Focus: SDGs

UN Sustainable Development Goals (SDGs)

The Sustainable Development Goals (SDGs) were adopted in 2015 by all United Nations member states. The 17 goals with their 169 targets and more than 200 indicators represent a global timetable for sustainable development, aiming to improve all human lives and protect the planet. The SDGs provide a “common language” for the public and private sectors. This year marks the tenth anniversary since the 2030 Agenda for Sustainable Development was approved. It is a milestone that reinforces the global obligation to implement the SDGs and highlights the continuing efforts being made to achieve these goals. In recent years, amid wars, conflicts and multiple geopolitical crises, many parts of the world have regressed rather than progressed with implementation of the SDGs. However, we still have five years left to take decisive steps forward together. This will especially require the private sector to deliver: without its capacity for innovation and active engagement, the global sustainability goals cannot be achieved.

Responsible private sector companies that enjoy long-term success make a vital contribution to these global sustainability goals. DEG is committed to increasing its customers’ contribution to the economic, social and environmental objectives of sustainable development and thereby to continuously improving the positive development impact of its investments. It achieves this by combining financing with extensive advice and support services and at the same time encouraging implementation of environmental, social and governance standards. Through their financial success and responsible operations, the companies supported by DEG are driving forward sustainable development in line with the 2030 Agenda.

There are no harmonised, standardised indicators for (promotional) banks to rely on for documenting their (financing) contributions to the SDGs. While the UN has defined 232 indicators to track global progress towards the SDGs, these leave room for interpretation and primarily serve as a framework for SDG plans at national government level. To illustrate the SDG contribution of its customers, DEG therefore uses its own Development Effectiveness Rating (DERa). Selected indicators in five DERa impact categories show the extent to which the positive impacts of DEG’s investments in companies, financial institutions und infrastructure projects  relate directly to the specific SDG targets. This SDG mapping provides transparency regarding the contribution of DEG customers to the UN sustainability goals. As part of the continuing development of the DERa, DEG has also updated its SDG mapping based on the available DERa 2.0 indicators.

Focus of SDG allocation at DEG

DEG customers’ contributions to the SDGs are recognised at two levels: through SDG mapping, which defines how the DERa indicators relate to the SDG targets, and directly through the customers’ core business.

Depending on its particular business model, a customer may inherently have a positive impact that is directly relevant to achieving the SDGs. For example, educational establishments, hospitals, renewable energy generators and fintech companies enabling financial inclusion all make a signifi­cant direct contribution to the SDGs through their core business.

A customer may also contribute to the SDG targets through its business practices. For example, a customer that lays the groundwork for non-discriminatory workplaces and also has a high proportion of women in senior management or has committed to gender-equitable career advancement is contributing to SDG 5 (Gender equality).

SDG contributions of DEG customers

Private sector companies contribute in a wide variety of ways to the UN’s 2030 Agenda for Sustainable Development (SDGs). Their contribution to SDG 8 (Decent work and economic growth) and SDG 9 (Industry, innovation and infrastructure) is particularly relevant. They create jobs, promote economic growth and improve quality of life by offering fair working conditions and training opportunities. In addition, companies play a key role in industrial development and promotion of innovation by investing in research and development and driving sustainable technologies. By expanding and modernising infrastructure, they also help to improve vital resources and economic stability. Through responsible actions and sustainable business models, private sector actors can therefore not only become more successful themselves but also contribute to more sustainable and equitable global development.

SDG mapping

The basic premise of DEG’s SDG mapping is to assign customers’ positive impacts on society, the economy or the environment as clearly as possible to a specific SDG target. This involves matching the selected DERa indicators and their features to the content of the SDG targets.

Alongside customer specifics, this approach also looks at whether DEG has supported a customer with promotional measures directly related to the SDGs or negotiated an impact/climate commitment with the customer. The mapping takes into account only those initiatives and impact/climate commitments whose potential impact is rated by DEG as “medium” to “very high” and that have already achieved a defined minimum implementation level.

DEG’s approach therefore recognises that customers contribute to multiple SDGs simultaneously in different ways.

No poverty

DEG customers contribute to SDG 1 if they

pay living wages (SDG 1.2), provide affordable access to basic services in healthcare, education and housing (SDG 1.4) or offer financial services in the area of microfinance or social insurance (SDG 1.4).

