generationally fair use of nature 

“The planetary limits of utilization at the 

same time mark the limits of material 

value creation and thus the framework 

within which intergenerational distribution 

processes must operate.” 



You can’t do business in a broken 

world 

Industry and trade have a decisive role 

to play in this process. They have the 

money, the know-how and the capacities 

to make sustainability more widespread. 

Doing so is not just a question of morality 

or purpose; it is also about profit 

and the realization that the source of 

prosperity could dry up. The following 

graphic shows the scope and risks using 

the current climate discussions as 

an example: 

Embracing this means a real rethink in 

companies. “The business of business is 

business” said Nobel Prize winner and 

economics professor Milton Friedman, 

meaning that companies should focus 

on making money. 

What is wrong with this sentence? It is 

simply too simplistic: The economy is 

part of society, which in turn is part of 

the planet. If we ruin that, then neither 

society nor the economy will function. So 

companies need to look at their impact 

on the environment and on society. >> 

Source: Germanwatch 

REAL AND FINANCIAL ECONOMY EQUALLY AFFECTED 

Greenhouse gas neutrality by 2045 

Impact on the real 

economy or more 

restrictive lending 

policies 

Transition risks 

• Climate policy 

• Technology 

• Consumer preference 

• and more 

Real Economy 

• Amortization of 

corporate assets 

Financial Economy 

Physical risks 

• Sea level rise 

• Droughts 

• Floods 

• And more 

Liability and lawsuit risks 

• Due to previous emissions 

• Risks in the supply chains 

• Due diligence of corporate 

management 

• Stranded Assets 

• Innovation / 

Disruption 

• Supply Chain 

risks 


• Change in the 

profitability of 

companies 

• Change in the level 

of prosperity 


• Financial 

market risks 

(equities, bonds, 

commodities) 

• Credit risks 

• Insurance risks 

Changes in the real 

economy affect 

financial markets 


9

Linda Lacina of the World Economic 

Forum rightly says: “Putting the planet 

over profits isn’t a ‘nice-to-have’ – it’s 

a must have for businesses looking for 

long-term survival. Nearly half of GDP 

is dependent on nature. But while more 

and more leaders are embracing that 

simple principle of stakeholder capitalism, 

there’s still more work to do and 

plenty of leaders talking about change 

and coming just short of taking action. 

No leader wants to be consciously disruptive, 

she says. They’re parents and 

citizens, too. I think that they are often 

trapped in a paradigm which they can’t 

get out of.” 

Katrin Muff is an internationally recognized 

thought leader on transformation 

and sustainability. She is the director 

of the Institute for Business Sustainability 

in Lucerne, and in a newspaper 

interview she complements Lacina’s 

forementioned thoughts: “Apparently, 

this is also convincing more and more 

people in the boardrooms. Recently, 180 

CEOs of well-known US corporations 

such as Amazon and Walmart vowed 

in a Statement of Corporate Purpose to 

benefit their employees, society, and the 

environment in the future – instead of 

just their shareholders. Is the economy 

just becoming green and good? 

“In companies that set out in this way, 

four things change. First, the internal 

culture, which is reflected not only in 

new criteria for promotion, but also in 

concrete corporate goals. Climate goals, 

for example, must be verifiable. If a 

company promises to become climate 

neutral by 2050 but has no short-term 

implementation plans, nothing happens. 

Secondly, something like this can only 

be achieved together with others. And 

to do that, a company has to see itself 

as part of society instead of just focusing 

on itself. It’s about more. 

“Thirdly, we need a supervisory board 

that is fit for the future. The same type 

of person should not always sit on it; 

more diverse supervisory boards bring 

strategic corporate issues more strongly 

to the table. At a supervisory board meeting, 

questions are no longer only asked 

about return on sales and risk minimization, 

but also about new business 

areas that help improve society or solve 

environmental problems. This is the 

fourth point: How does all this show up 

in new services and products?” 

Metrics can create momentum for 

stakeholder capitalism 

Setting clear metrics for management 

that align with company purpose is an 

important step for boards. “Business lead- 



ers are increasingly implementing business 

models that create value based on 

stakeholder needs,” says Klaus Schwab, 

Founder and Executive Chairman of 

the World Economic Forum. “While 

there’s increasing momentum towards 

stakeholder capitalism, many businesses 

are also looking for practical solutions to 

help them fully understand and address 

the concerns of all their stakeholders.” 

A new white paper, “The Future of the 

Corporation: Moving from Balance Sheet 

to Value Sheet,” provides analysis about 

the important role boardrooms and corporate 

governance play in addressing the 

environmental, social, and governance 

(ESG) challenges their companies face. 

This includes leadership-level actions, 

such as aligning company purpose and 

incentives with transparent goals and 

KPIs, increasing board diversity, and 

adopting the common stakeholder capitalism 

metrics to measure and manage 

global risks and opportunities related 

to business, society, and the planet. 

Note: The text passages by Urban and 

Ehlscheid were published under the Creative 

Commons license “CC BY-NC-ND 3.0 DE - 

Attribution - Non-Commercial - No 

Derivative Works 3.0 Germany.” 

Authors: Hans-Jürgen Urban, Christoph 

Ehlscheid for Aus Politik und 

Zeitgeschichte/bpb.de 

THE MAKE-OR-BREAK DECADE HAS BEGUN 

In our current issue of the Global Goals Yearbook, we examine the 

called-for Decade of Action on three levels: 

1. Framing the debate 

In this section, we trace how the sustainability debate has evolved from 

an inequality discourse to an equity discourse. Such models of justice 

need rules and policy prescriptions. We therefore report on the Green 

New Deals in Europe and the United States and the introduction of 

metrics, reporting standards, and the expanded concept of materiality. 

Common to all aspects is the attempt to translate the broad field of 

sustainability into numbers. After all, numbers are considered facts, they 

can be checked, and that is how judgments can be made. In the second 

part, we look at the question of concrete implementation in operational 

management processes and internal control systems. 

2. Zooming in 

The pandemic has revealed the vulnerability of the interconnected world: 

Building up the economy in the form it was before the pandemic is no 

option. The economic recovery plans offer a true chance for sustainable 

transformation in the sense of the UN development goals. We have 

defined the eight transformation areas that we will explore more actively. 

All best practices will be assigned to these topics. In this edition we will 

cover the aspects of sustainable purpose, “leave no one behind,” the 

circular economy, net-zero strategies, and sustainable cities. 

3. Looking around 

We will only solve global challenges together. This requires a solidary and 

cooperative world community. The concept of “rule of law” is therefore 

regarded as a guiding principle in international politics. It finds its 

concrete expression in multilateralism. In this Yearbook, we shed light on 

the origins and development of this concept. Although multilateralism 

has suffered considerably recently – not only, but also because of 

ex-President Trump. EU Commissioner Joseph Borrell therefore explores 

the question of how to revive multilateralism in a multipolar world. Finally, 

Stefan Brunnhuber of the Club of Rome looks at the tensions between 

democracies and autocracies and their ability to find solutions to Agenda 

2030. 


11

The Green New Deals: 

Europe and the 

United States 

in Comparison 

In response to growing 

concerns about climate, 

biodiversity loss, pollution, 

and growing inequality, 

government bodies in 

Europe and the United 

States have proposed (and 

in some cases – adopted) 

“Green New Deals.” The 

aim of these deals is to 

decarbonize and keep 

the climate crisis to a 

minimum while creating 

employment and ensuring 

a just transition. 



Jonathan Fordyce 

the SustainAbility Institute 

by ERM 

The American Green New Deal 

The Green New Deal resolution was 

delivered by Democrats Alexandria 

Ocasio-Cortez and Edward J. Markey 

on February 5, 2019, under the title 

“Recognizing the duty of the government 

to create a Green New Deal.” The resolution 

was non-binding, meaning that 

even if Congress approved it, nothing 

would materialize into law. On March 

26, 2019, the resolution was denied 

in a 57–0 vote with many criticisms 

focusing on the ability to fund the deal 

and the potential for increased taxes 

and the deal’s subsequent impacts on 

the economy. 

Since this development, and differing 

from the Green New Deal, US President 

Joe Biden revealed a $2.3 trillion infrastructure 

plan to address climate change. 

The plan includes $174 billion to boost 

the electric vehicle market and $100 

billion to update the country’s electric 

grid and make it more resilient to climate 

disasters. 

The key focus areas of the Green New 

Deal were around decarbonizing the 

economy through the phasing out of 

fossil fuels and transitioning to 100 percent 

renewable energy. The resolution 

also aimed to fix societal issues such as 

economic inequality, poverty, and racial 

injustice. Some of the key takeaways 

from the resolution were: 

• Achieve net-zero emissions through a 

fair and just transition 

• Create new high-paying jobs 

• Invest in infrastructure to sustainably 

meet the needs of the 21st century 

• Promote justice and end inequality 

The European Green New Deal 

On December 11, 2019, the new European 

Union Commissioner, Ursula 

von der Leyen, presented the European 

Green Deal. The Green Deal resets the 

Commission’s commitment to tackling 

climate change while also transitioning 

the economy toward a new growth strategy. 

“Our goal is to reconcile the economy 

with our planet, to reconcile the way 

we produce, the way we consume with 

our planet and to make it work with our 

people,” von der Leyen stated. The deal 

was adopted in 2019 and includes 50 

policy measures with a legally binding 

target of reducing EU emissions to net 

zero by 2050. The four key ambitions of 

the Green New Deal are: 

1. EU to become climate neutral by 2050 

2. Protect humans, animals, and plants 

by cutting pollution 

3. Help companies become world leaders 

in clean products and technologies 

4. Ensure a just and inclusive transition. 

The deal covers 10 policy areas, which are 

depicted below with an accompanying 

roadmap for legislative release dates: >> 


13

Increasing the EU’s Climate 

ambition for 2030 and 2050 

Transforming the EU’s 

economy for a 

sustainable future 

Mobilising research 

and fostering innovation 

A zero pollution ambition 

for a toxic-free environment 

Supplying clean, affordable, and 

secure energy 

Mobilising industry for a 

clean and circular economy 

The 

European 

Green 

Deal 

Preserving and restoring 

ecosystems and biodiversity 

From “Farm to Fork”: a fair, healthy, and 

environmentally friendly food system 

Building and renovating in an 

energy and resource efficient way 

Accelerating the shift to 

sustainable and smart mobility 

Financing the transition 

Leave no one behind 

(Just Transition) 

The EU as a 

global leader 

A European 

Climate Pact 

Source: 

The European Commission 

What is the corporate relevance of 

these policies? 

In both Green Deals, there is a call for 

private-sector involvement. The role of 

the private sector in these policies can 

be categorized into five core themes. 

• Innovation and digitalization 

Fostering sustainable innovation and 

creating new business models present 

an opportunity for business to differentiate 

and capture new markets. The EU 

is encouraging entrepreneurship and 

innovation through tax-reform incentives 

that could encourage sustainable 

behavior. 

Leveraging digital innovation is a key focus 

of both deals; the EU emphasizes the 

need for digitalization in the fight against 

the climate crisis and to transform the 

economy to meet their ambitions. Digital 

and disruptive 

technologies can 

play a key role in delivering 

climate ambitions, 

and the private sector can be 

the fundamental enabler. 

The focus of both these policies is 

around reducing GHG emissions, and 

consequently there is significant appetite 

for low-emission technologies and 

sustainable products. The private sector 

will be able to capitalize on the new 

markets and jobs that will emerge in 

the face of the transition to decarbonize 

these economies. 

• Collaboration 

Climate change is a global issue, and 

cross-border collaboration and action 



is necessary. Both deals back the need 

for international partnerships to tackle 

what is a global, borderless crisis. “The 

involvement and commitment of the 

public and all stakeholders is crucial 

to the success of the European Green 

Deal” (EU Green Deal, page 22). Green 

alliances form part of the EU strategy 

in terms of collaboration as they look 

to strengthen sustainability policy globally. 

The focus here is for partnerships 

in Africa, Latin America, the Caribbean, 

Asia, and the Pacific. To foster collaboration, 

the Commission introduced the 

European Climate Pact, which brings 

together regions, local communities, 

civil society, and businesses to give them 

a voice and space to share and develop 

climate information and ambitions. 

Digitalization is a key driver of climate 

action, and with smart infrastructure 

comes the need to implement crossborder 

collaboration. If there are international 

leaders who do not share 

each other’s ambitions, issues such as 

carbon leakage become a risk, and the 

vision of these policies becomes ineffective. 

Collaboration will also necessitate 

redefining trade policies to ensure that 

imports comply with the standards of 

the respective nations in terms of their 

sustainability ambitions. 

• Transparency 

A significant component of any green 

policy is the need for more robust and 

transparent sustainability reporting. 

The desire for reliable data is imperative 

to the ambitions of both policies 

and is something that organizations 

need to be conscious of in terms of 

the impacts of these policies on their 

operations. The EU in particular has 

outlined 50 policies that form the basis 

of their Green Deal. Additionally, the 

new European Climate Law underpins 

the EU Green Deal. The Art of Alignment 

highlights investors’ calls for a 

standardized methodology that will 

encompass sustainability reporting and 

deliver trustworthy data. The report suggests 

robust data can help organizations 

better communicate long-term value, 

understand sustainability, and improve 

stakeholder communications. In so doing 

businesses can avoid green-washing 

and make sustainable investments more 

tangible and accessible, which will drive 

capital toward them. 

• Investment 

The magnitude of investment required 

(€260 billion annually in the EU) to 

deliver the ambitions of these policies 

requires the mobilization of both the 

public and private sectors. The use of 

sustainable investment funds is vital 

to driving sustainable transformation. 

One way to do this is through effective 

carbon pricing. The idea is that this will 

stimulate behavioral changes and foster 

public and private investment as climate 

risks are priced in. The CDP has extensive 

data on carbon pricing and believes that 

by putting a price on carbon, decisionmakers 

are able to effectively make the 

transition to a low-carbon economy a 

core part of business. 

Long-term signals are crucial for driving 

capital to green investments. Importantly, 

the classification of green investments 

and transparency of data is needed to 

encourage capital inflows. In the EU, 

the rulebook is set by the EU Taxonomy. 

Investments that are easily identifiable as 

sustainable make it easier for investors 

to know which are credible, and thus to 

invest their capital. The EU currently provides 

40 percent of the world’s climate 

finance, and the hope is that through 

policies like these, more countries and 

regions will deliver the investment that 

is needed. 

• Just transition 

Ensuring a just transition is prevalent 

in both pieces of policy. The visions of 

these policies are grand, and with any 

change of this magnitude, trade-offs need 

to be managed to ensure nobody is left 

behind. According to an article published 

by SustainAbility, “Benefits for All: Engagement 

for a Just Energy Transition,” 

under-resourced communities bear the 

brunt of climate change. It is the role of 

all stakeholders, including business, to 

ensure the transition is just; in the EU, 

this will be backed by the Just Transition 

Mechanism. This will focus on the social 

and economic costs of the transition in 

the areas that are most impacted, and 

it will support business in projects, reskilling 

redundant employees, and the 

creation of new workplaces. 

Governments are calling for privatesector 

mobilization and support in 

tackling the climate crisis. There is an 

opportunity for business to play an active 

role in transitioning the world toward 

a low-carbon economy while ensuring 

no one is left behind. The deals propose 

radical changes that present a huge opportunity 

for business to innovate and 

create new markets, while also making 

a significant contribution to the fight 

against the climate crisis. 


15


Measuring 

Stakeholder 

Capitalism 

Madeleine Hillyer 

World Economic Forum 

The World Economic Forum 

released a set of universal 

environmental, social, and 

governance (ESG) metrics 

and disclosures to measure 

stakeholder capitalism that 

companies can report on 

regardless of their industry 

or region. Organized around 

the pillars of principles of 

governance, planet, people, 

and prosperity, the identified 

metrics and disclosures align 

existing standards, enabling 

companies to collectively 

report non-financial 

disclosures. 

The report, Measuring Stakeholder 

Capitalism: Towards Common 

Metrics and Consistent Reporting 

of Sustainable Value Creation, 

comes at a pivotal moment. The social 

unrest, economic inequalities, and racial 

injustice exacerbated by the Covid-19 

pandemic has accelerated demand from 

business, governments, standards bodies, 

and NGOs for a comprehensive, globally 

accepted corporate reporting system. 

“This is a unique moment in history to 

walk the talk and to make stakeholder 

capitalism measurable,” says Klaus 

Schwab, Founder and Executive Chairman, 

World Economic Forum. “Having 

companies accepting, not only to 

measure but also to report on, their 

environmental and social responsibility 

will represent a sea change in economic 

history.” >> 


17

These metrics will 

provide clarity 

to investors and 

other stakeholders 

and ensure capital 

is aligning to 

drive progress 

on the SDGs. 

That’s stakeholder 

capitalism in 

action. 

Brian Moynihan, Chairman and 

CEO of Bank of America, and Chairman of the 

International Business Council 

The stakeholder capitalism metrics and 

disclosures, developed in collaboration 

with Deloitte, EY, KPMG, and PwC, reflect 

an open consultation process with corporates, 

investors, standard-setters, NGOs, 

and international organizations. They 

are designed to provide a common set 

of existing disclosures that lead toward 

a coherent and comprehensive global 

corporate reporting system. 

In parallel to this work, the World 

Economic Forum has also collaborated 

with the Impact Management Project 

to bring together the efforts of the five 

leading independent global framework 

and standard-setters (CDP, the Climate 

Disclosure Standards Board, the Global 

Reporting Initiative, the International 

Integrated Reporting Council, and the 

Sustainability Accounting Standards 

Board) to work toward a comprehensive 

corporate reporting system and a statement 

of intent that works as a complement 

to the common metrics released 

today. 

Companies see the importance of social, 

climate, and other non-financial factors 

as critical for their long-term viability 

and success. Some 86 percent of executives 

surveyed by the Forum agreed that 

reporting on a set of universal ESG disclosures 

is important and would be useful 

for financial markets and the economy. 

Expert views 

“Companies have to deliver great returns 

for shareholders and address important 

societal priorities,” says Brian Moynihan, 

Chairman and CEO of Bank of America, 

and Chairman of the International Business 

Council. “These metrics will provide 

clarity to investors and other stakeholders 

and ensure capital is aligning to drive 

progress on the SDGs. That’s stakeholder 

capitalism in action.” 

“As the UK works in partnership with Italy 

toward hosting the COP26 climate change 

conference in Glasgow in November 2021, 

I welcome the work of the World Economic 

Forum’s International Business 

Council in creating a set of common 

metrics for reporting sustainable value 

creation,” says Mark Carney, Finance 

Advisor to the UK Prime Minister for 

COP26 and United Nations (UN) Special 

Envoy for Climate Action and Finance. 

“Through this work you are demonstrating 

to shareholders, stakeholders and 

society at large that the private sector is 

committed to measuring and improving 

its impacts on the environment as part 

of the transition to a low-carbon future. 

I encourage governments, regulators, the 

official accounting community and voluntary 

standard setters to work with the 

IBC toward creating a globally accepted 

system of sustainability reporting based 

on this project’s groundbreaking work.” 

“The disruptions of 2020 have underscored 

the critical importance of organizations 

managing and reporting their 

impact on the economy, the environment 

and society, and their increasing connection 

to long-term enterprise value 

creation,” says Punit Renjen, CEO, Deloitte 

Global. “Deloitte is pleased to have 

led the development of the Principles 

of Governance pillar and collaborated 

on this project with so many respected 

organizations. We hope our work supports 

organizations as they move toward 

consistent reporting of ESG metrics 

and disclosures in mainstream annual 

reports, as ultimately, this is how the 

business community will make greater 

progress against the Sustainable Development 

Goals.” 

“The time is now for companies to broaden 

their engagement with stakeholders,” 

says Carmine Di Sibio, EY Global 

Chairman and CEO. “The combined 

impacts of climate change, Covid-19 

and economic inequality contribute to 

the urgency for businesses to embrace 

long-term, sustainable value creation 

and prioritize the needs of people and 



planet and the creation of broad-based 

economic prosperity.” 

“As businesses become more acutely aware 

of their role in addressing societal and 

environmental issues, moving toward 

a common set of ESG-focused metrics 

will help ensure that we all collectively 

make a difference where it counts,” says 

Bill Thomas, Global Chairman and Chief 

Executive Officer, KPMG International. 

“Reporting on ESG factors like carbon 

emissions and human rights and other 

key metrics will not only help inform 

investors while helping companies control 

their full corporate value, it has 

the power to realign capitalism for the 

benefit of broader society.” 

“Robust non-financial reporting is a crucial 

element of the systemic economic 

reform the world needs to address issues 

like climate change and social inclusion, 

and we were pleased to be able to collaborate 

on this initiative and lead on 

the Planet pillar of this work,” says Bob 

Moritz, Global Chairman, PwC. “Stakeholders 

– including investors, but also 

policymakers, consumers, and employees 

– need more rounded, comparable, and 

robust information to make decisions. 

Get that information flowing, align market 

incentives against performance on 

these metrics, and a better tomorrow 

becomes possible.” 

Companies are encouraged to report 

on the full set of metrics in their mainstream 

reporting. Measuring Stakeholder 

Capitalism: Towards Common Metrics 

and Consistent Reporting of Sustainable 

Value Creation recommends a 

“disclose or explain” approach when 

certain metrics are not feasible, not 

relevant, or difficult to implement immediately. 

The report also recommends 

that each company apply its own view of 

dynamic materiality, reporting on what 

is deemed material to its business and 

stakeholders. The metrics are centered 

on four pillars: 

PEOPLE 

Reflects a company’s equity and its 

treatment of employees. Metrics 

include diversity reporting, wage 

gaps, and health and safety. 

PLANET 

Reflects a company’s dependencies 

and impacts on the natural 

environment. Metrics in this pillar 

include greenhouse gas emissions, 

land protection, and water use. 

PROSPERITY 

Reflects how a company affects 

the financial well-being of its 

community. Metrics include 

employment and wealth generation, 

taxes paid, and research and 

development expenses. 

PRINCIPLES OF 

GOVERNANCE 

Reflects a company’s purpose, 

strategy, and accountability. This 

pillar includes criteria measuring 

risk and ethical behavior. 

Report 

Measuring Stakeholder Capitalism: 

Towards Common Metrics 

and Consistent Reporting of 

Sustainable Value Creation 

Published 

22 September 2020 

https://bit.ly/3hLQRdL 


19

Goodbye, 

Non-financial Reporting? 

The sustainability-related pressure on the financial industry 

and economy is massively increasing. Although there is 

much accordance on what sustainability reporting seeks 

to achieve, there is still confusion about the fragmentation 

in the multiplicity of initiatives, standards, and stakeholders 

to achieve these goals. Finally, there are signs of improvement: 

Increasing state regulation is beginning to address the 

challenge of turning businesses toward a zero-emissions and 

zero-exploitative future. 

In the course of the pandemic recovery plans, sustainability 

issues are becoming even more relevant: Covid-19 proved to 

be a catalyst for ruthlessly exposing flaws and weaknesses 

in the system. Environmental, social, and governance (ESG) 

aspects are – in the eyes of many – the right answer to 

reboot the economy as well as to add resilience to businesses 

and societies. 



Sarah Kaplan, from the Canadian law 

firm McCarthy Tétrault LLP, writes: “Governments 

are looking to ‘build back better’ 

by investing in green infrastructure 

and emission-reduction initiatives, or by 

issuing sustainability bonds – measures 

that are designed to drive post-Covid 

economic recovery and growth. Industry 

is also looking to find its innovative 

edge and competitive advantage in a 

lower-carbon economy – announcements 

from companies committing to 

net-zero carbon emissions are now a 

regular occurrence.” 

In the end, the pandemic might not 

only have damaged the economy, but 

also probably changed our behavior in 

many ways. Online meetings are replacing 

business trips. City center retail is 

clearly losing out to online platforms. 

And those who are rich have more of an 

educational advantage than ever before 

in a digital school landscape, etc. 

Again Sarah Kaplan: “The need for more 

responsive risk management approaches 

has put a spotlight on ESG as an important 

factor not only in creating value for 

organizations, but also enabling them 

to be more nimble in dealing with risks 

to business, such as climate change. In 

particular, the pandemic has highlighted 

the need to quantify and manage these 

risks. Diversity and inclusion are also 

being increasingly seen as essential to 

boosting the value of companies.” 

Simplification is a must 

The question, therefore, is no longer if 

companies have to change to adapt to the 

new demands, but how we can measure 

them if they really do. Since the turn of 

the millennium, a confusing landscape 

of sustainability reporting initiatives has 

emerged: to meet the evolving information 

needs of the investment community 

and to respond to the growing expectations 

of other stakeholders. As a result, 

these initiatives call out for regulators 

to harmonize and streamline ESG disclosure 

standards. 

The establishment of a globally accepted 

ESG standard, for example, would enable 

all of us to assess and compare 

companies’ sustainability performance 

in a more meaningful and efficient way. 

One thing is clearer than ever before: The 

race to establish ESG reporting standards 

must also be a race toward simplification. 

The international community is now 

(finally) moving in this direction. Yet, an 

ironic footnote remains: The struggle to 

overcome fragmentation is itself complicated, 

fragmented, and diffuse. But it is 

going in the right direction! A visible step 

toward this was the 2021 publication 

Common Metrics for Stakeholder Capitalism 

by the World Economic Forum (WEF). 

THESE ARE THE MAIN DRIVERS: 

1. The financial sector 

Probably the biggest source of momentum 

has come from the investors. They 

have been looking at ESG for a long time, 

but for years sustainable investments 

were marginalized. Today, the situation 

is changing at a dramatic pace. BlackRock 

CEO Larry Fink stands for this change: 

Fink was one of the first leading investors 

who recognized the sign of the times. 

In his annual letters to BlackRock, Fink 

is turning up the heat. In January 2021 

he wrote: “We strongly support moving 

to a single global standard, which will 

enable investors to make more informed 

decisions about how to achieve durable 

long-term returns.” 

The private investors are also finally being 

joined by state actors. In particular, 

central banks, prudential regulators, 

and stock exchanges are all now fully 

engaged in these debates. 

2. The European Union 

The European Green Deal is a significant 

roadmap for a sustainable EU economy. 

EU leaders want to achieve this goal by 

viewing climate and environmental challenges 

as opportunities in all policy areas 

and by making the transition equitable 

and inclusive for all. At the heart of this 

is an investment plan under which the 

European Commission aims to spend €1 

trillion within a decade. 

The Commission has announced a draft 

directive on Sustainable Corporate >> 


21

Governance and Sustainable Supply 

Chains for the second half of 2021. The 

legislative package is completed with 

an amendment to the directive on nonfinancial 

reporting. This legislative initiative 

is to be seen in the context of the 

European Green Deal and the (Covid-19) 

Recovery Plan, and it aims to anchor 

sustainability even more firmly in corporate 

governance. 

The push for a global ESG standard 

Ever since a European task force was 

created for Europe to define its own ESG 

reporting standards, the momentum 

toward the standardization of sustainability 

or non-financial reporting has 

been building fast. The push toward a 

global ESG standard will bring together 

the existing frameworks. 

Even those responsible for creating the 

big standards have recognized the signs 

of the times and are relying now more 

strongly on “cooperation” instead of the 

previous language of “interoperability,” 

“complementarity,” and “concurrence.” 

WEF Chair Klaus Schwab says: “We are 

working together with standard-setting 

agencies and governments, not to create 

a competition, but to create a generally 

accepted common framework of metrics. 

It needs a key number of companies 

to report, but to then integrate this in 

standard-setting.” 

At the content level, therefore, no major 

surprises are to be expected. With areas 

such as climate change, environment, 

labor rights, health and safety, as well 

as human rights due diligence, central 

topics are already clearly identified. The 

real game changer, however, lies in the 

field of materiality: Materiality is an ambiguous 

concept. In the end, it is always 

a question of the observer. Different 

stakeholder groups perceive the materiality 

of sustainability items differently. 

Investors, for example, have a narrower 

view than those who examine the SDGs. 

THE MATERIALITY DISCUSSION 

ENCOMPASSES AT LEAST THREE 

DIMENSIONS: 

1. Materiality referring to reporting 

standards 

The reporting specialists at Datamaran 

rightly pointed out in their blog recently 

that we need to distinguish at least three 

levels in each company case: There are 

general questions, sector-specific questions, 

and company-specific questions. 

Only when we interpret the requirements 

in such a tailor-made way do we 

get a meaningful reporting architecture. 

Datamaran writes: “Looking at sectorspecificity, 

EU standards should cover 

three layers: sector-agnostic (applicable 

across sectors), sector-specific (ensuring 

the necessary level of detail per sector), 

and entity-specific (depicting the entity’s 

unique situation). The third layer 

TARGET ARCHITECTURE 

3 L A Y E R S 

1. SECTOR-SPECIFIC 

2. SECTOR-SPECIFIC 

3. ENTITY-SPECIFIC 

SUSTAINABILITY REPORTING 

Sustainability Statements 

demands that reporting entities ‘own’ 

their double materiality assessment 

process. Hence, the sector-agnostic and 

sector-specific standards do not replace a 

materiality assessment, which companies 

will be required to conduct.” 

2. Materiality referring to issues 

Traditionally, materiality is defined by 

issues that are material to a company 

and other issues that are subordinate. 

But this is only the internal view. From 

an outside perspective, the question is: 

Who defines materiality? The investor? 

That is the classic ESG lens. Or is it about 

the interaction between the influence 

the company has on its environment 

and the environment on the company? 

This means that all sustainability-related 

facts that are necessary to understand 

the company’s business performance, 

situation, and results must be published, 

but also information that is necessary 

to understand the company’s impact on 

society. This is the current perspective 

3 REPORTING AREAS 

Strategy, Implementation, 

Performance measurement 

3 TOPICS 

Environmental, Social, 

Governance 

Source: Sustainable Finance Research Platform, Mercator Stiftung 



MATERIALITY DEFINITION 

COMPREHENSIVE MATERIALITY 

Considering a wider scope of stakeholders e.g. the environment or 

future generations. 

DOUBLE MATERIALITY 

Companies have to report about how sustainability 

issues affect their business and about their own 

impact on people and the environment. 

STAKEHOLDER MATERIALITY 

Stakeholder engagement to involve organization 

or people who may be affected by company's 

decisions. 

FINANCIAL MATERIALITY 

Financial materiality identifies 

issues that are reasonably likely to 

impact the financial condition or 

operating performance of a 

company and therefore are most 

important to investors. 

Source: Own data and EU Commission, Guidelines on non-financial reporting: 

Supplement on reporting climate-related information (2019 / C 209/01) 

BIODIVERSITY AS A PRIORITY IN AGRICULTURE, 

FISHERIES, AND FORESTRY 

Companies listed 

in the EU 

Number of companies 32 11,597 

Non-listed companies, 

Germany only 

Number of employees ca. 12,000 ca. 120,000 

Annual turnover ca. €2.1 bil. ca. €17.3 bil. 

Total assets ca. €3.3 bil. ca. €45.3 bil. 

Source: Sustainable Finance Research Platform, Mercator Stiftung 

of EU legislation. Or do the relevant 

stakeholders chosen and questioned by 

the company set the direction? Then we 

are at the Global Reporting Initiative 

and UN Global Compact approach. Or 

does an even broader understanding of 

materiality need to be used, including 

views from areas that cannot express 

themselves, such as nature, biodiversity, 

and future generations? That would be 

the view of the SDGs. 

3. Materiality referring to the 

companies concerned 

This materiality aspect has a significant 

impact on the number of companies 

affected. Let us take the topic of biodiversity: 

Experts agree that we need to 

pay much more attention to species 

protection. We must not only consider 

biodiversity in terms of financial or double 

materiality, but at least in terms of 

stakeholder materiality. 

In reality, however, only the big listed 

companies from the agriculture, fishing, 

and forestry sectors are currently covered 

by this kind of mandatory disclosure – if 

at all. In Europe, for example, we talk 

about a mere 32 companies with total 

revenue of approximately €2.1 billion. 

If we expand this scope to all companies 

in these sectors that have an impact on 

biodiversity, then we are talking about 

completely different dimensions. The 

figures are not available for the whole 

of Europe, but a study by the Mercator 

Foundation found that there are around 

11,600 companies in Germany that are 

subject to reporting requirements and 

generate annual revenues of €17.3 billion. 

Mind you, this is only the topic of 

biodiversity, only related to the sectors of 

agriculture, fisheries, and forestry, and 

only for Germany. Other topics, such as 

climate protection, plastic mountains, 

diversity, etc., would generate further 

scopes and lists of concerned companies. 


23

What does this mean for reporting 

obligations? 

1. Sustainability reporting 

There is ample evidence, however, that 

the information which companies are 

reporting is not sufficient. Reports often 

omit information that investors and 

other stakeholders think is important. 

Reported information can be hard to 

compare from company to company, 

and users of the information are often 

unsure whether they can trust it. 

Problems in the quality of sustainability 

reporting have knock-on effects. It means 

that investors lack a reliable overview 

of sustainability-related risks to which 

companies are exposed. 

Investors increasingly need to know 

about the impacts of companies on people 

and the environment. They need 

to know this partly to meet their own 

disclosure requirements under the Sustainable 

Finance Disclosure Regulation. 

More generally, if the market for green 

investments is to be credible, investors 

need to know about the sustainability 

impacts of the companies in which 

they invest. Without such information, 

money cannot be channeled toward 

environmentally friendly activities. 

Finally, problems in the quality of reporting 

create an accountability gap. Highquality 

and reliable public reporting by 

companies will help create a culture of 

greater public accountability. 

2. Human rights reporting 

The UN Guiding Principles on Business 

and Human Rights (UNGP) have been a 

global instrument for remedying and 

preventing human rights violations in 

business contexts since 2011. To this end, 

they are being transposed into national 

law (“supply chain law”). In parallel, 

the EU is working on a Europe-wide 

law. At the end of January 2021, the 

Legal Affairs Committee of the European 

Parliament voted on its positions on the 

planned supply chain law and called on 

the Commission to submit a law. EU Justice 

Commissioner Didier Reynders has 

announced such a law by the summer 

break. This supply chain law would be 

the second European law on labor and 

human rights after the law on conflict 

minerals. What is new is that it will also 

include other categories, in particular 

requirements for suppliers to comply 

with the Paris climate targets. 

The EU wants to create uniform regulations 

for the internal market and relies 

on a risk-based approach: This means 

that sectors and countries are assessed in 

a differentiated manner. Problem zones 

are designated as high-risk zones. This 

also has consequences for the number of 

companies affected: Unlike the German 

approach, there is no minimum size for 

companies in the Brussels simulation. 

What counts is the vulnerability to risk. 

Thus, says Axel Voss (MEP, EPP Group), a 

company with 50 employees could become 

subject to reporting requirements 

if, for example, it sources its goods from 

1,000 farmers in a high-risk zone. On 

the other hand, all companies that work 

mainly with suppliers from Europe will 

probably get by without any requirements. 

Brussels urges in a statement: “Companies 

that want to be prepared for upcoming 

regulations must now review their 

human rights and environmental due 

diligence processes. Assessing whether 

their existing processes are in line with 

the UNGP and OECD guidelines will help 

identify gaps and channel resources to 

drive sustainable change. A structured 

human rights due diligence process is 

critical to ensuring human rights compliance 

across companies’ operations.” 

3. Climate reporting 

If we want to be climate neutral in Europe 

by 2050, a lot still has to happen. To 

achieve this, we must measure, reduce, 

and measure again. Here, it is above 

all the investor network of the Carbon 

Disclosure Project (CDP), the Task Force 

on Climate-related Financial Disclosures 

(TCFD), as well as the Science Based Targets 

initiative jointly launched by CDP, 

WWF, the World Resources Institute, 

and the Global Compact that are giving 

companies steam. A KPMG survey 

shows that TCFD recommendations are 

already widespread in the oil and gas and 

automotive sectors. Other sectors that 

are also critical are still hesitant. These 

include, in particular, the construction 

and materials, forestry and paper, food 

and beverage, and transport and leisure 

sectors. Here the pressure will increase. 

We can see this well in the example of 

the real estate sector: Climate aspects are 

leading to a comprehensive reassessment 

of many properties on the European 

market. Experts see the consideration 

of sustainability criteria alongside the 

central parameters of return and risk 

as a third pillar in the evaluation of 

real estate investments in the future. 



consultancy, and in the public. Another 

important recommendation of the advisory 

board is to create transparency on 

the contribution of all financial products 

to the global development agenda, the 

SDGs, and the Paris climate targets. 

“Properties that do not meet the latest 

sustainability standards will become 

much less attractive to investors and 

fund managers in the future. No one 

wants to invest in ecological and social 

legacies any more. If real estate becomes 

uninteresting as an investment object 

against this background, it loses value,” 

says real estate valuer André Heid. 

Here too, however, the reporting practice 

is sobering: “A large part of the companies 

do not yet seem to have any clarity 

about which key figures are to be used 

and reported for measuring progress 

in the context of climate reporting. As 

a result, the goals set appear less credible 

and tangible,” analyses Nicolette 

Behncke from PwC. Added to this, fewer 

than one in three companies relates 

the climate-related key figures used to 

established financial key figures or operational 

performance indicators – for 

example, analyses emissions – to turnover. 

“However, if this information is not 

presented transparently, it is difficult for 

stakeholders to understand, compare, 

and critically appreciate the significance 

of the respective key figure for the company,” 

Behncke continues. Nevertheless, 

a trend can be observed of linking the 

climate targets of individual companies 

to the global 2°C target with the help 

of science-based targets. This shows a 

growing awareness in the business world 

that a majority of companies recognize 

the need to contribute their fair share 

toward efforts to reduce emissions. 

4. ESG reporting 

In Europe, around €13 trillion is invested 

in investment funds, a good 4 percent 

of which observe sustainable criteria. 

However, the effects of these sustainable 

investments, which have been growing 

steadily for years, are hardly discernible. 

One reason for this is the lack of a uniform 

definition of sustainability. The EU 

wants to change this with a taxonomy for 

“sustainable finance.” In Germany, the 

Sustainable Finance Advisory Board of 

the Federal Government recently submitted 

31 recommendations for a sustainable 

financial system. These include integrated 

and forward-looking corporate reporting, 

sustainability-oriented financial products, 

as well as research and systematic knowledge-building 

with a view to changing 

competence requirements for managers 

with supervisory authorities, in the 

financial and real economy, in financial 

Christian Hell of KPMG in Germany says: 

“Worldwide, more and more companies 

are reporting on sustainability issues, 

and they are doing so in greater detail. 

Drivers are often regulatory requirements, 

but also the increasing demands 

of capital providers – sustainability is 

becoming more and more important for 

the equity story.” It is therefore hardly 

surprising that the focus of reporting is 

shifting, with more and more reference 

being made to potential business risks. 

The trigger for this is climate change. 

Here, companies are increasingly seeing 

financial risks – whereas a few years 

ago they were still concerned about associated 

reputational risks. “We assume 

that other sustainability issues such as 

human rights, diversity, or appropriate 

remuneration will soon also be recognized 

in their financial dimensions.” 

5. SDG reporting 

In 2015, the global community adopted 

the UN Sustainable Development Goals. 

Since then, the SDGs have gained a high 

profile in sustainability reporting. Greater 

stakeholder pressure on companies to 

be more transparent about supply chain 

impacts, labor standards, and diversity 

may have influenced this leap in reporting. 

It is also likely that more companies 

now have a better understanding of the 

SDGs. Nevertheless, SDG reporting is 

mostly unbalanced and often disconnected 

from corporate goals: A KPMG 

study suggests that corporate reporting 

on the SDGs focuses almost exclusively 

on companies’ positive contributions to 

achieving the goals and does not make 

negative impacts transparent. Only 10 

percent also talk about setbacks (balanced 

reporting). 


25

“ 

Insights into the New 

EU Reporting 

Obligations 

Since the EU Commission’s 

introduction of the climate 

taxonomy and the CSRD, 

discussions concerning an 

upcoming European reporting 

standard have shown no 

signs of dying down. Who, 

what, when, and about what 

will be reported on in the 

future? Three interviews with 

experts. 

In the last weeks we saw European climate 

objectives set, with both a climate taxonomy 

and a Cooperate Sustainability Reporting 

Directive (CSRD) being approved. Now you 

will have to take a moment to briefly guide 

us through all these decisions! We have a 

climate strategy, we have a taxonomy, and 

we have reporting obligations. How are they 

all related? 

Christoph Töpfer: That’s true, they are 

basically all connected, but it is difficult 

to actually classify the individual 

processes. The actual points of contact 

repeatedly represent a challenge, even 

for those who are closely connected with 

the processes. With its introduction of 

the European Green Deal in 2019, the 

Commission put forward a massive work 

program. The various subsections are 

currently being worked through, one by 

one, and in a tight time frame at that. 

Now to the classification: The recently 

adopted European climate law states 

that the European Union will achieve 

greenhouse gas neutrality by 2050. Interim 

goals will also be set for 2030. The 

EU reporting obligation – known as 

the CSRD, the Corporate Sustainability 

Reporting Directive – as well as the 

EU taxonomy for green and sustainable 

economic activity are tools that will significantly 

contribute to reaching these 

overarching goals. 

Perhaps we could hone in on these two instruments? 

