Opinion

Judging a business

Richard Heald | Updated on April 12, 2021

Giving back to society as vital as profit-making

In recent years, measuring the societal impact of business has become an increasingly important metric in judging the “worth” of businesses. Globally, in C-suites, boardrooms as well as within the investing community the contribution that businesses collectively and individually make to Sustainable Development Goals (SDGs) is seen as on a par with profitability, capital growth and dividends.

As such, pressure has been growing on companies to be seen to be giving back to society in a meaningful and measurable way. And this makes sense. Direct involvement from business shares the burden with government efforts. Direct involvement instils a sense of responsibility and well-being amongst employees. Consumers are increasingly conscious of the products they buy, and brands are increasingly working to align themselves with these views.

Measurement is key and this is where the UN’s SDGs play a fundamental role, helping companies co-ordinate and measure their efforts against accepted metrics both absolutely and relatively.

Covid impact

Moreover, the current Covid crisis has accelerated the realisation that the achievement of SDGs is a collective objective. It has also thrown up new challenges, and solutions. The importance of the accessibility of digital infrastructure and online delivery and learning is now seen as a necessity. Perhaps, this is also a time for companies to take further stock of the positive change they can generate beyond, as well as within, their own business interests.

And, throughout the pandemic period, businesses have been playing a significant role, alongside government, in the response, including provision of medical equipment and other crucial supplies, donations, and shelter, as well as continuing to adapt to provide their products and services.

India is committed to the SDG Agenda 2030. NITI Aayog has established an SDG Index to measure its progress across the 17 key areas of focus. UK businesses are deeply invested in India and committed to the country achieving its SDG goals. UK businesses are currently the sixth largest source of FDI in India, with a cumulative inflow from 2000-20 of approximately $30 billion, employing some 800,000 employees and representing around 5 per cent of India’s “organised” sector.

The UKIBC’s new report, ‘Supporting India’s Sustainable Development Goals: The socio-economic impact of UK businesses in India’ (www.ukibc.com), highlights this impact. The report also discusses the areas of priority for business to support, the complementarity between business goals and socio-economic development, and challenges and opportunities to do more in areas such as infrastructure, energy, financial services, technology, sanitation, and education.

In the past, wider development has been thought of as a responsibility for government but, as is now evident, the private sector can deploy its expertise and resources to play a significant and supportive role.

Amartya Sen summarised the argument well in Development as Freedom: “As people who live in a broad sense together, we cannot escape the thought that the terrible occurrences that we see around us are quintessentially our problems. They are our responsibility — whether or not they are also anyone else’s.”

Whether it be the people we work with or interact with, we all share responsibility for each other’s actions and well-being. Not only is it right to help people, it also is mutually beneficial (and rewarding) for us all to live in a world free from poverty and deprivation.

The writer is Group Chair,

UK India Business Council

Published on April 12, 2021

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