Zero hunger

DEG customers contribute to SDG 2 if they

work in sustainable agriculture, make fertiliser (SDG 2.4) or produce food and drink (excluding alcoholic drinks) for the local economy (SDG 2). Customers whose products benefit small-scale farmers also contribute to SDG 2 (SDG 2.3).

Good health and well-being

DEG customers contribute to SDG 3 if they

work in the health sector and offer affordable medical care or pharmaceutical or medical products (SDG 3.8).

Quality education

DEG customers contribute to SDG 4 if they

work in the education sector and make education available to a wide demographic (SDG 4.2 and SDG 4.3),

offer vocational education or training courses with a duration of more than three months (SDG 4.4),

undertake an education-related project with DEG (SDG 4.4).

Gender equality

DEG customers contribute to SDG 5 if

they align themselves with international non-discrimination standards and also employ a significant proportion of female managers,

they actively promote fair career advancement for women (SDG 5.5),

their company was founded by or is owned in significant part by women (SDG 5.a) or they are working with DEG to actively drive progress on gender, diversity and inclusion (SDG 5.5),

they offer women, especially entrepreneurs, access to finance (SDG 5.a).

Clean water and sanitation

DEG customers contribute to SDG 6 if they

work in water extraction, treatment and supply (SDG 6.1) or wastewater disposal (SDG 6.3),

are working with DEG to address their water efficiency in the form of a specific commitment (SDG 6.4 and SDG 6.5).

Affordable and clean energy

DEG customers contribute to SDG 7 if they

work in the energy sector and/or produce renewable energy (SDG 7.2),

work in a sector providing infrastructure or technology for the supply of energy (SDG 7.b).

Decent work and economic growth

DEG customers contribute to SDG 8 if they

promote economic growth,

contribute to increasing economic productivity through business or market innovations (SDG 8.2),

create decent jobs (SDG 8.8) or engage actively with DEG on matters of gender diversity and integration in the form of TA projects (SDG 8.5),

offer access to financial services (SDG 8.10) or work in sustainable tourism (SDG 8.9), the circular economy or recycling (SDG 8.4).

Industry, innovation and infrastructure

DEG customers contribute to SDG 9 if they

work in the building or maintenance of infrastructure (SDG 9.1),

promote industrialisation by working in manufacturing and increasing employment in this area and/or grow financially (SDG 9.2),

offer access to finance via SME financing or microfinance (SDG 9.3),

introduce a disruptive innovation in their industrial sector with a completely new product or open up a new market, making a major contribution to economic and social changes (SDG 9.5),

work actively on their resource efficiency with DEG in the form of a specific commitment, e.g. as part of projects providing advice or funding (SDG 9.4).

Reduced inequalities

DEG customers contribute to SDG 10 if they

offer targeted access to finance for women or microfinance (SDG 10.2), or offer products specifically aimed at women (SDG 10.2),

work in a sector that benefits ICT users (SDG 10.2),

work with DEG to champion financial education or integration (SDG 10.2).

Sustainable cities and communities

DEG customers contribute to SDG 11 if they

provide affordable housing (SDG 11.1).

Responsible consumption and production

DEG customers contribute to SDG 12 if they

work in sustainable waste management, recycling (SDG 12.5) or sustainable tourism (SDG 12.b), implement sustainable practices with DEG’s assistance or introduce their own sustainability reporting (SDG 12.6).

Climate action

DEG customers contribute to SDG 13 if they

work actively on the topic of climate action (SDG 13.2.2) or adaptation to climate change with a significant level of commitment, as assessed by DEG (SDG 13.1), or enter into a specific commitment with DEG on a climate-related topic (SDG 13.1 and SDG 13.2).

Life below water

DEG customers contribute to SDG 14 if they

contribute to protecting the oceans and/or improving management of water resources by (re)financing relevant activities (SDG 14.2).

Life on land

DEG customers contribute to SDG 15 if they

practise sustainable forestry (SDG 15.2), contribute to improving biodiversity (SDG 15.5) or actively champion biodiversity with DEG (SDG 15.5).

Peace, justice and strong institutions

DEG customers contribute to SDG 16 if they

actively work on solving problems for groups at risk (SDG 16.1).

Partnerships for the goals

DEG customers contribute to SDG 17 if they

actively contribute to domestic resources by paying taxes (SDG 17.1).