Töpfer: The EU taxonomy is a classification 

system that enables financial 

market players in particular to assess 

whether the activities in which they 

would like to invest are environmentally 

friendly and if they would even 

be sustainable in a greenhouse-gasneutral 

economy. Is that green or just a 

transitional solution? This taxonomy 

has now been adopted through a 

legislative act that is primarily focused 

on climate change. Taxonomies 

regarding other climate objectives will 

follow. 



Christoph Töpfer 

was a member of the EFRAG 

Task Force responsible for 

preparing the European 

sustainability reporting 

standards. 

However, the reporting obligation is just 

a fundamental tool. In order to make 

sustainable investment decisions, one 

needs good and comparable data from 

companies, information concerning their 

sustainability and environmental efforts. 

Information about the sustainabilityrelated 

risks to which the companies are 

exposed are especially important. According 

to the EU Commission’s analysis, the 

current reporting obligations have not 

fulfilled these requirements, which is 

also in line with our assessment at the 

UBA [German Environment Agency]. 

Investors aren’t the only ones interested 

in the data. Other target groups such as 

non-governmental organizations, public 

authorities, and, of course, customers 

want to have access to this information. 

A very important point of discussion is the 

aspect of materiality. There are different approaches 

– the classical investor’s perspective 

or double materiality: Which is favored by 

the European Commission. What is meant 

by "double materiality"? 

Töpfer: Understanding the concept of 

materiality is key. It determines when 

and what information is to be included 

in the report. There is also the classical 

perspective of financial reporting, which 

requires information that is pertinent to 

decision-making in terms of financial effects 

for the companies or which entail 

corresponding risks. So that is what is 

meant by the term “financial materiality.” 

Then we have the opposite perspective, 

which concerns the effects of a company’s 

activities on its surroundings, 

the environment, and society with its 

products and services. That is materiality 

from the perspective of the environment 

and sustainability. This information is 

just as relevant and is increasingly being 

requested by investors. 

The European Commission would like to 

see both of these perspectives reflected in 

the reports. This is what they refer to as 

“double materiality.” The German CSR Directive 

Implementation Act (CSR-RUG) is 

much more restrictive in this regard. The 

debate on the term “materiality” came 

up quite often in the German context 

because people asked themselves: If we 

were to picture this as a Venn diagram, 

do we only report on the points that 

intersect or do we have to report on both 

areas in their entirety? Now we have a 

clear statement. The intersecting areas 

are no longer the issue, the focus has to 

be on both perspectives from here on out. 

Understanding 

the concept of 

materiality 

is key. It 

determines 

when and what 

information is 

to be included 

in the report. 

>> 


27

“ 

The company has a 

compliance or risk 

management 

department in place. 

But whether it works 

and can actually 

implement its 

responsibilities in the 

spirit of company rules 

or code of conduct 

is usually not 

investigated. 

What will the regulations change for CEOs and supervisory boards in 

terms of liability? 

Kai Michael Beckmann: Sanctioning is an issue here. The 

central message of the Non-Financial Reporting Directive is 

plain and simple. In the future, auditing bodies within the 

company will be required by law to give equal consideration 

to financial and non-financial statements. Up until now, supervisory 

boards were able to get out of their responsibilities 

in this regard. They did fulfill their official audit obligations, 

but they had an auditor perform a limited assurance review 

– which, up until now, was sufficient. However, in the future, 

the auditing committee must give equal consideration to 

both perspectives, meaning that the committee now needs to 

guarantee the involvement of “non-financials” in the internal 

control system and in risk management. This also has to do 

with the assessment of adequacy and effectiveness – a real 

increase in quality. Furthermore, the functions of the supervisory 

and executive boards or the CEO must be concretely 

laid out in the creation of sustainability reporting. From now 

on it must be specified who has which tasks and what roles. 

This ensures a clear overview of who carries responsibility 

in specific areas, which, in turn, has consequences for the 

executive board’s balance sheet oath. 

A follow-up question to effectiveness. What exactly is new here? Many 

readers are not yet familiar with the term. You often hear the term 

“materiality” and we are familiar with the term “adequacy” from the 

discussion surrounding due diligence. But perhaps you should explain 

the idea of effectiveness. 

Beckmann: In order to understand what effectiveness means 

in this context, the term adequacy needs to be clear. Adequacy 

here simply means that something is present. The company 

has a compliance or risk management department in place. 

But whether it works and can actually implement its responsibilities 

in the spirit of company rules or code of conduct 

is usually not investigated. However, assessing effectiveness 

does just that. Let’s take Volkswagen and the diesel scandal as 

an example. Compliance and risk management departments 

were in place, yet they couldn’t avoid the scandal. The control 

mechanisms weren’t effective because they were eclipsed by 

a corporate culture in which goals, other than sustainability, 

took precedence. 



If supervisory boards take effectiveness 

as a given, they must assign completely 

different tasks to the internal auditors or 

hire an external auditor, and this is why 

the directive will initially also provide for 

an initial mandatory limited assurance 

audit. Finally, once the rules have been 

tightened, a reasonable assurance audit 

will be required, thereby ensuring that 

the audit standards of the non-financial 

statements correspond to those of the 

annual report. This is a completely new 

approach and will present many companies 

with big challenges, because the 

integration of sustainability and ESG of 

risk and compliance management and 

internal control systems is still quite rudimentary 

in many German companies. 

about the direct alignment of financial 

and non-financial reporting. However, 

from my perspective, the chairperson 

of the board will play an increasingly 

larger role, not least because the capital 

market will make significantly more 

demands on companies – also due to 

the new EU taxonomy. Companies will 

also be asked which concrete ideas and 

strategies they have in place in order to 

prove their future sustainability. And 

not just on paper. In reality as well. It’s 

obvious that the chairperson carries the 

responsibility. 

Doesn’t the buck stop at the CFO in that respect? 

Beckmann: At the moment, where the 

numbers and reporting are the main 

concern, the Chief Financial Officer is certainly 

in demand. After all, we are talking 

Kai Michael Beckmann 

is Division Manager 

Governance, Risk, 

Compliance, & Sustainability 

at Mazars Germany; 

Head of Sustainability 

>> 


29

“ 

Does double materiality actually equate to SDG 

materiality or is that not taking it far enough? 

Alexander Bassen: The Sustainable Development 

Goals were adopted by the 

United Nations in 2015 and comprise 17 

goals that the international community 

has agreed to, along with 169 sub-targets. 

These were originally intended for states 

to measure their performance. However, 

they are now increasingly being implemented 

by companies to measure their 

own performance in relation to societal 

challenges. It’s not necessarily the case 

that double materiality is covered by this. 

The SDGs are concerned with very, 

very different areas – from poverty 

and hunger to questions regarding the 

environment and water as well as social 

questions, such as urban development. 

When you use SDG materiality 

as a basis, it becomes important to work 

out what type of influence companies 

have on the SDGs with their activities or 

products. Certain companies are already 

reporting on this very essential question. 

However, when we take a closer 

look at the reporting, individual SDGs 

are often singled out and are usually 

those in areas where one is making a 

positive contribution as a company. Of 

course, it is interesting to see the whole 

picture. Positive contributions are made 

by companies as well as negative ones, 

which necessarily exist, because the 

SDGs also contain conflicting targets. 

Aspects surrounding growth often cause 

problems not only with environmental 

standards but also with social standards. 

Obviously, these target conflicts need to 

be addressed within the context of an 

overall view, otherwise you don’t have 

the complete picture. 

In the area of climate change, you work with 

the “currency” of CO 2 

equivalents. It’s not 

nearly as defined or as easily measured as in 

other areas, such as biodiversity and social 

topics. How do we solve the problem when, on 

Prof. Dr. Alexander Bassen 

has been Professor of Business 

Administration, in particular 

Capital Markets and 

Management, at the University 

of Hamburg since 2003. 

Furthermore, he has also been 

a member of the German 

Council for Sustainable 

Development since 2013. 



the one hand, we want a change, but on the 

other, we cannot consistently and coherently 

measure and evaluate change? 

Bassen: That certainly is one of the central 

problems. However, you have to 

admit that we are significantly further 

along than we were a couple of years ago. 

The EU is currently trying to determine 

this with the help of taxonomy. So far it 

has been done for climate questions, climate 

change mitigation, and adaptation. 

The EU has also set six environmental 

goals, including circular economy or 

biodiversity, which you just mentioned. 

Measurements are currently being compiled 

for these goals and are also meant 

to become the standard for reporting. 

These are, to the extent possible, always 

scientifically based. In the cases of climate 

change mitigation and adaptation, 

you orient yourself on the Paris Agreement. 

This also means that we have to 

work much closer with scientists from 

other disciplines in the future. Otherwise, 

we will end up with the usual amounts, 

such as tons of waste thanks to tons 

of manufactured cars. That is not sufficiently 

complex. 

So far, the taxonomy and CSRD have only been 

suggested by the EU Commission, but the time 

specifications are very concrete. If we still want 

to achieve anything by 2030, we don’t actually 

have much time for discussions. What do you 

think the rest of the procedure will look like? 

Bassen: From an EU perspective, the 

taxonomy will not be an issue because 

it will be enforced directly by the EU and 

won’t have to go through the national 

parliaments. It has to be approved by the 

Council, but that was already done on 

April 21. The CSRD, the reporting obligations 

for companies, however, must go 

through the national parliaments, and 

they usually have hearings beforehand 

to listen to their stakeholders. However, 

this time the EU Commission has already 

indicated that certain areas will have no 

wiggle room for national variations. For 

example, in the future, the reporting 

must be undertaken in the management 

report. A company can of course make a 

separate sustainability report, but that no 

longer meets the CSRD’s requirements. 

In that way, the EU Commission has 

already determined the boundaries of 

the discussion. According to the timeline, 

the directives from this year will 

most certainly be brought through the 

European Parliament followed by the 

usual two years for the national implementation. 

Currently there is only one climate taxonomy. 

And we spoke earlier about further areas of 

materiality. That encompasses much more 

than climate. Does that mean that there still 

need to be many more taxonomies? 

Bassen: Yes, that’s true. The first two 

climate objectives – climate change mitigation 

and adaptation and the climate 

taxonomy – are just the first step. The 

other climate objectives will follow this 

year. The question obviously remains: 

With all this talk about sustainability, 

what will happen to the social objectives 

that obviously remain extremely 

relevant? A social taxonomy is already 

in the works. It will take a little longer 

because the technical evaluation criteria 

need to first be identified. But I am 

certain it will come through next year, 

at the very latest, since the societal pressure 

behind it is great and the necessity 

is there. 

However, when 

we take a closer 

look at the 

reporting, 

individual SDGs 

are often 

singled out and 

are usually 

those in areas 

where one is 

making a 

positive 

contribution as 

a company. 


31

HOW DOES THE EU TAXONOMY FIT 

WITHIN THE SUSTAINABLE 

FINANCE FRAMEWORK? 

Proposed CSRD 

(Corporate Sustainability Reporting Directive): 

reporting done by large companies and listed companies on their sustainability 

risks and impacts, i.e., impact of their business on the climate and impact of 

climate change on their business 

Other CSRD information on 

environmental, social, and 

governance issues 

have to 

publicly report 

reporting 

information 

goes to 

LARGE COMPANIES AND 

LISTED COMPANIES 

% of activities aligned with 

Companies to report the % of their 

current revenues coming from activities 

aligned with and % of their future 

revenues (capital expenditure) coming 

from activities aligned with 

Source: EU Commission 



Two examples when the taxonomy will be used: in disclosures of financial 

products and reporting by large companies and listed companies 

SFDR (Sustainable Finance Disclosure Regulation): 

disclosure when selling sustainable financial products 

OTHER END USERS 

(civil society, customers...) 

Products with environmental or social 

characteristics 

may partially pursue "sustainable investment" as objective 

– the “light green” products 

FINANCIAL MARKET 

PARTICIPANTS 

(asset managers, insurance companies, 

pension funds, etc.) 

AND FINANCIAL ADVISERS 

Products with "sustainable investment" 

objective 

Activities aligned with are included in the definition of 

“sustainable investment” (investment contributing to an 

environmental or social objective) 

WHAT IS THE EU TAXONOMY? 

EU taxonomy: 

a common classification of economic activities significantly 

contributing to environmental objectives, using science-based 

criteria 


33

World 

Where Profits Are 

Derived from True 

Value Creation, not 

Value Extraction 

The world faces critical challenges: climate 

change, pandemics, nature loss and growing 

inequality, among others. Therefore business 

faces major changes: Vision 2050: Time to 

Transform from the World Business Council 

for Sustainable Development (WBCSD) lays 

out a new framework to guide business action 

in the decade ahead. We spoke about it with 

Julian Hill-Landolt, Director, Vision 2050 at 

the WBCSD. 

Making progress toward your Vision 

2050 demands several critical and 

complex systemic transformations. 

That comes with the UN Year of Ambition, the 

World Economic Forum’s call for stakeholder 

capitalism, and other initiatives for a change 

of course in the economy. Are these competing 

ideas or how do they fit together? 

Julian Hill-Landolt: The systems that 

may have worked for 1 or 2 billion people 

simply aren’t fit for purpose if we want 

to live in a world in which 9+ billion 

people can live well, within planetary 

boundaries. In the words of Bill Gates, 

“We need to transform everything.” These 

transformations are critical and complex, 

and they span from the way that we 

create and use energy and things, to the 

ways we move around, to the foods that 

we eat, the homes we live in, and indeed 

even the goals and rules that define the 

way our economies work. Given the level 

of systems transformation required, we 

need as many organizations as possible 

working to engage their constituencies 

in the urgent task at hand. And we need 

them to be clear about the necessity, the 



effort required, the costs involved and 

the opportunities along the way. The 

SDGs provide the world with a foundational 

framework and all initiatives 

need to ensure that they align with the 

achievement of the SDGs. WBCSD works 

with multinational businesses, and so 

that is who our work is designed to be 

engaging and actionable for. Vision 2050: 

Time to Transform is a framework for business 

action in line with the urgency of 

the challenges that we face as global 

societies – it provides business with a 

uniquely comprehensive guide to making 

transformation happen. At the same 

time, Vision 2050’s nine pathways are 

specifically designed to make the SDGs 

actionable for business. 

“Culture eats strategy for breakfast” is a famous 

quote from legendary management writer 

Peter Drucker. As an analogy, we can say that 

unpredicted events such as pandemics, disruptions, 

etc., throw every plan off kilter – even the 

SDG strategies and Vision 2050. How will you 

deal with disruptions and unpredicted events? 

Will you have to refresh the refresh? 

Hill-Landolt: Another famous quote, 

attributed to both Eisenhower and 

Churchill, is that “Plans are worthless, 

but planning is everything.” The future 

cannot be predicted, but it unfolds as a 

result of our actions and reactions. One 

way in which to exert some control over 

how the future unfolds is to plan for the 

things that might happen in the future 

– both those changes that are highly 

likely and harder-to-predict disruptions. 

Systems change as a result of pressures 

exerted by macrotrends and disruptions, 

as well as new innovations. During our 

work to refresh Vision 2050, we spent 

quite some time thinking about the way 

in which these factors could shape the 

next 10 years – how they might make 

it easier or harder to achieve our vision, 

how they might increase or alleviate 

existing sustainability challenges. >> 


35

»Stakeholder 

capitalism is 

not about a 

world without 

profits, it is 

about a world 

where profits 

are derived 

from true value 

creation, not 

value 

extraction.« 

Vision 2050 asks companies to take these 

factors into account as they plan their 

own strategies, as it is only by developing 

ideas about how they might react to 

change that they can have a chance of 

reacting well when the change happens 

and their plans have to be adapted to 

the new reality. The Covid-19 tragedy 

has made companies much more aware 

of the need for this kind of scenarioplanning 

as part of good risk management 

and business practice. 

“Build build build!” With these words, Boris 

Johnson announced his “new deal” to boost 

the UK economy. It’s the old mantra that the 

economy has to keep growing. Now you say: 

Stop! The concept of capitalism needs to be 

discussed. You go even further and demand 

that capitalism be reinvented. Aren’t you taking 

on a bit too much? 

Hill-Landolt: With respect, that’s absolutely 

not what we have said! We have 

said that there are three strategic business 

mindsets that need to change if we 

are to unlock the kinds of transformations 

we are talking about at the rate and 

scale required. One of those mindsets 

is around capitalism, and yes, we have 

said that it needs to be reinvented. But 

we have not said stop! Quite the contrary 

– as the World Business Council 

for Sustainable Development, we are 

absolutely committed to capitalism – its 

innovative power and tremendous reach 

are essential for driving the changes the 

world needs. But we are also clear that 

the current dominant model of capitalism 

is not delivering the outcomes that 

society needs, and therefore capitalism 

must be reinvented (as it has been many 

times before) so that it rewards true 

value creation, not value extraction, as 

today’s model does. We are not alone in 

this view: Many of the world’s leading 

companies are also clear on the need for 

the rules of the game to be updated so 

that social and environmental costs and 

benefits are internalized and reflected in 

the relative prices of goods and services, 

in companies’ P&L statements, the cost 

of capital, and market valuations. 

It reminds me a bit of a quote by David Byrne 

from the music group Talking Heads: “When 

everything is worth money, then money is worth 

nothing.” Do you really believe that most CEOs 

will lightheartedly abandon profit targets and 

embrace stakeholder capitalism? 

Hill-Landolt: No, CEOs will not abandon 

profit targets. Stakeholder capitalism 

is not about a world without profits, 

it is about a world where profits are 

derived from true value creation, not 

value extraction. Forward-looking CEOs 

understand that running companies well, 

well into the future, will demand that we 

update the current model of capitalism. 

It needs to become: stakeholder-oriented 

(rather than maximizing shareholder 

value); impact-internalizing (rather than 

impact-externalizing); long-term (rather 

than short-term); regenerative (rather 

than degenerative); and accountable 

(rather than unaccountable). These are 

the features that are going to help CEOs 

run their companies well and profitably 

into the future. That is why CEOs will 

embrace these changes. 

The homo economicus is not easily replaced by 

a “mindful mankind.” That takes time, but we 

don’t have it. Isn’t that a dilemma? 

Hill-Landolt: This is a question that 

applies at a societal level, not just an 

economic one. Politically, intellectually, 

and culturally we have failed to act on 

the information that we have had available. 

However, while it is true that there 

is very little time left for us to act and 

avoid breaching the safe operating space 

for humanity, it is also true that for some 

time, momentum has been building to 

a point where the right level of action 

can finally be taken. From the begin- 



nings of the environmental movement 

in the 1970s, to the coalition-building 

efforts of the last decade, we are now at 

a point where more and more governments, 

companies, investors – and more 

broadly the general public – are truly 

beginning to rally behind the need for 

transformational change. 

What exactly does “mindset shift” mean? At 

first glance, it sounds very academic. In dayto-day 

business with quarterly figures, concrete 

turnover targets, and a generally fast pace, 

many see this reset button as an indicator that 

the whole system might not restart properly. 

Hill-Landolt: We think that there are 

core strategic business mindsets that 

need to shift if we are going to give 

ourselves permission to invest in, and 

drive, the transformations and transitions 

that achieving Vision 2050 will 

depend on – to advance the actions 

that are laid out in Vision 2050’s nine 

transformation pathways that cover the 

essential products and services that business 

provides to society. In essence, these 

mindset shifts are what make a move 

away from “business as usual” possible. 

At the heart of business as usual is our 

current model of capitalism, and unless 

we reinvent that model, we will not see 

progress at the rate and scale required. 

Shifting our mindset on the purpose 

and outcomes of capitalism – moving 

to a longer-term view of what business 

exists to do – will allow us to think 

differently about what it means to be 

a more resilient business, and why it 

is important to become a regenerative 

business. The whole system depends 

on these mindset shifts, as they are the 

key to running companies well, well 

into the future. 

In business, we constantly encounter so-called 

push-pull situations: Typically, organizations 

push resources to employees with the expectation 

that they will pull from that. The reality 

is that most employees are still expecting employers 

to tell them what to do. We are still far 

away from a shift in mindset and a new kind 

of ownership where employees are motivated 

to “pull in” what they need and “push up” 

creative ideas and new approaches to solve 

problems. Such a corporate culture, however, 

also includes mistakes, setbacks, and delays. 

You might accept that in the C-suite, but if we 

go down into the engine room of a company, 

speed and a zero-error strategy are demanded. 

That doesn’t fit, does it? 

Hill-Landolt: WBCSD works mainly 

with senior leaders – our main touch 

points are the C-Suite and the sustainability 

leadership of our member companies. 

For us, we focus on making sure 

that these points of leadership within 

companies are driving the transformations 

that are required. Vision 2050 

was developed with the full support 

of WBCSD’s Executive Committee, and 

the leadership statement at the front 

of the report was signed by 42 C-Suite 

leaders from our member companies. 

These leaders are fully aware of how 

challenging transformation is, and that 

it will involve significant cultural and 

financial investments within their companies. 

But while business needs to be 

bold enough to lead these changes, it 

must also be humble enough to know 

that it cannot succeed in driving them 

on its own. Companies must inspire 

their ecosystems and value chains to 

follow their lead, and they must work 

with policymakers, investors, and customers 

to ensure that all are aligned 

and working toward a future in which 

9+ billion people can live well, within 

planetary boundaries. 

The aspect of enablers and barriers is very 

important and not often taken into account 

in many discussions. It includes psychological 

barriers (individual level) and structural barriers 

(company level). What exactly does the 

“need for system thinking” mean in this context? 

Hill-Landolt: As mentioned above, it 

means that business needs to be bold 

enough to lead, but humble enough to 

build the kinds of coalitions that are 

capable of bringing about lasting change. 

The first thing we did when we set out 

to bring Vision 2050 up to date was to 

spend time understanding how systems 

transform, and it is this understanding 

that Vision 2050 is built on. That is why, 

in addition to the nine transformation 

pathways that map out the specific transitions 

and actions that business needs 

to drive, it also guides business as to the 

mindsets that those actions will depend 

on, and the enablers of transformation 

that make the difference between action 

and impact at scale. Business must 

steer, support, and contribute to change 

through its influence on – and interactions 

with – innovation and technology, 

individuals and consumption, finance 

and investment, and policy and regulation. 

And finally, systems thinking also 

requires business to think about the 

macrotrends, disruptions, and innovations 

that shape its operating landscape. 

I would like to quote Peter Drucker once again. 

In a variation of his well-known phrase, one 

could say “You can only measure what you 

imagine.” We will measure what we have 

defined beforehand. That implies that we have 

understood the issue of sustainability in all its 

complexity. Aren’t we in 2021 overestimating 

ourselves a little? 

Hill-Landolt: Not at all. We know that 

this is an enormous task. I’m happy to 

quote from our leadership statement 

here: “Business can lead. Business can 

forge the collaborations required to drive 

change. It can ... but more than that, it 

must. It is in business’s interest to pursue 

the transformations set out in Vision 

2050 – because its long-term success depends 

on thriving societies to trade with, 

and a healthy planet for us all to exist on.” 

In other words, it’s time to transform. 


37

Those who commit themselves to the SDGs are committed 

to society and the environment. Such action is not only 

done for philanthropic reasons, but also due to self-interest: 

No company can work successfully in an environment where 

global problems such as climate change remain unsolved. 

What Does 

Good SDG 

Management 

Look Like? 

By Dr. Elmer Lenzen 

The Sustainable 

Development Goals (SDGs) 

were originally intended to 

be used by governments to 

measure their commitment 

to sustainability. However, 

they are now increasingly 

being adopted by companies. 

Integrating the SDGs 

into in-house control and 

management systems is 

not easy. In this article, we 

explain the right steps. 

This consideration requires adopting a risk perspective, but 

it also presents opportunities: Companies can find a business 

case within the SDGs that opens up new markets and creates 

innovation. Especially in global supply chains, the SDGs offer 

important opportunities. However, as the responsible manager 

in the company, you must understand that the SDGs are not 

just another sustainability standard or reporting framework. 

They do not include specific metrics. The SDGs provide global 

goals, and managers must align their internal control and management 

systems with this compass. That sounds complicated. 

And in fact, it is. But there are forms of support. 

The best known is the SDG Compass. To make it easier for 

companies to integrate the SDGs into their infrastructures 

and implement targeted measures, the UN Global Compact 

– in collaboration with the Global Reporting Initiative and 

the World Business Council for Sustainable Development 

(WBCSD) – developed a five-step guide that offers approaches 

to aligning corporate action along the SDGs and assistance 

with reporting. 

Equally important, in our view, are the WBCSD’s SDG Sector 

Roadmaps. In April 2018, the WBCSD published a set of SDG 

Sector Roadmap Guidelines detailing a step-by-step methodology 

for how companies within a given industry can come 

together and explore their collective potential to advance 

the SDG agenda. 

In the following, we would like to give you some useful tips for 

implementation. In doing so, we are following the three-step 

approach of the WBCSD: The starting point is the status quo. 

Understanding where you stand and honestly admitting your 

own strengths as well as weaknesses is the most important 

step. This is where the course is set and can only be changed 

with great efforts. (Figure 1) 

How do you avoid “rainbow washing”? 

“Rainbow washing” is the term used to describe undifferentiated 

reporting using the colorful SDG tiles. The term is derived 

from greenwashing. It describes the simple assignment of 

the SDGs to already existing activities, without the intent to 

improve. A corporate approach to the SDGs must therefore 

always include goals and measures that demonstrate further 

development. 



The second step consists of developing 

measures as well as identifying opportunities 

and risks. In doing so, businesses 

should ensure that opportunities and 

risks are of different types so that they 

cannot be properly addressed using the 

same methodology. Risks, for example, 

have the unpleasant characteristic of 

being recurring, whereas opportunities 

are usually characterized by their uniqueness 

and occur only within a limited time 

window (window of opportunity). 

In most companies, the management of 

opportunities takes place within the scope 

of corporate and product development, 

marketing, and continuous improvement 

processes. Since this is mostly done 

along well-trodden paths, the SDGs and 

sustainable transformation are not automatically 

taken into account. Therefore, 

the opportunities that can arise from 

following the SDGs are unknown in most 

companies. However, the topic can be 

fostered with the help of concrete questions 

and methods. 

Finally, the third and decisive step is to 

take your own action. Walk the talk. This 

phrase indicates that failing to match your 

behavior with your statements leads to a 

loss of credibility and trust. This “valueaction 

gap” is widespread – research 

suggests that there are many internal and 

external factors which affect behavior and 

the reasons behind consumer choices. 

The underlying reason for value-action 

gaps is that people must actively translate 

their values into actions. It is characteristic 

of humans to often cause such steps 

to be delayed, postponed, or even aborted. 

Therefore, those implementing SDGs into 

management systems need to identify 

barriers and take into account potential 

solutions and impact accelerators. 

Step 1 

Understanding 

First of all, it is about identifying sector 

champion(s) and learning from their 

example. This helps in recognizing the 

relevant SDGs for your sector as well as 

the current or planned initiatives, >> 

Figure 1: 

KEY STEPS INVOLVED IN AN SDG SECTOR ROADMAP 

1 Establish current position 2 Identify key impact 

opportunities 

3 Call to action 

OBJECTIVE 

Understand the sector’s level of impact 

for SDGs across the value chain 

Conceptualize where the sector can 

make the largest contribution to the 

SDGs collectively 

Inspire the sector and others to take 

action to reach the SDGs 

1.1 Map SDGs and current level of 

impact across the sector value 

chain 

2.1 Identify key impact opportunities 

to drive progress toward realization 

of the SDGs 

3.1 Identify barriers, potential 

solutions, and impact accelerators 

for the sector 

MAIN ACTIVITIES 

1.2 Prioritize SDGs for the sector 2.2 Assess sector apportionment 3.2 Identify short-, medium-, and 

longterm actions to advance SDG 

3.3 Monitor, measure, and report 

progress 

OUTCOME 

Priority SDGs for the sector 

to address 

Key impact opportunities for 

the sector 

Action plan for the sector 

Source: WBCSD (ed.): SDG Sector Roadmaps, p. 12 


39

Figure 2: 

SDG INDUSTRY 

MATRIX 

► Financial services 

► Food, beverage, & consumer 

goods 

► Climate extract 

► Healthcare & life sciences 

► Industrial manufacturing 

► Transportation 

► Energy, natural resources, 

chemicals 

VISION 2050: 

TIME TO TRANSFORM 

► Energy 

► Transportation & mobility 

► Living spaces 

► Products & materials 

► Financial products & services 

► Connectivity 

► Health & wellbeing 

► Water & sanitation 

► Food 

WEF PLATFORM 

► Shaping the future of 

consumption 

► Shaping the future of energy, 

materials, and infrastructure 

► Shaping the future of investing 

► Shaping the future of mobility 

► Shaping the future of 

trade and global economic 

interdependence 

► Shaping the future of the 

internet of things and urban 

transformation 

► Shaping the future of the new 

economy and society 

partnerships, and products that relate to 

particular SDG targets. You will learn at 

which stage of the value chain your company 

interacts with each SDG and which 

geographies are most relevant for you. 

Various initiatives and publications can 

provide assistance in this regard. This 

applies in particular to these three: 

The SDG Industry Matrix of the UN 

Global Compact (UNGC) showcases industry-specific 

examples and ideas for 

corporate actions that are related to the 

SDGs. Presented in a series of publications, 

each matrix highlights the bold 

pursuits and decisions made by diverse 

companies for each SDG. 

Vision 2050: Time to Transform of the 

WBCSD presents a shared vision of a 

world in which more than 9 billion people 

are able to live well, within planetary 

boundaries, by 2050. To achieve this 

vision, we need transformation at scale, 

and business needs to focus its actions 

on the areas through which it can best 

lead the systems transformation. 

The World Economic Forum (WEF) 

Platform integrates and aggregates solutions 

to a complicated and fast-changing 

world with interconnected problems and 

challenges. 

Each of these initiatives has developed 

detailed information on selected industries 

and business areas that can be used 

for your company. (Figure 2) 

And this is how an initial classification 

of the SDGs can look, depending on the 

industry (Figure 3): 

With all this data, you can assess your 

current level of positive and negative 

impacts (high, medium, or low) for each 

SDG and the chances for potential business 

opportunities that are linked to 

this. The goal is a materiality matrix 

for trends and to prioritize SDG targets 

where the sector can contribute the most 

to minimizing negative impacts and 

maximizing positive impacts. 

These questions help in the analysis: 

• Is this topic a core issue for your company? 

• Is it critical that your sector take the 

lead in addressing this specific sustainability 

challenge? 

• Would this happen without any activity 

in the sector? 

• Does this contribute toward the prioritized 

SDGs identified in step 1? If so, 

which one(s)? 

• Does it offer potential for impact contribution? 

• Will the impact of this deteriorate before 

2030 or soon after? 

• Is this applicable globally? If not, to 

which geographies is it most relevant? 

• Does it create a rebound effect? 

• Is this complementary to other sustainability 

initiatives you run? If so, 

which ones? Will your stakeholders 

support this? 

• Will your clients and customers support 

this? 

The results can be transferred to such a 

table (Figure 4): 



Figure 3: 

SDGS & SECTORS: MAPPING THE HIGH-LEVEL LINKAGES 

Primary 

(raw material extraction and product) 

Oil & gas 

Secondary 

(production of goods using raw materials) 

Tertiary 

(provision of services to people and business) 

Basic materials 

Industrials 

Consumer goods 

Healthcare 

Utilities 

Telecomms 

Consumer services 

Financials 

Technology 

Figure 4: 

Source: Business & Sustainable Development Commission: Corporate Citizenship Sustainability, Simplified, p. 5 

SAMPLE SDG MAPPING TEMPLATE 

SDG1 SDG2 SDG3 SDG4 

Relevant SDG targets 1.1, 1.4, 1.5 2.1, 2.3 3.5, 3.6., 3.9 4.3, 4.4 

How can the sector contribute 

Invest in local communities; 

enhance 

access to energy; 

contribute to resilience 

of vulnerable 

communities to 

climate risks 

Share infrastructure 

to enhance 

agricultural productivity 

Reduce operational 

risks; protect 

workers and 

community from 

diseases 

Invest in workforce 

education and talent 

pipeline programs 

Relevant value chain stage 

Upstream, core 

operations 

Operations Operations Multiple 

Direct or indirect impact Both Direct Direct Direct 

Key geographies Africa, Latin America Africa Global Global 

Current level of positive impact High Low Medium Medium 

Current level of negative impact Low Low High Low 

Sector’s potential to contribute Medium Medium High Low 

Potential to add business value Low Medium Medium High 

Source: Business & Sustainable Development Commission: Corporate Citizenship Sustainability, Simplified, p. 11 

>> 


41

Step 2 

Prioritizing 

For many companies, up to 90 percent of 

their market capitalization is attributable 

to factors beyond their essential assets. 

But what if there was even more value 

to be generated, if only we had better 

measurement methods? 

The assessments described earlier are one 

step in this direction. The next step is 

to identify key opportunities and risks, 

review sector-specific reports and internal 

partner solution knowledge, identify 

stakeholder groups for expert input on 

potential impact opportunities, and 

agree on the format of engagement. 

Now you can shortlist a manageable 

number of impact opportunities that: 

(1) are most likely to minimize negative 

impacts or increase positive impacts; 

and (2) can realistically be implemented. 

Apply criteria that all shortlisted opportunities 

must meet and when they 

should start, stop, or continue to have 

the most impact on transformation and 

innovation. 

Ask yourself: What level of sector effort 

is required to implement and realize 

this action? What types of partners are 

needed to give this action impact? In 

what region(s) could this action have 

the greatest impact? 

You also have to consider different time 

horizons: Short-term actions will typically 

involve process innovation and 

show results within one to three years. 

Medium-term actions will typically take 

several years. Long-term actions will show 

results by 2030 and often be based on the 

success of reaching medium-term targets. 

The authors of the SDG Sector Roadmaps 

write: “A materiality matrix will allow 

the sector to prioritize the mapping 

exercise results and visually present 

areas where the sector has the most 

potential to maximize positive impacts 

and minimize negative impacts over the 

life of the roadmap. Figure 5 presents a 

sample matrix where the x-axis scales 

from high current negative impact (i.e., 

where the sector currently has adverse 

issues that need to be managed) to high 

current positive impact (i.e., where the 

sector currently has positive impact) and 

the y-axis indicates the sector’s potential 

to contribute to the SDG. The goals falling 

into the upper left- and right-hand 

quadrants of the matrix suggest where 

the sector could have the most material 

contribution.” (Figure 5) 

Figure 5: 

SAMPLE SECTORAL SDG MATERIALITY MATRIX 

Sector potential to contribute to SDG 

High 

Medium 

Low 

Sector priority: 

3 

Minimize negative 

impact 

8 

1 

11 10 

17 

15 

13 

12 

9 

4 

10 

14 

6 

5 

2 

16 

High 

Medium 

7 1 

15 

Low 

14 

7 

11 

13 

8 

9 

12 

4 

17 

Sector priority: 

Maximize positive 

impact 

6 

16 

5 

3 

2 

High 

Medium 

Low 

Low 

Medium 

High 

Current level of negative SDG impact 

Current level of positive SDG impact 




Step 3 

Engaging 

A large number of internal and external 

influencing factors play a role in the development 

of the corporate SDG strategy. 

Societal consensus is also fundamental 

to the success of such a system-changing 

restructuring. The translation of these 

assessments into a concrete corporate 

roadmap includes opportunities and 

risks. Figure 6 is a good visual sector 

example, although the risk assessment 

is missing here. Such a graphic must 

therefore be further elaborated and improved 

to be truly complete. (Figure 6) 

In further fine-tuning, the more detailed 

analyses of external and internal barriers 

play a key role. The authors of the SDG 

Sector Roadmaps write: “To fully realize 

the potential of the top impact opportunities 

identified in step 2, it is important 

to identify existing barriers that may 

prevent the sector from fulfilling this 

potential and the solutions that will help 

to overcome them. Identifying barriers 

for each opportunity is the first step 

in overcoming them and will support 

the development of a more detailed action 

plan. Many solutions will also have 

the potential to be impact accelerators, 

whereby they will not only overcome 

a barrier but scale SDG contribution.” 

Common structural barriers that may 

arise include: complexity, lack of buy-in, 

insufficient resources, limited availability 

of data, insufficient monitoring systems, 

or lack of leadership. 

In addition, there are also psychological 

barriers. A good overview of this valueaction 

gap is provided by this listing from 

the website Effectiviology.com: 

The value-action gap can occur due to 

various causes, such as: 

• Failure to generate concrete intentions 

for acting in accordance with values. 

• Failure to recognize opportunities to 

act in accordance with values. 

• Motivational complexities, for example 

in cases where people have competing 

values that support different actions. 

• Social dilemmas, such as feeling that 

it’s unfair to support a certain value 

when many other people don’t. 

• Lack of trust that acting in accordance 

with values will be effective, for example 

when it comes to not believing 

that a certain product will actually be 

recycled if you put it in the recycling bin. 

• Counter-incentives that outweigh the 

associated values, for example when a 

product that is manufactured in a more 

ethical way is more expensive than >> 

Figure 6: 

BASIC MATERIALS 

The opportunity SDG Illustrating the opportunity 

Innovation & market development 

New products and services that 

address environmental health challenges 

(e.g. lower impact chemicals, 

recycling technologies, certification) 

Efficiency & cost savings 

Operational efficiency can significantly 

reduce costs. 

Reputation management 

Manage potential negative social & 

environmental impacts Associated 

with the sector (health effects of 

chemicals, labour rights, child labour, 

healthy & safety, pollution etc.) 

Risk reduction 

Promote sustainable management 

of depleting natural resources (e.g. 

forests) 

• 95 % of chemicals excutives say they’ll innovate around technology over 

50 % expect breakthrough / radical advances. (PwC) 

• The global market for FSC certified wood is currently worth over $5 billion ... 

certified products are now carried by major retailers (GreenBiz) 

• Energy requirement forrecycling iron is some 20 % lower than for mining & 

processing it. For copper the energy saving is approximately 60 % and for 

aluminium even 90 %. (The Buiness of Mining) 

With energy accounting for 20 to 40 % of operational costs, energy savings 

has become a critical focus for mines, particularly in today's challenging 

business enironment. (Energy and Mines) 

Adressing chemicals, waste and pollution problems can promote, rather than 

inhibit, economic groth. Enacting solutions now can avoid longer-term 

economic constraints. (Global Alliance on Health and Pollution) 

Independent certification for ... sustainable management of timberlands has 

led to measurable improvements in the protection of forests, wildlife, and 

stakeholder rights ... as well as to the long-term economic viability of forestry 

operations. (GreenBiz) 



43

competing products (this specific example 

is a case of an attribute tradeoff, 

whereby the attribute of the product 

being more ethical is balanced by it 

being more expensive). 

• Lack of relevant options or increased 

difficulty of choosing those options, for 

example in the case of having no environmentally 

friendly version of a necessary 

product available for purchase. 

• External forces that prompt people to act 

against their values, such as marketing 

that encourages people to buy a certain 

type of unhealthy food. 

We must talk 

Answers to these questions can best be 

found through appropriate stakeholder 

dialog. Such dialog formats can be roughly 

divided into three parts: the “problem 

space,” the “solution space,” and the 

“organizational space.” The goals of the 

dialog processes are: 

1. getting to know the initiatives through 

their presentation of the results of the 

respective self-evaluations, 

2. having the participants work out 

– under guidance and appropriate 

moderation methods – structural 

obstacles that stand in the way of 

greater effectiveness, 

3. developing suggestions together to 

promote sustainable action in practice. 

You will not find an answer to all open 

points. Moreover, this process is very 

time-consuming. In the long run, it is 

almost impossible for most companies 

to conduct such stakeholder dialogs on 

their own and at their own expense. 

That is why it is worth getting involved 

in industry initiatives. The exchanges on 

such platforms can serve as useful aids. 

Two activities of the UNGC are worth 

highlighting here: 

To support companies everywhere in 

advancing the ambitions of the 2030 

Agenda for Sustainable Development, the 

UNGC has developed a portfolio of Action 

Platforms to inspire new and leading 

approaches to sustainable business. By 

bringing committed companies together 

with relevant experts and stakeholders, 

Action Platforms provide a collaborative 

space to: 

• shape the definition of leadership on 

critical sustainability issues and inspire 

continuous performance improvement, 

• participate in time-bound action plans 

to address sustainability challenges 

and support the achievement of goals, 

• engage with stakeholders that have the 

power and influence to move sectors 

and peers in the right direction, 

• utilize the unique assets of the UN 

Global Compact to advance the case for 

responsible business practices globally. 

The UNGC has also developed the Global 

Impact Initiatives, which support companies 

in embedding the SDGs in their 

core business. In this way, companies 

align their activities with Agenda 2030, 

become more resilient, and develop 

new business opportunities. Available 

to participating companies of the UNGC, 

Global Impact Initiatives are run in close 

collaboration with Global Compact Local 

Networks and are designed with a view 

to generating behavior change across a 

large number of companies at the local 

level – achieving maximum impact 

and scale. 

Companies participating in the Global 

Impact Initiatives will: 

• learn from thought leadership content, 

best practices, and resources, 

• access a diverse set of global and local 

engagement opportunities such as 

awareness-raising campaigns, trainings, 

mentoring, and blended learning, 

• increase employee engagement and 

professional development opportunities, 

• build a professional network of peers, 

UN partners, and experts, 

• accelerate the integration of the SDGs 

and Ten Principles into your company’s 

business strategy and operations, 

• deliver concrete company-specific outcomes. 

(Figure 7) 

Figure 7: 

UNGC ACTION 

PLATFORMS 

► Financial innovation for the 

SDGs 

► Peace, justice, & strong 

institutions 

► Decent work in global supply 

chains 

► Pathways to low-carbon and 

resilient development 

► Business for action platform 

for the ocean 

► Water security through 

stewardship 

GLOBAL IMPACT 

INITIATIVES 

► Target gender equality 

► SDG ambition 

► Young SDG innovators program 

► Climate ambition accelerator 



60 YEARS OF OFFICIAL DEVELOPMENT ASSISTANCE (ODA) 

RESILIENCE AMIDST ECONOMIC CRISES 

Post-war 

prosperity 

sees aid flows 

hold steady 

1973-1979 

Debt crises 

don’t stop ODA 

groth 

1990-1999 

Strong political 

will secures 

ODA’s most 

generous decade 

2011-2019 

1960-1972 

Despite oil 

crises, ODA 

volumes 

increase 

Geopolitical 

cooling sees 

1980-1989 ODA volumes 2000-2010 

and growth fall 

ODA budgets 

tighten before 

rebounding 

Note: The calculations in this timeline are based on 60 Years of ODA data and were prepared by the Data 

Collection Unit of the Development Co-operation Directorate of the OECD 

Historically, ODA is the most stable external Resource for Developing Countries ... 

Constant 2018 USD billion 

700 

600 

500 

400 

300 

200 

Total net 

resource flows 

from DAC 

countries to 

developing 

countries 

OIL PRICE SHOCKS 

MEXICAN 

DEBT CRISIS 

1990 

RECESSION 

2008 

FINANCIAL CRISIS 

100 

0 

1960 

1961 

1962 

1963 

1964 

1965 

1966 

1967 

1968 

1969 

1970 

1971 

1972 

1973 

1974 

1975 

1976 

1977 

1978 

1979 

1980 

1981 

1982 

1983 

1984 

1985 

1986 

1987 

1988 

1989 

1990 

1991 

1992 

1993 

1994 

1995 

1996 

1997 

1998 

1999 

2000 

2001 

2002 

2003 

2004 

2005 

2006 

2007 

2008 

2010 

2011 

2012 

2012 

2013 

2014 

2015 

2016 

2017 

2018 

Official development assistance Other official flows Private flows at market terms Private grants 

... with limited correlation between increase in ODA and GDP 

% 6 

5 

Annual 

average 

growth rates of 

ODA and GDP 

4 

3 

2 

ODA 

GDP 

1 

0 

-1 

1961-1969 1979-1979 1980-1989 1990-1999 2000-2009 2010-2019 

Source: Six decades of ODA: insights and outlook in the Covid-19 crisis © OECD 2020 


45

Is Covid-19 Slowing Progress 

Toward the SDGs? 

Yes, 

Say Experts 

However, many experts are not optimistic about the possibility 

of a green recovery. 

As we move into a crucial decade of action on 

achieving serious progress on sustainability, 

many are hoping the Covid-19 pandemic and 

subsequent economic recession will serve to 

reset our priorities toward a greener future 

in line with the UN Sustainable Development 

Goals (SDGs). 

Tove Malmqvist 

Research Manager 

Consulting group GlobeScan 

Over half of sustainability professionals believe that Covid-19 

will instead slow the rate of progress toward achieving the SDGs, 

according to a new report, Evaluating Progress on the SDGs, by 

GlobeScan and The SustainAbility Institute by ERM. Findings 

from the research also show that sustainability practitioners 

continue to report poor progress being made toward each of 

the 17 goals, as well as on sustainable development overall. 

Nearly 500 experienced sustainability professionals in 75 

countries were asked to evaluate the progress that has been 

made – on sustainable development overall and on each 

SDG; to rank the relative urgency of each goal; and to share 

insights into the priorities within their own organizations. 

Experts were also asked how the pandemic will affect progress 

on the SDGs. In addition, the survey tracked expert opinions 

polled in 2017 and 2019. 

When asked to rate the progress to date on the overall transition 

to sustainable development, more than half of sustainability 

experts (54 percent) say progress has been poor, with most 

remaining respondents giving neutral ratings (41 percent). 

Only 4 percent are satisfied with society’s achievements so 

far. Those who have the most negative views on progress tend 

to work in the academic and research sector, with European 

experts being the most negative. (Figure 1) 



Negative expert perceptions of our collective 

sustainability efforts so far are also 

apparent in their assessments of progress 

on individual SDGs, with majorities rating 

achievements as being poor on 10 

of the 17 goals. 

Figure1: Progress on transition to sustainable development 

% of experts, 2020 

1% 

4% 

Life below water (Goal 14), Reduced inequalities 

(Goal 10), Life on land (Goal 

15), and No poverty (Goal 1) are seen by 

experts as the SDGs where society’s level 

of achievement has lagged the most. Proportions 

of 7 in 10 or higher see progress 

in these areas as being poor — particularly 

on Goal 10 (Reduced inequalities). 

54% 

41% 

Excellent (4+5) 

Neutral (3) 

DK/NA 

Poor (1+2) 

In contrast, only around one-third of 

experts believe that there has been poor 

progress on Industry, innovation and 

infrastructure (Goal 9) and Partnership 

for the goals (Goal 17). (Figure 2) >> 

Question 

How would you rate the progress made to date in the transition 

to sustainable development globally? Please use the 5-point 

scale provided (where 1 is “very poor" and 5 is "excellent"). 

Figure 2: Progress on individual goals 


Good (4+5) 

Poor (1+2) 

Industry, Innovation and Infrastructure 

Partnerships for the Goals 

Affordable and Clean Energy 

Gender Equality 

Quality Education 

Clean Water and Sanitation 

Good Health and Well-being 

Responsible Consumption and Production 

Zero Hunger 

Sustainable Cities and Communities 

Climate Action 

Decent Work and Economic Growth 

Peace, Justice and Strong Institutions 

No Poverty 

Life Below Water 

Life on Land 

Reduced Inequalties 

21 34 

19 

36 

17 

44 

16 

42 

14 

42 

12 

48 

11 

49 

9 

57 

9 

62 

9 

51 

8 

61 

7 

56 

6 

64 

6 

68 

4 

75 

4 

72 

2 

84 

Question 

How would you rate society’s performance to date in having achieved progress toward each one of the 

Sustainable Development Goals (SDGs)? Please use the 5-point scale provided (where 1 is "poor" and 5 

is "excellent"). 


47

Figure 3: Urgency of SDGs 


Climate Action 61 

Life on Land 22 

Reduced Inequalities 22 

Responsible Consumption and Production 22 

No Poverty 19 

Quality Education 19 

Zero Hunger 18 

Decent Work and Economic Growth 16 

Peace, Justice and Strong Institutions 16 

Good Health and Well-being 15 

Clean Water and Sanitation 14 

Life Below Water 13 

Affordable and Clean Energy 11 

Gender Equality 9 

Partnerships for the Goals 8 

Sustainable Cities and Communities 7 

Industry, Innovation and Infrastructure 5 

Question 

Which three Sustainable Development Goals (SDGs) do you think require the most urgent action? 

Please choose at most three goals. 

Figure 4: Goal receving most attention within organizations 


Climate Action 44 

Responsible Consumption and Production 24 

Quality Education 23 

Partnerships for the Goals 21 

Industry, Innovation and Infrastructure 21 

Decent Work and Economic Growth 18 

Gender Equality 18 

Sustainable Cities and Communities 15 

Good Health and Well-being 14 

Affordable and Clean Energy 14 

Life on Land 13 

Clean Water and Sanitation 9 

Life Below Water 8 

Reduced Inequalities 6 

Zero Hunger 6 

Peace, Justice and Strong Institutions 5 

No Poverty 4 

Question 

Which of the Sustainable Development Goals (SDGs), if any, receive the most attention within your own 

organization (or within your own work if more applicable)? Please choose at most three goals. 



Sustainability experts tend to believe 

that several goals where progress has 

been the most unsatisfactory are also 

the most urgent, which is a cause for 

some concern. 

When asked to assess which goals require 

the most urgent action, experts 

overwhelmingly choose Climate action 

(Goal 13) — a goal that fewer than 1 in 10 

experts say we have made good progress 

on achieving. Reduced inequalities – the 

goal with the lowest overall score in 

terms of our collective progress – also 

ranked as one of the most important 

areas for action, along with Life on land 

(Goal 15) and Responsible consumption 

and production (Goal 12). 

The Covid-19 pandemic seems to have 

further dampened experts’ views on our 

collective progress on the SDGs. 

Around one-third of those surveyed say 

that the pandemic will serve to accelerate 

headway on achieving the goals, 

perhaps placing their hope in the potential 

of Green New Deals or renewed 

faith in our potential to collectively solve 

great challenges such as developing vaccines 

to save humanity. But over half 

instead believe that the pandemic and 

its economic impacts will further slow 

our already dismal progress. Experts in 

the service and media sectors are more 

optimistic about the potential impact 

of the pandemic, whereas respondents 

in the academic and research and NGO 

sectors, along with those based in Latin 

America, Africa, and the Middle East, 

are most prone to pessimism — possibly 

reflecting the limited resources available 

in many markets, resources that 

may be directed away from long-term 

sustainability priorities to cover more 

immediate needs. (Figure 5) 

This diversion from the SDGs toward 

other, more immediate issues resulting 

from the pandemic and its economic 

impacts should be of great concern to 

all. At this crucial point in time, we need 

to ensure that our collective efforts on 

sustainable development are not only 

maintained but accelerated. 

The perceived urgency of reduced 

inequalities has increased compared 

to 2019 in the wake of the pandemic, 

highlighting the unequal impact experienced 

by poorer countries as well as 

more vulnerable populations within 

countries. (Figure 3) 

Within their own work and organizations, 

sustainability professionals are 

most likely to be addressing climate 

action; almost half of the experts surveyed 

(44 percent) and more than half 

of corporate sustainability professionals 

(52 percent) say this is one of the SDGs 

receiving the most attention within their 

own organizations or work. 

Climate action is prioritized by respondents 

across most sectors and regions 

except the academic and research sector 

and among those based in Africa and the 

Middle East, both of which focus more 

on Quality education (Goal 4). 

Figure 5: Impact of the pandemic on the SDGs 


10% 

54% 36% 

Accelerate progress 

No change 

Slow progress 

Far fewer (6 percent) say they focus their 

work on reduced inequalities, despite 

the relative parallel urgency of this 

secondary issue. Other goals that are 

mainly overlooked include No poverty 

(Goal 1), Peace, justice and strong institutions 

(Goal 16), and Zero hunger 

(Goal 2). (Figure 4) 

Question 

How will the Covid-19 pandemic and its economic impacts 

affect society’s progress toward achieving the Sustainable 

Development Goals (SDGs) over the coming decade? 

Source: All Charts: GlobeScan-SustainAbility Survey 2021| Evaluating Progress on the SDGs 


49

PHOENIX 

RISING 



How Joaquin Phoenix’s 

career revival has been 

an important thing for 

the man, the industry 

and, perhaps even just 

in a very slight way, the 

welfare of the planet. 

By Frank Grice 

Joaquin Phoenix’s triumphant return 

to form in DC Comics’ 2019 psychological 

thriller Joker presented an interesting 

double edge to the dynamism 

of an actor who has often ventured to the 

furthest corners of both the movie world 

and his own mind in search of meaningful 

stimulation and contemplation. 

In giving one of the industry’s most considered 

thinkers a platform on which to 

speak about matters far removed from 

film scripts and red carpet flashbulbs, he 

found the project as profitable morally 

as the colossal box office receipts were 

for Joker’s backers. 

In a famous scene in the movie, Phoenix 

booms, “Do you ever actually leave the 

studio? Everybody just yells and screams 

at each other. Nobody is civil anymore; 

nobody knows what it’s like to be the 

other guy.” 

As a social commentary, whether you 

regard the line to be uncannily insightful 

or perhaps just a Hollywood-laced 

dose of pernicious garbage, it actually 

matters not. That’s because in the two 

years since – and despite decades of 

successfully evading the public gaze 

when it comes to cheap, gossip-laden, 

salacious column inches – Phoenix, as 

a social and environmental commentator, 

has never been more in demand or 

better regarded. 

He’s also never spoken so much sense. In 

the first instance, the 46-year-old actor 

is passionately dedicated to the preservation 

of human rights. His work for 

Amnesty International circumnavigates 

women’s issues, looks to raise awareness 

of societal abuse – not least about the 

ongoing genocide in the Darfur region of 

Sudan, where over three million people 

are said to have perished – as well as lobbying 

governments, throwing his weight 

behind health organizations, global climate 

change projects, as well as reaching 

to support localized environmental 

and natural world initiatives. There is 

nothing he won’t do to promote change. 

“Making a difference is easier than you 

think,” he begins. “The first step is making 

your voice heard. When you’ve done 

that, make it heard some more, and 

again. Fairness isn’t a choice, it’s a right, 

and we will get there if enough people 

stand behind it.” 

That drive for fairness is no better 

summed up than through Phoenix’s 

Peace Alliance, which has raised well in 

excess of $100 million for international 

peace-building initiatives. 

“Peace is such a vague term, and it’s been 

repackaged and repurposed so many 

times over the years. It’s been used for 

so many different things – environmentally, 

in war, as an urban delivery 

mechanism for solidarity … yet there is 

no ambiguity in what we mean by it or 

expect from it. 

“I think sometimes we are overplayed by 

the expectations of so many organizations 

and mission statements and plans 

and everything else. Sometimes we need 

to just lay out a very simple message 

and let people use their insight and 

intelligence to walk their own path. >> 


51

“There is always more than one route to 

a destination,” he adds. 

Perhaps what keeps Phoenix so engaged 

with “the fight” is the fact that his life 

has been patterned with creative accomplishment 

and personal heartache 

in equal measure. 

“ 

There is 

always more 

than one 

route to a 

destination. 

Undoubtedly complex, reassuringly aloof 

and, it should be said, wonderfully funny 

(when he wants to be), the philanthropist 

and campaigner has always been 

someone smart enough to deconstruct 

a problem from the inside. “The route 

to all of us solving the world’s ills isn’t 

necessarily by doing more … by going 

after these problems in a frenetic way 

where we’re all clamoring for action and 

attention and praise. I think sometimes 

the best way to tackle a problem is to 

really take a step back and have a good 

look at it. 

“Take Covid as an example; for once … 

for perhaps the first time ever, the movie 

industry found itself with time to sit back 

and ponder its own existence,” he says. 

“And I think, in almost every corner, it 

didn’t particularly like what it saw, and 

perhaps that’s a good thing. We will see 

in the years to come.” 

Phoenix first came to prominence in 

1986’s SpaceCamp. His evolution as a personality 

as well as an actor would soon 

find itself played out against a backdrop 

of the heart-breaking death of his older 

brother, River, yet it led him to forge a 

reputation as a thoughtful, emotional, 

intelligent force the industry could be 

proud of. 

Rather than rally against everything his 

sibling stood for – the fresh, clean-cut, 

poster-boy image of early 1990s teen entertainment 

– Phoenix instead followed 

a cerebral path that came as naturally to 

him as breezy, stylish charm did to River. 

“We were always very different in that 

respect. I was always the miserable one,” 

he says, breaking into a slow-motion 

smile that lights up otherwise somber 

eyes. “We were just different people going 

about the same project in different 

ways. Who knows where we would both 

be now?” he says, referencing River’s untimely 

death in 1993 at the age of just 23. 

While, you sense, he will never get over 

the loss of his big brother, he most certainly 

has focused a career on producing 

things that are worthwhile in his 

memory. “He always told me I would be a 

bigger, better actor than him, despite the 

incredible heights he was at. He told me 

I wouldn’t quit and I’d keep going, and 

everything I do has a piece of him in it.” 

Indeed, the arrival of Phoenix and wife 

Rooney Mara’s first child in September 

2020 offered the biggest possible tribute 

to an acting tour de force who continues 

to inspire almost three decades on – 

their son is called River. 

Phoenix picks and chooses his projects, 

dramatic or otherwise, in a measured 

way. He has been known to have long 

periods out of the spotlight, and he ensures 

that whenever there is the chance 

to return to prominence, it will be in a 

project deserving of the investment. The 



“ 

Covid reassured 

my idea that, in 

this world, we are in 

it for each other 

rather than just for 

ourselves. 

successful revival of DC Comics’ Joker 

certainly provided that in 2019 – a role 

played out with such impeccable artistry 

that talk of a sequel remains rife. It is 

also the highest-grossing R-rated film of 

all time, taking in more than $1 billion 

at the box office. 

That sort of mass populism goes against 

the man himself in many ways. He is just 

as happy taking on small independent 

projects, and his producer roles (including 

the upcoming documentary The End of 

Medicine, which explores the link between 

the treatment of animals and health pandemics 

– a subject more relevant now 

than ever before) have reflected a predominant 

urge to stimulate conversation 

rather than wealth. He is a philosopher, a 

deep thinker, the likes of which modern 

cinema doesn’t respect as much as it 

might; but he does at least redirect those 

qualities into environmentalism, activism, 

and philanthropy. Across ambassadorial 

roles for the likes of Veganuary, PETA, and 

In Defense of Animals, he is a passionate 

supporter of organizations that respect 

the Earth’s health, and the welfare of 

those who reside on it. 

“Covid reassured my idea that, in this 

world, we are in it for each other rather 

than just for ourselves. It proves we can 

adjust our thinking toward harmonious 

aims, and that should serve us well for 

the future, if only we can just hold onto 

that special feeling that we generated. 

“I think Covid enabled us to reconnect 

to the possibility of sustainability (in 

preserving life), and change (in being 

adaptable to the new conditions that 

were being put in place around us). 

“It also showed us that absolutely anyone 

can stimulate debate, can raise awareness 

for goodness, can put real pressure on 

those who have influence. And finally 

I think we understand better now that 

conflict is a natural human and animal 

condition. It is as natural as love and 

laughter. By accepting and embracing 

conflict you can then manage how it’s 

played out. You can still obtain peace 

from resolving it the right way, rather 

than by force.” 

Phoenix also raises the notion that real 

action cannot be a constant. “People 

who push for change need to take a 

break as much as those being lobbied 

need headspace to make their minds 

up,” he says. “When you push too hard 

you lose people, so my belief is that if 

we think harder about the delivery of 

a message, we are much more likely to 

see results.” 

This is a man who clearly possesses a true 

talent for theorizing over the universe – 

it’s a gift to look at the universe, at life 

forms, at the science of what’s around 

us, and picture the reality of what that 

is and who we are. 

“The progression we all want for a better 

environment, a fairer world, needs to be 

one of those things that ebbs and flows. 

As society changes or goes through new 

challenges, it moves in and out of relevance. 

At the moment the whole world 

is in conflict with itself – it needs help 

in ways more meaningful than celebrities 

singing songs over YouTube. 

“Luckily it has a few billion people willing 

to get it to where it needs to be – I 

am confident of that.” 


53


ZOOMING IN 

LEAVE NO ONE BEHIND 

“We must urgently transition to a 

green, gender-sensitive, and inclusive 

economy, and raise global ambition 

in the fight against climate change. 

We must eradicate poverty and build 

a fair globalization that delivers for 

all. The Sustainable Development 

Goals offer a path. Let us take it 

together and uphold our promise to 

leave no one behind.” 

António Guterres, UN Secretary-General 


55

Four Rings and Three “E”s 

for a More Sustainable 

Society 

Engage, Educate, Empower: These are the principles Audi has adopted for its social commitment 

in order to put it on a strategic foundation. Activities range from donations and financial aid – 

specifically during the coronavirus pandemic – to the promotion of ideas for sustainable mobility 

concepts, all the way up to encouraging others to work toward a better world. 

By Dr. Roxana Codita and Dr. Stefanie Augustine, Audi 

At Audi, responsible management means 

considering sustainability in all of its 

facets. This goes beyond the development 

of innovative mobility solutions, 

resource-friendly production, and responsible 

supply chains, and also includes 

social sustainability. “We at Audi 

have a vision of sustainable mobility that 

everyone can use with a clear conscience. 

That is why we take responsibility for 

the future of our planet,” explains Silja 

Pieh, Head of Corporate Strategy at AUDI 

AG, adding, “Besides environmental and 

economic aspects, social responsibility 

therefore also plays a key role in our 

strategy.” In so doing, Audi is putting its 

social commitment on a broad strategic 

foundation, guided by three principles 

– “Engage,” “Educate,” and “Empower.” 

Engage – worldwide commitment, 

especially during the coronavirus 

pandemic 

Audi combines all activities relating 

to donations and volunteering under 

“Engage.” This heading also encompasses 

social sponsorship, events, cooperations 

with nonprofit organizations, and the 

promotion of projects with a positive 

social impact. One example of this is 

the aid made available in relation to the 

coronavirus pandemic. In 2020, Audi 

donated emergency coronavirus relief 

of €600,000 to hospitals near its sites in 

Germany. The company also provided 

10,000 medical masks for the Ingolstadt 

region and 5,000 medical masks for the 

Neckarsulm region. “With these donations, 

we want to send a signal of solidarity 

and social responsibility at our home 

sites in Ingolstadt and Neckarsulm, and 

to thank all of the doctors, nurses, and 

other staff of the social institutions and 

hospitals for their untiring efforts in this 

exceptional situation,” said Wendelin 

Göbel, Board of Management Member 

for Human Resources, when handing 

over the donation. 

In Mexico, Audi supplied doctors and 

nursing staff with vehicles at no charge, 

enabling them to commute between 

their homes and workplaces without 

risk of infection. Audi Mexico also donated 

protective equipment to various 

hospitals and the local Red Cross. Audi 

Brussels likewise donated money and 

56 

Global Goals Yearbook 2021

protective medical equipment to hospitals 

and the Red Cross. In addition, the 

employees of the Brussels site actively 

supported the StreetwiZE organization, 

which specializes in talent development 

and change management, investing 

primarily in educational projects for 

children in need. 

Educate – innovative ideas from 

clever people 

“Educate” unites all the training and 

education programs that Audi offers or 

supports – not only for employees, but 

also for business partners and society 

as a whole, for example through initiatives 

at Audi sites. For Audi, “Educate” 

also means helping to shape progress in 

research and teaching and cooperating 

with numerous national and international 

universities. The MQ! Innovation 

Summit that Audi organizes comes under 

the category of “Educate,” for example. 

This summit brings together numerous 

participants from across the world to 

discuss the mobility of the future. Here, 

the focus is on the four key aspects of 

intelligent, networked, social, and ecological 

mobility. In panel discussions 

and workspaces, the participants discuss 

solutions, concepts, and new ideas under 

the motto of #neverstopquestioning. 

Sustainable mobility concepts are also 

on the agenda at the Audi Hackathon, 

which likewise comes under the category 

of “Educate.” In 2020, 25 participants 

spent 30 hours developing new ideas 

for sustainable urban mobility – from 

the concept on the drafting board up to 

the digital prototype. The participants 

then had to convince the jury in 20- 

minute presentations. The team with the 

“10MinuteMap” concept was awarded first 

place. The app shows users where they 

can find local points of interest such as 

businesses or cafés within a 10-minute 

radius of their location and how they can 

get there as sustainably as possible. “The 

hackathon showed how we can create new 

ideas in an unbelievably short time when 

we bring together different points of view. 

We need to think sustainably, ecologically, 

economically, and socially,” says Matthias 

Brendel, Head of Audi Denkwerkstatt. 

Empower – achieve more together 

With “Empower,” Audi hopes to encourage 

others to advocate sustainable 

practices and lifestyles. Through various 

innovation and cooperation projects, 

the company empowers other players 

to make the world as a whole more 

sustainable. Audi acts as a multiplier 

here and plays the role of a “change 

agent.” The sustainability agents include 

employees, customers, and other stakeholders. 

“Empower” will bring about 

even more far-reaching and long-term 

changes – however, without the direct 

involvement of the company. This will 

give the instrument a strong impact. 

One example of this is the Nunam startup, 

which is sponsored by the Audi 

Environmental Foundation. Nunam repurposes 

old batteries. The start-up company 

takes used lithium-ion battery cells 

and batteries and creates a new mobile 

energy storage system that can serve as 

a light source for Indian vegetable sellers 

at a market after dark, for example. 

The start-up provides the power banks 

as cheaply as possible so that even the 

poorest people in the region have access 

to electricity. 

Three “E”s to fulfill the SDGs 

With its activities relating to Engage, 

Educate, and Empower, Audi is also 

making a contribution to a whole series 

of Sustainable Development Goals (SDGs), 

especially Goal 4 (Quality education), 

Goal 8 (Decent work and economic 

growth), Goal 9 (Industry, innovation 

and infrastructure), and Goal 11 (Sustainable 

cities and communities). 

Global Goals Yearbook 2021 57

Rebooting Decent Work 

Although mainstream media coverage and public interest in sustainability has increased, the 

pandemic has decelerated progress on the Sustainable Development Goals (SDGs). Workers 

have felt this most in the progress toward full and productive employment and decent work for 

all (Goal 8). By making Goal 8 one of the key elements of their recovery strategy, businesses, 

investors, and asset managers could get that progress back on track and improve supply chain 

resilience to future shocks. 

By James Lewry, Control Risks 

The Covid-19 pandemic has been the 

most far-reaching shock to the workplace 

since the advent of personal computing. 

Abrupt changes to supply chains have 

led to job losses in manufacturing and 

logistics. Crews of cargo ships found 

themselves without employers while at 

sea. In emerging economies, informal 

workers were impacted most through 

lost income and received little government 

help. Pandemic restrictions and 

rapidly shifting consumer trends raised 

existential questions about the future 

of some jobs and sectors. But in other 

sectors, booms were created, such as the 

app-based economy, presenting frontline 

workers who delivered food, goods, and 

people with health and safety challenges 

and job insecurity due to an increase 

in casual or informal employment and 

zero-hours contracts. 

In emerging and developed economies 

alike, young people were disproportionately 

affected through the loss of valuable 

early work experience and compromised 

education systems. In emerging economies, 

concerns were expressed about a 

reversal in the progress on child labor, 

which is linked to an increase in poverty 

– a significant hurdle for Goal 1 and 

ending poverty in all its forms. 

This has happened in a world of work already 

undergoing major changes through 

increased automation, an emergent 

energy transition, and rapid economic 

progress in major emerging markets. 

Although the pandemic did not create 

social inequality in the global economy, 

it did cruelly expose it. More than 1.6 

billion informal workers have been at 

risk of losing their livelihoods worldwide, 

with income among those workers falling 

by an estimated 60–81 percent in 

some regions. 

Stakeholders respond 

The UN Secretary-General has called 

for a new social contract that integrates 

employment, sustainable development, 

and social protection, recognizing the 

gap between changes in the world of 

work and the policies and institutions 

meant to manage them. 

The flood of government support to the 

private sector in 2020 will unwind in 

2021, but its legacy will continue. Taking 

public money means accepting public 

scrutiny – businesses’ circle of stakeholders 

will widen. The same trend has 

created a positive momentum, with several 

governments, including the United 

States, putting new jobs and better working 

conditions at the heart of their economic 

recovery plans. 

Over the past 20 months, we have seen 

the introduction of, and national debates 

on, new legislations that are in 

line with the Goal 8 targets, from the 

EU-wide mandatory human rights due 

diligence law to adoption of draft human 

rights legislation in Germany and Switzerland. 

The explosion in ESG investing 

has also accelerated investor scrutiny on 

the social issues that Goal 8 is seeking to 

address and created a market for social 

“upside” investing. 

The pressure on employers mounts… 

Companies already on the path to decent 

work and sustainable growth fared better 

during the pandemic than ones who 

were not. Those companies benefited 

from more resilient supply chains, the 

agility to pivot to new markets and opportunities, 

and the continued financial 

performance of those businesses. But for 

those companies that had not aligned 

fully with the SDGs – or had unsustainable 

employment practices in their supply 

chains – there is an opportunity to 

boost recovery by aligning with Goal 8. 

The key aims of a Goal 8-focused strategy 

pivot around: 

• tackling inequality and discrimination, 

particularly within vulnerable groups 

such as workers with disabilities, young 

workers, and migrant workers; 

• upholding labor standards and skills development 

throughout the value chain; 

58 


• identifying child and forced labor and 

using remediation when abuses are 

found; 

• preventing unfair hiring and recruitment 

practices, particularly of vulnerable 

groups. 

Lessons from the leaders 

Faced with growing pressure from investors, 

governments, and consumers, 

and the need to recover supply chains 

and operations, here are three areas 

that companies aligned with Goal 8 are 

focused on: 

• Understanding material risks and 

opportunities: Those who performed 

well in the pandemic understood their 

supply chain in detail, having mapped 

their suppliers and the material social 

risks impacting them. They know where 

to look, and what to look for. They are 

more likely to have included decent 

work and social-impact measurements 

as part of their sustainability strategies. 

• Worker-centric due diligence and 

policy: Leading companies could already 

answer the question of whether 

the workers who delivered their packages, 

made their clothes, or assembled 

their electronics were paid a living wage, 

were in debt bondage, or were forced to 

work long hours with no job security. 

These companies used due diligence 

focused on the local risks most material 

to their workers to ensure risks are 

understood and managed at the source. 

• Collaboration and partnerships: 

Leading companies were working with 

suppliers to maintain progress toward 

decent work and to build capacity with 

those suppliers in supporting their 

workers. They are collaborating with 

suppliers, NGOs, and industry peers to 

raise the standard of workplace safety 

and provide independent opportunities 

for workers to voice concerns and 

grievances regarding their employment. 

Companies that direct their policies to 

survival mode will end up eroding workers’ 

contracts and conditions, and they 

are more likely to struggle through the 

aftershocks of the pandemic and the 

changes it has accelerated. Whereas 

those that integrate a values-based 

approach and address Goal 8 through 

their corporate strategies by investing 

in their people and supply chains today 

will come out more robust and resilient 

on the other side. 

James Lewry 

Director at Control Risks 


Date Palm 

Cultivation in the 

Sign of the SDGs 

The General Secretariat of the Khalifa International Award for Date Palm and Agricultural 

Innovation has sought, since the award’s establishment in 2007, to bring a consistent vision, goal, 

and message to the Millennium Development Goals (2000–2015) and the SDGs (2015–2030). 

The Award has succeeded in developing the infrastructure of date palm cultivation and 

agricultural innovation sectors at the national and international levels. 

By Prof. Dr. Abdelouahhab Zaid, Khalifa International Award for Date Palm and Agricultural Innovation 

The Award’s main objective is to highlight 

to the world the great interest 

of H.H. Sheikh Khalifa bin Zayed Al 

Nahyan, President of the UAE in date 

palm cultivation and agricultural innovation. 

His Highness has made generous 

initiatives to organize activities 

to support research in this field and 

to embrace the UAE’s leading role in 

supporting creativity and innovation 

in the agricultural field in general, and 

date palm cultivation in particular. The 

Award also pays great attention to environmental 

protection, fighting poverty, 

and increasing green areas to achieve 

sustainable development. In addition to 

supporting scientific research, it encourages 

and appreciates the professionals 

working to develop the date palm and 

agricultural sectors, in the UAE and 

worldwide. The Award also benefits 

from various previous experiences to 

improve the agricultural and date palm 

sectors in accordance with the best international 

practices. This confirms 

that the Award’s vision, mission, and 

objectives have a great benefit globally 

60 


as well as efficient implementation, all 

within the criteria of Goal 17 (Partnerships 

for the goals). 

Award’s activities and achievements 

Following the directives of H.H. Sheikh 

Mansour Bin Zayed Al Nahyan, UAE 

Deputy Prime Minister, Minister of Presidential 

Affairs, and the continuous follow-up 

of H.E. Sheikh Nahayan Mabarak 

Al Nahayan, Minister of Tolerance and 

Coexistence, Chairman of the Award’s 

Board of Trustees, all the national efforts 

were guided to support and develop the 

date palm cultivation sector by launching 

a set of initiatives and development 

projects aiming to enhance food security 

and achieve sustainable development. 

These efforts are as follows: 

• Organizing 13 sessions of the Khalifa 

International Award for Date Palm and 

Agricultural Innovation (2009–2021) 

with the participation of 1,648 candidates 

representing 56 countries. 

• Organizing 3 sessions of the Distinguished 

and Innovative Farmer Award 

(2018–2020) with the participation of 

192 farmers from across the UAE. 

• Organizing 12 sessions of “The International 

Date Palm Photography” competition 

with the participation of 3,971 

photographers from 54 countries. 

• Organizing 5 sessions of “The International 

Date Palm Poetry” competition 

with the participation of 586 poets 

representing 18 countries. 

• Organizing a ministerial conference for 

date-producing countries to develop a 

framework strategy for the eradication 

of the red palm weevil (2019). 

• Launching the Abu Dhabi Declaration 

to Combat the Red Palm Weevil and 

establishing a trust fund under the 

supervision of the FAO (2019). 

• Establishing refrigerated date stores 

in Al Wahat Al Bahariya in the Arab 

Republic of Egypt with a capacity of 

4,000 tons (2019). 

• Rehabilitation of the Siwa government 

dates factory in the Arab Republic of 

Egypt with a production capacity of 

10,000 tons per year (2017), as well as 

the New Valley Dates Complex with a 

production capacity of 5,000 tons per 

year (2019). 

• Launching the world’s largest electronic 

library, which includes 299 scientific 

sources in both Arabic and English, 

specialized in the fields of date palm 

cultivation and agricultural innovation. 

Idea behind the Arab date festivals 

The organizing of date festivals in dateproducing 

areas in Arab countries is 

mainly based on the Award’s vision, 

which considers the improvement of 

job opportunities and living standards of 

date-producing families. This is achieved 

by establishing multiple development 

projects, such as refrigerated date stores, 

and guiding farmers on how to produce 

organic dates according to internationally 

recognized standards, without undermining 

natural resources. This contributes 

toward expanding the scope of 

communication as well as the availability 

of Arab dates in the global markets. As 

a result, the Award gained a significant 

role in achieving various SDGs: 

Goal 1 (No poverty) and Goal 2 

(Zero hunger) 

The Award’s General Secretariat has 

worked for several years hosting date 

palm farmers from various date-producing 

countries at date festivals and exhibitions 

that it has organized in several 

Arab countries. The aim is to provide 

an opportunity to small farmers and 

date producers in the Arab region to 

participate in festivals and date exhibitions 

in order to exchange experiences 

between farmers from date-producing 

and processing countries. Another goal 

is to provide the opportunity to export 

Arab dates to various countries across 

the world through direct communication 

with international date-trading 

organizations, hosted by the Award in 

each exhibition. This, in turn, has >> 

• Organizing the annual International 

Egyptian, Sudanese, Jordanian, and 

Mauritanian Date Palm Festivals. 

• Organizing the annual Abu Dhabi 

International Date Palm Exhibition 

(2015–2021). 

• Organizing the International Date Palm 

Conference every four years (1998– 

2022) with the participation of 1,754 

researcher from 45 countries. 


a direct result on improving the reputation 

of Arab dates internationally, thus 

increasing the global demand for Arab 

dates, which has been highlighted in 

official statements by senior officials 

working in this sector in Arab countries. 

The Award has also worked to improve 

the quality of Arab dates so as to be in 

line with the requirements of international 

markets. The Award has supported 

and rehabilitated more than 200 date 

palm farms in the Siwa Oasis in the Arab 

Republic of Egypt to obtain an organic 

farming certificate for dates (Ecocert) accredited 

by the European Union. This, in 

turn, has contributed to enhancing the 

competitiveness of Arab dates with other 

international dates. This all contributes 

to improving the income levels of small 

farmers and even eliminates hunger and 

poverty among the farmers and date 

producers in Arab countries. 

Goal 8 (Decent work and economic 

growth) 

The Arab dates exhibitions and festivals 

(more than 16 festivals and exhibitions 

in six countries) contribute to enabling 

the broad commercial activities of date 

palm growers, producers, and processors 

in Arab countries by promoting 

comprehensive, diversified, and productive 

rural economies that create 

decent job opportunities and increase 

incomes. This has been implemented in 

the Siwa Oasis in the Arab Republic of 

Egypt, where the International Festival 

of Egyptian Dates in Siwa took place for 

four consecutive years (2015–2018) and 

contributed to improving livelihoods 

and increasing productivity capacities. 

It also led to an increase in the number 

of date-packaging factories, and this is 

supported by a number of performance 

indicators. For example, Egyptian date 

exports increased during the festival’s 

organization period to 17 percent, while 

the amount of dates imported from outside 

the country decreased by about 25 

percent. This indicates the contribution 

of the Award’s activities and events toward 

increasing the economic growth of 

the date palm cultivation sector in order 

to achieve sustainable development for 

agricultural communities. This is because 

the Award has extensive knowledge, 

experience, and high-level partnerships 

with international organizations that it 

relies upon to support the development 

of value chains for Arab dates. 

Goal 9 (Industry, innovation and 

infrastructure) 

The Award has also contributed to promoting 

innovation in the agricultural 

sector, at both the individual and institutional 

levels, in support of the SDGs. 

This is achieved by encouraging innovation 

and providing the opportunity for 

innovative agricultural entrepreneurs to 

compete for one of the Award’s categories 

(Pioneering and Advanced Innovations 

Serving the Agricultural Sector). 

Each year, the Award organizers receive 

hundreds of innovative agricultural projects, 

and the winner receives a trophy, an 

appreciation certificate, and an amount 

of more than $200,000. The number of 

participants in this category has reached 

more than 298 from 56 countries. These 

innovative projects have contributed 

to improving the quality of life, work 

systems, and sustainable production 

levels in the agricultural sector. 

Goal 12 (Responsible consumption 

and production) 

The Award has also contributed to creating 

a balance between the production 

and consumption systems in the date 

palm cultivation sector. A more sustainable 

practice is achieved through knowledge 

transfer and by holding a series of 

workshops for the farmers. The Award 

has hosted more than 30 international 

experts in cooperation with international 

organizations in the field of date palm 

cultivation and agricultural innovation. 

Goal 13 (Climate action) and Goal 15 

(Life on land) 

The Award’s projects at the regional and 

international levels have had a direct positive 

impact on the development of the 

agricultural sector – and date palm cultivation 

in particular in the date-producing 

countries – and directly contributed to 

enhancing climate awareness for workers 

in this sector. The Award’s investments 

in sustainable farming methods in dateproducing 

countries – by encouraging 

farmers and promoting traditional farming 

patterns – have contributed toward 

better preserving natural resources and 

increasing the ability of cultural agricultural 

systems to adapt to climate change. 

Goal 17 (Partnerships for the goals) 

The Award’s General Secretariat signed 

more than 38 memoranda of understanding 

during the period of 2015–2021 

with a number of concerned ministries 

in the date palm cultivation sector and 

agricultural innovation. The Secretariat 

also worked with a number of international 

organizations, civil society organizations, 

and private-sector companies on 

this effort. This has built a framework 

for partnerships with those ministries 

and organizations. The aim is to extend 

communication and cooperation as well 

as promote comprehensive, diversified, 

and productive rural economies – including 

in business areas related to date 

manufacturing and trading – through 

the implementation of initiatives and 

projects and organizing conferences and 

festivals. 

62 


DEVELOPMENT AIMS 

By Prof. Dr. Abdelouahhab Zaid and Dr. Sandra Piesik 

The Khalifa Award Report has been inspired by 46 

contributors from across 21 countries, including adaptation 

experts. It provides a framework to tackle the major 

climate change issues such as CO 2 

emissions, biodiversity, 

desertification, drought, and land degradation, which can 

lead to reduced harvest yields and the deterioration of 

natural resources, particularly in lower-income countries. 

By implementing sustainability principles, date palm 

ecosystems are vital in reversing desertification in desert 

regions. They can also play a key role in reducing the 

number of people who face food insecurity across the 

globe – that number, unfortunately, has significantly 

increased since the Covid-19 pandemic outbreak. 

Therefore, the pursuit of a self-sustainable developmental 

model serves both planetary and human health. 

As the year 2021 marks the beginning of the UN Decade 

of Ecosystem Restoration (2021–2030), the Khalifa Award 

Report, Bridging Boundaries, was framed around the 

“5 Ps”: people, planet, prosperity, peace, and partnerships, 

which shape the 2030 Agenda for Sustainable 

Development. 

Moving toward the implementation of sustainability 

enforces the replacement of the traditional “manufacture, 

use, and dispose” economy with a bio-circular model, 

where everything that is extracted from nature returns to 

nature, and in this way we allow the global economy to 

rebuild in a healthy manner. The date palm industry has 

huge potential to lead this shift to a bio-circular global 

economy. 

Global date palm production is estimated to be 8 million 

tons annually. Date palm trees have a vast range of health 

benefits, in addition to a variety of products that are 

produced from it and used around the world. Currently, 

the date palm industry produces a huge amount of 

unnecessary waste, with an average rate per tree of 23 

kilos of waste per year, which significantly contributes 

to environmental pollution. This could be cut to zero by 

using second-class dates in consumable products such as 

chopped dates, date paste, and date honey. 

Date palms also produce fibers that can be used in several 

useful products such as ropes, thermal insulation, and 

evaporative cooling equipment. This gave rise to the idea 

of turning date palm waste into a sustainable business. 

Date palm fibers will have a great impact on the MENA 

region, which accounts for 90 percent of date palm 

production. Minimizing the produced date palm waste will 

require skills, technology, and new jobs. This will tackle 

poverty and revive investment opportunities in the region 

and, most importantly, in low-income countries. 

As urban populations continue to grow across the 

world, rural spaces are depopulating. Date palm oasis 

ecosystems emphasize the importance of linking the 

rural with the urban, as date palm trees can absorb 

huge concentrations of CO 2 

– every tree can absorb 200 

kilograms of CO 2 

every year. This means that the 100 

million date palm trees in the MENA region can absorb 

28.7 megatons of CO 2 

per year. In return, this could help 

lower CO 2 

levels and positively impacting climate change. 


Unlocking Women’s Economic 

Potential: Merck Initiatives Seek 

to Level the Playing Field 

Gender parity is still a long way off. Not only do women earn significantly less than men on 

average, but they also sacrifice far more time to (unpaid) domestic activities and caring for sick 

and elderly relatives, often at the expense of their own health and well-being. Merck, a science 

and technology company, is pursuing two initiatives in an effort to rectify this imbalance. 

Although no small task, this undertaking is of great importance to the organization, which offers 

products and solutions to address diseases that disproportionately impact women, including 

thyroid disorders, multiple sclerosis, and infertility. Merck is thus positioned to help improve 

critical aspects of women’s health, from awareness and education to access to health and 

government programs. 

By Lynn A. Taylor, Merck 

When it comes to women’s economic 

empowerment, one single figure is very 

revealing: 99.5. According to estimates 

by the World Economic Forum, this 

represents the number of years it will 

take to achieve gender parity in the 

dimensions of economic participation 

and opportunity, educational attainment, 

health and survival, and political 

empowerment if things continue to move 

at their current speed. 

Inequality and its consequences 

Both men and women would benefit from 

an expedited achievement of gender parity. 

After all, the gender gap is not only 

unjust but also has massive economic 

consequences. Not only do women spend 

much more time on unpaid work than 

men, but they are also frequently paid 

less than men for remunerated labor. 

Given these circumstances, women’s 

labor accounts for a much smaller share 

of gross domestic product. By contrast, 

according to the International Labour 

Organization (ILO), if women were paid 

the same as men, they would contribute 

between 5 percent (United States) and 34 

percent (Egypt) more to national income 

(depending on the country). The ILO also 

estimates that 865 million women worldwide 

currently suffer from this inequity. 

In addition, women are much more likely 

than men to be responsible for child rearing 

or unpaid caregiving, frequently in 

addition to any paid employment. This 

dual burden often has a tangible impact 

on the health and well-being of women 

who find themselves in this situation. 

According to a 2011 study published in 

the American Journal of Public Health, 

women who care for relatives at home 

are six times more likely to suffer from 

depression or anxiety. 

Initiatives help drive UN Sustainable 

Development Goals 

Must things stay this way? Merck does 

not think so. By the mid-2010s, the Executive 

Board of this German blue-chip 

company had already moved to advance 

gender parity for women through its 

Healthy Women, Healthy Economies 

initiative as well as the Embracing 

Carers initiative. These two programs 

are pursuing complimentary goals: to 

reduce the health impacts on women 

caused by the dual responsibility of work 

and family, and to provide support to 

unpaid caregivers, whether women or 

men – objectives that happen to closely 

align with UN Sustainable Development 

Goals 3 and 5. 

Launched in 2015 as a partnership between 

Merck and the governments of 

the United States and the Philippines, 

64 


Merck is also driving the Embracing 

Carers initiative, a collaboration with 

nine global caregiving organizations that 

seeks to provide support to women and 

men in their role as unpaid caregivers 

and drive public awareness about the 

challenges they face. Women carry a 

disproportionate burden of this work – 

no surprise considering that 70 percent 

of the time, it is women who provide 

care for parents, grandparents, or inlaws, 

often without any pay at all. It 

goes without saying that such a situation 

has an impact on the carers’ economic, 

mental, and physical well-being. 

Eliminating blind spots in research 

The program is also working to fill in data 

gaps and collect adequate research-based 

evidence. For instance, Merck is supporting 

the research being conducted by Dr. 

Felicia Knaul, a renowned economist 

from the University of Miami (Florida, 

United States) leading the examination 

of women’s unpaid labor with a current 

focus on Canada, Chile, China, Mexico, 

and Peru. 

the Healthy Women, Healthy Economies 

initiative is underpinned by one 

fundamental concept: that unlocking 

women’s potential will lead to more 

economic growth. With this in mind, 

the founding partners first considered 

where women needed the most support 

– such as access to health services 

and workplace safety – and developed 

toolkits to provide to the governments 

and organizations of the Asia-Pacific 

Economic Cooperation forum. 

A collaborative of renowned partners 

Healthy Women, Healthy Economies has 

programmatically collaborated with the 

US-based think tank The Wilson Center 

and a US-based nonprofit working to improve 

the health of mothers and babies, 

March of Dimes, giving the initiative 

a much broader base of support and 

impact. Merck has built a collaborative 

among the various initiative partners 

while also spearheading and guiding 

the program’s focus. 

Influence of the pandemic on 

caregiving 

In 2020, Embracing Carers created the 

Carer Well-Being Index, a 9,000 person 

survey across 12 countries to determine 

the current and residual impacts 

of Covid-19 on unpaid caregivers on 

their mental, physical, and financial 

well-being. The survey’s findings show 

that the global pandemic heightened 

pressures on caregivers, with caregivers 

averaging 24.2 hours per week on 

providing care. Caregivers perhaps unsurprisingly 

experienced a significant 

mental toll, with 76 percent reporting 

feeling more burnt out than ever, and 

64 percent feeling the pandemic made 

caregiving harder. With many caregivers 

feeling unrecognized and unsupported, 

a key takeaway from this report is the 

need for support services and resources 

from all levels of society – governments, 

private sector, non-profits, and local 

communities. 


Concern for People, 

Concern for Energy 

Sakhalin Energy is the operator of the Sakhalin-2 oil and gas project. The company operates 

onshore and offshore facilities with more than 100 contractors and about 10,000 employees. In 

the complicated epidemic and economic situation of 2020, it was critically important to arrange 

efficient management of the company as an organization with a continuous production cycle, a 

decision-making process to protect personnel and productions assets, and to provide continuous 

deliveries to customers. 

By Valentin Zhovtun, Sakhalin Energy 

The battle has begun 

When the pandemic was announced in 

March 2020, a corporate General Coordinating 

Committee and three Task Forces 

were created to ensure uninterrupted 

operation of the company under the high 

alert mode. Having operated 24/7 throughout 

the whole period of Covid-19, they 

are still in place. Also, in order to ensure 

two-way communication, the company 

established a 24/7 hotline: Personnel and 

family members are able to get prompt 

answers to any questions and concerns. 

Moscow 

NOGLIKI 

to the North assets 

YUZHNO-SAKHALINSK 

Khabarovsk 

to the South assets 

Together with standard infection prevention 

measures, Sakhalin Energy proactively 

introduced temperature checks 

for everyone at the entrances of the company’s 

production facilities and offices, 

mandatory use of medical face masks, 

social distancing, use of hand sanitizers, 

etc. The company had to enhance 

measures to prevent the spread of the 

coronavirus infection, take prompt management 

decisions aimed at ensuring the 

stable operation of the company during 

the pandemic, and take into account the 

situation on the global energy markets. 

New logistics 

The Sakhalin-2 assets are located at a 

significant geographical distance from 

each other. Three offshore oil and gas 

production platforms and an onshore 

processing facility with a compression 

station construction site are located in 

the north of Sakhalin. The Prigorodnoye 

production complex, including the LNG 

plant, is located in the south of the island. 

Previously, all personnel arrived at the 

Sakhalin Oblast Airport in the south and 

were then transported by train and plane 

to the assets. 

During the pandemic, for the purposes of 

minimizing the risks of coronavirus infection, 

managing ingress into the production 

facilities, and preventing the spread 

of infection among communities during 

personnel transportation, the company 

developed new logistical schemes. The 

staff working at the northern assets come 

straight to the north via Khabarovsk Airport 

(located at the mainland) to Nogliki 

66 


(settlement in the north of Sakhalin). 

Those who are working at the south facilities 

arrive at Yuzhno-Sakhalinsk Airport 

in the south. In this way, passenger traffic 

for the delivery of personnel on rotation 

was distributed via the northern and 

southern hubs. In addition, by actively 

using air services (charters), the company 

supported the regional airlines during 

the economically tough time (occurring 

due to a significant decline in regular air 

flights during the pandemic). 

Temporary accommodation facilities 

The considerably long (about two weeks) 

latent stage of the new coronavirus posed 

a serious risk to keeping the production 

facilities safe and free of infection. To 

deal with this, Sakhalin Energy promptly 

established 10 temporary accommodation 

facilities (TAFs), where each employee 

involved in the Sakhalin-2 project had 

to stay under observation for 14 days 

before entering the assets. 

Sakhalin Energy did its best to establish 

high standards of health, safety, hygiene, 

and epidemiology in the TAFs. In all 

areas of vital activities (meals, changing 

bedding, waste disposal, cleaning of 

premises), the company adopted stringent 

procedures to minimize any spread of 

infection. Mandatory health controls, 

including double testing for Covid-19, and 

regular temperature checks were carried 

out for all people under observation. 

In order to use the employees’ time in 

TAFs efficiently, the company arranged 

on-line training. In addition, the employees 

were offered access to more than 300 

courses on soft skills competences. 

Large-scale shutdown 

In 2020, the company had planned to 

carry out a complete shutdown of the 

entire gas system and perform extensive 

repairs on the equipment taken out of operation. 

However, the Covid-19 pandemic 

introduced its own changes: Many countries, 

including Russia, limited as much as 

possible any international transportation 

routes, which made it impossible to invite 

foreign contractors and representatives 

of manufacturing plants to provide their 

expert support. Sakhalin Energy analyzed 

potential risks, reconsidered the scope 

of work, and developed a new approach 

to implementing the shutdown. The 

company became the first in Russia to 

extensively apply what are called “digital 

twins”: Using helmets equipped with 

broadcasting video devices, specialists at 

the assets carried out repair operations 

at the production site, and engineers of 

foreign manufacturing plants remotely 

controlled the operations in real time. All 

works were completed three days ahead 

of the approved modified schedule. 

Psychological support 

The changes brought by Covid-19 could 

have caused stress among the company 

personnel. To address this, the company 

arranged the provision of urgent personal 

psychological assistance to employees. In 

addition, targeted webinars were arranged 

to talk through topics such as how to 

eliminate general stress, hesitancy, and 

anxiety. 

Protecting labor rights 

Sakhalin Energy upholds and respects 

human rights and considers it necessary 

to ensure that every employee has the 

opportunity to exercise them. During 

the pandemic, the company committed 

to ensure that the labor rights of its personnel 

were not transgressed. 

• The compensations and benefits provided 

to Sakhalin Energy personnel were fully 

maintained for the whole duration of 

the observation period in TAFs. If any 

issues associated with Covid-19 resulted 

in grievances, they were immediately 

assessed and addressed by the GTT. 

• Early voting with regard to amendments 

to the Constitution of the Russian Federation 

was organized at remote assets and 

TAFs in compliance with all epidemiological 

requirements. It was necessary 

to allow the exercising of voting rights 

The project staff arrive by charter flight and 

proceed to the production sites. 

of company and contractor personnel 

holding Russian citizenship. 

Support to the local communities 

Sakhalin Energy retained its key charity 

programs. Based on preliminary evaluations 

and consultations with the regional 

government and relevant stakeholders, 

the company started new charity projects 

to mitigate the impacts of the coronavirus 

by supporting non-profit organizations 

and institutions whose actions were 

focused on healthcare, education, and 

social support. 

Some initiatives of the company were 

adapted to the new reality. For example, 

a new grants competition called “Digital 

Transformation of Educational and Social 

Services” was aimed at implementing 

online formats in the activities of education 

and social organizations. 

Conclusion 

Early and elaborate measures, streamlined 

internal teamwork, and effective 

partnership with local and regional governments 

and social institutions helped 

Sakhalin Energy to confidently face the 

challenges and firmly protect people’s 

rights in these severe circumstances. 


Powering Opportunities 

for Youth 

Investing in young people’s education can create a more equitable and inclusive economy and 

society for all. That is why UNICEF and SAP are partnering to create new ways of learning so 

that young people have the skills and opportunities they need to reach their full potential. 

By Tim Rohde, UNICEF 

India, 2020: Arpita Barua of Jaipur, a 

city in the state of Rajasthan, wants to 

be a wildlife photographer when she 

grows up. She has just written her class 

12 board examination. But, like the rest 

of the world, Arpita is affected by the 

pandemic and her future is uncertain. 

In these times, the “Rajasthan Career 

Guidance Portal” gives her hope. The 

portal was launched by the state government 

and UNICEF and is supported 

by SAP. Arpita has discovered a wealth 

of information using the career portal 

– colleges, courses, and multiple career 

streams. She also found scholarships 

that can support her while in college. 

She has gained a lot of confidence 

and is ready to follow her dream. But 

her story is the exception rather than 

the rule. 

1.8 billion reasons to act now 

There is a pressing need to provide young 

people around the world with access to 

quality education and digital skills. We 

are facing a learning crisis for children 

and adolescents, and Covid-19 has only 

exacerbated this crisis, with billions 

of young learners affected by school 

closures. 

Today’s young people represent the 

largest cohort ever – 1.8 billion – and 

they will be a dominant force in the 

decades to come. But 1 in 5 young people 

aged 15–24 are not employed, educated, 

or trained. Many are at risk of being left 

behind in the digital economy. Many are 

not learning the skills they need to get 

jobs as a fast-changing global economy 

demands increasingly specialized skills. 

If current trends continue in low-income 

countries, only 8 percent of their young 

people will achieve a minimum level of 

secondary skills, compared to 70 percent 

in high-income countries. 

Joining forces 

The challenges are significant, but so 

are the opportunities. The growth of 

technology and the increasingly broad 

range of support from partners bring the 

potential to deliver learning opportunities 

anywhere, to anyone, at any time. 

Partnerships are at the heart of how 

UNICEF works, and young people are 

at the heart of the partnership between 

SAP and UNICEF. In 2019, the two 

organizations embarked on a global partnership 

to address workforce readiness 

by equipping underserved youth with 

digital and life skills. The collaboration 

is reaching young people across Asia and 

Europe, with initial efforts focused on 

India, Turkey, and Vietnam. 

The partnership brings together UNICEF 

and SAP’s vast, far-reaching ecosystems 

of businesses, governments, and nongovernmental 

partners and supports the 

development of standardized national 

curricula, workforce readiness programs, 

and in-depth research to address gaps in 

secondary education. 

Equipping underserved youth 

with skills 

In India, the SAP-UNICEF partnership 

supports the “Young Social Change Makers” 

program. The program includes 

developing an integrated curriculum 

for life skills and social innovation skills 

with the government; a Learning Management 

System for use by teachers 

and students; the capacity-building of 

teachers to measure skills; and access 

to career guidance in order to reach 

learners. 

The program is being implemented in 

the two states of Gujarat and Rajasthan 

68 


in secondary schools. The ultimate aim 

is to scale the program to more than 

1 million adolescents through further 

uptake of the technical models and 

resources offered by the state and 

national government. New life skills and 

social innovation learning content have 

already been developed and digitalized. 

A career portal is also active in 12 states 

– including a mobile app – and a Life 

Skills Measurement Tool is available 

for use by teachers across the country. 

In Vietnam, UNICEF, with support from 

SAP and in partnership with the government, 

has been scaling the development 

of digital learning curricula at the 

secondary school and TVET (Technical 

and Vocational Education and Training) 

levels – focusing on learning needs and 

tackling the digital divide for the most 

vulnerable adolescents. 

To date, SAP and UNICEF have reached 

more than 1,600 teachers with digital 

education training. Moreover, UNICEF 

introduced Augmented and Virtual Reality 

education solutions in Vietnam’s remote 

mountainous provinces, where students 

do not have access to teachers qualified in 

STEM (science, technology, engineering, 

mathematics) subjects. The partnership 

also supported the government to develop 

a “Transferable Skills and Digital Literacy 

Framework” for pre-schools, upper 

secondary schools, and TVET education. 

In addition, the partnership promoted 

the digital transformation on a regional 

level, leading to 10 ASEAN member states 

making a commitment to foster digital 

literacy and create access to safe digital 

learning opportunities for all children 

and adolescents. 

With the support of SAP, UNICEF and 

Turkey’s Ministry of National Education 

formed a partnership for the “Design 

and Skills Labs” (DSL) program to help 

adolescents improve their skills and acquire 

practical knowledge. This initiative 

aims to expand vulnerable Turkish and 

refugee adolescents’ access to technical 

and life skills. 

SAP and UNICEF have established two 

new DSLs in upper-secondary schools and 

reached more than 350,000 children with 

ICT skills. A resource pack for teachers 

was developed to facilitate a successful 

implementation of the program. The 

Teacher’s Manual has been used during 

training sessions with 500 teachers 

and coordinators from all 81 provinces 

of Turkey. The electronic version of the 

Manual is also accessible via a portal 

of the Ministry of National Education. 

Reimagined: The future of 

education 

SAP’s support has laid an important foundation 

for this generation of learners and 

thinkers, like Arpita from Jaipur. After 

using the career portal, she was admitted 

to the Bachelor of Arts program at the 

government-run Brahampuri Kanwar 

Nagar College, where she studies geography, 

history, and political science. Arpita 

has also enrolled in a Rajasthan staterun 

computer course on information 

technologies. She is now in her second 

Students in Vietnam are excited to gain 

new experiences with Augmented and 

Virtual Reality equipment. 

year of the BA program and continues 

to take pictures using her mobile phone, 

eager to practice her photography skills 

and capture the diversity of the world 

with her lens. She has learned that there 

is a lot of information available about 

photography online as well as different 

apps and tools available. 

Investing in quality education for young 

people puts them on a path to fulfill their 

dreams and live to their highest potential. 

It also benefits the world because 

productivity rises and standards of living 

improve. Preparing young people for 

tomorrow’s world of work supports and 

benefits them, advances the Sustainable 

Development Goals, and contributes to 

a better future for all. 



ZOOMING IN 

CIRCULAR ECONOMY 

The transition from a linear to a 

circular economy requires a joint effort 

by stakeholders from all sectors. 

Companies can contribute to the 

transition by developing competencies 

in circular design to implement 

product reuse, and recycling, and 

serving as trend-setters of innovative 

circular economy business models. The 

circular economy is relevant to 

all sectors of the economy. Examples 

of its successful implementation exist 

in different countries and sectors. 

Source: United Nations 


71

Circular Economy – 

We are Ready for Tomorrow 

Sustainability is the CWS Group’s business model. A full-service provider in the fields of hygiene, 

workwear, and fire safety, CWS offers the majority of the products in a service model. The 

advantage here is that, in addition to the all-round carefree package, the CO 2 

emission savings 

potential also speaks in favor of product rental. Circular business activities within the company 

form the basis for the sustainability strategy. All the projects, cooperations, measures, and 

products relating to the circular concept are united under the guiding principle of Think Circular. 

By Dr. Maren Otte, CWS Group 

What was still an utopian idea just a few 

years ago is now increasingly becoming 

a reality: doing business in such a way 

that no waste is produced and resources 

can be responsibly employed, recycled, 

and reused. This all comes under the idea 

of the circular economy. The aim is to 

produce maximally sustainable products 

and keep them in circulation for longer. 

A product is maximally sustainable when 

it does not need to be produced again 

and can be used for a long time in a way 

that protects resources. 

Saving resources, combating climate 

change, and curbing emissions are global 

issues that need to be addressed and 

resolved together. Private individuals 

must play their part, but companies also 

bear responsibility: It is not merely about 

giving something back to society but also 

about leaving behind a livable planet 

for future generations. The anticipated 

economic damage resulting from the 

effects of the factors above must also 

not be underestimated. 

Recently, politics has also been intervening 

and increasingly prescribing regulations 

and laws at the international and 

national levels. Since the introduction 

of the CO 2 

tax, companies have been required 

to regulate their emissions, reduce 

them, and accept (financial) responsibility 

for their (unecological) decisions. The 

financial market is presenting regulations 

on its side and expects increasingly 

detailed reporting in the field of ESG 

– meaning that environmental, social, 

and corporate governance measures 

and reporting are becoming ever more 

important for companies. 

However, the resulting increase in the 

demand for sustainable and innovative 

solutions is also creating massive growth 

opportunities for companies. New markets, 

new value chains and business 

models, as well as customer groups are 

opening up to market participants. The 

circular economy is the order of the 

day. This is a long-established system 

at CWS, where it is offered in a simple 

model: the rental service. CWS’ circular 

business model is based on being a 

service company that focuses on the 

long-term use of the materials employed. 

Products manufactured once go through 

long cycles before being reprocessed, 

repaired, and recycled in a way that 

protects resources. Circularity is the 

business model of the future and has 

been CWS’ approach right from the start, 

which is why all products, projects, and 

measures in the scope of the circular 

economy included under the guiding 

principle Think Circular are labeled 

accordingly. 

Workwear in the service model 

saves up to 76 percent CO 2 

emissions 

The development of a decarbonization 

strategy is a fundamental step for every 

company. The key question is: Where 

can CO 2 

emissions be reduced? The target 

figure is net zero. In this endeavor, 

it is important to consider all options. 

One is to switch from purchasing to 

renting items. 

A joint study conducted by CWS and the 

consulting firm sustainable thinking 

revealed the savings that can be achieved 

by switching to the service model. On 

average, the rental service on its own 

reduces the greenhouse gas emissions 

that are generated by around 76 percent. 

If service transport is also taken into 

consideration, the emissions are halved. 

The reference value is the greenhouse 

gas emissions measured based on the 

clothing requirements of one person 

72 


Quality controls at CWS pay close attention to every detail – 

up to 7,000 inspections every day. 

over a period of one year in the classic 

purchasing model. 

Around 72 kg of CO 2 

are normally generated 

per year and worker when workwear 

is purchased. The rental service reduces 

the greenhouse gas emissions to 17 kg of 

CO 2 

without transport. This is because 

worn-out or damaged garments are not 

thrown away, nor do they need to be 

produced again, which creates lots of 

emissions. They are instead repaired or 

replaced with used items. If the CO 2 

emissions 

resulting from the service vehicles 

are also taken into consideration, the 

initial value of 72 kg is reduced to 36 

kg of CO 2 

emissions per person per year. 

The calculation model developed is based 

on data for repairs, wear, and reuse from 

four different CWS Workwear collections. 

All in all, a processing volume of around 

550,000 items from four collections were 

analyzed with regard to their processing 

in German CWS laundries in 2019. 

Repairs are essential for the 

durability of textiles 

In the scope of the circular economy 

taking quality standards into consideration, 

the repair and reuse of old clothing 

results in a considerable ecological 

advantage. Naturally, every item that 

does not need to be produced again also 

does not create extra greenhouse gas 

emissions. In Germany alone, more than 

2.3 million garments were repaired in 

CWS’ laundries in 2019 instead of being 

retired. That represents a big difference 

from the linear purchase system. Only 

very few purchasers repair their wornout 

clothing. Compared to the rental 

service, only about half of the necessary 

repairs are performed. This poses a risk 

of injury, as workwear is intended to 

protect the wearer. Consequently, if it 

is defective, not properly maintained, 

or used in damaged condition, it is no 

longer possible to guarantee the wearer’s 

safety. Plus, what is not repaired at home 

simply ends up in the bin. 

The average customer relationship in the 

rental model at CWS lasts 12 years. During 

this time, the textile stock is managed 

and recycled jointly according to needs 

and wishes. That is how circularity can 

be successful. We know that the most 

sustainable garment is the one which 

does not even need to be bought. That 

is why we think in cycles and integrate 

the simple three-step concept of Reduce, 

Reuse, Recycle into our daily work. 

We Think Circular! 


New Luxembourg Strategy 

for the Circular Economy 

A common vision to transform Luxembourg into a circular economy and center of competence in 

the field 

By the High Council for Sustainable Development (Nohaltegkeetsrot) Luxembourg 

Moving toward a circular economy is a 

strategic priority in Luxembourg. Adopting 

a circular approach – where goods 

and services are produced and exchanged 

based on a circular management of materials 

that take into account the limits and 

regenerative capacities of the planet – is 

crucial in view of the country’s limited 

resources. The new strategy provides a 

common vision of the implementation 

of a circular economy in Luxembourg 

and offers practical guidelines to citizens, 

businesses, municipalities, and state administrations. 

A central link in the value chain 

The strategy has been jointly developed 

by the Ministry of Energy and Spatial 

Planning; the Ministry of the Economy; 

the Ministry of the Environment, Climate 

and Sustainable Development; and the 

Ministry of Finance. “Ever since we carried 

out a first study in 2014, the Ministry of 

the Economy has recognized the potential 

of the circular economy for Luxembourg 

and the opportunity it represents for 

companies,” said Minister Franz Fayot 

when presenting the strategy. “In the 

meantime, many initiatives have emerged 

and the circular economy has become a 

government priority. The objective of the 

strategy and its planned actions is twofold: 

firstly, to accelerate the deployment 

of the circular economy at the national 

and regional level, and secondly, to position 

Luxembourg as a center of expertise 

and an international leader in the field.” 

The circular economy has become a 

government priority. 

For Carole Dieschbourg, Minister of the 

Environment, Climate and Sustainable 

Development, the circular economy is an 

essential link in the sustainable development 

value chain: “The rapid expansion 

of the circular economy is a necessary 

condition for succeeding with our national 

strategic efforts to fight the climate 

crisis, protect resources, and promote 

sustainable finance.” 

Rethinking the economy 

The government has far-reaching ambitions 

in the field. “This national strategy 

will make our society more sustainable by 

rethinking our entire economy from A to 

Z,” says the Minister for Energy, Claude 

Thurmes. “It will provide Luxembourg’s 

key sectors with a toolbox to bring together 

public and private players and 

to develop the vision through concrete 

projects.” 

The circular economy strategy 

includes three main components 

It identifies methods and tools in the fields 

of regulations and standards, financial 

aspects (e.g., incentives in the form of 

74 


subsidies or taxes), and knowledge management 

(education, training, and public 

research) where the government can act 

to stimulate innovation, as well as in the 

area of digitalization and ICT support. 

It proposes a methodology to activate 

processes and tools in key economic sectors 

through concrete projects piloted by 

public bodies but implemented together 

with other main stakeholders. 

It outlines a mechanism for close and 

continuous consultation between the 

ministries in charge of the strategy, as 

well as communication tools aimed at 

supporting those who are managing concrete 

projects. 

Promoting clean technologies and the 

transition toward a circular economy 

is a priority in Luxembourg. 

The country offers an attractive economic 

environment for entrepreneurs 

who are looking to create value while 

reducing pollution, waste, and energy 

consumption. 

THE 7 PRINCIPLES 

OF THE CIRCULAR 

ECONOMY IN 

LUXEMBOURG 

Local and solidarity 

7 

1 

Create values 

2 

The circular economy is an 

economic model that tends to 

preserve resources and encourage 

local and solidarity-based solutions. 

CE is an economic model that also 

aims to increase resilience. 

Systemic and holistic 

Promote diversity 

6 

3 

Two cycles 

Repairing and regenerative 

5 

4 

Health, well-being, and positive impacts 

1 Create values 

The disruptive circular economic 

model creates economical, 

ecological, and social values by its 

very nature. 

2 Systemic and holistic 

The circular economy is based on an 

interdisciplinary, systemic, holistic, 

and collaborative approach. 

3 Two cycles: the biological and 

the technological cycle 

The circular economy eliminates the 

concept of waste by relying on two 

distinct cycles, the biological and the 

technological cycle. Each product 

should be configured or designed in 

a way to evolve in either cycle. Some 

materials or products may pass from 

one to the other cycle. 

4 Health, well-being, and positive 

impacts 

Health and well-being are an 

integral part of the circular economy. 

The circular economy promotes the 

creation of positive impact on both 

human beings and nature. Reducing 

negative impact alone is not 

considered sufficient for sustainable 

development. 

5 Repairing and regenerative 

The circular economy is repairing 

and regenerative in nature. It protects 

and enhances ecosystemic 

services and promotes biodiversity. 

The processes of technological 

cycles must be designed to maintain 

or even enhance the quality of the 

resources and products used. 

6 Promote diversity 

The circular economy promotes 

diversity of solutions in all aspects, 

whether technical, economic, 

ecological, or socio-cultural. 

7 Local and solidarity 

In Luxembourg, the circular 

economy encourages local and 

solidarity-based solutions and 

encourages proximity cycles. 

Conseil Supérieur pour un Dévelopment Durable, csdd.public.lu 



ZOOMING IN 

CO 2 

CLIMATE CHANGE 

Climate change is affecting every 

country on every continent. It is 

disrupting national economies and 

affecting lives. Weather patterns are 

changing, sea levels are rising, and 

weather events are becoming more 

extreme. The Paris Agreement, 

adopted in 2015, aims to strengthen 

the global response to the threat of 

climate change by keeping a global 

temperature rise this century well 

below 2 degrees Celsius above preindustrial 

levels. The agreement also 

aims to strengthen the ability of countries 

to deal with the impacts of climate change, 

through appropriate financial flows, a new 

technology framework and an enhanced 

capacity building framework. 

Source: United Nations 


77

AAIB Paves the Way for 

a Greener Economy 

Despite Covid-19 being recently recognized as the mother of all crises that has negatively 

affected the whole world, climate change is still the most crucial and serious matter for Agenda 

2030. Accordingly, in addition to undertaking preventive actions and supporting the community 

during the pandemic, AAIB has focused on attending to climate change and its impacts. The 

bank has continued to integrate Environmental and Social (E&S) risks into its risk management 

framework, include renewable energy projects in its portfolio, and offer climate solutions to its 

consumer banking clients. 

By Dalia Noureldin, AAIB 

By the time COVID-19 was announced 

as a global pandemic, climate change 

has already been a crucial and alarming 

matter that needed to be placed at the 

forefront of global agendas. However, 

the world’s spotlight moved away from 

climate change as the impact of the 

pandemic wore on. Although immediate 

action to a disaster that is novel, widespread, 

affects lives and is accompanied 

with much uncertainty like the coronavirus 

was crucial, climate change is 

not any less of a problem — and the 

only way to avoid the worst possible 

climate outcomes is to accelerate our 

efforts now. 

Climate change is becoming the greatest 

environmental crisis of all time with its 

impacts that are already too costly for 

people, planet and overall prosperity. It 

can no longer just be considered an environmental 

crisis but also a socioeconomic 

one. The physical risks associated with 

climate change could disrupt livability 

and workability, giving the rise to transition 

risks including shifts in demand, 

especially for food and energy. To start 

with, climate change and its environmental 

impacts -including floods and 

droughts- severely impact agriculture 

and fisheries, which in turn influences 

food prices and the employees working 

in these sectors and their value chains. 

In addition, Typo change mitigation 

impacts patterns of energy production 

and energy prices. 

Financing sound environmental projects 

plays an important role in delivering 

several of the Sustainable Development 

Goals (SDGs). Given the current climate 

finance gap, the financial sector needs to 

act on two fronts: we need to facilitate 

the transition towards a greener and 

more sustainable economy as well as to 

manage Environmental & Social (E&S) 

risks associated with our financing activities. 

To encourage the development of 

78 


a more viable economy, AAIB has been 

integrating Environmental, Social and 

Governance (ESG) criteria into its financing 

activities and its risk management 

framework. 

Environmental and social risk 

management 

According to the Intergovernmental Panel 

on Climate Change (IPCC), the current 

business-as-usual scenario will result 

in a 3-5°C average global temperature 

increase by 2100. To minimize, manage 

and where possible prevent the impacts 

of climate change on the environment 

and the society rapid, far-reaching and 

unprecedented changes in all aspects 

of doing business are urgently needed. 

While banks, like any other business, 

produce greenhouse gases (GHG) directly 

through their business activities, their 

significant contribution to GHG emissions 

is indirect, through their financing 

and lending activities. To this end, and 

to manage the Environmental & Social 

(E&S) risks associated with our clients’ 

activities AAIB has broadened its risk 

management framework beyond its traditional 

definition that includes credit 

risk, market risk, operational risk and 

liquidity risk to include E&S risks such 

as climate change, income inequality 

and more constituting sources of major 

financial tremors and instability. 

Given our intermediary role in the 

economy along with our commitment 

to the SDGs, AAIB joined the Equator 

Principles (EP), which has been the main 

guideline for determining, assessing and 

managing E&S risks in project-related 

transactions in 2009. The framework 

ensures that projects that fall within 

its scope are well-developed and operate 

with respect to international E&S 

standards. To foster our commitment 

to the EP, the bank introduced an E&S 

Risk Policy that is updated continually 

to ensure coping with emerging E&S 

challenges and best practices. The Policy 

is guided by the EP and other internationally 

recognized E&S standards. 

Finance as the engine for 

development 

Since banks are the backbone of the 

economy, we have a major role in accelerating 

the much needed transition 

from a fossil fuel-based economy to an 

efficiency- and renewable energy-based 

economy. In AAIB, our goal is to drive 

long-term sustainable growth with an 

eye on development priorities, protecting 

the environment and the community, as 

well as delivering measurable benefits 

to the economy. 

In a country like Egypt with its strategic 

geo-climate location and great potential 

in renewable energy, we have a great 

opportunity to achieve sustainable and 

inclusive growth aligned with the 2030 

agenda. This can be done through offering 

products and services that enable 

transition and adaptation. In this regard, 

AAIB signed a long-term loan agreement 

worth EGP 200m with Enara Group’s 

subsidiary Libra Capital to finance 

renewable energy projects in March 2021. 

This comes in light of our role in encouraging 

institutions and individuals 

to adopt sustainable practices, being the 

financing arm for all sectors that affect 

the environment and society. 

Engaging clients in sustainable 

practices 

Believing that actions taken individually 

and collectively can create a difference, 

AAIB is working on creating synergies 

with its customers, encouraging them 

to move towards sustainable practices 

and accompanying them in their transition 

towards more sustainable lifestyles 

through offering products and services 

that meet environmental and financial 

needs. 

With regards to this matter, AAIB introduced 

its Solar Energy Loan to its 

consumer banking clients to empower 

them to adopt more sustainable practices 

and behaviors, as part of our broader 

effort to create a market for renewable 

energy in Egypt. The product aims at 

contributing to SDG 7 (Ensure access 

to affordable, reliable, sustainable and 

modern energy for all) and, consequently, 

SDG 13 (Take urgent action to combat 

climate change and its impacts), as well 

as the objectives of the Paris Agreement 

on climate change. In addition to climaterelated 

targets, transition to solar solutions 

will have a direct effect on health, 

employment and cost-savings benefits. 

Despite the ambition in the 2030 agenda 

for moving towards a better world, a core 

focus on the SDGs has been significantly 

altered, drawing our attention to new realities 

and ways of life that resulted from 

Covid-19, which dramatically resulted 

in the loss of lives and economic misery. 

However, it still offered some lessons and 

reasons for hope. First and foremost, the 

coronavirus shows just how much can 

be done through alignment and cooperation; 

how much money can be mobilized 

in a matter of just days when we focus 

our efforts on addressing a cause. If just 

a small portion of the billions of dollars 

pledged for economic recovery were used 

to invest “cleaner and greener initiatives” 

we could get much closer to achieving 

global climate goals. It also showed 

how many far-reaching measures from 

minimizing travel and transportation, 

enabling remote work, shifting to online 

serices and other changes in business 

practices can be taken. It is crucial that 

we maintain the climate-friendly habits 

we have had to develop. 

Acknowledging that climate change 

combined with COVID-19 is a double 

whammy for millions of people, and the 

urgency of both topics, AAIB will continue 

playing its role in attending two of 

the top crises the whole world is facing. 


CO₂ Reduction at Bosch: 

Focusing on the Entire 

Value Chain 

Bosch is pressing ahead with its own climate action targets. Now that the climate-neutral status 

of the Bosch Group with its more than 400 locations worldwide has been certified, Bosch is 

giving concrete shape to its plans for what is known as Scope 3. By 2030, Bosch aims to reduce 

carbon emissions by 15 percent from their 2018 level along its entire value chain, from suppliers 

to customers – a reduction of 67 million metric tons of carbon dioxide. 

By Dr. Volkmar Denner, Bosch Group 

The Bosch Group has been climate 

neutral since 2020. To achieve climate 

neutrality, we have been systematically 

applying four levers: increasing energy 

efficiency, using renewable energies, 

expanding the purchase of green electricity, 

and – as a last resort – offsetting 

unavoidable CO 2 

emissions with 

carbon credits. As our next step, we 

want to optimize the mix of levers by 

2030 while continuing to refine our 

measures to make a further significant 

contribution to climate action. 

A review conducted in 2020 shows that 

we are on the right track. In particular, 

we needed far fewer carbon offsets to 

compensate for our energy consumption 

in 2020 than we had budgeted. At 

the same time, we were able to reach 

our target levels for new clean power 

and – thanks to improved availability – 

significantly exceed them in the case of 

purchased green electricity. We intend to 

continuously improve the lever mix over 

the coming years in order to reduce our 

use of carbon offsets and green electricity 

from existing plants while further 

increasing our energy efficiency and 

procurement of new clean power. 

In the years up to 2030, we will 

extend our climate action beyond 

the company’s immediate sphere of 

influence (Scopes 1 and 2) and also 

systematically reduce upstream and 

downstream emissions (Scope 3) by 

15 percent. These targets have been 

confirmed by the Science Based Targets 

initiative (SBTi). Bosch has thus adopted 

science-based climate targets across the 

entire value chain, from purchasing to 

the product use phase. 

With its Scope 3 target, Bosch has deliberately 

set itself an ambitious goal, 

as upstream and downstream emissions 

(448 million metric tons of CO 2 

) exceed 

those in Scopes 1 and 2 several times 

over. This target value was set independently 

of sales growth, which means the 

mitigation target will increase steadily 

as Bosch continues to grow in the future. 

Our targeted 15 percent reduction in 

CO 2 

emissions corresponds, from today’s 

perspective, to a reduction in the burden 

on the climate of some 67 million metric 

tons of CO 2 

. We are pursuing a threestage 

approach to ensure we achieve our 

goals. In 2019, we analyzed all Scope 3 

categories in accordance with the GHG 

Protocol using external databases and 

then focused on those from which the 

majority (99 percent) of CO 2 

emissions 

originate. 

According to the findings, upstream 

emissions in the Bosch value chain 

primarily concern goods and services 

we purchase as well as logistics. Downstream 

emissions are mainly caused by 

customer use of our products. However, it 

is not sufficient to measure a company’s 

specific progress based on database 

values alone. In 2020, we therefore 

went one step further and increased the 

calculation’s granularity for the main 

categories, while also integrating specific 

parameters into the models. 

This finer-grained calculation makes it 

possible to identify significant drivers 

within purchasing and in the use of our 

products, based on which we can derive 

measures that make an active and measurable 

contribution to climate action. 

In this process, we focus primarily on 

options that lie within our immediate 

sphere of influence. 

80 


• To reduce CO 2 

emissions from purchased 

goods and services, we seek to 

cooperate closely with our suppliers. 

Going forward, a supplier’s or logistics 

provider’s carbon footprint will be one 

of the criteria considered before awarding 

new procurement contracts. 

• In the field of logistics, we will focus on 

transport. Our priority is to optimize 

purchasing in the product evolution 

process and in volume manufacturing, 

while also avoiding airfreight. In 

addition, by combining more freight, 

we want to reduce transport, optimize 

routes and capacity utilization, and 

thus avoid CO 2 

emissions. 

Upstream emissions 

Purchased goods and services 

as well as logistics, Scope 3 

Own generation and purchased 

energy, Scope 1 and Scope 2 

Climate neutrality 

since 2020 

» 

1 

2 

3 

4 

• Bosch products are already designed 

for energy efficiency, and thus help 

mitigate climate change during their 

use. In 2020, we identified additional 

potential for further reducing CO 2 

emissions in the use phase. The corresponding 

activities can be clustered 

into three levers, which we can apply 

in different ways in our various areas 

of business: boosting energy efficiency, 

adjusting our product portfolios, and 

harnessing the transformation of the 

energy sector. 

• Since 2020, we have been using carbon 

offsets to make all our business flights 

carbon neutral. 

Energy efficiency 

New clean power 

Green electricity 

Carbon offsets 

-15 % 

CO 2 

by 

2030 

At present, we are deriving specific performance 

indicators to track the contribution 

of the measures identified 

through to 2030. This will also allow 

us to introduce any follow-up measures 

that might be needed. By focusing on 

the key levers, we are ensuring the 

best possible use of our resources in 

the interest of sustainability as well 

as our ability to reach our Scope 3 

target by 2030. 

At the same time, we are continuously 

refining our calculation methodology in 

order to obtain as realistic a picture as 

possible of our Scope 3 emissions, and 

thus meet our standards with respect to 

transparency and completeness. In 2020, 

for example, we extended our view of 

mobility solutions-related emissions to 

take all emissions generated “from wellto-wheel” 

into account, as opposed to the 

more limited “tank-to-wheel” perspective. 

As this approach also encompasses 

the emissions from fuel production and 

electricity generation, it provides a more 

realistic picture of road traffic’s overall 

carbon footprint. Although this refinement 

of the calculation raises our baseline, 

we nevertheless remain committed 

to the ambitious target of a 15 percent 

absolute reduction in Scope 3 emissions. 

Downstream emissions 

Product use phase, Scope 3 

» 

For more information, please visit 

sustainability.bosch.com 

Bosch sees the highly efficient 

solid oxide fuel cell as an 

essential element of a 

sustainable energy supply. 

Volkmar Denner has been 

Chairman of the Board of 

Management of Robert Bosch GmbH 

and a limited partner of Robert 

Bosch Industrietreuhand KG since 

July 1, 2012. His responsibilities 

include corporate strategy, 

corporate communications and 

governmental affairs, and real 

estate and facilities. He is also 

responsible for the Bosch Healthcare 

Solutions GmbH subsidiary 

and the Bosch business in China. 


Cities Race to Zero 

The majority of people live in cities. This is why it is here that we will decide whether we can 

make the transition to a climate-neutral lifestyle. The Cities Race to Zero initiative wants to 

recruit 1,000 cities to participate in a global movement to address the climate emergency. 

By 2050, the global urban population 

is expected to grow by 2.5 to 3 billion 

(compared to 2009); worldwide, 64 to 69 

percent of people will then live in cities. 

The effects of climate change will worsen 

access to basic services and quality of life 

in cities: among them rising sea levels 

and river flooding, hot spells and the 

potential spread of disease, increasing 

droughts and associated water scarcity 

and air pollution – all will severely 

affect people’s health, livelihoods, and 

assets. 

A new CDP analysis of 812 global cities 

publishing environmental data has 

found that nearly half lack plans to 

keep their populations safe from climate 

threats. Though nearly all (93 percent) of 

the cities reported facing climate risks, 

353 (43 percent) disclosed no adaptation 

plan. This means a population projected 

to reach 400 million over the next decade 

live in poorly prepared cities. 

At the same time, urban areas are a 

major source of greenhouse gases and 

currently account for about 70 percent 

of global energy consumption. Therefore, 

the pace of emission reductions must 

increase in cities of both developed and 

less-developed countries. This is also 

what the Cities Race to Zero initiative 

is advocating. 

“Cities continue to be vital leaders on the 

frontlines of the fight against climate 

change,” says Michael R. Bloomberg, 

founder of Bloomberg LP and former 

Mayor of New York City. “It’s critically 

important that countries meet their climate 

targets – and go beyond them, as 

the effects of the crisis are only worsening. 

The more that national leaders 

empower cities, states, and businesses, 

and strengthen their own contributions 

toward reducing emissions, the more 

success we will have. We can win the 

82 


Race to Zero – but only if we accelerate 

our climate progress, together.” 

To build resilience, cities are taking many 

actions, ranging from tree planting and 

greening (20 percent of cities) to flood 

mapping (18 percent). In Berlin, for example, 

the 1,000 Green Roofs program 

was launched, Paris is creating “cool islands” 

to manage the impact of increased 

heatwaves, and Malmö is managing flood 

risks by ensuring all new buildings must 

be 3 meters above sea level. 

Mirjam Wolfrum, Director Policy 

Engagement at CDP Europe, comments: 

“Environmental action cannot slow down. 

With Covid-19 stimulus packages totaling 

$12 trillion globally, national governments 

have an opportunity to implement 

a green recovery in cities. As a 

first step to managing climate threats, 

every city must carry out a climate risk 

and vulnerability assessment to identify 

the crucial actions they must take. We 

also encourage cities to set science-based 

targets to support them on their journey.” 

What does the initiative want? 

Mayors and council leaders from cities 

of any size and location who are signing 

up to the Race to Zero campaign are 

committed to: 

• keeping global heating below the 1.5°C 

goal of the Paris Agreement; 

• adopting a science-based emission-reduction 

target consistent with constraining 

global temperature rise to 1.5°C; 

• achieving a fair share of a 50 percent 

global reduction in emissions by 2030 

and reaching zero carbon by 2050; and 

• implementing specific inclusive climate 

policies in sectors such as buildings, 

transport, waste, clean energy, food, 

and nature. 

ABOUT CITIES' RACE 

TO ZERO 

C40 Cities, the Global Covenant 

of Mayors for Climate and Energy 

(GCoM), and CDP announced a 

campaign to recruit as many as 

1,000 cities around the world to 

deliver inclusive climate action, 

consistent with limiting global 

temperature rise to 1.5°C, as set 

out in the Paris Agreement, and to 

initiate a green and just recovery 

from Covid-19. 

It is part of the Race to Zero 

alliance to mobilize companies, 

cities, states, regions, investors, 

universities, and non-state actors 

that are aiming to halve emissions 

by 2030 and are individually 

committed to achieving net zero 

emissions as soon as possible, 

and by 2050 at the very latest. 

Roland Hunziker, Director, Sustainable 

Buildings & Cities at WBCSD, refers to the 

opportunities: With population growth 

and rising purchasing power in emerging 

markets, the global building floor area 

is expected to double by 2050. Although 

this rapid expansion of infrastructure is a 

challenge for the construction sector on 

its path to meeting the goals of the Paris 

Agreement, it also opens a window of 

opportunity. The construction sector can 

provide the boost we need to jumpstart 

the economy in the aftermath of Covid-19. 

Today, the construction sector represents 

11–13 percent of global GDP and employs 

7 percent of the global workforce. 

WBCSD has developed the Building System 

Carbon Framework, which helps to 

place a focus on the carbon transactions 

that happen during the process of building 

and renovating infrastructure, in a 

simple and transparent way. These carbon 

transactions can then be discussed 

alongside cost, time to build, and risk, 

and reduction targets can be passed along 

the value chain and trigger innovation 

to create low-carbon solutions. 

Example 1 WUHAN, China 

Keeping cities cool 

Wuhan is experiencing a silver lining 

as the dark clouds of 2020 make way 

for something new. For the city’s 11 

million residents exposed to searing 

summer temperatures, respite is coming 

in the form of large fabric “clouds,” 

which promise to shield them from the 

blazing sun. By capturing breezes and 

air movements, the “clouds” gently fan 

passersby. 

Designed by HDA, a Parisian architectural 

practice that is also behind 

Miami’s Climate Ribbon, which uses 

similar structures to naturally regulate 

the temperature of urban spaces, the 

“clouds” are one of several novel ways 

that architects, entrepreneurs, and scientists 

are exploring to keep cities cool 

– without ramping up climate-polluting 

air-conditioning units. 

>> 


SNAPSHOT OF CITY RISKS 

93% 

are facing significant 

climate risks 

43% of cities 25% 

do not yet have an 

adaptation plan 

of cities 

report budgetary capacity 

issues as a barrier to adaptation 

60% 

of cities 

cite substantive risk to 

their water security 

The top two services 

under threat from 

climate change are water 

supply and sanitation, 

and public health 

74% 

of cities 

climate change is 

increasing risks to already 

vulnerable populations 

Source: CDP Report “Cities on the route to 2030” 

Already basking in warmer temperatures 

than the surrounding countryside, cities 

are suffering from record-breaking highs, 

which residents are often ill-equipped 

to handle. The last decade has been 

the hottest on record, and as millions 

more swarm to urban jungles, city temperatures 

will keep rising. Ironically, airconditioning 

is a big part of the problem, 

as it uses climate-polluting coolants and 

pumps warm air right back into the 

atmosphere. 

“Rising temperatures create significant 

challenges for urban centers, where 

extreme temperatures are often exacerbated 

by the urban heat island effect,” 

says Jessica Brown, Executive Director of 

the Kigali Cooling Efficiency Program at 

the ClimateWorks Foundation. “Cooler 

cities lead to positive impacts on human 

health, air quality, economic productivity, 

public safety, energy savings, and quality 

of life. Simply, when we’re hot, we’re 

less productive and economies suffer.” 

To create the innovative cooling clouds 

in Wuhan, HDA is working with a wind 

tunnel laboratory. The project will see 

them design a series of canopies next to 

the Buddhist temple of Guiyan that will 

provide shading and naturally help to 

ventilate the streets. Many cities across 

the world are aligning with HDA’s thinking, 

looking to trees, plants, and green 

spaces to keep residents cool. In Singapore, 

any greenery lost on the ground 

has to be replaced with greenery in the 

sky. Barcelona is promoting the transformation 

of roofs into gardens, and 

London plans to become zero-carbon 

and at least 50 percent green by 2050 

through measures that include planting 

more trees along streets. Cities from 

Beijing to Stuttgart are building green 

“ventilation corridors,” which decrease 

air pollution and alleviate heat. 

“The Colombian city of Medellin has lowered 

temperatures by 2 to 3ºC with its 

Green Corridors urban planting projects,” 

urban researcher Richard Dobbs says. 

Some 30 green corridors of trees, plants, 

and bushes were planted, transforming 

derelict parts of the city into green 

oases. “We need to invest in sustainable 

alternatives to air-conditioning – like 

buildings that make smart use of shading 

and ventilation and cooling our streets 

with trees and water.” 

Keeping urban jungles cool bolsters 

economies and can also saves lives. The 

Ahmedabad Heat Action Plan in India, 

which implements measures that include 

planting trees and painting roofs, saves 

84 


more than 1,000 lives a year. “There’s an 

assumption that air-conditioning must 

be the cooling solution in all buildings, 

and a large air-conditioning industry 

is pushing that approach,” Dobbs says. 

But low-carbon solutions can be really 

effective. “There are huge opportunities 

everywhere.” 

Example 2: Turku, Finland 

Enabling 1.5-Degree Lifestyles 

Having pledged to become carbon neutral 

by 2035, Finland is now developing 

a strategic program to transform its 

economy into one that is based on the 

principles of circular economy. The city 

of Turku – a champion in localizing 

the circular economy – is coordinating 

the inputs of Finnish cities and regions 

to the strategic program. The circular 

economy is gaining traction in cities 

worldwide as a key element of climate action. 

The 1.5-Degree Lifestyles framework 

is a useful tool for cities to connect their 

climate and circular economy policies 

to communities’ everyday realities and 

address consumption-based emissions. 

Developed by the Finnish innovation 

fund SITRA and IGES, the 1.5-Degree 

Lifestyles framework quantifies how drastically 

lifestyle carbon footprints must 

be reduced in order to meet the 1.5ºC 

target and which lifestyle changes most 

support this transition. With support 

from ICLEI and the International Urban 

Cooperation, Turku, Nagano Prefecture, 

and Obuse Town (Japan) are kickstarting 

community engagement processes 

around 1.5-Degree Lifestyles. 

Lifestyle changes only take us so far if 

city infrastructure and services do not 

support decarbonization. It is critical for 

cities wishing to act on lifestyles to first 

show policy commitments to and investments 

being made for infrastructure and 

city services that make the transition 

to 1.5-Degree Lifestyles convenient and 

cost-neutral for residents. “The system 

needs to change and individuals need 

to change,” summarizes Markus Thero 

from SITRA. 

This is why Turku’s campaign starts 

by showcasing how “Turku is doing its 

part to keep the world on track for the 

1.5-degree target,” for instance through 

investments in sustainable energy and 

infrastructure, circular economy innovations, 

and low-carbon transport, 

which have already allowed Turku to cut 

emissions by half. Acknowledging that 

products and services flowing through 

cities must also support the transition, 

Turku is focusing on the engagement 

of local businesses offering decarbonized 

innovations by featuring them as 

1.5-degree solutions providers as part of 

the campaign. 

Three tools for cities to communicate 

about 1.5-Degree Lifestyles 

With enabling conditions in place, city 

dwellers will be more prone to engage 

in 1.5-Degree Lifestyles. Here are three 

tips from city practitioners and lifestyle 

experts to communicate about 1.5-Degree 

Lifestyles to city residents in a way that 

resonates with their individual aspirations 

and needs. 

Adapt the message to different audiences: 

“Consumption drivers and motivations 

include priority needs and practicality, 

time savings, durability, relevance in 

everyday life. Oftentimes, the considerations 

that drive consumption do not 

include climate action,” says Thero. This 

is why communicating about 1.5-Degree 

Lifestyles is most efficient when focusing 

on co-benefits (e.g., cost-savings, health, 

practicality, sense of community) that are 

most relevant to different target groups. 

In the pathways to achieving 1.5-Degree 

Lifestyles by 2030, SITRA describes four 

characters with different lifestyles and 

values. The attributes of these people 

are based on previous work featured in 

the SPREAD Scenarios for Sustainable 

Lifestyles 2050 and SITRA’s Motivation 

profiles of smart consumption; they 

can form the basis of local campaigns 

targeted to different consumer groups 

and their specific aspirations. Different 

channels for different contexts: 1.5-Degree 

Lifestyles campaigns will compete 

for attention with the billboards and 

other mass consumption advertisements 

that currently shape what is seen as affluent. 

Therefore, it is key to diversify 

communication channels and reach out 

to various stakeholders, from religious 

communities to influencers, depending 

on the context. Turku’s 1.5-Degree 

Lifestyles campaign is focusing on online 

engagement of young Turku residents 

through social media and existing local 

youth platforms, such as the city’s Youth 

Climate Panel. In the long-term, Turku 

wishes to have a wide variety of Turku 

residents as champions of a 1.5-Degree 

Lifestyle. “We need different people on 

board, we need them to be messengers,” 

says Liisa Lahti from Turku. 

Break down your message: Not everything 

needs to happen at once. Changing 

habits takes time, and transitions are 

most durable when each change has 

been established in people’s everyday 

lives. In their 2030 pathways, SITRA 

presents the needed changes in lifestyles 

spread across a 2019–2030 time frame. 

They start with low-hanging fruit, easy 

lifestyle shifts people can implement 

right away, such as cutting down on meat 

and dairy products, buying second-hand 

instead of new, and going on holidays to 

places accessible by public transport. A 

lot can also be learned from how Cape 

Town managed its recent water crisis. 

“Within 18 months, water consumption 

was halved, mainly through institutional 

and social shifts,” says Paul Currie. “This 

was achieved in part through communication 

campaigns showcasing where 

residents are in the water management 

system and what sustainable water 

consumption looks like in practice, for 

instance through the guide of using 50 

liters of water per day.” 

Sources: This article was produced with the 

assistance of publications from ICLEI, the We 

Mean Business Coalition, the WBCSD “Building 

System Carbon Framework,” and the CDP report 

“Cities on the Route to 2030.” 


Agriculture Is at the Center 

of Climate and Food 

Security Solutions 

A commitment to protecting and preserving the source of our food and helping agricultural 

communities thrive drives Corteva Agriscience 

By Henri Moore, Corteva Agriscience 

The combination of a changing climate 

and the interruption of the food system 

due to Covid-19 has had a devastating 

impact on the lives of millions of people 

around the world. The 2021 Global 

Food Security Index, developed by The 

Economist Intelligence Unit, reported 

that agricultural production has become 

more vulnerable in 49 countries as compared 

to a year ago. With 113 countries 

measured in the index, that means that 

the food security of people in nearly half 

of the total index is at greater risk. 

global food security and climate challenges, 

and that the movement begins 

on farms around the world. 

A key part of the solution is strengthening 

the resilience of farmers to be able to 

withstand the impacts of climate change 

through more sustainable agriculture. 

Soil and water are finite – but there are 

measures we can take to improve their 

sustainable use and even increase production 

to feed a growing global population. 

In June 2020, Corteva announced 14 

sustainability goals that will drive our 

actions and nearly every aspect of our 

business as well as increase the resilience 

of our global food system. These goals 

span a set of targets for farmers, the land, 

our operations, and the communities 

where Corteva employees and customers 

live and work. 

Our goals are consistent with five of the 

United Nations Sustainable Develop- 

Although the Index takes into consideration 

a number of factors, there is 

no doubt that farmers of all sizes in 

every country around the world are 

under significant pressure to grow more 

food on a fixed, or declining, amount of 

arable land. 

This is the second year in a row that 

the Index shows global food security in 

decline, with both high- and low-income 

countries suffering significant food production 

challenges. For example, drought 

and extreme summer growing conditions 

led to the worst harvests in 50 years in 

Denmark, Norway, and Sweden. 

Although the challenges are great, we 

at Corteva Agriscience firmly believe 

that agriculture holds the key to solving 

86 


CORTEVA AGRISCIENCE SUSTAINABILITY GOALS TO REACH BY 2030 

Goals to benefit farmers 

• Provide training to 25 million 

farmers on soil health, nutrient and 

water stewardship, and productivity 

best practice. 

• Increase the productivity, incomes, 

and sustainable farming practices 

of 500 million smallholder farmers 

cumulatively through 2030. 

• Enable farmers to sustainably 

increase crop yields by 20 percent 

while also reducing greenhouse 

gas emissions by 20 percent within 

cropping systems compared to 

2020. 

Goals to benefit the land 

• Improve soil health on 30 million 

hectares. 

• Accelerate improvement in nitrogen 

use efficiency (NUE) across global 

agricultural land. Reduce water 

consumption while increasing yields 

on 2.5 million hectares of seed 

production and water-stressed 

agricultural land by 2030 compared 

to 2020. 

• Enhance biodiversity on more than 

10 million hectares of grazing lands 

and natural ecosystems globally 

through sustainable management 

practices and habitat conservation. 

Goals to benefit communities 

• Protect the health and safety of 

people at our facilities and those 

working in agriculture. 

• Empower women, enable youth, and 

engage communities in all of the 

global communities where we have 

corporate operations and all of the 

countries where we do business. 

• Volunteer 1 million Corteva 

employee hours to support people 

and communities globally. 

• Increase supply chain transparency, 

from farmers to consumers, by 

leveraging digital tools that enable 

farmers to create additional value 

through transparency in agriculture 

markets, food systems, and 

communities. 

Goals for our company’s 

operations 

• Every new Corteva Agriscience 

product will meet our sustainability 

criteria by 2025. 

• Establish our climate strategy 

for Scope 1, 2, and 3 emissions, 

including appropriate reduction 

targets by June 1, 2021. 

• All packaging will be reusable or 

recyclable. 

• Operate every Corteva Agriscience 

site more sustainably through waste 

reduction, water conservation, and 

enhanced biodiversity. 

ment Goals, including ending hunger 

and achieving food security; ensuring 

availability and sustainable management 

of water and sanitation for all; 

ensuring sustainable consumption 

and production patterns; taking urgent 

action to combat climate change and 

its impacts; and protecting, restoring, 

and promoting the sustainable use of 

the land. 

The goals are ambitious, but they are 

built on best practices and global frameworks 

for sustainability. During the first 

year, our efforts have been focused on 

establishing benchmarks as well as creating 

the metrics and tools that we will 

use to measure and report our work 

around the world. 

HENRI MOORE 

Henri Moore is Vice President / 

Head of Global Responsibility 

at Corteva Agriscience. She is 

responsible for the development 

and execution of a Global 

Responsibility strategy, inclusive 

of Community Investment, 

Sustainability, Agriculture 

Development and Technology 

Acceptance in over 

140 countries. 


Driving Responsibility 

and Shaping Tomorrow’s 

Transportation 

Given the Covid-19 pandemic as well as ongoing climate change, we are facing global challenges 

that have prompted us to further refine our business model. Knorr-Bremse is committed to 

helping build a more sustainable society and taking more climate action. As the global market 

leader for braking and other systems for rail and commercial vehicles, we see ourselves as a 

role model in the mobility sector and aim to express this commitment not just through our 

products but also through the way we work. 

By Frank Markus Weber, Knorr-Bremse 

For more than 115 years, Knorr-Bremse 

has been the industry visionary, driving 

innovation in mobility and transportation 

technologies with an edge 

in connected system solutions. For us, 

sustainability means giving equal and 

simultaneous priority to economic, social, 

and environmental targets, and 

doing so upon a foundation of good 

corporate governance. Our ongoing efforts 

to engage in environmental, social, 

and governance-related (ESG) activities 

are reflected by our good third-party ESG 

ratings. At Knorr-Bremse, we are convinced 

that sustainability and competitiveness 

are not polar opposites – they 

are inextricably linked. Only reliable, 

sustainable business activity sows the 

seeds of lasting success. This is why we 

also support the UN’s Sustainable Development 

Goals (SDGs), focusing on five 

key SDGs in particular: “Gender equality” 

(Goal 5), “Decent work and economic 

growth” (Goal 8), “Industry, innovation 

and infrastructure” (Goal 9), “Responsible 

consumption and production” (Goal 12), 

and “Climate action” (Goal 13). 

Knorr-Bremse drives forward extensive 

climate action measures 

We are driving forward our climate action 

(Goal 13) measures in the context of 

our new Climate Strategy 2030. By setting 

our climate goals, we are contributing 

to the Paris Agreement to limit global 

warming to 1.5°C, aiming to halve our 

CO 2 

emissions by 2030. This 50 percent 

reduction is to be achieved through energy-efficiency 

measures and the owngeneration 

and purchase of renewable 

energy. We have additionally pledged 

to make our own sites carbon-neutral 

from 2021 onward. To do so, we want to 

maximize our sourcing of energy from 

renewables while residual, unavoidable 

emissions are to be offset by means of 

high-quality climate protection certificates. 

For the purpose of offsetting, we 

have recently signed a cooperation agreement 

with climate protection organization 

atmosfair gGmbH. Knorr-Bremse 

has selected two projects that reached 

the implementation stage earlier this 

year: the Clean Drinking Water project 

in Kenya, and the Efficient Wood Gas 

Stoves project in India. Both of these 

carbon-offset projects are certified to 

the independent and internationally 

recognized Gold Standard. These projects 

contribute to Goals 5, 8, 9, and 

13. Additionally, certified environmental 

management systems are in place 

at all Knorr-Bremse production sites 

worldwide to eliminate waste and support 

closed-loop recycling of materials. 

At the individual company level, local 

waste management initiatives (Goal 12), 

such as our “Zero Waste” program, are 

Frank Markus Weber, 

Chief Financial Officer 

of Knorr-Bremse 

88 


educing the types and quantities of 

waste that we dispose of. 

Recent adoption of Group-wide human 

rights policy 

In May, Knorr-Bremse made a clear commitment 

to due diligence with respect 

to human rights by adopting a Groupwide 

human rights policy. As a first step, 

we are concentrating on analyzing the 

working conditions of people potentially 

affected by our business activities and on 

analyzing our employee recruitment processes 

to identify potential for improvement. 

Knorr-Bremse is a participant in 

the United Nations Global Compact, and 

we are making an additional contribution 

to due diligence on human rights at 

all stages in the value chain. For example, 

67 percent of the purchasing volume 

from direct suppliers was assessed according 

to sustainability criteria – especially 

human rights governance. Another goal 

is to recruit more qualified female employees 

and take concrete steps to further 

women’s careers (Goal 5). Knorr-Bremse 

made further progress toward this goal 

in 2020. As well as signing the Diversity 

Charter, we have adopted a number of 

measures, including the introduction of 

a quota for women in management positions, 

establishing an internal women’s 

network, and continuing to develop 

existing support measures. 

Social matters deeply embedded in 

our corporate governance 

Clear compliance requirements across 

our entire supply chain, a strict code of 

conduct, and our corporate values all 

form the basis of our social commitment. 

We are gradually applying our supplier 

code of conduct for suppliers globally 

(Goal 8) and made significant progress in 

2020. As part of our initiative for Goal 8, 

Knorr-Bremse is globally rolling out the 

LinkedIn Learning self-directed learning 

tool in the course of 2021, offering 

more than 16,000 courses. In the future, 

the Knorr-Bremse Executive Board’s remuneration 

will be directly linked to 

attaining ESG targets. This link embeds 

KNORR-BREMSE CLIMATE STRATEGY 2030 

– 50.4 

per year CO 2 

-neutrality 

from 2021 

Goal: To halve our 

CO 2 

emissions by 2030 

Average reduction of Scope 1 and 

Scope 2 emissions by 4.2 percent per annum 

in relation to the reference year 2018 

Three levers to 

achieve a reduction: 

Energy 

efficiency 

by 2030 

Improve energy 

efficiency and switch 

to low-carbon fuels 

% CO 2 

– 4.2.% 100 % 

sustainability in our management model 

and in the everyday activity of our managers 

and workforce. This is how we 

are defining performance criteria that 

relate directly to long-term, sustainable 

economic success and include challenging 

objectives. 

Our key remit for the future: 

Eco-friendly, safe, efficient mobility 

Gradually increase 

share of renewable 

energy generated on 

our own 

Knorr-Bremse is a keen proponent of environmentally 

friendly technologies and 

invests significant amounts in R&D every 

year to enhance products with regard to 

EcoDesign principles (Goal 9). As one of 

our new approaches to innovation, we 

use an accelerator program involving 

startups to identify, for example, sustainable 

technologies. Our Rail division 

aims to help deliver the rail-borne transportation 

of the future – a key pillar 

in an eco-friendly mobility system. The 

investments announced by the EU are 

Renewables 

generation 

Goal: CO 2 

-neutrality 

By further increasing the 

proportion of renewable 

energy we use above the 

4.2 percent target 

and, as necessary, 

offsetting any 

remaining 

emissions 

Renewables 

purchase 

Expand renewable 

energy purchasing, 

making use of power 

purchase agreements, 

green energy products 

and certificates 

a key step toward making rail the green 

means of transport that moves people 

and goods in a sustainable and efficient 

way. Only by investing in infrastructure 

and digital technologies will the mobility 

sector be able to contribute to achieving 

the climate targets. With innovative 

braking technologies, solutions to further 

improve rail vehicles’ footprint, as 

well as digital innovations and services, 

Knorr-Bremse is already playing a part. 

At the same time, our Truck division 

is also making a big contribution to 

reducing global CO 2 

emissions, not least 

by means of lightweight design, which 

should result in lower fuel consumption 

by truck fleets. Electric mobility is one of 

the key levers for achieving internationally 

agreed emissions targets. Last year, 

Knorr-Bremse took the next step toward 

the age of electric mobility by bundling 

its expertise in the field of e-mobility 

within the eCUBATOR, our own new 

development unit. 


MAN Gives the People 

CO 2 

-free Mobility 

Electric drives with battery storage cannot bring about a transformation in passenger transport 

and the transport sector on their own. In order to provide customers with environmentally 

friendly commercial vehicles for every situation, MAN is also assessing the potential of hydrogen 

as an alternative drive technology for clean mobility. To achieve this, the company is cooperating 

with impressive partners from the worlds of politics, business, and science. 

By Stefan Klatt, MAN 

Reducing pollutant emissions has been 

on the agenda of commercial vehicle 

and engine manufacturer MAN for many 

years. Although the initial aim was to 

reduce emissions that are harmful to 

humans – such as carbon monoxide, 

nitrogen oxides, and particulate matter 

– to a minimum, awareness of the 

harmful impact that CO 2 

has on the 

climate has meant that reducing CO 2 

emissions is now a top priority. More and 

more private-sector and municipal fleet 

operators want to make a contribution 

to climate protection and are asking for 

vehicles with low CO 2 

emissions or a 

zero local emissions propulsion system. 

In addition, the EU decided in summer 

2019 that manufacturers of trucks and 

commercial vehicles must reduce CO 2 

emissions by an average of 15 percent by 

2025 and 30 percent by 2030, compared 

to 2019 levels: “Since the CO 2 

emissions 

from diesel engines are directly related to 

consumption, this means the following: 

Zero local emissions alternatives are required 

because diesel engines alone cannot 

be made 30 percent more efficient. 

The EU’s CO 2 

targets can only be met 

using low or, better still, zero-emission 

vehicles,” MAN explains. 

Customized solutions for every 

application 

Although electric drives with battery storage 

are considered the most promising 

technology for passenger cars in terms 

of preventing CO 2 

emissions in traffic, 

making the correct decision with regard 

to the appropriate alternative for heavy 

commercial vehicles is not so simple. 

The reason: It is not possible to commit 

to a single type of environmentally 

friendly propulsion technology because 

vehicle configurations and operating 

parameters are too varied. “While a 

scheduled-service bus in city traffic rarely 

covers more than 300 kilometers a day, 

a coach can clock up twice that. And 

the requirements for a delivery truck 

that returns to the depot every day are 

completely different to those for a longhaul 

transport truck that is out on the 

road for days or even weeks at a time 

all over Europe,” the company explains. 

For this reason, MAN is pursuing various 

approaches to alternative energy sources 

and types of drives at the same time as 

well as developing different solutions for 

its range of vehicle types and how those 

vehicles are used. For example, with its 

MAN Lion’s City E and eTGE models 

as well as the eTGM distribution truck, 

the company is already supplying its 

customers with series-produced, batterypowered 

vehicles for public transport 

and distribution transport applications. 

For long-haul transport, on the other 

hand, hydrogen (H 2 

) constitutes a good 

complementary alternative fuel option. 

The company unveiled its development 

roadmap in this regard in autumn 2020: 

According to this, prototype vehicles are 

to be built as soon as 2021, in line with 

ongoing predevelopment projects. MAN 

is testing the use of both a fuel cell and 

an H 2 

internal combustion engine. 

Hydrogen as a clean partial solution 

for heavy commercial vehicles 

The benefits are obvious: Firstly, this 

form of e-mobility is very eco-efficient. 

Fuel cells do not produce any CO 2 

emissions 

when in use, as they only emit 

water vapor. Secondly, thanks to the onboard 

power generation function, their 

range of around 800 km is great enough 

for long-haul transport by truck even if 

the payload is significant. The hydrogen- 

90 


ased internal combustion engine, on 

the other hand, offers a more readily 

available and robust solution on account 

of the well-established basic technology 

and could therefore be used as a form 

of bridging technology. “We take our 

responsibility toward the environment 

and society very seriously. As such, we 

put a lot of effort into developing alternative 

drive systems at MAN Truck & Bus,” 

says Dr. Frederik Zohm, Executive Board 

Member for Research & Development 

at MAN Truck & Bus. “Hydrogen is an 

interesting solution, but it will require 

significant infrastructural expansion. We 

are delighted that we can play our part 

by developing the right vehicles – as we 

have demonstrated with our roadmap.” 

The roadmap envisages that the vehicles 

will undergo practical testing in 

cooperation with selected customers 

in 2023 / 2024. As part of a “Bavarian 

fleet,” MAN wants to work with Bavarian 

infrastructure operators and haulage 

partners to test hydrogen for use in longhaul 

goods transport. “Bavaria is set to 

become a pioneering region for hydrogen 

technology: Collaboration with MAN to 

develop hydrogen engines for trucks in 

Nuremberg. With our high-tech agenda, 

we are firing up the research turbocharger 

to develop green technologies. 

Taking this technological leap is the only 

way to secure jobs over the long term,” 

wrote Bavarian Premier Markus Söder 

on Twitter after visiting the MAN site 

in Nuremberg in autumn 2020. He was 

referring to the Bavarian hydrogen strategy 

“WasserstoffBayern (H2.B),” which is 

aiming to make Nuremberg a European 

center of excellence for hydrogen propulsion 

by having the worlds of commerce, 

research, and politics all pull in the 

same direction. 

MAN undergoes transformative 

change to become supplier of 

alternative drives 

In the future, MAN will be working 

with the Friedrich-Alexander University 

of Erlangen-Nuremberg (FAU) and 

the Nuremberg Institute of Technology 

(THN) in order to research and develop 

hydrogen-based vehicle drive systems. The 

so-called Hydrogen Campus covers the entire 

value chain of this form of propulsion: 

from the environmentally friendly production 

of hydrogen to distribution and 

infrastructure, from energy conversion 

back to electricity to how the technology 

is applied in the customer’s vehicle: “For 

the first time, university scientists and 

students will be working with a vehicle 

manufacturer’s developers in running a 

joint laboratory and test benches on the 

manufacturer’s factory premises in order 

research hydrogen technology. With this 

hydrogen campus, the MAN diesel engine 

plant in its current form is paving the way 

for a successful transition to alternative 

drive systems,” says MAN. 

With its research into clean mobility in 

the commercial vehicle sector, MAN is 

not only safeguarding the company’s 

future commercial success, but also playing 

its part in the fulfillment of the UN’s 

Sustainable Development Goals. By making 

this commitment, the company is focussing 

on Goals 9 (Industry, innovation and 

infrastructure), 13 (Climate action), and 

17 (Partnerships for the goals). 

Fuel cell 

Hydrogen engine 


Symrise Aims 

at Climate-positive 

Operations by 2030 

Sustainability forms an integral part of the Symrise business model. The manufacturer of 

fragrances and flavorings, cosmetic active ingredients and raw materials, and functional 

ingredients for food assumes responsibility beyond the company for customers, consumers, 

employees, society, and the environment. Numerous ratings, certificates, and prizes – such as 

the German Sustainability Award, which Symrise has already won twice – deliver proof of this. 

In addition, the nonprofit organization CDP gave the Holzminden Group a triple-A rating – the 

highest one – in the categories of climate, forests, and water. This makes the company one of 

the ten most sustainable companies worldwide. 

By Christina Witter and Friedrich-Wilhelm Micus, Symrise 

Focus on three dimensions of 

sustainability 

Symrise splits its sustainability management 

into three dimensions: Environment, 

Social, and Governance (ESG). 

Symrise has defined its ESG performance 

as a measure of its success, and it has 

derived focal points such as biodiversity, 

climate change, as well innovation and 

development from this. The Sustainable 

Development Goals (SDGs) of the United 

Nations give these dimensions a more 

specific definition. In the course of its responsible 

conduct along the entire value 

chain, Symrise orients itself to these 

goals. A particular focus lies on SDG 13. 

The Holzmindeners have set themselves 

the ambitious goal of climate-positive 

operations starting in 2030. Due to its 

diversified positioning, Symrise must 

keep an eye on all 17 goals. The company 

has identified six of these to which it 

can contribute most: “Decent work and 

economic growth” (SDG 8), “Responsible 

consumption and production” (SDG 12), 

“Climate action” (SDG 13), “Protection of 

life/biodiversity on land and below water” 

(SDGs 14/15), and “Partnerships for the 

goals” (SDG 17). 

Of these six core topics, “Climate action” 

(SDG 13) carries particularly relevance. 

Symrise needs a healthy climate for 

long-term success and the continued 

existence of its business model. This 

will allow the approximately 10,000 

mostly natural raw materials that the 

company uses for its products to thrive, 

92 


oth today and tomorrow. Specifically, 

Symrise positions its six core SDGs as 

follows. 

SDG 13: Climate action 

Rich biodiversity and a healthy climate 

go hand in hand – this is why Symrise 

has decided to take an important step. 

Beginning in 2030, business activities 

are expected to prevent or sequester 

more greenhouse gas emissions from 

the atmosphere than they produce. As 

an intermediate goal, by 2025, Symrise 

expects to increase its eco-efficiency of 

greenhouse gas emissions by 63 percent 

compared to 2016. 

The company already managed to improve 

this efficiency by 13 percent in 

2020. To make additional progress, it is 

examining all processes in more than 100 

locations worldwide to see how it can use 

electricity, gas, and steam most sustainably 

in production in those places. This 

may involve using energy from renewable 

sources or generating their own sustainable 

electricity. The Group achieved 

this goal in 2020 by demonstrably covering 

its external power needs worldwide 

entirely from renewable sources. It had 

already achieved this in Germany in 2018. 

To achieve its goals, Symrise includes 

climate protection in the planning phase 

of current projects. It has developed a 

“toolbox” that it has initially used in the 

construction of its first “green factory” 

in Tocancipá, Colombia. Building blocks 

include solar collectors, systems for water 

and wastewater management, and environmentally 

friendly waste recycling. 

Symrise also includes its partners in its 

dedication to these goals: 87 percent of 

its major suppliers have committed to 

their own climate-protection objectives. 

SDG 8: Decent work and economic 

growth 

In addition to its dedication to the climate, 

Symrise is committed to observing 

human rights. It pays attention to good 

work conditions, equal opportunity, and 

facility safety, both in the company itself 

and along the supply chain. Suppliers 

and business partners must acknowledge 

the company’s own Code of Conduct 

before a partnership begins. By 2025, 

it expects the share of major suppliers 

who it assesses based on sustainability 

criteria to increase to 100 percent. 

SDG 12: Responsible consumption 

and production 

Sustainable production processes and 

the efficient use of natural resources are 

firmly connected to the core business 

of Symrise. This starts with the environmentally 

friendly use of chemicals 

and extends to the avoidance of waste. 

Symrise exerts a great influence on this, 

already in the product development 

phase. 

SDGs 14 and 15: Biodiversity on land 

and in the water 

Because it needs an intact global variety 

of species for the long-term manufacture 

of natural products, Symrise actively 

protects biodiversity. Specifically, Symrise 

intends to make a contribution to 

clean oceans by 2025 by preventing or 

significantly reducing garbage and/or 

sensitive waste. 

SDG 17: Partnerships for the goals 

Furthermore, Symrise needs strong partners 

to help it reach its ambitious objectives. 

Sustainable partnerships require 

knowledge transfer and synergies with 

suppliers, political actors, and local 

partners. Beyond this, a high level 

of backward integration ensures 

secure access to traceable, highquality 

raw materials. 

Learning partnerships among 

suppliers, farmers, Symrise, 

and its customers form an 

additional focal point. Symrise 

and its partners want to 

invest €16 million in “Bridging 

the Gap” over the next four 

years. This shall counteract the 

global phenomenon of a lack of 

successors in small-scale agriculture, 

thereby reducing bottlenecks of certain 

raw materials. Symrise and its partners 

continue to develop specific methods for 

cultivation and harvesting. This enables 

higher incomes and makes agriculture 

more attractive to future generations. 

Summary 

Symrise takes its responsibility for the 

protection of the climate and living 

ecosystems seriously. These aspects 

come with the highest priority since 

they form the basis for the company’s 

economic success. In light of this, the 

MDAX-listed Group has set itself ambitious 

goals such as climate positivity 

starting in 2030 and the efficient use 

and preservation of natural resources. 

Among other indicators, Symrise underpins 

its position as a visionary pioneer 

of climate protection with its triple-A 

CDP rating. The company continues to 

search for opportunities to thoroughly 

and profoundly interweave sustainability 

with its business model along its entire 

value chain. Close collaboration with its 

partners bears strategic relevance. Only 

by combining forces will Symrise succeed 

in reaching its stated goals quickly. By 

doing so, Symrise will secure the future 

for itself, its partners along the entire 

value chain, and consumers alike. 


Are Covid-19 Recovery Funds 

Helping the Environment? 

In the last year, governments have pledged trillions of dollars in Covid-19 relief, creating what 

some observers have called a once-in-a-generation chance to make planet-friendly investments 

– and save the Earth from a looming environmental catastrophe. But, that does not mean the 

path to a green recovery will be easy. 

According to a report launched by the 

Global Recovery Observatory, only 2.5 

percent of all Covid-19 recovery spending 

will have “positive green characteristics,” 

such as reducing greenhouse gas emissions 

and protecting natural capital. 

The Observatory is tracking the fiscal 

rescue and recovery spending of the 

world’s 50 largest economies to pin down 

the level of green spending built into 

rescue and recovery plans. The study is 

part of the broader Oxford University 

Economic Recovery Project, which is 

supported by the United Nations Environment 

Programme (UNEP), the International 

Monetary Fund, and the 

Deutsche Gesellschaft für Internationale 

Zusammenarbeit. 

Researchers studied funds announced 

for both short-term “rescue” and longterm 

recovery. They found that green 

spending is concentrated in wealthier 

countries and populations, threatening 

to reinforce dangerous pre-pandemic 

inequities. 

“Pandemic recovery packages are a massive 

opportunity to accelerate action on 

the three crises facing humanity: climate 

change, biodiversity loss and pollution,” 

says Steven Stone, Chief of Resources 

and Markets at UNEP. “We must seize 

it or we risk scarring, saddling future 

generations with massive debt and a 

broken planet.” 

Spending so far 

In 2020, $368 billion was announced 

in national spending on programs that 

will reduce greenhouse gas emissions. 

Although this is a large sum, it pales in 

comparison to the $14.6 trillion in total 

spending announced by the 50 largest 

economies. Much of that larger number 

consists of spending that is not expressly 

green, which threatens to reinforce business 

as usual patterns of production 

and consumption that are ravaging the 

planet, the new report says. 

Despite the severity of air pollution, 

which causes up to 9 million deaths 

annually, only 16 percent of total recovery 

spending (excluding the European 

Commission) is deemed to potentially 

reduce air pollution. When it comes 

to preserving natural capital – or the 

global stock of natural resources – and 

reversing ecosystem degradation, “only 3 

percent of recovery spending is deemed 

positive.” 

There are reasons for hope, though, the 

report says. Numerous countries are 

bucking trends and making substantial 

green investments. Poland, for instance, 

has put forth $2.1 billion in a recovery 

push to position itself as a European 

leader in the production and adoption 

of electric vehicles. Spain has earmarked 

more than $7.2 billion for a recovery 

plan – “España Puede” – meant to spur 

a “just and inclusive energy transition” 

through direct investment. 

Recovery requires long-term 

thinking 

Most green spending is concentrated 

in countries with a history of driving 

green investment. The report points to 

Germany’s leadership, highlighting its 

$8.3 billion investment in green hydrogen. 

And it said France – through an 

$8.4 billion allotment to its sweeping 

“France Relance” recovery program – has 

emerged as a leader in green building 

and energy-efficiency retrofits. 

Although some advanced economies and 

the European Commission account for 

most of the green recovery spending, the 

report warns that “for the vast majority 

of countries, recovery spending has been 

relatively low and minimally green.” The 

economic ravages of the coronavirus are 

only exacerbating existing disparities 

– and recovery spending – between 

nations. The report points out that ad- 

94 


TECH COMPANIES TAKE ON CLIMATE CHANGE 

25 technology companies signed a pledge to develop 

“green digital solutions” that will help the world slash 

carbon dioxide emissions and digitally transform key 

economic sectors. Signatories, which include Microsoft, 

Ericsson, and Vodafone, also committed to becoming 

carbon-neutral themselves by no later than 2040. 

The pact, known as the European Green Digital Coalition, 

was spearheaded by the European Commission and 

endorsed by UNEP. 

It comes as the world faces what experts warn is 

a looming climate crisis. The last decade was the 

warmest on record and, scientists say, unless humanity 

dramatically reduces its greenhouse gas emissions, the 

Earth is facing a future of heat waves, food shortages, and 

mass extinctions. 

“We are in a race against time to lower greenhouse gas 

emissions,” says UNEP Executive Director Inger Andersen. 

“Only digital technologies move at the speed and scale 

necessary to achieve the kind of dramatic reduction in 

emissions that we need to see in the next 10 years.” 

UNEP’s support for the European Green Digital Coalition is 

part of an effort to use data and digital tools to encourage 

politicians, business leaders, and consumers to embrace 

sustainable consumption and production. The initiative 

is designed to help the world tackle climate change, 

biodiversity loss, and pollution over the next 10 years. 

Digital technology could help reduce the world’s carbon 

emissions by about 17 percent, according to a report from 

the International Telecommunication Union, a United 

Nations body. Industry players say artificial intelligence, 

for example, could help make electric transmission 

grids more efficient. Blockchain technology could allow 

concerned citizens to track corporate carbon emissions. 

And the use of satellites can be further enhanced in 

monitoring environmental changes, including activities 

such as illegal logging, mining, and waste dumping, at sea 

or on land. 

vanced economies are spending about 

17 times more per person than what is 

being spent in emerging markets and 

developing economies. 

The imbalance among nations reflects 

inequalities that exist within nations – 

inequalities that have only worsened during 

the pandemic. Disparities in health 

and healthcare access “led to the disease 

burden falling heavily on low-income 

and otherwise marginalized groups,” according 

to the report. Worldwide, those 

groups have also experienced the bulk 

of job losses and wage cuts. 

UNEP itself is retooling for a Covid-19 

recovery. The organization’s recently 

launched Medium-Term Strategy for 

2022–2025 sets out a vision to address 

climate change, biodiversity loss, and 

pollution, and it maps out the actions 

needed to shift consumption and production 

patterns toward sustainability. It will 

bolster UNEP’s efforts to advance the 

environmental dimension of the 2030 

Agenda for Sustainable Development. 



ZOOMING IN 

SUSTAINABLE CITIES 

The world is becoming increasingly 

urbanized. By 2030, 5 billion people, 

60 percent of the world’s population, 

will live in cities. Rapid urbanization 

requires new transport, power, water, 

and waste systems. While cities 

generate the mayor share of gross 

domestic product in many countries, 

they are also responsible for 70 percent 

of global CO 2 

emissions. In this section 

we name promising aspects how cities 

could develop to become more 

sustainable and resilient. 


97

Building a sustainable, inclusive 

and resilient present and future 

As a leading building materials company, we recognize and embrace our responsibility in the 

development of sustainable cities and resilient communities. We continue to advance toward our 

commitment to the United Nations Sustainable Development Goals (SDGs) and specifically the 

five we prioritized that are directly related to our company’s business strategy. SDGs 8, 9, 11, 13, 

and 15 represent our greatest opportunities for shared value creation and offer us the greatest 

potential for living our purpose of building a better future. We collaborate within and outside our 

company to collectively work toward achieving the SDGs. 

By Martha Herrera, CEMEX 

At CEMEX, we believe sustainability is 

the most meaningful way of doing business. 

Sustainability is embedded in our 

strategy, and thus, it is linked to all 

decision-making processes across our 

business lines. Our 2030 Sustainability 

Targets are designed to further enhance 

CEMEX’s economic, environmental, and 

social performance, and to strengthen 

our commitment to build a sustainable, 

inclusive, and resilient present and future 

for all. 

Climate actions (SDG 13) 

As of 2020, we have reduced our net 

CO 2 

emissions per ton of cementitious 

products by close to 23 percent compared 

with the 1990 baseline. With our 2030 

goal, we aim to avoid up to 16 million 

tons of CO 2 

per year, equivalent to the 

annual emissions of 3 million passenger 

vehicles. 

Our 2050 ambition is to deliver net-zero 

CO 2 

concrete to all customers and geographies. 

Concrete will continue to have 

a critical role to play in a low-carbon 

economy. In 2020, we launched Vertua, 

our industry-first Net-Zero CO 2 

Concrete 

Solution. This product is an important 

step in our ambition of achieving carbon 

neutrality in all our concrete products 

and geographies. We achieve this 

through a cutting-edge technology with 

geopolymers that reduces the carbon 

footprint by up to 70 percent. 

Biodiversity (SDG 15) 

In 2020 we continued taking action to 

enhance the biodiversity in and around 

our quarries through the implementation 

of rehabilitation plans and conservation 

initiatives and the development 

of local Biodiversity Action Plans for 

quarries located in or close to high-value 

biodiversity areas. Our conservation activities 

provide a valuable opportunity to 

engage employees and local communities 

in wildlife enhancement initiatives and 

foster awareness of how industry and 

natural habitats can coexist. 

Circular economy (SDG 8, SDG 9, 

SDG 11, SDG 13, and SDG 15) 

CEMEX has the proven experience, 

technology, and know-how needed to 

process, store, and leverage the special 

conditions offered by the rotary kilns 

in the production of clinker as well as 

to process waste and recover energy 

from alternative sources in a responsible 

manner. 

Our Alternative Fuels Strategy helps us 

confront climate change by enabling 

us to rely less on fossil fuels and thereby 

reduce the CO 2 

intensity of clinker 

manufacturing. Going forward, we will 

continue working to reach our targets 

and seek investment opportunities to 

identify and transform new sources of 

waste to replace fossil fuels, all while remaining 

a prominent industry advocate 

and leading user of alternative fuels for 

cement production. 

Diversity and inclusion (SDG 8 and 

SDG 9) 

We embrace the benefits of our differences 

and our similarities; with more 

than 41,000 employees from more than 

100 nationalities working as One CEMEX 

across our operations, our success is 

rooted in leveraging our diversity to 

deliver on our vision of building a better 

future. Launched in 2020, our Global 

98 


Recruitment Policy emphasizes providing 

equal employment opportunities in our 

company and describes our D&I Position 

Paper on the subject and our public adherence 

to the UN WEPs. At CEMEX, we 

actively promote inclusivity across our 

operations with our policies, D&I Local 

Committees, recruitment practices, and 

training to address unconscious biases 

across the workplace, marketplace, and 

community. 

Social actions during the Covid-19 

pandemic (SDG 11 and SDG 17) 

2. Sustainable and Resilient Infrastructure 

and Mobility: 

• +3.6 million people have accessed affordable 

housing solutions to date 

• +550 beds were added by developing a 

building solution for the construction 

of hospitals in Mexico 

3. Social and Environmental Innovation 

and Entrepreneurship: 

• In 10 years, the CEMEX-Tec Award 

has built a unique ecosystem of more 

than 8,600 students, social innovators, 

community entrepreneurs, and leaders 

of multi-sectoral initiatives from 

90 countries 

• 196 MSMEs supported in cooperation 

with NGOs to navigate the crisis 

4. Culture of Environmental Protection, 

Health, and Safety: 

• 14,800 environmental promoters have 

been trained to date 

• + 3.6 million m² of hospitals and public 

spaces sanitized 

Our Social Impact strategy enables us 

to embed a total social impact mindset 

into everyday actions and fully integrate 

the footprint from its actions cross-functionally 

into all of our business units. 

The long-term goal is to accomplish 

well-being and social welfare as well as 

generate shared social transformation 

in more than 5,000 communities in 

which we have operations. To support 

our stakeholders worldwide in enduring 

lockdowns and loss of income, we 

developed swift action plans across our 

operations in coordination with local 

partners and authorities. 

Prior to and during the Covid-19 crisis, 

we have developed solutions through our 

partnerships, replicated our programs in 

multiple countries in record time, and 

scaled efforts to reach out to the most 

vulnerable people in society. 

To date, CEMEX has collaborated with 

more than 23 million people in more 

than 5,000 communities in which we 

operate. Through our four community 

investment pillars, we guide collaboration 

and actions that contribute to the 

transformation of communities globally 

and create shared value. 

1. Education and Capability Development 

for Employability: 

• +53,000 youths trained to date 

• +6,600 youths reached through education 

programs, despite the global 

pandemic 

HIGHLIGHTS FROM OUR MULTISTAKEHOLDER 

COLLABORATIONS 

CEMEX SDG Innovators 

In 2020, for the second consecutive year, young intra-entrepreneurs from 

CEMEX were selected to participate in the UN Global Compact’s Young SDG 

Innovators Program. This 10-month accelerated training program enables 

future change-makers to join peers from across the globe to develop 

innovative solutions that help deliver on the global Agenda 2030 as well as 

our company’s sustainability objectives. “In order to achieve the SDGs, 

businesses need to collaborate on developing and innovating their business 

models. The Young SDG Innovators Program gives me the opportunity to 

reach out to various fronts within CEMEX and collaborate with the extended 

network of the UN Global Compact to try to contribute ideas that will add 

value to the company and have an impact on the SDGs.” 

Gonzalo Daniel García, CEMEX 

GCCA 

In partnership with the Global Cement and Concrete Association (GCCA), we 

developed a joint statement to fully document our sector’s contributions to all 

17 SDGs. We acknowledge that a decade of action is needed to achieve the 

UN SDGs and that the concrete industry will play an important role in 

contributing toward achieving these targets. 

UN Global Compact – Our leadership in Mexico 

CEMEX has been a participant in the UN Global Compact since 2004. Through 

our leadership as Chair of the UN Global Compact Mexico in 2020, the UN 

Global Compact led around 19 multistakeholder working groups to support 

and accelerate the SDG targets in Mexico. This was done in alliance with the 

federal government and Mexico’s Coordinating Business Council. 


Project “Impact Assessment”: 

Measure Impacts and Improve 

Sustainability 

This year the A7 highway is undergoing the biggest modernization in its history in order to be able 

to cope with increasing traffic volumes. New connections are thereby being created: Because the 

highway is being “roofed over” in urban districts with wide covers in three places, districts that had 

been separated for years are growing back together, and green spaces with small gardens and 

parks are being created. One of these covers is Stellingen Tunnel, which was opened for traffic in 

spring of 2021. The landscaping above ground is ongoing, and the new peace and quiet is a 

blessing for local residents, who up to now suffered from the loud traffic noise. In the future, the 

pleasant sound of twittering birds will be heard here instead of the drone of engines. 

By HOCHTIEF 

As a technical leader, HOCHTIEF has 

shared responsibility for the infrastructure 

project and the construction of the 

joint venture. It is one of many infrastructure 

projects worldwide in which 

the Group is contributing to stable and 

sustainable urban construction. 

In search of measurability: Research 

project for infrastructure projects 

As with all construction projects, the 

work on the A7 highway initially generated 

noise, dust, and increased emissions 

of greenhouse gases. Such effects rank 

among the usual and unavoidable side 

effects of construction. Can the effects 

on society and the environment actually 

be measured, and ideally also reduced? 

What leverage, if any, does a construction 

company have for the sustainable 

design of projects? 

HOCHTIEF is looking for answers to the 

question of measurability and avoidability 

of impacts, together with socioeconomists 

of Zeppelin University in 

Friedrichshafen in a research project. 

The team, led by Professor Manfred 

Moldaschl, Head of the Institute for 

Socioeconomics, investigated the social 

and ecological impacts of construction 

for infrastructure projects. They concentrated 

on two projects in Hamburg in 

which HOCHTIEF is participating: Stellingen 

Tunnel and Langenfelde Bridge, 

which crosses over the A7 highway. 

They are being built on behalf of DEGES 

(Deutsche Einheit Fernstraßenplanungsund 

-bau GmbH), which is supporting 

the research project. 

The objective of the scientists was to identify 

suitable sustainability approaches 

and instruments in order to observe and 

evaluate the impacts. In their methodology, 

the researchers concentrated on 

noise measurements at the bridge project 

and on observations of traffic congestion. 

They did this because the construction 

company can – at least partly – have 

an influence on these elements. 

Closures and noise – measuring real 

impacts 

If individual traffic lanes and highway 

sections have to be closed, this very 

likely results in traffic congestion, which 

is costly. It not only costs time but also 

money. According to a traffic study by 

INRIX, in 2019 German motorists spent 

an average of 46 hours in traffic jams. 

The economic damage is immense: Commuters 

arrive late to work, materials 

are delivered late, and traffic has to be 

diverted. Fuel consumption increases, 

and hence CO 2 

emissions, with direct 

consequences on the environment and 

climate. 

In the course of the research project, the 

scientists created a model that monetizes 

the impacts of closures, and it also had 

the ability to be modified for other traffic 

infrastructure projects. Since closing 

stretches of highway causes considerable 

social and ecological costs, closures 

are always reduced to a minimum in 

100 


EXPANSION OF 

INFRASTRUCTURE 

IN NORTHERN 

GERMANY 

The A7 highway in the Hamburg 

region is subject to one of 

the heaviest traffic loads in 

Germany: Just accounting 

for the section between 

the highway intersection 

Hamburg-Northwest and the 

junction Hamburg-Stellingen, 

152,000 vehicles pass through 

every day, and this number 

is increasing. The expansion 

of the highway was decided 

because of this high traffic load, 

which leads to above-average 

numbers of accidents and long 

traffic jams. In its capacity as 

a technically oriented global 

infrastructure group, 

HOCHTIEF not only 

successfully realized 

Langenfelde Bridge and 

Stellingen Tunnel but, in a 

public-private partnership, 

also expanded the A7 highway 

along a stretch of more than 

60 kilometers further north. 

The Group was also recently 

awarded the contract for the 

“Altona Tunnel” project – the 

last of the three “Hamburg 

Covers” projects under the 

leadership of HOCHTIEF. 

HOCHTIEF projects. They are coordinated 

and transparently communicated in 

detail with clients and authorities. In 

principle, the following applies: Closures 

only occur if they are absolutely necessary, 

for instance due to the relocation 

of traffic lanes or material transportation. 

Furthermore, they are scheduled 

to take place outside of rush hour, as 

far as possible. 

Stellingen Tunnel 

Such rules also apply to the topic of 

noise. However, in order to determine 

the impacts here, many other factors 

have to be taken into consideration, for 

instance the population density in the 

surrounding areas, a “basic noise level” 

without construction noise, the wind direction, 

and also noise-absorbing objects. 

Noise emissions were measured during 

construction of the Langenfelde Bridge. 

However, there is no obligation to continually 

document noise pollution on 

construction sites, which means that 

the availability of information can vary 

considerably at other project sites. With 

regard to traffic figures and the evaluation 

of congestion, data availability is 

considerably better. However, in many 

cases, the scientists came to the following 

conclusion: An analysis of the impacts 

is only partly suitable for effectively 

promoting sustainability on construction 

projects. The study does provide an analytical 

instrument for the quantification 

and comparability of impacts. However, 

each construction project is unique and 

always involves new and different requirements 

– and consequently they 

are hardly comparable. Furthermore, 

for an analysis of impacts, appropriate 

monitoring measures are necessary – 

these have not yet been established. 

Logistics, communication, and 

digitalization: Important 

instruments for sustainable design 

Langenfelde Bridge 

The research project also indicates the 

following: In particular, well-coordinated 

construction logistics play a more important 

role in ensuring trouble-free 

construction than impact management 

does – guaranteeing that the project can 

proceed without any hitches, because 

disturbances always have direct negative 

impacts on the environment and society. 

In addition to good planning, open communication 

with all stakeholders is also 

essential for implementing construction 

measures – not only with clients but 

also with subcontractors, local residents, 

and road users. At HOCHTIEF, logistics 

and stakeholder management have long 

since been an integral part of the internal 

management system, and hence part 

of the regular project implementation. 

HOCHTIEF is also working in many other 

ways to further improve sustainability 

performance, also with the aid of innovative 

technologies. For instance, by using 

multidimensional works for presentations, 

digital construction can contribute 

to trouble-free construction sequence. 

In pilot projects, water and electricity 

consumption is being recorded and digitalized 

in real time to be able to analyze 

and correct unusual peaks. There is an 

ongoing campaign in the United States to 

reduce the amount of time construction 

machinery is idle. The potential is great: 

A good 30 percent of the operating time 

of heavy equipment can be eliminated. 

Other current digitalization topics in 

the Group include projects for robotics, 

the use of artificial intelligence, and the 

Internet of Things. Digital innovation 

is making active contributions toward 

sustainability, which could considerably 

reduce impacts in the future. 


Vonovia on Track to Achieve 

Affordable Climate-neutral 

Housing Stock 

Vonovia is aware of its social responsibility regarding climate protection. In addition to energyefficiency 

refurbishment and the expansion of renewable energies, Germany’s leading residential 

real estate company is investing in innovations and new approaches – such as seeking holistic 

solutions for entire neighborhoods. Its neighborhood in Hamburg-Wilhelmsburg is an exemplary 

project for Vonovia. 

By Anne Werner, Vonovia 

Wilhelmsburg, Hamburg’s largest district 

in terms of area, is located south of the 

river Elbe and never used to be considered 

to have urban appeal or be very 

central. The neighborhood experienced 

an upswing thanks to the Internationale 

Bauausstellung (International Architecture 

Exhibition). At present, Wilhelmsburg-Ost 

has a population of around 

54,000 on an area of approximately 37 

hectares, including many young families 

of migrant backgrounds with children. 

The local real estate structure there is 

largely dominated by two large residential 

areas: the Korallus Quarter, established 

between 1950 and 1970 and 

featuring apartment blocks and high-rise 

buildings, and the Bahnhof Quarter, built 

at the end of the 19th century in the 

Gründerzeit architectural style. Over the 

past few years, the area itself has seen 

little benefit from urban development 

processes. Overall, there is an acute need 

for buildings to undergo maintenance 

and modernization work. The apartments 

lack greenery and play areas, and 

brownfields dominate the landscape in 

the Korallus Quarter. 

Affordable, climate-neutral housing in the 

urban neighborhood of Wilhelmsburg: 

This is the new approach that Vonovia 

wants to take to turn the district into a 

popular residential area for young and 

old alike. People should feel at home 

and get the full experience of a good 

social environment. A large majority 

of the roughly 1,400 residential units, 

23 commercial units, and 253 parking 

spaces and garages owned by Vonovia 

have not yet been renovated. The measures 

currently in planning offer a high 

savings potential in the long term, as the 

current lack of thermal insulation as well 

as old windows and heating units leads 

to excessive ancillary expenses. 

Overall, the neighborhood has good 

prospects, and the vacancy rate is very 

low. Due to their generous dimensions, 

apartments are in high demand and are 

particularly attractive to young families. 

The Korallus Quarter primarily offers 

three- and four-room apartments; the 

Bahnhof Quarter two- to two-and-a-halfroom 

apartments. In addition to that, 

there is huge potential here in terms of 

external areas. 

The investments planned by Vonovia 

will turn the neighborhood into an 

attractive residential area for families 

and older residents. To achieve this, 

Vonovia will implement a modern and 

cost-effective energy concept with an 

environmentally friendly and subsidized 

supply of energy to the neighborhood. 

Attractive and affordable apartments will 

be preserved and the current portfolio 

expanded through special offers and 

concepts. Important measures include 

social diversity among the tenants, the 

expansion of services offered on site, 

and an upgrade of green spaces and 

play areas. 

Together toward a climate-neutral 

neighborhood 

A holistic urban renewal concept for the 

future development of the neighborhood 

that takes the residents into account 

is currently being designed in a workshop 

process – four planning teams 

are developing concept proposals that 

see the improvement of the neighborhood’s 

environmental footprint as a key 

criterion. Vonovia’s goal is to make its 

102 


entire portfolio climate-neutral by 2045. 

For this reason, an integrated approach 

that includes electricity and heating 

in the energy-efficient refurbishment 

of the buildings will be carried out in 

Wilhelmsburg. 

Around 350 residential units will be 

heated through a local heating network 

powered by solar thermal plants on 

roofs, a cogeneration unit, and a new 

condensing boiler. The cogeneration 

unit also generates electricity as part 

of the power-heat coupling, and this 

can be obtained directly by the tenants 

through a customer facility. This adds 

a renewable energy component to the 

holistic concept – the gas in stock used 

to feed cogeneration units and gas boilers 

will even be replaced by synthetic fuels 

such as hydrogen. This measure will 

allow for CO 2 

emissions to be reduced 

to almost zero. 

However, the core aspect of the project 

is the development and expansion of a 

local heating network that also includes 

the construction and refurbishment of 

heating systems in the neighborhood. 

Renewable energy sources such as photovoltaics 

or solar thermal plants on roofs 

are also an important component. This 

means the burden passed on to tenants 

can be kept below €2 per square meter. 

Overall concept 

In the coming years, Vonovia will invest 

more than €100 million in this energy 

project. The realization is taking place 

in three phases. 

The first phase, which has already been 

completed, saw the energy-efficient refurbishment 

of 334 residential units. 

Around €31 million was spent to achieve 

this. In addition to that, 15 loft apartments 

were expanded vertically. They 

are supplied with energy conventionally 

through the installation of their own 

gas-condensing boilers. 

The second phase involves the energyefficient 

refurbishment of an additional 

350 apartments by 2022 / 2023. This also 

includes the installation of a solar energy 

cogeneration unit and a local heating 

network for the supply of the units. This 

way, positive effects in the area of heating 

and energy supply will be achieved using 

power-heat coupling, and the primary 

energy factor will be reduced from 1.11 

to around 0.4. Vonovia expects tenants 

to actively participate by obtaining their 

energy from the customer facility. 

Around 40 additional modern and familyfriendly 

apartments will be created from 

the gutting and repurposing of approximately 

145 former student apartments 

built in the 1950s that are now also 

connected to the heat pump network 

and solar energy plants. In addition to 

energy-efficiency refurbishment, this 

phase will see the creation of 60 to 70 

new apartments by expanding into attics. 

The construction of 10 new apartments 

is also in the pipeline. 

Phase three, which is currently being 

planned, concerns mainly the Gründerzeit 

buildings in the Bahnhof Quarter. 

All in all, this will affect 400 apartments, 

which will be refurbished following 

phase two starting in 2023. A further 18 

to 20 apartments will be created through 

expansion, and 14 further barrier-free 

apartments through infill developments. 

Around 50 apartments are in 

the planning as part of new construction 

projects. 


Smart Urban Areas: 

Future-proof Cities with 

Solutions from Wilo 

Worldwide, more and more people are moving to cities. According to an estimate by UN-Habitat, 

almost two-thirds of the global population will be living in urban environments by 2030. With its 

innovative pumps and pump systems, the Wilo Group contributes to turning cities into Smart 

Urban Areas with the purpose of making life and work in these areas future-proof. 

By Ricarda-Marie Pomper, Wilo Group 

First and foremost, New York, Paris, 

London, Istanbul, and Mumbai have one 

thing in common: They are so-called megacities 

– that is, cities with extremely 

large populations. According to estimates 

by the United Nations in 2018, there are 

currently 33 such megacities worldwide, 

and their number is growing. However, 

the rapid population increase poses growing 

challenges with regard to the urban 

infrastructure. This includes a lack of 

housing, for example, as well as traffic 

chaos. Yet, there are many more issues 

to deal with: In the Nigerian metropolis 

Lagos, for example, the water and energy 

supply is unreliable, the poorer inhabitants 

have no access to clean sanitary 

facilities, and the garbage ends up on 

the streets. The situation is similar in 

other large cities, mainly in emerging 

economies and developing countries. 

What’s more, climate change is aggravating 

the already tense situation: For 

example, in 2018, the metropolitan city 

of Cape Town was at risk of completely 

running out of drinking water. “Day Zero” 

was only just prevented due to drastic 

saving measures. Furthermore, 90 percent 

of the urban areas are located near 

coasts. If sea levels rise, these regions are 

at particular risk. However, at the same 

time, the cities are also contributing to 

climate change, as they are producing 

approximately 70 to 75 percent of all 

greenhouse gases. 

The interconnected city 

In order to render large cities futureproof 

and livable, we urgently need 

sustainable solutions. This feasibility 

is demonstrated by Smart Urban Areas. 

With this concept, urban infrastructures 

and many spheres of life will be digitally 

and intelligently connected. They can be 

divided up into six zones with different 

requirements and functions: Recreation 

and leisure, work and trade, living space, 

industry, transport and infrastructure, 

as well as agriculture. 

The Wilo Group is one of the world’s 

leading suppliers of pumps and pump 

systems for building services, water 

management, and the industrial sector, 

developing customized, energy-efficient, 

and smart solutions for different requirements. 

This occurs across the entire 

water circuit – from raw water intake 

and transport up to sewage treatment. 

“Our intelligent and connected solutions 

LESS POWER 

CONSUMPTION 

DUE TO EFFICIENT 

SYSTEMS 

Realistic estimates currently 

assume that pumps account 

for about 10 percent of global 

electrical energy consumption. 

This is no surprise, since a large 

proportion of pumps in use are 

outdated and inefficient. If they 

are replaced with modern highefficiency 

pumps of the latest 

generation, up to 246 terawatt 

hours of electricity can be saved 

worldwide. This is comparable to 

the power of around 80 coal-fired 

power stations. 

104 


contribute significantly to the development 

of cities toward Smart Urban Areas. 

Thanks to the significantly lower energy 

consumption of our systems, we also 

contribute to slowing down the climate 

change,” says Oliver Hermes, President 

and CEO of the Wilo Group. 

Pump systems against the monsoon 

in Mumbai 

The city of Mumbai in India exemplifies 

what such a project looks like. With 25 

million people living there, Mumbai is 

the economic center of India and houses 

the most important port of the country. 

As the city is in the tropics, 95 percent 

of the water precipitation occurs during 

just four months of the year. To prevent 

floods during the summer monsoon, 

Mumbai built storm pumping stations. 

It is the only city in India so far to have 

done this. These pumping stations are 

equipped with 29 axial submersible motor 

pumps from Wilo. Each pump is 6 

meters high and can pump approximately 

6,000 liters of water per second. 

If the water levels are too high, these 

pumping stations discharge the water 

from a drain or arm of water into the sea. 

At the same time, automated tide gates 

prevent seawater from getting into the 

city. “Our axial submersible motor pump 

was the optimum solution to meet the 

requirements within the project,” says 

Rajesh Unde from Wilo India. “Its own 

weight ensures a self-centering position 

in the discharge tubes, and it can easily 

be installed despite its size.” 

The Narmada-Malwa Gambhir link 

project 

However, whereas some have too much 

water, others have to contend with too 

much aridity. Such is the situation in 

the Indian central province of Madhya 

Pradesh. With support from the government 

and other partners on site, Wilo 

India implemented a project for the 

irrigation of a total of 50,000 hectares 

of land in the region. Now, 36 highly efficient 

vertical turbine pumps transport 

water more than 500 meters high and 

through a pipe network of approximately 

600 kilometers. The project provides the 

population with a sustainable source of 

income by way of agriculture as well as 

access to clean drinking water in around 

158 villages. “Wilo is thus improving the 

living conditions in the central province 

of India. With state-of-the-art German 

engineering technology, we provide sustainable 

solutions in the area of irrigation 

and drinking water supply,” says Hemant 

Watve, Head of Wilo India. 

A company with climate protection 

in its DNA 

As the inventor of the first high-efficiency 

pump, sustainability and climate protection 

have always been priorities for 

Wilo. Energy and resource efficiency are 

key to this. Therefore, the pumps of the 

company contribute to supplying people 

all over the world with water in an intelligent, 

efficient, and climate-friendly 

way. Furthermore, the Wilo Group is 

aiming to provide at least 100 million 

people with access to clean drinking 

water by 2025. 

With the projects in India as well as the 

innovative solutions for Smart Urban 

Areas, Wilo is not only improving the 

worldwide supply of water as well as 

life in cities and rural areas, but it is 

also contributing toward meeting the 

UN sustainability targets. Among others, 

these are SDG 6 (Clean water and 

sanitation), SDG 9 (Industry, innovation 

and infrastructure), SDG 11 (Sustainable 

cities and communities), as well as SDG 

13 (Climate action). “Our work with the 

precious resources of water and energy, 

as well as our approach to protecting the 

climate, require a sustainable mindset 

and sustainable actions. These are firmly 

anchored in Wilo’s corporate culture,” 

says Oliver Hermes. 



ZOOMING IN 

SUPPLY CHAIN 

Supply chain sustainability and 

responsible procurement are critical to 

making global goals local business by 

ensuring that the extension of a 

company’s operations, products, and 

services can support the realities of 

our planet and better serve markets 

both today and in the future. When 

supply chains are done wrong – by 

not taking into consideration the 

environmental, social, and governance 

(ESG) performance of suppliers – 

companies leave themselves open to 

significant operational and reputational 

risks. Impacts on people and the 

environment can be substantial and severe. 

Source: UN Global Compact 


107

“A good report shows the 

link between business and 

sustainability” 

Many rules, many numbers, many questions. In everyday life, reporting is a challenge for many 

sustainability managers. Thorsten Pinkepank, responsible for sustainability relations at BASF, 

answers questions about sustainability reporting. 

By BASF 

The EU Commission is currently discussing 

the introduction of its own non-financial reporting 

standard. Do you think this is a good 

approach? And what would you expect from 

such an EU-wide rule? 

How much freedom and how many rules 

make sense for corporate sustainability 

reporting is also a crucial question in 

the discussion among reporting experts 

in Germany. More freedom means more 

possibilities for differentiation – more 

standards mean more comparability. If 

one is in favor of more comparability, 

as many users understandably are, for 

example in the financial sector, a legal 

standard “only” for Europe actually falls 

short again, because sustainability is not 

a topic for one region alone. My expectations 

would therefore in any case be 

maximum international connectivity 

and orientation to existing frameworks 

such as GRI (Global Reporting Initiative), 

SASB (Sustainability Accounting Standards 

Board), IIRC (International Integrated 

Reporting Council), as well as a dialog on 

this with international players such as 

IFRS (International Financial Reporting 

Standards). With regard to topics, only 

a few central criteria should be defined 

across all sectors. Further sector-specific 

criteria could be discussed with relevant 

stakeholders. What is particularly important 

for reporting companies in practice: 

a pilot phase for the transition because 

it is difficult to comply with standards 

“retrospectively.” 

The UN Sustainable Development Goals, the 

SDGs, span over all the frameworks and standards 

like an umbrella. With 17 goals and 169 

targets, these were originally conceived by and 

for states. But companies should also align themselves 

with them. What does this mean for the 

future? Will everything be turned inside out or 

will old wine simply be poured into new bottles? 

The SDGs have indeed become a globally 

accepted reference framework. In terms 

of content, they were and are not new 

– GRI and others have been focusing on 

most of the topics for some time. Even if 

the SDGs are addressed to the states, they 

naturally also have a thematic orientation 

function for the private sector. It can be 

seen that they have a structuring effect, 

especially in connection with “impact 

reporting.” Take a look at the work of 

the Value Balancing Alliance, for example. 

The UNGC (UN Global Compact) is 

also currently working with a group of 

CFOs to try to harness the SDGs to develop 

criteria for sustainable investing. I 

therefore see the SDGs in the context of 

reporting more as a broader framework 

for orientation than as a framework for 

operational reporting. 

Various studies show that the quality of many 

sustainability reports is mediocre. There is 

often a lack of concrete proof of the measurements 

and achievements of the communicated 

goals. What do you think is essential for a good 

sustainability report? 

A report is good if it describes the link 

between business and sustainability in 

a comprehensible way. At its core, this 

includes elements such as materiality, 

strategy presentation, targets, and associated 

KPIs. A good report also reflects the 

analysis of important stakeholders and 

their expectations – and therefore also 

takes a stand on critical, controversial 

issues. I also see transparent alignment 

with standards and appropriate external 

scrutiny as a mark of quality. As it 

108 


Thorsten Pinkepank, 

Director Corporate 

Sustainability Relations, 

BASF 

GLOBAL BATTERY 

ALLIANCE 

BASF is committed to responsible 

and sustainable global supply 

chains for mineral raw materials 

that, like cobalt, are an important 

component in the production of 

battery materials for electric 

vehicles. 

becomes increasingly clear that sustainability 

plays a central role in both business 

strategies and customer decisions, I see 

a trend toward integrated reporting – a 

path that BASF, for example, has been 

following since 2007. 

How have you managed at BASF to ensure 

that sustainability is so robustly anchored in 

the company? 

At BASF, we have been thinking about 

product life cycles for a long time and 

have done a lot of calculations. In addition, 

a key element – alongside the integrated 

reporting process – was certainly 

a method for portfolio segmentation and 

management according to sustainability 

criteria. In simplified commercial terms, it 

showed that “more sustainable” products 

are also better business. Quite consistently, 

at all levels in the company, we 

increasingly clearly see sustainability 

as a paradigm of successful corporate 

management that we must integrate into 

our day-to-day core and decision-making 

processes. 

BASF is active worldwide, so you have a good 

overview of developments in the individual 

regions of the world. What’s happening in 

the world? 

Whoever develops the gold standard here 

is indifferent to sustainable development, 

but may be a future location factor. We 

see a dynamic development globally. Competition 

accelerates progress here, too – 

but ultimately it is still a matter of global 

cooperation. This is particularly evident 

in individual or sector-specific topics: 

BASF, for example, is working with other 

companies, NGOs, and also governments 

in the Global Battery Alliance to drive 

transparency for this value chain with 

a battery passport as the digital twin of 

a battery – this must be done together 

with Asia, Europe, and America. 

For example, BASF is actively 

involved in the Global Battery 

Alliance (GBA) of the World 

Economic Forum, which it cofounded 

in 2017. The GBA consists 

of more than 70 members who are 

committed to making the value 

chain for batteries socially 

responsible, environmentally and 

economically sustainable, as well 

as innovative. The GBA is currently 

developing a battery passport for 

this purpose. In the future, this 

“digital twin” will contain information 

on the sustainability of a 

battery in order to increase 

transparency in the value chain. 

Together with its partners BMW, 

Samsung SDI, Samsung 

Electronics, Volkswagen, and the 

Gesellschaft für Internationale 

Zusammenarbeit, BASF is also 

committed to sustainable cobalt 

mining. The joint project “Cobalt 

for Development” aims to sustainably 

improve working conditions in 

small-scale mining as well as 

living conditions for the surrounding 

communities in the Democratic 

Republic of the Congo. BASF will 

contribute the findings from the 

project to the GBA, for example. 

For more information on the GBA, 

please visit: 

www.weforum.org/globalbattery-alliance/home 


Protecting Supply Chain 

Workers during the Covid-19 

Pandemic 

Building a supply chain strategy that puts workers firmly at the center has proved to be as 

important now as it ever was before and throughout the Covid-19 pandemic. 

By Javier Losada, Inditex 

This health emergency has led to a 

unique set of challenges for all those 

involved in the global garment supply 

chain. The impacts have differed in severity 

and characteristic across all regions. 

At Inditex, our longstanding focus on 

the human and labor rights of supply 

chain workers through our sustainability 

strategy has only intensified by working 

closely with key stakeholders to ensure 

safe and secure work environments. 

“Our priority through this crisis 

has been, and continues to be, the 

health and safety of our people, the 

workers in our supply chain, 

and our customers.” 

Inditex Executive Chairman Pablo Isla 

We have articulated our response to these 

challenges in the supply chain under 

four pillars, drawing on the UN Framework 

for the Immediate Socio-Economic 

Response to Covid-19 as a reference. 

Although these efforts play a role in 

addressing all the Sustainable Development 

Goals (SGDs), they specifically 

strengthen our work in the areas of Goal 

3 (ensuring healthy lives and promoting 

well-being for all), Goal 8 (promoting 

sustained, inclusive, and sustainable 

economic growth, full and productive 

employment, and decent work for all), 

Goal 10 (reducing inequality within and 

among countries), and Goal 17 (strengthening 

the means of implementation 

and revitalizing the global partnership 

for sustainable development through 

aspects such as resource mobilization). 

1. Health first 

We launched a strategy to strengthen 

the protection of the health of workers 

that aligns with our strategic occupational 

health and safety plan. 

From the outset of the crisis, 

we developed this global 

response to support 

our suppliers and 

manufacturers and 

assist them in implementing 

specific 

measures 

geared toward 

preventing 

Covid-19 in 

the workplace 

and finding 

spaces for collaboration. 

INFORMATION 

Communication of 

requirements and 

recommendations 

Our involvement 

in organizations 

and initiatives such 

as ACT (Action, Collaboration, 

Transformation) 

and the Bangladesh Accord, both of 

which have addressed this issue in their 

agendas, has allowed us to respond to 

this health crisis with a collaborative 

approach at the industry level. 

2. Protecting people 

We have been actively working with various 

players to set up a global response to 

address the adverse effects of Covid-19 in 

order to protect 

workers 

COLLABORATION WITH THE INDUSTRY 

PROTECTING HEALTH 

AS A PRIORITY 

IMPROVEMENT 

Training, monitoring, 

and corrective plans 

ASSESSMENT 

Selfassessments 

and 

assessments in 

the supply chain 

DEVELOPING GOOD PRACTICES AND SUPPORT MATERIALS 

110 


in the sector. One of the key aims has 

been to help in the development of social 

protection systems and to protect 

employment to build industry resilience. 

We have played an active role in the 

inception and subsequent endorsement 

of the initiative Covid-19: Action in the 

Global Garment Industry. This initiative 

aims to structure an urgent response 

to Covid-19 and is geared toward the 

protection of the incomes, health, and 

jobs of workers by mobilizing funds 

from international financial institutions 

and supporting the development of social 

protection systems in the various 

countries. The document governing this 

initiative has been agreed by the International 

Organisation of Employers, the 

International Trade Union Confederation, 

and the IndustriALL Global Union, with 

technical support from the International 

Labour Organization (ILO) and backed 

by various international brands such 

as Inditex, business organizations, and 

trade unions. 

Social dialogue has been one of 

the fundamental tools to address 

the effects of Covid-19. By driving 

relations with Inditex’s core 

stakeholders to develop a collective 

approach within the sector, we have 

been able to address challenges 

common to all of them. 

The organizations have set the following 

priorities: 

• appealing to governments and financial 

institutions to expedite support for 

workers and employers; 

• collaborating with financial institutions, 

governments, and donors to support 

the rapid and innovative mobilization 

of funds to provide support for workers’ 

incomes; 

• mobilizing funds to allow manufacturers 

to ensure business continuity, including 

paying the wages of all workers; 

• fostering respect for the fundamental 

labor rights laid down by the ILO, as well 

as the promotion of safe and healthy 

workplaces; 

• supporting the development of social 

protection systems for workers and 

employers in the textile industry. 

3. Economic response and recovery 

One of the most important aspects of the 

crisis has been to ensure that workers 

remain in employment and continue to 

receive their wages. 

IndustriALL Global Union General Secretary 

Valter Sanches notes how “manufacturing 

suppliers need stability and 

predictability so that employment and 

income can be preserved.” In line with 

our responsible purchasing practices 

policy, we guaranteed the payment of all 

orders already placed and in production 

throughout the pandemic. These commitments 

make it easier for suppliers to 

meet their obligations. Swift and effective 

communication with our suppliers 

has been key to providing visibility and 

trust in the future of the supply chain. 

Additionally, we have worked proactively 

with various financial institutions and 

multilateral organizations to improve 

and expand the financing options available 

to our suppliers. 

4. Multilateral collaboration 

The effects of the pandemic have reiterated 

the need for stable and sustainable 

relationships with stakeholders that promote 

mature industrial relations. 

In this sense, together with IndustriALL 

under the Global Framework Agreement 

that we have held since 2007, we have 

worked on the worldwide textile industry 

recovery plan. This commitment was 

formalized through a joint statement 

on August 2020. The joint statement 

bolsters both organizations’ lasting commitment 

to workers’ rights to freedom 

of association, collective bargaining, and 

social dialogue. 

“Our longstanding and fruitful 

work with IndustriALL for more 

than 13 years makes our Framework 

Agreement a strong tool to keep 

working to protect and promote 

workers’ rights and well-being 

while supporting the global 

garment industry during these 

unprecedented times.” 

Inditex Executive Chairman Pablo Isla 

Agenda 2030 is even more relevant in the 

current context of Covid-19, since the SDGs 

represent a common point for meeting and 

agreement among all stakeholders involved 

in sustainability. They will be fundamental 

to the reconstruction of health systems, the 

economy, and society following the crisis. Inditex 

continues to strengthen its commitment 

to create economic, social, and environmental 

value for all its stakeholders, generate the 

greatest positive impact, and contribute to 

sustainable development. 


Due Diligence: 

French Law As a Model for 

Germany and the EU? 

The year 2021 has seen an increase in legislative initiatives regulating human rights and the 

environmental due diligence of companies’ supply chains, particularly in Europe. While 

Germany’s Due Diligence Act (Sorgfaltspflichtengesetz), also known as the Supply Chain Act 

(Lieferkettengesetz), which was adopted in June 2021, will take effect in 2023, and the 

European Union’s Due Diligence Regulation is expected to be adopted later this year, several 

regulations on due diligence are already in place in other countries. In particular, the French 

Due Diligence Act, also known as Duty of Care Law (Loi sur le devoir de vigilance), is 

considered exemplary. A study commissioned by iPoint-systems examined its contents. 

By Dr. Katie Boehme, iPoint-systems 

As part of the European Green Deal and 

the coronavirus rescue package, the 

European Union also intends to enact 

regulation requiring companies to conduct 

human rights and environmental 

due diligence in their supply chains 

from 2021 onward. European Commissioner 

for Justice Didier Reynders provided 

information about the plan in a 

webinar in April 2020. With this, the 

EU is joining existing efforts that have 

already become law in France, for 

example, with the Loi sur le devoir de 

vigilance, or in the Netherlands with 

the Wet Zorgplicht Kinderarbeid, report 

Dr. Chris N. Bayer and Juan Ignacio 

Ibañez in the iPoint blog. 

Germany recently passed its own Due 

Diligence Act (Sorgfaltspf lichtengesetz), 

also known as the Supply Chain Act 

(Lieferkettengesetz). This was urgently 

needed because only about one-fifth 

of German companies even check 

compliance with human rights in 

their supply chains; the NGO Initiative 

Lieferkettengesetz reports on the occasion 

of the monitoring of the German 

government within the framework of 

the National Action Plan for Business 

and Human Rights (Nationaler Aktionsplan 

Wirtschaft und Menschenrechte). In contrast, 

the chair of the German Council 

of Economic Experts, Lars Feld, warned 

in the German newspaper Frankfurter 

Allgemeine Zeitung that the law, which 

is also supported by the federal ministers 

Hubertus Heil (SPD) and Gerd Mueller 

(CSU), threatens to impose massive burdens 

on the economy. 

Yet, massive burdens have not materialized 

in the frontrunner legislation – the 

French Due Diligence Act – seen by 

many as a model for possible EU-wide 

regulation. In France, companies with 

more than 5,000 employees in size must 

draw up, implement, and evaluate plans 

on how they will protect the health and 

safety of employees in their supplier 

companies and also ensure environmental 

protection on site. They must 

also identify the direct and indirect risks 

of harmful effects from their supplier 

relationships and take precautions to 

prevent them. Annual reports must also 

be submitted on this. 

The Berlin-based non-profit research 

agency Development International e.V. 

has analyzed how the French law works 

112 


in practice. Commissioned by the software 

house iPoint-systems, the study 

evaluated the due diligence reports of 

134 French companies on the basis of 42 

quantitative performance indicators and 

a further 14 qualitative characteristics 

in terms of their compliance with the 

legal requirements, their compliance 

with the UN Guiding Principles on Business 

and Human Rights (UNGP), as well 

as the quality of the disclosures. The 

overall result showed that most companies 

still had significant potential for 

improvement, particularly in the areas 

of transparency (a value of 36 percent 

compliance with the indicators was determined 

here) and compliance with 

the UNGP (24 percent). With an overall 

compliance rate of 66 percent, the law 

had been observed to trigger reform 

processes in French companies. 

One aim of due diligence is to focus attention 

on ultimate outcomes of corporate 

governance. Moreover, companies may 

learn good practice from each other. In 

a specialist article for iPoint-systems, the 

authors of the study point out that there 

are several obstacles on the way to achieving 

these goals. In their non-financial 

reporting, many companies tended to 

report on supply chain risks and how 

to prevent them, rather than current 

harmful impacts caused by suppliers. 

This very deficiency was also revealed in 

a 2019 comparative study of non-financial 

reporting in Germany, Austria, and 

Sweden, also conducted by Development 

International and sponsored by iPoint. 

Country-specific differences emerged: 

According to Bayer and Ibañez, Swedish 

companies are particularly open about 

their own impact on human rights as 

well as environmental and health impacts 

in the supply chain. 

As suitable means against the inconsistent 

compliance with human rights 

and environmental due diligence, the 

authors recommend a stricter legislation 

along the lines of the French model. 

Companies would also be motivated to 

fulfill their due diligence obligations 

carefully, among other reasons, because 

relevant stakeholders could even hold 

the companies liable if they can prove 

violations or also false or insufficient 

protective measures. The discussion in 

the EU is leading toward such a model, 

which would then apply to companies 

of all sizes and sectors, possibly with 

exceptions for small and medium-sized 

businesses. 

The Reutlingen-based software company 

iPoint regularly funds studies and projects 

on due diligence and non-financial 

reporting. By doing so – and with its 

software solutions for product compliance, 

sustainability, risk management, 

and due diligence processes based on a 

circular economy approach, as well as 

for traceability of the entire product life 

cycle and supply chain transparency – 

iPoint contributes to Goal 12 (Responsible 

consumption and production). Most 

importantly, the solutions contribute to 

making the environmental and social 

footprints of companies and products 

visible. Furthermore, iPoint’s software 

solutions also promote the achievement 

of Goal 8 (Decent work and economic 

growth) and Goal 9 (Industry, innovation 

and infrastructure). 

THE UN GUIDING 

PRINCIPLES ON 

BUSINESS AND 

HUMAN RIGHTS 

The UNGP were approved 

unanimously by the UN Human 

Rights Council in 2011. The 

principles, which are not legally 

binding, have nevertheless found 

expression in a variety of other 

initiatives and frameworks. The 

UNGP are governed by three 

pillars: protection of human rights, 

respect for human rights, and 

access to remedy. The protection 

of human rights primarily 

addresses the governments, 

while the second pillar is mainly 

aimed at companies. This reflects 

the issue of due diligence. 

The third pillar assumes a 

shared responsibility between 

governments and companies. 

Governments should take legal 

and institutional measures to help 

victims of human rights violations 

to demand that their rights be 

respected. Companies are also 

expected to create opportunities 

for complaints and, if applicable, 

to make compensation for human 

rights violations that have been 

committed. 


Empowering Women and 

Their Communities Within 

Supply Chains 

Sustainability challenges do not exist in a vacuum. They are often linked to one another, and 

their interdependencies – including the direction of causality and magnitude – must be 

considered when crafting appropriate solutions. At Philip Morris International (PMI), necessary 

trade-offs also occur due to its business transformation. For example, the company’s priority is 

to address its biggest externality by replacing cigarettes with less harmful alternatives. With the 

growth of PMI’s smoke-free business, there is a simultaneous decline of its cigarette business, 

which translates into a gradual decrease of demand for tobacco leaf. Such change has an 

undeniable impact on PMI’s contracted farmers. 

By Jennifer Motles and Anna Kletsidou, Philip Morris International (PMI) 

In designing its strategies and programs, 

it is vital that PMI accurately comprehends, 

analyzes, and accounts for situations 

of compromise. The company, 

guided by its sustainability materiality 

assessment, strives to minimize trade-offs. 

However, if appropriately addressed, PMI 

has found some trade-offs to be a source 

of innovation, as such compromises press 

the company to develop plans for tackling 

the tensions created. By embedding 

an integrated approach to sustainability 

within its business, PMI has been able 

to monitor and tackle multiple issues 

simultaneously, identifying effective 

solutions that leverage interdependencies 

to make progress. 

Socioeconomic well-being of 

tobacco-farming communities 

The tobacco that PMI sources is cultivated 

in many regions of the world, including 

low- and middle-income countries, 

where it is typically grown on smallholder 

farms of less than two hectares. 

The socioeconomic well-being of these 

tobacco-farming communities depends 

on many factors – namely the nation’s 

socioeconomic development, health and 

educational services, political stability, 

resilience to climate shocks, access to 

markets, and public infrastructure, as 

well as regulatory frameworks and 

their enforcement. If these factors are 

insufficiently developed, the population 

risks being locked in a cycle of systemic 

poverty, leading to poor working and 

living conditions, including the use of 

child labor. 

As a global business sourcing tobacco 

from 23 countries, PMI has an important 

role to play in addressing systemic issues 

such as poverty and social issues and the 

exacerbation of gender inequality that 

results from it. Further, agricultural 

development can stimulate economic 

development outside of the agricultural 

sector. In turn, it can help alleviate 

poverty, prevent human rights issues, 

and contribute to higher paid job and 

growth creation. Increased productivity 

of agriculture also raises farm incomes, 

increases food supply, reduces food prices, 

and provides greater employment opportunities. 

The plight of women in agriculture 

In certain sectors, women are more likely 

to suffer from deeply rooted gender 

inequalities; agriculture is one of these. 

Around the world, women participate in 

agriculture both as members of familyfarming 

households and as hired wage 

labor on farms owned and operated by 

other households or companies. They 

frequently face structural and cultural 

barriers such as employment segmentation 

and gender gaps in earnings, 

financial inclusion and access to credit, 

ownership of land and property, and 

opportunities to receive training or 

technical support. Though agriculture 

114 


A training session for women in Indonesia 

A VSLA group training in Malawi 

remains the primary source of income 

for both men and women in rural areas 

in developing countries, women are just 

13 percent of agricultural land holders 

globally. Women typically also must 

balance their financial contribution to 

the household with domestic responsibilities, 

which puts additional constraints 

on their time. Additionally, girls tend to 

have higher school dropout rates. 

To break this cycle and overcome the 

dropout problem, policies need to be put 

in place and enforced with the goal of improving 

educational access and retention 

while simultaneously reducing gender 

inequality. Large companies like PMI 

are in a position to shape and influence 

gender norms given their often-expansive 

value chains. That could include taking 

action in the workplace to reinforce 

gender equality and women’s representation 

in leadership and decision-making 

roles or supporting women farmers 

who produce raw materials. At PMI, the 

Agricultural Labor Practices (ALP) program 

is taking on these challenges by putting 

the women involved in its tobacco supply 

chain – including field technicians, 

farmers, and spouses and daughters of 

workers – at the center of its work to 

ensure safe and fair working conditions 

for all people involved in the tobacco 

farms. 

Originally established a decade ago, the 

ALP program was evolved in 2018 so that 

PMI could better address the root causes 

of the issues that impact its tobacco 

supply chain year after year. Namely, it 

saw an opportunity to leverage what it 

had learned about the power of women 

in tobacco-farming communities to 

influence positive change in the fight 

against rural poverty and child labor. 

For example, women are known for 

being more open to learn and change, 

especially when it comes to issues 

related to their children’s well-being and 

safety in general. By engaging women 

in awareness-raising programs, PMI saw 

that it could extend learnings to their 

families and influence them toward a 

safer and more inclusive work environment 

without child labor. 

To formalize this, PMI added women’s 

empowerment as one of ALP’s guiding 

principles, stating: “Women are positive 

agents of change, but they can also 

be a vulnerable group in many rural 

environments. We empower women 

to play an active role in improving the 

household economic condition but also 

in enhancing the overall well-being of 

their children and maintaining a safe 

work environment.” 

By playing an active role in sustainably 

improving the livelihoods and well-being 

of families and communities, PMI’s ultimate 

goal is to achieve a living income for 

all contracted farmers and eliminate child 

labor in its tobacco supply chain by 2025. 

Moving from action plan to real change 

Today, the ALP team is a diverse group of 

26, including 16 women living across six 

countries, from nine different nationalities, 

speaking more than 10 languages. 

Together, they work to empower women 

on the tobacco farms to play a more 

active role in their communities through 

awareness-raising and training, job 

opportunities, economic empowerment, 

and social inclusion. 

In 2019, PMI began implementing 

ambitious action plans in several >> 


A community member using a borehole in Malawi. 

priority countries. To explore how this 

works in practice, let us take a trip 

around the world. 

1. Targeted training for greater impact: 

Since the beginning of the ALP program, 

training and awareness-raising have been 

key components to ensure fair working 

conditions and sustainable agricultural 

practices. Initially, the training was 

focused on raising awareness on the ALP 

code requirements, informing farmers 

and workers of PMI’s expectations and 

of their rights and obligations. Today, 

the focus is on adapting the training 

methodology and approach to be more 

effective and targeted, using real-life 

examples and creative delivery methods. 

The objective is to ultimately achieve 

behavioral change and have a positive 

impact in communities. 

For example, in 2019, three of PMI’s 

suppliers in Turkey, with the support of a 

local NGO, introduced training for women 

involved in tobacco-growing activities. 

The goal was to raise awareness about 

the mental and physical consequences of 

child labor and to train the participants on 

the importance of safe working practices. 

Fifty-three sessions were delivered across 

17 villages, reaching 1,111 women. The 

majority of participants stated they will 

implement the learnings in the next 

crop cycle. Further, many stated that 

this was the first time they had attended 

a women’s training, and that they felt 

“visible” and that their contribution to 

tobacco production was recognized. 

2. Farm-by-farm monitoring: Since the 

beginning, hiring female field technicians 

has been a focus of PMI’s strategy, 

despite the fact that this role has been 

traditionally performed by men. This 

remains a key priority because it values 

the additional gender-sensitive insights 

and expertise that female field technicians 

can bring to the team, particularly 

in engaging openly with female farmers, 

workers, and family members. 

For example, cultural paradigms in 

Pakistan lead to male field technicians 

not being able to directly engage with 

women on the farm. This is why, in 2019, 

PMI’s local affiliate took the decision 

to deploy a team of 10 women (“ALP 

Monitors”) to raise awareness on the 

ALP standards. The team engaged with 

more than 250 women across 250 farms, 

mostly through house visits. During 

follow-up visits, they recorded significant 

improvements achieved so far with 

respect to the ALP requirements. The 

most important progress was identified 

in the areas of safe working practices 

in tobacco growing, especially in the 

prevention of green tobacco sickness. 

In addition to improving working conditions 

on the farms, they conducted 

health and hygiene awareness-raising 

campaigns and distributed more than 

1,500 sanitation and hygiene kits at 

homes. This work improved sanitation 

and hygiene practices not only on the 

farms but also at home. 

3. Empower women entrepreneurs: 

Research has shown that a greater 

percentage of women’s income is reinvested 

in their families and communities. 

Women are indeed more likely to spend 

their income on long-term investments 

such as education, health, and household 

services. Taking this into account for its 

ALP program, PMI has been testing and 

rolling out entrepreneurial activities for 

women involved in tobacco farming in 

various countries. 

116 


who can, in turn, further cascade their 

knowledge and provide funding for 100 

additional women. 

Women’s empowerment enables 

sustainable development 

The UN 2030 Agenda for Sustainable 

Development has set a 2030 target to 

achieve gender equality and simultaneously 

acknowledges throughout its 

declaration that achieving women’s 

empowerment, gender equality, and 

women’s human rights are a prerequisite 

for sustainable development. 

For example, in Malawi, “Village Savings 

and Loan Associations” (VSLAs) enable 

women to play an active role in improving 

household economic conditions and 

enhancing families’ overall well-being. 

These women save together and take 

small loans from those savings. The 

purpose is to provide simple savings and 

loan facilities in a community that does 

not have easy access to formal financial 

services. 

PMI began rolling out VSLAs to women 

farmers and workers in Malawi in 2015. 

Based on the learnings, it partnered 

with a number of organizations to transform 

their scope to become more entrepreneurial 

by supporting them with 

financial literacy and entrepreneurial 

training, seed funding, opening their 

own bank accounts, gaining access 

to capital, and connecting them to 

potential business opportunities. More 

than 4,300 women constituting 257 

groups were given the opportunity to 

participate and earn additional income 

that can be invested on family needs. 

In a country where child labor can be 

considered a systemic issue, with the 

International Labour Organization 

A field technician in 

Nayarit, Mexico 

estimating its prevalence at 38 percent, 

PMI included an additional prerequisite 

for women to be able to benefit from this 

initiative: the signature of a “no child 

labor” pledge. Recent impact evaluation 

of the initiative demonstrated that 

the participants were able to make a 

profit and improve families’ livelihoods 

through activities such as growing and 

selling vegetable crops. 

More recently, PMI partnered with the 

local NGO ASSIST in India to support 

“Self-Help Groups” (SHGs) developed by 

local government. In 2020, the company 

rolled out a project aimed at building 

the entrepreneurial capabilities of 200 

female members of the SHGs by training 

them on financial and organizational 

skills. ASSIST uses a “train the trainer” 

approach, equipping selected women 

with knowledge to empower and train 

others after them. Some 100 women 

from 11 SHGs, after having received 

training, have been selected to set up 

their own microbusinesses. In turn, they 

will support the funding of microbusinesses 

for 100 new beneficiaries, creating 

a positive domino effect. In 2021, PMI 

plans to train an additional 200 women 

When women are guaranteed equal 

rights and opportunities, and when 

gender norms and stereotypes that hold 

women back are overcome, it benefits 

individuals, their families, societies, and 

business. Providing women and men 

with equal opportunities is not only the 

right thing to do, it is critical for meeting 

a wide range of SDGs. 

Diversity and inclusion are indicators 

of a society’s equity and openness. Upholding 

equality, diversity, equity, and 

fair treatment are human rights that are 

key to unlocking social and economic 

development. That is why inclusion is at 

the heart of the UN’s 2030 Agenda, with 

the ambition to “leave no one behind.” 

Greater gender equality in the workplace 

benefits all, in multifold ways. PMI 

is committed to fostering an inclusive 

culture and enhancing its diversity, 

including empowering women and 

achieving gender equality. This is not 

only the right thing to do, but it also 

helps to define PMI’s culture and is fundamental 

to achieving its purpose of 

delivering a smoke-free future. Varied 

perspectives, experiences, and problemsolving 

skills always add value but are 

especially critical in times of change. 

PMI is convinced that a diverse and inclusive 

working environment will only 

help promote the innovation needed 

and accelerate the pace at which it is 

able to achieve its purpose. 




Redefining 

Garry Jacobs 

Chief Executive Officer 

World Academy of Art and 

Science; Vice President, The 

Mother’s Service Society, India 

Donato Kiniger-Passigli 

Vice President 

World Academy of Art and 

Science 

Dr. Alexander Likhotal 

Professor 

Geneva School of Diplomacy 

& International Relations, 

Switzerland; Fellow, World 

Academy of Art and Science 

Today, humanity is confronted with a complex 

nexus of interrelated security threats. 

The multilateral system for international 

cooperation and global governance is under 

siege at precisely the time we need it more 

than ever before. The ideas, institutions, 

and policies on which the system is based 

is not fit for purpose to handle the complex, 

cross-border challenges arising from the 

globalization and financialization of the 

world economy; the growing power and 

independence of multinational corporations 

(MNCs); rising levels of unemployment and 

inequality; the pressures of political and 

economic refugees; the depletion of natural 

resources; the existential climate threat; 

and, most urgently, the plethora of urgent 

economic and social problems generated by 

the microscopic Covid-19 virus. 


119

Milestones of Multilateralism 

1648 

Westphalian Treaty 

The peace agreement that 

ended the Thirty Years’ War 

in 1648 is described as the 

moment of birth of the 

modern state system. 

1815 

Vienna Congress 

After the fall of Napoleon, the congress 

initiated the “Concert of Europe,” which 

was a system to resolve issues peacefully. 

Ultimately, it prepared the ground 

for international congresses in the 

future. 

1884 

Berlin Conference 

By invitation of then-German Chancellor 

Otto von Bismarck, the conference 

arbitrarily parceled out African territories 

by drawing artificial borders on a 

five-meter-tall map, thus manifesting 

colonialism and so-called Western 

hegemony. 

1899–1907 

Hague Peace Conferences 

The Hague Peace Conferences were a 

series of international conferences 

aiming to regulate the conduct of 

warfare. In particular, they defined the 

treatment of prisoners of war and 

provided definitions of war 

crimes as well as regulations 

for the protection of 

civilians. The latter paved 

the way for today’s refugee 

conventions. 

UN Organizations 

1865 

International Telegraph 

Union (ITU) 

1919 

International Labour 

Organization (ILO) 

The global pandemic is the most 

immediate and visible of these 

challenges due to its sudden, 

devastating impact on human 

health, the global economy, jobs, incomes, 

food production and distribution, 

education, travel, and other sectors. It 

has highlighted and severely aggravated 

fundamental flaws in prevailing 

economic policies. It has spurred rising 

levels of unemployment, economic 

inequality, and insecurity around the 

world. These, in turn, are reinforcing 

the retreat from multilateralism and 

democracy and fueling polarization and 

tensions within nations. The impact 

of these threats is far more visible and 

tangible to billions of people than the 

threats to national security envisioned 

at the time the UN was established. They 

are also much more complex. And they 

all dwindle into relative insignificance 

in comparison with the fast-approaching, 

existential threat of global climate 

change. 

1. Characteristics of the global crises 

The multidimensional crises confronting 

humanity today share a number of 

defining characteristics. All of them are 

global in origin and magnitude. None 

of them can be effectively addressed 

by individual nation-states operating 

independently of one another. The solutions 

for each and every one of these 

problems require profound changes in 

the relationships between nation-states 

and in the structure and functioning 

of multilateral institutions. This is selfevident 

with regard to issues such as 

Covid-19 and climate change, but it is 

even true for issues such as unemployment, 

which have been traditionally 

regarded as strictly national in origin 

and remedy. More than two-thirds of 

the factors impacting on unemployment 



within countries stem from the conduct 

of other nations and the global system. 

These challenges come at a time when 

there is a loss of confidence in traditional 

institutions of governance, a decline 

in governability, and a general crisis of 

leadership. People have lost confidence 

in their governments and, by extension, 

the intergovernmental organizations to 

which they belong. National political 

parties, business, the media, and even 

scientific institutions are confronting a 

mounting trust deficit. Democratic values 

and the rule of law are under attack. 

Nationalism, populism, and isolationism 

pose a growing threat to the global order. 

The distance between global institutions 

and the people has widened, in spite of 

the increasing efforts of the United Nations 

system to play a more direct role 

in tackling global challenges. 

There is a compelling need to redefine 

our conceptions and reinvent our institutions 

for multilateralism. The notion 

of multilateralism as a system by which 

nation-states manage interstate relations 

no longer captures the entirety of the 

global game. Conceptually, we need 

to reshape the principal objectives of 

multilateralism and expand participation 

to include a much wider range of 

stakeholders. 

People have 

lost confidence 

in their 

governments 

and, by 

extension, the 

intergovernmental 

organizations 

to which 

they belong. 

But let us not prematurely dismiss the 

potential contribution of nation-states. It 

was only five years ago that 193 countries 

united in adopting the 17 Sustainable 

Development Goals (SDGs). The unanimous 

adoption of Agenda 2030 is an 

unprecedented historical commitment 

to operationalize and realize in practice 

the idealistic principles set forth in 1948 

in the Universal Declaration of Human 

Rights. During the same month when the 

SDGs were being adopted, another landmark 

of multilateralism was achieved 

by 197 nations with the adoption of the 

Paris climate accord to curb the release 

of greenhouse gases. 

A more effective multilateral system is 

absolutely and urgently needed. Criticism 

of the present system fails to take 

into account the extraordinary changes 

in global society, which make the current 

institutional framework increasingly 

inadequate. Whatever its shortfalls, its 

achievements have been enormous, and 

the need for a multilateral system is 

greater today than ever before. 

Since the founding of the League of 

Nations and its rebirth as the United 

Nations, there have always been ambiguities, 

conflicting viewpoints, and competing 

concepts regarding the purpose 

and nature of the multilateral system. 

At its inception, many viewed it primarily 

as an instrument to maintain the 

balance of power between potentially 

conflicting states in a world where empires 

were still legitimate. They regarded 

multilateralism as a buffer against a 

fracturing of the world by a proliferation 

of small states striving for ethnic 

or national homogeneity. Legal experts 

emphasized its role as a mechanism 

for preserving peace and supporting 

international relations through international 

laws, rules, regulations, and 

systems for arbitration. Others promoted 

its virtues as an international system 

for establishing technical standards for 

coordinating global services such as 

the postal system, telecommunications, 

and weather monitoring. And some 

envisioned it as the embryo for a future 

world government that could gradually 

emerge as humanity outgrew the narrow 

distinctions of nationality and embraced 

universal values and a shared common 

human identity. >> 


121

1920 

League of Nations 

The founding of the League of Nations 

was an initiative of the victorious 

powers at the end of World War I. It was 

the first intergovernmental organization 

to foster peace and cooperation among 

member states. Though US President 

Woodrow Wilson was one of the driving 

forces of its founding, the United States 

never became a member of the League 

of Nations. 

1944 

Bretton Woods Agreement 

At the end of World War II, the Bretton 

Woods Agreement set up a new global 

monetary architecture by replacing the 

gold standard with the US dollar as the 

global currency. It also paved the way 

for two international finance institutions: 

the International Monetary Fund, 

which monitors the creditworthiness of 

countries, and the World Bank, which 

acts as a lender for development 

projects. 

1945 


The United Nations was established as 

the successor to the League of Nations. 

Its mission is to promote peace, security, 

and sustainable development in all parts 

of the world. It operates through five 

organs: the General Assembly, the Security 

Council, the UN 

Secretariat, the International 

Court of Justice, and the 

Economic and Social 

Council. There are also 15 

specialized UN agencies. 

1945 

Food and Agriculture 

Organization (FAO) 

1946 

World Health 

Organization 

(WHO) 


Educational, 

Scientific and 

Cultural 

Organization 

(UNESCO) 

The UN was founded by 55 nations in 

1945 – including many, such as India, 

that were still subject nations within the 

imperial system. None could anticipate at 

the time that within 15 years, the entire 

global system of empires would virtually 

dissolve into thin air, emancipating onethird 

of humanity, and that the number 

of nation-states would eventually multiply 

more than three-fold. None could 

foresee that the Universal Declaration of 

Human Rights, which was established 

as a set of idealistic principles without 

legal status or means of enforcement, 

would in subsequent decades acquire 

increasing power in international law 

and eventually serve as the foundation 

for the 17 Sustainable Development 

Goals, which were adopted unanimously 

by 193 nations in 2015. 

These circumstances illustrate the radical 

changes that have taken place in the 

world since the birth of the UN 75 years 

ago. They underline the necessity for the 

continuous evolution of multilateral institutions 

to keep pace with the ongoing 

evolution of the global community that 

it was established to serve and protect. 

In the context of the dramatic changes 

that have taken place, a review and assessment 

of international institutions is 

required to identify needs and opportunities 

to realign their mandates, structures, 

strategies, policies, and funding in order 

to enhance their capabilities to preserve 

peace and promote human security in 

its broadest sense. 

2. Transformations of the global 

community 

Reshaping multilateralism requires taking 

into account fundamental changes in 

the world system. First, the international 

system is much more inclusive than ever 

before. For the first time in the history 



of mankind, it encompasses nearly the 

whole of humanity. When the UN was 

founded, 750 million people – almost 

a third of the world’s population at the 

time – lived in territories that were 

non-self-governing. Regions that were 

once considered on the periphery are 

now becoming center stage. The number, 

variety, and diversity of stakeholders acting 

globally; the volume of international 

interactions and transactions taking 

place; and the interdependence and 

complexity of the engagements have 

expanded beyond imagination. Membership 

totals on Facebook now approach 

three billion users, making it the largest 

community in the world and challenging 

the notion of the nation-state as the 

most representative model of democracy. 

Though national, religious, and ethnic 

identities persist, there is an increasing 

emergence of a common global identity, 

a global sense of community, a shared 

global commons, and a shared global 

culture – not a culture of uniformity, 

but of increasing richness and diversity. 

A second fundamental change is a deep 

mutation in the nature of conflict. Wars 

used to be a matter of competition between 

powers. Today, weakness is replacing 

power as the source of conflict and 

war. Conflict situations today reflect 

manifestations of state weakness in the 

form of political instability, ethnic or 

religious strife, administrative incapacity, 

economic breakdown, natural calamity, 

or environmental degradation. The 

greatest threats confronting humanity 

now primarily result from the flight of 

political refugees, economic refugees 

fleeing shortages of jobs or food, and 

environmental refugees fleeing drinking 

water shortages, floods, or rising 

sea levels. These diverse causes of insecurity 

are turning the international 

environment upside down. They >> 


123

1947 

General Agreement on Tariffs and Trade 

GATT is a set of multilateral agreements 

to coordinate tariffs, subsidies, and 

quotas. It introduced “negotiation rounds” 

to international agendas, which is what 

we see today in the climate negotiations. 

1948 

Universal Declaration of Human Rights 

The declaration was proclaimed by the 

UN General Assembly in Paris as a 

milestone in the history of 

human rights. Though 

not legally binding, it has 

been integrated into 

various treaties and 

national legislations. 

1957 

Treaty of Rome 

Signed by France, Italy, Western 

Germany, and the Benelux countries, the 

treaty established the European 

Economic Community, which later led to 

the European Union. 

1948 

International 

Union for 

Conservation 

of Nature 

(IUCN) 

1950 

UN High Commissioner 

for Refugees (UNHCR) 

World 

Meteorological 

Organization 

(WMO) 

1951 

International Organization 

for Migration (IOM) 

1961 

Organisation for Economic 

Co-operation and 

Development (OECD) 

represent more imminent, tangible, and 

dangerous threats to global peace than 

superpower rivalry. 

A third change is mobility. The international 

system used to be based on the 

idea of territory, fixed physical boundaries, 

and physical property. Today, the 

territorial notion of politics has been 

altered by a wide range of non-material, 

extra-territorial, increasingly fluid, and 

rapidly changing cross-border factors, 

including information flows, financial 

flows, trade, intellectual property rights, 

technological dissemination, the spread 

of social movements such as Fridays 

for Future and Black Lives Matter, the 

onset and course of the pandemic, and 

the looming consequences of global 

climate change. 

A fourth change associated with the 

other three is the growing complexity 

and interdependence between all the 

dimensions of multilateral relations. 

The major crises confronting humanity 

today are multi-sectoral with respect 

to both their causes and the requisite 

solutions. Conventional disciplinary 

boundaries between economy, politics, 

technology, society, and ecology are illusory 

theoretical constructs. Piecemeal 

strategies and policies implemented by 

specialized, sectoral institutions at the 

national and global levels are inadequate 

to address them. These challenges transcend 

prevailing theory and models in 

the social sciences and defy solution 

that apply conventional thinking and 

strategies. Specialized, siloed organizations 

are ill-equipped to address complex, 

multidimensional issues. 

The world today is also increasingly 

integrated. As society has expanded 

horizontally to encompass the whole 

world, its various dimensions, sectors, 



The UN system 

was established 

to serve its 

member states 

and the world 

community 

rather than 

to exercise 

authority over 

them. For its 

mission, it 

depends far 

more on 

trust and 

confidence than 

on power. 

and activities have become increasingly 

interrelated and interdependent with 

one another. The multilateral system 

has to be reshaped to address a far wider 

range of issues as inseparable dimensions 

of a complex and increasingly integrated 

global system. It also has to be 

empowered with the required mandate, 

authority, resources, and commitment 

of member states to meet the global 

challenges to human security. It has to 

overcome the perceptual and conceptual 

barriers erected by disciplinary silos to 

decipher the complex interactions and 

interdependencies between different 

fields of social existence and to transcend 

the piecemeal, specialized actions of 

narrow sectoral institutions, policies, 

and programs. 

3. Building trust and confidence in 

the UN system 

The evolution of the global community 

has been supported by a growing awareness 

of the shared values and common 

destiny that bind together all human 

beings. In the measure that awareness 

has grown, relations and cooperation 

between people and nations have 

grown exponentially. Those born after 

1995 have come into a world in which 

people everywhere are interconnected 

as never before and more conscious 

of their shared humanity than earlier 

generations, which were often divided 

by history, war, nationalism, ethnicity, 

and religion. Their human relationships 

have been dramatically altered 

by instant global interconnectivity. The 

growing sense of “we the people” is the 

ultimate basis on which the UN system 

is founded – and on which it will evolve 

in the future. 

Strengthening multilateralism is absolutely 

essential for humanity to effectively 

address the global challenges 

confronting the world today. Yet, some 

UN member states and large portions 

of humanity either underestimate its 

importance or rely on unilateral and 

bilateral initiatives that undermine its 

power to serve humanity. The UN system 

was established to serve its member 

states and the world community rather 

than to exercise authority over them. 

For its mission, it depends far more on 

trust and confidence than on power. 

Anything that enhances public trust and 

confidence in the multilateral system 

enhances its capacity for effective service. 

Anything that diminishes public 

perceptions impairs its functioning as 

well as that of the tens of thousands of 

UN staff, whose motivation is strongly 

influenced by public perceptions of the 

UN system. 

In a June 2020 survey by GlobeScan, 

citizens of 27 representative member 

states expressed nearly twice the level of 

trust in the UN system (26 percent) than 

in national government (15 percent). But 

both of these figures were far below the 

ratings for medical professionals (82 percent), 

scientific and academic institutions 

(73 percent), and NGOs (41 percent). Even 

large national companies rated higher in 

trust (28 percent). These figures reflect a 

general decline in respect for, and trust 

in, all types of social institutions in times 

of great uncertainty about the future. 

But they also highlight an opportunity 

that can be leveraged to strengthen the 

UN system and enhance its effectiveness 

through strategies that strive to 

build confidence and trust among the 

citizenship of member countries. While 

governments view with one another 

across conference tables, a growing sense 

of solidarity among ordinary citizens 

may be the best way to reinforce the 

foundations of the system. >> 


125

1964 

Group of 77 

The G77 was founded by 77 developing 

countries to promote and bundle the 

interests of the Global South and 

provide it with more bargaining power. It 

was the first time that the Global South 

had embarked on such an initiative. 

1971 

World Economic Forum 

Also known as the Davos Summit, this 

annual conference gathers political and 

business leaders to discuss global 

economic and political issues and to 

network with one another. The WEF has 

recently become a trendsetter on 

important sustainability issues. 

1964 

United Nations Conference 

on Trade and Development 

(UNCTAD) 

1966 

International Covenant on Civil 

and Political Rights (ICCPR) 

1970 

World Intellectual Property 

Organization (WIPO) 

1972 

United Nations Environment 

Programme (UNEP) 

1973 

Convention on International 

Trade in Endangered Species 

of Wild Fauna and Flora 

(CITES) 

4. Broadening the stakeholder base 

of multilateralism 

A new form of multilateralism or plurilateralism 

is needed that effectively engages 

a substantially larger number and 

wider range of stakeholders. The last 

three decades have brought about radical 

changes in the number and variety 

of institutions actively engaged at the 

global level that possess the knowledge 

and capacities essential for addressing 

global issues. Non-state actors are playing 

an increasingly important role in 

analyzing problems, shaping political discourse, 

and influencing public opinion 

in global society. Subnational structures, 

interparliamentary unions, megacities, 

MNCs, pressure groups, scientific institutions, 

and CSOs are all stakeholders and 

players in global affairs. 

Business has been transformed by the 

establishment of global supply chains. 

The number of MNCs multiplied from 

7,000 in 1970 to 82,000 in 2008, with 

230,000 foreign affiliates by 2014. The 

largest MNCs exceed the wealth and 

influence of many nation-states and 

have assumed the role of global social 

systems. The world’s leading financial 

institutions have become linked as elements 

of an increasingly integrated 

global financial system. Academies, universities, 

and research institutes have 

established international networks for 

collaborative action. 

International civil society institutions 

have multiplied exponentially and are 

now forging networks to multiply their 

reach and effective power. The international 

movement to abolish land mines 

was initiated by six NGOs and was only 

later embraced by national governments. 

NGOs such as Fridays for Future have 

generated greater awareness of the cli- 



mate threat than years of pronouncements 

by the Intergovernmental Panel 

on Climate Change. From an estimated 

28,000 NGOs in the world at the beginning 

of the 21st century, today there are 

about 10 million, representing a 350-fold 

multiplication in two decades. Today, 

there are approximately 41,000 active 

international organizations from 300 

countries and territories. This includes 

intergovernmental (IGOs) and international 

non-governmental organizations 

(INGOs), with about 1,200 new organizations 

being added each year. 

This wide and expanding range of 

stakeholder institutions possesses an 

enormous breadth of knowledge, organizational 

capabilities, and technological 

resources. They also represent 

the aspirations and interests of “we the 

people” – in many cases more directly 

and effectively than the institutions of 

national government. But only a few of 

the very largest have an effective voice 

at the international level. Multilateralism 

needs to be redefined to give voice 

to, engage, and harness the capabilities 

of a much broader range of stakeholders. 

At a time when many nation-states 

are turning inward and re-forming into 

blocs, leadership in thought is needed 

to redefine the concept and practice of 

multilateralism to include all legitimate 

stakeholders representing the human 

community. 

5. Democratization of power 

The present multilateral system is severely 

limited in another respect. Although 

democracy was devised to empower citizens 

at the national level and give them 

a more direct voice in governance, in 

practice few of the actions of national 

governments – even in mature democracies 

– very accurately reflect the will of 

their own people. The size of populations, 

the intermediacy of political parties, the 

professionalization of politics as a career, 

the influence of lobbying and special 

interest groups, and the inordinate power 

of business and money in politics present 

nearly impenetrable barriers that prevent 

the general population from effectively 

influencing decision-making on issues of 

fundamental importance to all humanity. 

This has been further complicated by the 

corporatization and politicization of the 

media as instruments of special interests. 

What is true of politics at the national 

level is far more true when it comes to 

the representation of citizens on global 

issues. National politics is primarily concerned 

with domestic issues, and global 

issues are debated primarily from the perspective 

of their impact on nation-states 

and special interest groups rather than 

from that of the global community. The 

current system of multilateralism does 

not provide humanity as a whole with 

a direct voice in global affairs. Indeed, 

very little information is available to 

access the views of humanity on issues 

of pressing concern to the whole world, 

such as the pandemic, climate change, 

the international financial system, the 

role of multilateral institutions, and 

management of the global commons. 

There are, of course, important exceptions 

at both levels. Mass demonstrations 

by women across America protesting 

the nomination of an ultra-conservative 

member to the Supreme Court, and hundreds 

of thousands of citizens in Minsk 

– the majority women – calling for the 

resignation of Belarus’ president, and the 

massive protest that recently led to the 

resignation of Kyrgyzstan’s president are 

illustrative. Their impact is multiplied 

by the growing influence and reach of 

social media protests such as Black >> 


needs to be 

redefined to 

give voice to, 

engage, and 

harness the 

capabilities of a 

much broader 

range of 

stakeholders. 


127

1975 

Group of Seven 

In response to issues concerning energy 

and financial crises as well as the 

growing power of emerging markets, 

the largest economies and industrialized 

nations in the world formed the G7 

as an interest group. 

1987 

Montreal Protocol 

The Montreal Protocol was the first 

multilateral environmental agreement 

to protect the world’s ozone layer from 

greenhouse gases, which are 

responsible for ozone depletion. 

1992 

Earth Summit 

The United Nations Conference on 

Environment and Development, also 

known as the Earth Summit or the Rio 

Summit, was the first major 

international conference on 

global environmental issues. 

It introduced the concept of 

sustainability into global 

political discussions. 

1988 

Intergovernmental Panel on 

Climate Change (IPCC) 

1994 

World Trade Organization (WTO) 

1998 

International Criminal Court 

(ICC) 

Lives Matter and the MeToo movement, 

which has circled the globe. These spontaneous, 

informal social movements are 

indeed exercising growing influence at 

the national and global levels. But they 

have yet to acquire the organizational 

capabilities or institutional access necessary 

to systematically participate in the 

multilateral system. 

The adoption of the 17 SDGs by 193 

countries was itself the result of an unprecedented 

effort to democratize decision-making 

processes through public 

consultations and engagement with civil 

society and other stakeholders around 

the world. These global goals have legitimacy 

beyond politics because of the 

unprecedented participatory process and 

the crowdsourcing of ideas from so many 

different groups, based on information 

communication technologies. An estimated 

30 percent of the goals and targets 

included in the 2030 Agenda originated 

from crowdsourcing ideas contributed 

by stakeholders around the world. As a 

result, various sectors of society are taking 

ownership of the SDGs and aligning 

their activities with them, especially in 

developing countries, where they see the 

value of this overarching framework to 

leap forward. 

Efforts are already underway to expand 

the scope for non-state stakeholders to 

contribute to the implementation of 

the SDGs. The UN Global Compact, the 

International Chamber of Commerce, 

and the SDG Business Forum engage 

business. Local2030, a multi-agency 

initiative, works across the UN system, 

bringing together the UN system, local 

authorities, and national governments 

to develop and implement solutions that 

advance the SDGs at the local level. UN 

Youth Strategy works to scale-up global, 

regional, and national actions to meet 



young people’s needs, realize their rights, 

and tap their possibilities as agents of 

change. Such efforts, which are now 

largely confined to the implementation 

of Agenda 2030, need to be taken much 

further to provide an audible voice for 

shaping global agendas and to support 

the co-creation of effective solutions 

for all major issues by member states, 

UN officials, the private sector, local 

authorities, and other partners. 

Multilateral institutions must devise 

new and more effective ways to bridge 

the vast distance and surmount the barriers 

that separate “we the people” from 

decision-making in international affairs. 

It is not sufficient to work with top-level 

representatives of countries, business, 

and a few leading CSOs. They need to 

devise mechanisms to more actively 

and formally engage and collaborate 

with parliamentarians, local authorities, 

the private sector, large CSO networks, 

youth and religious groups – people 

at all levels and in all fields of political, 

economic, and social engagement. 

6. Accelerating social evolution 

It took centuries for the institutions 

associated with “balance of power” multilateralism 

to evolve, and it took the 

horrendous tragedy of two world wars 

to compel even a partial change in those 

institutions to accommodate the aspirations 

of a much broader section of humanity. 

Today, we do not have the luxury 

of continuing to progress at such a slow, 

hesitant pace. The challenge before us 

is to transform the long, slow process of 

social evolution into a conscious process 

of rapid social transformation. Nothing 

less will be sufficient to address the pressing 

challenges confronting humanity 

today. Nothing less can prevent a further 

retreat and deterioration of the vital >> 


129

2000 

Millennium Summit 

The summit was the largest-ever 

meeting of world leaders to discuss the 

role of the UN at the turn of the 21st 

century. The Millennium Development 

Goals were adopted at the summit and 

are the predecessors of the Sustainable 

Development Goals. 

2002 

Johannesburg Summit 

Ten years after the Rio Summit, the 

follow-up event in Johannesburg, South 

Africa, set the stage for a 

true multistakeholder 

approach by recognizing 

that the economy is an 

essential factor in solving 

global problems. 

2015 

Sustainable Development Goals 

Paris Agreement 

Both the adoption of the SDGs as well 

as the Paris climate accord are 

milestones for global sustainability. The 

SDGs define 17 global goals to end 

poverty, protect the planet, and ensure 

peace and prosperity by 

2030. The Paris Agreement 

imposes a legally binding 

obligation to all states to 

keep global warming 

below 2°C. 

2000 

UN Global 

Compact 

(UNGC) 

Global Alliance 

for Vaccines and 

Immunization 

(GAVI) 

2002 

The Global Fund to Fight AIDS, 

Tuberculosis and Malaria 

(Global Fund) 

2006 

United Nations Human Rights 

Council (UNHRC) 

institutions of multilateralism evolved 

so patiently and painstakingly over the 

last 100 years – institutions that are 

so essential for safeguarding the future 

of humanity. 

After 1990 it appeared to many that the 

need for multilateralism was no longer 

urgent or imperative. The resulting shift 

in focus from arms control to trade and 

globalization was accompanied by a slow 

retreat from multinationalism. 

It is now evident that this was a grave 

error. The concept of security is being 

steered in the wrong direction. More 

than ever before, the threats to peace 

and human security arise precisely in 

the undefined and unregulated no-man’s 

land between the boundaries of nationstates 

and the protections afforded by 

the institutions of global governance 

and rule of law. 

The urgency and intensity of global challenges 

today compel us to advance the 

development of the multilateral system 

based on the values enshrined in the 

Universal Declaration of Human Rights 

and the goals affirmed in Agenda 2030. 

The imminent risks and unavoidable 

costs of further delays far outweigh those 

of continuing to meander aimlessly into 

the future. 

7. Shift from competitive national 

security to human security 

We need a paradigm shift in thinking 

that views the full spectrum of global 

problems together and addresses them 

as the real threat to global security. We 

need to shift our thinking from the current 

competitive security paradigm to 

the more comprehensive, inclusive focus 

on human rights, the environment, 

employment, poverty, food security, 



Such a 

paradigm shift 

to a more 

inclusive and 

collaborative 

global 

cooperation 

is essential to 

meeting the 

world’s human 

security needs 

at the local, 

national, and 

international 

levels. 

education, health, and other dimensions 

of peace and human security. 

Covid-19 is a wakeup call to transform 

our systems. The total annual expenditure 

of 34 UN agencies engaged in the 

full gamut of governance, law, peacekeeping, 

health, education, refugee, and 

myriad other activities was less than $50 

billion in 2016, equivalent to less than 

4 percent, or 9.6 days, of global military 

budgets and about 0.057 percent, or 5 

hours, of world GDP. We are still entrenched 

in the old model based on the 

flawed belief that our security depends 

primarily on a strong military. There is 

a perversity in the way we are allocating 

capital. No country can be safe without 

a stable and vibrant economy, sufficient 

jobs for all jobseekers, and a strong 

social policy framework. The nations 

that have proven the most resilient in 

the face of the Covid-19 pandemic are 

those which have already shifted to 

a broader conception of security that 

also encompasses economy, ecology, 

health, education, social welfare, and 

well-being. 

A major paradigm shift is urgently needed 

for a more inclusive, representative, 

participative, multistakeholder system 

of global governance that is reflective 

of the aspirations and values of an increasingly 

informed and interconnected 

global community, equipped to understand 

and respond to the speed and 

complexity of the issues we face, and 

committed to realizing the comprehensive 

agenda of human security goals set 

forth by the world community. This is 

the most appropriate leadership task of 

the UN system and its member nations 

on the 75th anniversary of its founding. 

Such a paradigm shift to a more inclusive 

and collaborative global cooperation 

is essential to meeting the world’s 

human security needs at the local, national, 

and international levels. Nobody 

is safe in a world of pandemics, weapons 

of mass destruction, and climate change 

– unless and until we are all safe. 

The needed paradigm shift does not 

represent a derogation of national sovereignty 

in its true sense, but rather a 

strengthening of the only true basis 

for sovereignty itself, in two respects: 

First, because sovereignty implies power 

over ourselves, and we cannot exercise 

power over things that are beyond our 

control. Enhancing global cooperation 

will enhance the power and freedom of 

all nations, just as democracy enhances 

the power of all citizens. 

Second, sovereignty begins with – and 

is founded on – the rights of the people, 

and its institutions derive their 

legitimacy from the will of the people. 

Human security is not possible without 

economic, social, and ecological stability 

and resilience. 

The paradigm shift to an inclusive, 

global human security perspective is 

essential to reshape and refocus the 

purpose and function of our global institutions 

to address the full spectrum of 

humanity’s security needs. A Green New 

Deal for some countries may temporarily 

reduce the immediate impact of the 

pandemic and other threats on specific 

populations, but it cannot prevent their 

recurrence. 

A comprehensive and inclusive Global 

Green New Deal is the only viable 

strategy to address the vulnerabilities 

generated by the nexus of global challenges 

and create secure foundations 

for resilience in the future. Anything 

less is inadequate. 


131

How to Revive 


in a Multipolar 

World? 

Josep Borrell Fontelles 

Commission Vice-President 

Coordinating the external action 

of the European Union 

We all know that multilateralism is essential 

to our world vision but that it is 

also facing strong headwinds. However, 

with the new US administration in office, 

there is a real opportunity to work 

for its revival, even if it is not an easy 

task: first, because there are differences 

all over the world about how to rebuild 

it; second, because in a multipolar and 

fractured world, the geopolitical basis 

for multilateralism is changing; third, 

because Europe, like other global players 

in the world, will have to work in a more 

assertive way to advance its interests in 

a more transactional world. 

What I mean is that if you want to advance 

some key principles on the world 

stage, you need to throw your political 

weight behind them and not simply rely 

on their moral value. For example, since 

Europeans want to defend the principle 

that borders cannot be changed by the 

use of force, they adopted sanctions 

against Russia over its attempt to do 

just that in Ukraine. Those who violate 

the key principles must pay a price for 

their behavior. That is why – following 

my last visit to Moscow – I proposed 

to approach EU-Russian relations using 

three actions: to push back when 



Russia infringes international law, to 

contain when Russia wants to weaken 

our democratic system, and to engage 

when we have an interest in working 

with the Russian regime. 

The world today is becoming more 

multipolar and less multilateral. The 

challenge for Europe is to reconcile both 

dimensions – adapting to the new distribution 

of power while working to 

mitigate the political fracturing of the 

world into competing poles. 

Over the last three decades, we have 

seen a rapid transformation in the distribution 

of power around the world. 

We went from a bipolar configuration 

between 1945 and 1989 to a unipolar 

configuration between 1989 and 2008, 

before entering into what we today could 

call “complex multipolarity.” 

The world today 

is becoming more 

multipolar and less 

multilateral. 

Economically, for example, we have three 

dominant poles: the United States, China, 

and the European Union. However, politically, 

the structuring is more complex: 

first, because an emerging Sino-American 

bipolarity is increasingly structuring the 

world system; second, because there are 

important political and military powers 

that are not necessarily strong economic 

powers (such as Russia, or Turkey at the 

regional level); third, because there are 

actors in the middle of the fork, such 

as the EU, who carry a strong economic 

weight but are political poles in the 

making. The ambition of what we call 

“geopolitical Europe” is precisely to close 

the gap between economic power and 

geopolitical influence. 

Let us be clear here. The development 

of Europe as a political pole is not contrary 

to the defense of multilateralism, 

but a basic condition for its effective 

defense. In the first place, multilateralism 

is above all a methodology designed 

to regulate world relations on stable, >> 


133

transparent principles that apply equally 

to all, regardless of size. This means that, 

regardless of whether you are a smaller 

country or a great power, the rules are 

the same. However, as George Orwell 

imagined in Animal Farm, we know that 

even if states are formally equal, some 

are more equal than others. 

Multilateralism is not a magic wand. 

However, it can mitigate the power differences 

that exist between states by 

binding them using common rules. That 

is why Europe and the vast majority of 

states worldwide endorse it. 

Now, multilateral rules do not fall from 

the sky. They reflect a state of play and 

very often the preferences of the most 

powerful. If, for example, we want to 

win the battle of the European Green 

Deal, we will have to put in place a 

carbon border adjustment mechanism 

(CBAM), which is indispensable but also 

controversial: indispensable because, 

without CBAM, we will face carbon leakage 

and comparative disadvantage for 

our industries; controversial because 

many countries see it as a protectionist 

mechanism, which it is not. Therefore, it 

must be WTO compliant. We must build 

strong alliances with like-minded states 

and convince the most reluctant of them 

to join us in this endeavor. 

We need to think in terms of balance of 

power while advancing our interests. We 

are a principled Union, but principles 

alone are not enough to make a policy 

– and even less a successful policy. This 

is the main lesson we need to draw from 

the current global scene, where power 

politics is on the rise. 

The second reason for the crisis of multilateralism 

is that the liberal values of 

1945 are on the defensive in our changing 

world. Alternative narratives are 

challenging “the West” in every field, 

whether it be the economy, health, history, 

individual liberties, or human 

rights. Russia, China, and others see 

any discussion on human rights in their 

spheres of influence as an infringement 

on their sovereignty – whereas for the 

EU, human rights are universal values 

and a cornerstone of our foreign policy. 

If Russia now tries to bypass the Union 

and deal directly with member states, it is 

also because the EU matters and hinders 

Russia’s goals. In fact – and contrary 

to what is generally believed – there 

is no contradiction between playing 

power politics and promoting values. 

On the contrary. Showing that you will 

not abandon your principles is a sign 

of strength. 

The foundation of multilateralism in 

1945 and its resurgence after 1989 was 

not exclusively Western, but resolutely 

liberal. In this multilateral and rulesbased 

order, we Europeans were comfortable 

because it essentially reflected our 

preferences and interests. In tomorrow’s 

world, the situation will be more difficult 

because there are competing claims 

and visions as to how the international 

system should look. The liberal voice 

is simply one voice among others. The 

states that challenge this view want to 

transform multilateralism from within 

and redefine it. They are investing in 

multilateral institutions to roll back this 

liberal vision. 

In the face of this, Europe urgently needs 

to demonstrate the existence of a European 

point of view and forge alliances 

with like-minded states. In its conduct, 

it must be capable of forging issue-based 

coalitions and be more assertive, reactive, 

and agile. For, once again, the balance of 

power does not always work in our favor. 

Europe defends a diversity of viewpoints 

and has no hegemonic ambitions. At 

the same time, it must ensure that this 

does not lead to a generalized relativ- 

We have three 

objectives 

when it comes 

to shaping 

multilateralism: 

to consolidate 

what works, 

to reform 

what no longer 

works well, 

and to extend 

the scope of 

multilateralism 

to new areas. 



ism in which everyone does what they 

want within their own borders. That is 

why our commitment in international 

organizations such as the Human Rights 

Council is very important. 

There is a third reason for our work 

toward becoming a political pole in a 

multipolar world. It is the need for us 

to defend our priorities on how to shape 

the multilateral system. On this we have 

three objectives: to consolidate what 

works, to reform what no longer works 

well, and to extend the scope of multilateralism 

to new areas. That is the main 

message of the new strategy on multilateralism, 

which was recently endorsed 

by the Commission and by me as High 

Representative. It offers concrete ideas 

on how the EU intends to revitalize and 

modernize the rules-based international 

system in key priority areas – from trade 

and investment to health, climate change, 

and rules on emerging new technologies. 

The strategy highlights the commitment 

to invest in creative partnerships – not 

least with regional organizations such as 

the African Union, ASEAN, and others 

– and to strengthen collectively the UN 

and other multilateral forums. 

Indeed, the challenge is not so much 

to change international rules but to 

ensure their implementation. We can 

no longer be content, for example, to 

defend the WTO without modernizing 

its procedures, particularly with regard 

to state subsidies. Finally, there are new 

subjects such as digitalization and artificial 

intelligence for which we urgently 

need to define new global standards. 

We need to be in a position of strength 

to do this. In addition, to achieve this 

we need to define a common position, 

develop arguments, and build alliances. 

All this to say that we are not obliged 

to choose between multipolarity, which 

is a given, and multilateralism, which 

is an ambition. Accepting multipolarity 

means facing the reality of a world 

that is diverse, and also fractured and 

conflictual. To defend multilateralism is 

to reject fatalistic viewpoints and rally 

around our strengths and partners to 

make the global game more fluid, while 

always bearing in mind the interests of 

Europe and the values that underpin 

them. 

Published by the 

European External Action Service (EEAS) 


Open Societies 

versus 

Digital Autocratic 

Experiments 

Introduction 

Prof. Dr. Dr. Stefan 

Brunnhuber 

Professor for Sustainability 

and Psychology 

Member of the Club of Rome 

Considering the course of events over the past decade, it is 

obvious that Western democracies, sometimes also called 

the “free world,” are facing fundamental challenges. Far from 

liberal democracy marking the “end of history,” this system of 

governance is coming to be replaced by alternatives, primarily 

autocracies. This transformation is occurring hand in hand 

with increasing global challenges such as global warming, 

asymmetric wars, unprecedented inequality, forced migration, 

pandemics, the unknown impacts of automation on the traditional 

labor force, etc. In their book titled That Used To Be Us, 

Thomas Friedman and Michael Mandelbaum asked: “What if 

the US declared itself to be China for one day in order to solve 

all the challenges we are facing, and then decided to shift back 

to an open democratic system in order to enjoy all its benefits?” 

In other words, what is the right political agenda for the 21st 



century? Should there be more “open 

societies” or more autocracies? 

Freedom House stated that over the 

last 14 years, 64 countries have experienced 

a decline in their ratings regarding 

human rights, fair elections, rights 

of minorities, and the rule of law, and 

only 37 countries have experienced a 

net improvement with respect to these 

aspects. Considering the world population, 

39 percent live in free countries 

and territories, 25 percent live in partly 

free countries and territories, and 36 

percent live in countries and territories 

that are not free. If we attribute half of 

the population living under partly free 

political conditions to the free regions 

and countries, and the other half to those 

that are not free, respectively, it can be 

said that, although approximately 50 

percent of the world population lives 

in free countries and regions, the remaining 

do not. At the end of the Cold 

War, it looked as if authoritarian and 

totalitarian regimes were on the decline, 

but the current trend shows the opposite. 

Regarding the percentage of the world 

that was free, 2020 received the lowest 

ranking in more than a decade. These 

empirical findings reflect a statement 

made by Vladimir Putin, the president 

of the Russian Federation, in which 

he claimed that “liberalism is simply 

outdated.” The following graph illustrates 

this: >> 

THE GREAT DECLINE IN DEMOCRACY 

2009 

-33 

2008 

2012 

2007 -22 

2011 

2010 -20 

-16 

-17 

-15 

2013 

-14 

2014 2015 

-29 -29 

2016 

-31 

2017 

-36 

2018 

-18 

2019 

-27 

2020 

-45 

20052006 

+31 -3 

52 

83 

59 56 59 

43 

60 

38 

67 

34 34 

49 

54 

Democracy gap 

Number of countries that improved 

minus number of countries that declined 

37 

63 

43 

54 

40 

62 

33 

72 

43 

Number of countries 

that improved 

67 

36 

71 

35 

68 

50 

Number of countries 

that declined 

64 

37 

73 

28 

Source: Freedom House, 2021 Annual Report 


137

In open 

societies, 

the state 

legitimizes 

itself by 

enabling, 

safeguarding, 

and balancing 

the often 

conflicting 

forms of 

individual 

freedom and 

responsibility 

of each of its 

members. 

Problem-solving in the 

Anthropocene era 

Currently, these autocratic experiments 

enjoy significant support – not only 

within prominent autocratic countries, 

but also within the Western “free world.” 

In some countries, support for an autocratic 

agenda is even higher than support 

for the “free world.” Much has been 

written about this shift in acceptance 

of autocracies on the one hand, and 

their lack of legitimacy on the other, 

but one of the main reasons for this 

hype about autocracies is the fact that 

its advocates believe that the system of 

autocracy is capable of solving problems 

such as poverty, unemployment, global 

warming, inequality, corruption, and 

loss of biodiversity in a better manner 

as compared to open societies. Finding 

solutions to the abovementioned issues 

is a high priority for all humanity, and 

it appears that autocracies are able to 

do a better job in curbing these issues. 

Empirically speaking, the autocratic 

system has its attractions: fast political 

decision-making, a rapid rollout of solutions, 

and streamlined scaling of the 

economy. However, after examining 

the autocracy system more closely, it is 

observed that there are self-limiting factors 

built into the autocracy itself. The 

question arises as to which of the two 

contrasting alternatives has a relative 

competitive advantage to cope with the 

upcoming challenges of the Age of the 

Anthropocene, which is characterized by 

the limits set by planetary boundaries, 

spillovers, and all-time interconnectedness. 

In this era, the human species 

has taken the driver’s seat, not only in 

determining the course of the planet – 

leading to global warming, reduction of 

biodiversity, pandemics, etc. – but also 

by offering ways of life for humans in 

large coordinated societies and for meeting 

human socioeconomic needs. This an 

era in which there is no real exit option, 

plan B, or restart button. To summarize, 

of the two systems discussed – open 

societies and autocracies – which of 

them is doing a better job in solving 

global challenges? 

The nature of an open society: 

Human-centered and open to 

revision 

Historically, “open societies” – first 

described by the Austrian philosopher 

and founder of critical rationalism, Karl 

Popper (1945–2013) – are a conceptual 

response to the experiences of German 

fascism and Russian Stalinism, in which 

individual human rights were violated 

on a vast scale. Open societies reflect 

a societal and constitutional order in 

which personal freedom and reciprocal 

criticism provide not only the foundation 

of individual well-being, economic welfare, 

and peace, but also superior tools for 

solving problems and pursuing truth and 

coherence in both science and religion. 

In open societies, the state legitimizes 

itself by enabling, safeguarding, and 

balancing the often conflicting forms of 

individual freedom and responsibility of 

each of its members. 

Although historically the concept of 

an open society has been a contribution 

of the West, it is a political agenda 

that can be applied to any country in 

the world. In an open society, individuals 

engage in a critical, open, fearless, 

and public dialogue to solve problems. 

Each member of such an open society 

knows that this quest for a better life 

should be human-centered, open to revision, 

failure-friendly, and built upon 

reciprocal tolerance and trust. They are 

also aware that this search for personal 

freedom will potentially enable greater 

creativity, happiness, wealth, health, and 

truth than any alternative. The open so- 



ciety is built upon pluralism, reciprocal 

respect, and humility, in the awareness 

that our knowledge will always be incomplete, 

biased, and potentially misleading. 

This requires an ongoing fair, critical, 

and fact-based public debate; investigations 

by a critical and independent 

press; autonomous scientific endeavors 

that search for the truth and facilitate a 

better understanding of life’s miracles 

and magic; and an education system 

that unleashes the creativity of each and 

every individual. Open societies install 

checks and balances that prevent the 

abuse of power. In open societies, the 

prices of goods and services are generated 

in a free, fair, and regulated market 

system with product liabilities and 

entrepreneur responsibility, without 

hiding the truth about the social and 

ecological externalities. Moreover, they 

are societies in which a social security 

system is operational, that is, nobody 

is left behind, minorities’ rights are respected, 

and the votes of the majority 

are accepted. Open societies formulate 

– and if need arises, implement – laws 

to replace elected political officials if 

they fail to perform their duties. Open 

societies protect human rights and are 

built upon the conviction that the coexistence 

of other opinions, the creativity 

of individuals, and the institutionalized 

forms of criticism guarantee a life with 

overall greater levels of personal freedom, 

truth, and wealth. 

free markets. Therefore, according to this 

hypothesis, this Western value system 

is ultimately being implemented worldwide, 

making open societies themselves 

more stable and secure. This narrative 

even justifies the deployment of the 

military in humanitarian interventions 

(R2P: Responsibility to Protect). However, 

it seems that this form of expansive 

liberalism with its missionary proselytism 

has been taken too far. The flaw of 

this convergence hypothesis is that it is 

no longer falsified. Every time an autocratic 

regime takes a supposed misstep, 

it is assumed that the regime is “not 

yet there” or that its journey toward 

an open society still needs more time. 

However, it has been demonstrated with 

evidence that these were not missteps 

– autocratic regimes simply followed a 

different narrative. For example, in 1989, 

the fall of the Berlin Wall was used as a 

symbol in the West to proclaim the end 

of communism. Regarding China, 1989 

was the year of the suppression of the 

popular uprising in Tiananmen Square, 

which signaled the strength rather than 

the demise of communism. 

However, open societies’ understanding 

of democracy and human rights is subject 

to Western sovereignty with its claim to 

universal validity. If you visit a country 

with a high rate of poverty, illiteracy, 

and hunger, you may conclude that it 

is worth fighting for universal human 

rights. However, at the same time, you 

may acknowledge that there can be a 

temporal prioritization and geographical 

weighting of different values. Thus, the 

aims of overcoming poverty and hunger, 

providing housing for every indi- >> 

This ideal concept of the Western world 

enjoyed broad reception in the years 

following the fall of the Berlin Wall in 

1989. A further significant influence 

on the narrative of political debates in 

the West has been the convergence hypothesis. 

This hypothesis posits that free 

trade with autocratic regimes organically 

leads to a global convergence of the rule 

of law, the protection of minorities, the 

separation of powers, human rights, and 


139

on the nation’s security, stability, and 

economic welfare, which outweigh the 

need for the political participation of 

citizens, individual freedom, and human 

rights in the traditional Western 

sense. All types of autocracies have the 

population’s approval for the ruler’s 

decisions, which is higher than that in 

most, if not all, Western democracies 

and open societies. Autocracies prefer 

to synchronize, correct, and align their 

citizens with solidarity, homogeneity, and 

the subordination of individual rights to 

collective narratives that determine the 

political agenda. 

vidual, and ensuring universal access to basic education and 

health facilities will quickly take precedence over ascertaining 

the rights of freedom of expression, freedom of the press, and 

geographical mobility across national borders. The people living 

in open societies in Europe, the United States, and other 

Western countries need to admit to themselves that there 

may be societies that have other priorities and preferences. 

For example, there are societies in which its members might 

not think it is highly important that everyone has freedom of 

expression, but whose concern is instead that their children 

will no longer starve, will go to school, and have access to 

potable water. 

The autocratic system and its constraints 

Whereas in open societies, we witness shared, balanced, and 

controlled forms of political power, autocratic regimes rely 

on reduced or no constitutional constraints to their political 

power, which is exerted by the chosen few, by one party, or 

even by a single person. We can distinguish between communitarian 

forms of autocracies (China) with a one-party 

system; paternalistic autocracies (Russia), which emphasize the 

ruling individual – often described as a benevolent autocrat 

– over institutions; and tribal or feudal forms of autocracies 

(Gulf states) with a prominent family or clan structure, often 

including military and/or religious fundamentalist traits. The 

common trait among all these types of autocracies is a focus 

Consider the example of China. In Chinese 

culture, successfully copying the 

master is considered a special learning 

achievement. The more flawlessly this 

process is accomplished, the greater is 

the person’s learning curve and their reputation in society. 

This “copy and paste” culture means that the person who succeeds 

in imitating their superiors enjoys a head start because 

they can avoid the entire burden of imagination, invention 

and production, trial and error, and failure, and can instead 

concentrate completely on the imitation process. Additionally, 

the autocracy in China is impressive in its magnitude and the 

speed with which decisions are sometimes implemented. The 

reductions in the rates of poverty, the growth of the middle 

class, rising enrollment in education institutions, increased 

productivity, and the overall increase in life expectancy in 

China seem to demonstrate the superiority of the autocratic 

system as compared to the clumsy decision-making in open 

societies. The same seems to be true for other autocracies that 

we are currently witnessing in Europe, Africa, and the Americas. 

However, at the same time, a number of other cultural achievements 

are lost or never attempted in the first place, and critical 

debate, error-friendliness, public discourse, individual judgment, 

and autonomous thinking are characteristics that can only 

flourish in an open society. Autocracies must rely on copying 

and imitation strategies because the original results of critical 

judgment are not available firsthand. It is generally assumed 

that, because we are living in an uncertain and complex 

world, we need more critical thinking and less copying, more 

independent thought than imitation, and more freedom and 

critical autonomy than control and domination. The autocratic 



ruler must rely on knowledge and information 

that is only accessible to them 

through critical judgment. They pretend 

to possess knowledge that they are not 

able to generate from within. Instead, it 

needs to come from other sources. For 

example, considering basic research, the 

low number of patents and publications 

and the insufficient R&D infrastructure 

in countries and territories under autocratic 

rule support this argument. For 

example, most researchers working in 

China have been educated in open societies 

and represent a hidden import 

of Western values and standards into 

autocracies. They play the role of game 

changers in autocracies from within by 

making them more open (while sending 

their kids to Swiss high schools). 

Cannibalizing, parasitic, and 

self-limiting factors of autocracies 

My argument is that the autocracies currently 

in operation all over the world are 

flourishing on the basis of preconditions 

they did not generate themselves. These 

autocracies are self-limiting and cannibalizing, 

demonstrating that they will 

end sooner rather than later, as they are 

dependent on knowledge that originally 

came from the free world. 

The aspects of price allocation in free 

competitive markets; a rigorous debate 

on facts in an interdisciplinary scientific 

discourse; free public speech; a 

free, critical, and investigative press; a 

creative and pluralistic cultural scene; 

and the building of social capital based 

on interpersonally generated trust and 

reciprocal tolerance – they all draw 

on a human- and person-centered approach 

and are superior to any attempt 

to regulate society through a collective, 

non-democratic, top-down process. Lifelong 

political leadership or wielding 

political power for decades without the 

possibility of being replaced by an elected 

representative is not a sign of power, but 

of the weakness of the system in question. 

This shows that this system has 

abandoned a public and critical debate 

to impose and implement its will. 

The multiple critical feedback loops that 

maintain balance in an open society and 

provide sufficient flexibility to respond 

to asymmetric shocks (such as global 

warming or pandemics), which themselves 

require decentralized, uncensored 

information, are poorly developed in 

autocracies. It must be noted that the 

censorship imposed by autocracies does 

not facilitate criticism. Whereas criticism 

is inclusive and a fundamental component 

of any open society, as it honors 

different arguments and tries to improve 

the status quo, censorship creates an ingroup/out-group 

scenario of those who 

follow the ruler’s mandate and those 

who rebel against it. Autocracies are 

places where films and media, publishing 

houses and Wikipedia, curricula for 

schools and universities, and even history 

is censored, resulting in citizens who 

have no memory and humans who have 

no critical mind. In this case, censorship 

is exclusive and moralizing. 

In autocracies, the process of searching 

for truth, freedom, fairness, and so forth 

is replaced by autocratic knowledge and 

a political party agenda that the leader 

pretends to have charted themselves 

but which in reality relies on the quest 

for truth that is generated elsewhere, 

namely in open societies. Autocracies are 

too homogenous and too synchronized 

in a top-down manner to respond and 

operate in a complex, non-linear world, 

where uncertainties and incompleteness 

determine the decisions of daily life. 

This is true for politics as well as for 

the corporate world. This is also true for 

individuals, small and large groups >> 

Lifelong 

political 

leadership or 

wielding 

political power 

for decades 

without the 

possibility of 

being replaced 

by an elected 

representative 

is not a sign 

of power, but of 

the weakness 

of the system 

in question. 


141

The illusion 

of control: 

Autocratic 

regimes are 

convinced that 

they can 

control not 

only human 

behavior on 

a large scale, 

but also the 

course of a 

society as 

a whole. 

and entities, and large institutional bodies. 

Political clan structures, in which 

family members of the original ruler 

of the autocracy are chosen to rule the 

country or the territory without any 

kind of external auditing, signify that 

the innovation and creativity of the best 

and brightest people are never developed, 

and that the lack of involvement of a 

critical third sector leads to systemic 

corruption. Further examples demonstrate 

that a critical mind is superior to 

a mind that is subjected to mechanisms 

of collective control. 

Open societies, in contrast, are driven by 

a dynamic and decentralized process led 

by critical and freethinking individuals 

who are prepared to fail and sufficiently 

encouraged to take personal responsibility 

in entrepreneurship, in the unknown 

and rigorous journey of scientific discovery, 

in the creativity of cultural expression, 

in an open fearless public debate 

about their own doubts, uncertainties, 

and incomplete knowledge, in day-to-day 

decision-making in the private sphere, 

and in setting political agendas. 

Despite the acceptance of autocracies by 

the respective populations due to their 

economic and political power and sheer 

magnitude, autocracies are built on at 

least two forms of illusions, which lead 

to these autocracies being self-limiting, 

parasitic, and cannibalizing: the illusion 

of control and the illusion of knowledge and 

wisdom. Both of these illusions lead to 

the false assumption that the political 

control of autocracies and the power 

they exert over the dissemination of 

knowledge enable them to manage the 

challenges of the 21st century, making 

them superior to open societies. 

The illusion of control: Autocratic 

regimes are convinced that they can 

control not only human behavior on 

a large scale, but also the course of a 

society as a whole. Facial recognition 

programs, the unchecked application of 

artificial intelligence, social credit systems, 

large-scale state interventions and 

regulatory efforts, a closed internet, and 

public video surveillance are examples 

of how autocracies claim to control and 

command a societal process that open 

societies organize in a completely different 

way. However, autocratic political 

systems lack external feedback loops, 

such as a critical media and press, free 

and independent lawyers, or an autonomous 

civil sector providing indispensable 

wisdom to cope with challenges in the 

near future. Without this formation of 

social capital, which only occurs when 

free and autonomous humans decide 

to collaborate, autocratic systems find 

themselves much less in control as compared 

to open societies when faced with 

external and internal challenges. 

The illusion of knowledge and wisdom: Autocratic 

regimes are convinced that they 

are able to generate enough wisdom and 

knowledge from within to rule society 

and tackle systemic challenges. However, 

this autocratic knowledge is an illusion, 

because these regimes rely on the 

information and knowledge generated 

in open societies, which is then misused 

and instrumentalized for the purposes 

of autocratic systems. The knowledge, 

wisdom, and information acquired by 

individuals in open societies to solve 

problems are superior to the knowledge, 

wisdom, and information generated 

firsthand in autocracies. A one-party 

system is unable to generate wisdom 

in the way open societies do so, that 

is, in a decentralized, human-centered, 

critical, and failure-friendly manner. For 

example, a failed state-driven real-estate 

investment program requires a point of 

view that allows the program to be corrected. 

In an autocratic system, the only 



reliable source of information that the 

political apparatus has is its own political 

party programs. Contrastingly, an open 

society can rely on free price formation 

in free markets, a critical investigative 

press, and a research community that 

provides empirical evidence on how to 

proceed in correcting the errors in the 

program. In open societies, there is more 

than just one voice. These multiple voices 

guarantee progress, determine solutions 

to problems, and lead to the path of collective 

prosperity. When scientists get a 

bonus if they offer courses on political 

party programs – where ideology and 

party membership are more important 

than competence or professionalism, 

where spending on domestic security is 

higher than on defense and the military, 

and where even the constitution itself is 

subordinated to the party program – it 

cannot be assumed that such a system is 

ready to cope with the global challenges 

of the 21st century. No party program, 

no military regime, and no ideology 

whatsoever can replace the wisdom generated 

in open societies. In other words, 

the societal immune system or early 

warning system is weak in autocracies, 

as top-down commands prevail in the 

process of decision-making. 

This argument can be taken one step 

further. Autocracies function only 

because they are able to fall back on 

achievements they have not guaranteed 

or generated themselves in the first place; 

they lack the endogenous factor for critical 

self-correction, which is key for the development 

of knowledge in open societies. 

On the other hand, open societies accept 

the opinions of right- and left-wing 

populists, while also considering the 

aspects of closed homogeneous ethnic 

habitats, knowing that nobody is 100 

percent wrong and that each position 

will have to justify itself in the light of 

reciprocal criticism, open public debate, 

a free press, and free and autonomous 

research and development. If this test 

fails, a position will be proven false and 

disqualified within the open society. In 

this sense, autocratic systems are parasitic 

and self-limiting. The importance of 

their political influence is abolished as 

soon as they are confronted with all the 

cultural achievements that are characteristic 

of open societies: individual criticism, 

creativity, and the coexistence of 

heterogeneous ethnic and socioeconomic 

groups. In autocracies, basic research 

takes place, patents are filed, prices are 

created in markets, and journalists do 

their work. Thus, such operations are 

already unacknowledged islands of “open 

social relations” within an autocratic 

dystopia. The following graph illustrates 

the findings: 

Conclusion 

Illiberal democracies, controlled democracies, 

and one-party democracies – all 

of which can be considered as autocratic 

regimes in one sense or another – are 

not identical to the understanding of 

democracy and the rule of law in open 

societies in the West, even if they bear a 

similar name. These autocratic regimes 

represent a historical experiment that 

was highly promising but soon started 

showing its negative consequences. Although 

this experiment may sound great 

at first, it is a regressive response to the 

challenges of the 21st century. Contrastingly, 

open societies thrive on the idea 

of a liberal order based on a humancentered 

approach. They are not driven 

by the leftist narratives’ notion of a >> 

OPEN SOCIETIES VERSUS DIGITAL AUTOCRACIES: 

WHY AUTOCRACIES ARE PARASITIC, 

CANNIBALIZING, AND SELF-LIMITING 

creativity copy conformism 

critics coexistence control 

Open societies 

order of freedom 

Digital autocracies 

order of command 


143

Over the last 

centuries, the 

course of 

history has 

shown that 

the more 

perfectly a 

human-centered 

approach is 

accomplished, 

the better the 

results. 

forced equality, nor by an exclusionary 

ethnic identity of right-wing narratives. 

Both these narratives – if they assume 

an authoritarian character – depend 

on the illusions of being able to control 

societies and their citizens and of possessing 

information, knowledge, and insight 

about processes that do not belong to 

them. The free movement of goods, basic 

R&D activities, critical press reporting, 

and the unleashing of human creativity 

presupposes an order of freedom and 

is only really created in open societies. 

Anyone who refuses to understand this 

relationship between liberal democracy 

and progress will not survive the challenges 

of the 21st century. If the world 

was made up solely of autocratic systems, 

we would have neither real scientific 

progress nor objective and critical news, 

nor maximum creativity and cultural 

diversity. 

Thus, it boils down to the question of 

governance through control, conformism, and 

copying versus governance through criticism, 

the coexistence of heterogeneity, and creativity. 

The course of history will show which 

model proves more successful in coping 

with the challenges of the 21st century. 

The existing evidence suggests that autocratic 

systems are second-best to open 

societies in dealing with the problems of 

the 21st century. Although it is true that 

open societies appear to be more fragile 

on the outside, they demonstrate greater 

internal robustness due to autonomous 

and self-critical individuals. They appear 

clumsy and slow in their decisionmaking 

at first sight, but demonstrate 

flexibility and tolerance for failure if 

necessary and re-correct themselves. In 

a fully connected and complex world 

with increasing uncertainty, non-linear 

adverse feedback loops and spillovers, 

asymmetric shocks, and unknown unknowns, 

the competitive advantage of 

autocracies – both in terms of geography 

and time – will fall short or prove to be 

a nonstarter. They remain parasitic as 

they depend on open societies, cannibalizing 

themselves as they have to import 

relevant information generated only in 

open societies, consequently remaining 

self-limiting in nature. 

Despite the backlashes and backward 

steps, historically, it has always been a 

person- and human-centered approach that 

has enabled greater wealth, greater social 

achievements, more scientific discoveries, 

and greater health than any other form of 

political system. Over the last centuries, 

the course of history has shown that 

the more perfectly a human-centered 

approach is accomplished, the better the 

results. This does not mean that there 

have not been failures and that there has 

not been abuse or misguidance regarding 

a human-centered approach. However, 

any time a society favored individual 

creativity, criticism, and the coexistence 

of heterogeneous groups, honoring and 

protecting minorities and individual freedom, 

more wealth, health, and freedom 

has been achieved. I believe that open 

societies are more resilient because they 

are more error-friendly, more adaptable, 

and more restorative, which in turn is 

possible because they are more critical. 

They are able to mobilize their own 

self-healing powers in ways that are 

not available to autocracies. Thus, open 

societies do not need an agenda for world 

peace or global governance, but simply 

have to demonstrate their attractiveness 

through their own exemplary character. 

There is a need to admit that autocracies 

do not automatically become open 

societies with their inherent canon of 

values through the mere presence of 

open societies. Rather, it is the other way 

round: Autocracies need open societies 

in order to make themselves more stable 

by usurping the knowledge and discus- 



sions of open societies to consolidate 

their own power. 

As long as the free world does not mimic 

and copy these autocracies, we will come 

out of this historical phase ahead. This 

rising influence of autocracies will once 

again demonstrate that there is never an 

end of history or an end of ideology, but 

that the free world faces ongoing challenges 

that may never end. However, in 

the meantime, we must admit that we 

need both systems by considering the current 

status of the world. Open societies 

have generated sufficient knowledge and 

wisdom through public debates, a free 

investigative press, uncontrolled creativity, 

price signals in a free market system, 

uncensored information, and rigorous 

scientific discourse in social and basic 

science, all based on a person-centered 

approach; consequently, autocracies use 

these cultural achievements to roll out 

and scale-up solutions to major challenges 

in their own countries (e.g., global 

warming, eradicating poverty, etc.). 

Subsequently, the clash between open 

societies and autocracies will lead to the 

development of a non-hegemonic era, in 

which asymmetric and reciprocal interdependency 

predominate, rather than 

another era of imperialism, in which 

each proponent is convinced that their 

worldviews have to be adopted by the 

other. To rephrase the bon mot of the 

famous biologist E. O. Wilson: “Autocracies 

are an interesting experiment, but 

they have got the wrong species and the 

wrong time.” 

Extended and updated version 

of the Cadmus article (Brunnhuber, 2021) 


145

Global Goals Editorial Board 

GLOBAL GOALS 

YEARBOOK 

The Global Goals Yearbook is published under the patronage 

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and emerges from the renown Global Compact International 

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The Global Goals Yearbook helps to advance corporate transparency, 

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Head of Office 

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147

The UNSSC Knowledge Centre for 

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Source of the quote: 

H.E. António Guterres, UN Secretary-General 

Secretary-General’s remarks to the High-Level Replenishment 

Conference for the Peacebuilding Fund, January 26, 2021 

Authors of this edition (in alphabetical order): 

Dr. Stefanie Augustine, Prof. Dr. Alexander Bassen, Kai Michael 

Beckmann, Dr. Katie Boehme, Josep Borrell Fontelles, Prof. Dr. Dr. 

Stefan Brunnhuber, Dr. Roxana Codita, Dr. Volkmar Denner, Jonathan 

Fordyce, Frank Grice, Martha Herrera, Julian Hill-Landolt, Madeleine 

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Dr. Sandra Piesik, Ricarda-Marie Pomper, Tim Rohde, Lynn A. Taylor, 

Christoph Töpfer, Frank Markus Weber, Anne Werner, Christina Witter, 

Prof. Dr. Abdelouahhab Zaid, Valentin Zhovtun 

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Value Creation, Cover: Unsplash/Jan Tinneberg (P. 19), metamorworks/ 

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Michael Beckmann/Mazars Germany (P. 29), Andreas Weiss/RNE (P. 30), 

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Taylor Jewell/24kilos.com (P. 52/53), Audi (P. 56/57), Westend61/ 

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Timeline (P. 120-128): 

1648: Wikipedia.org/ Gerard Terborch, Public domain, https:// 

de.m.wikipedia.org/wiki/Datei:Westfaelischer_Friede_in_Muenster_ 

(Gerard_Terborch_1648).jpg, 1899: Wikimedia Commons, https:// 

commons.wikimedia.org/wiki/File:The_First_International_Peace_ 

Conference,_the_Hague,_May_-_June_1899_HU67224.jpg, Source: 

http://media.iwm.org.uk/iwm/mediaLib//7/media-7485/large.jpg 

photograph HU 67224 from the collections of the Imperial War, 

Museums, IWM Non-commercial Licence, 1945 und 1948: UN Photo, 

1992: UN Photo/Michos Tzovaras, 2002: UN Photo/Eskinder Debebe, 

2015: UN Photo/Cia Pak 

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