Creating new value with SDGs as a compass and common languageSaburo Kato (Corporate Adviser, Japan Association of Environment and Society for the 21 Century, and Director Research Institute for Environment and Society)
<Series 4> (Total 4 series)
This is the 4th and final article of this series. Here we will summarize the significance of SMEs working on the SDGs. Mr. Kato, who investigates the connection between “environment” and “civilization,” spoke about tips for corporate efforts based on "new value".
◆What are SDGs?
SDGs or the Sustainable Development Goals are a collection of global goals adopted by the United Nations General Assembly in September 2015 for the years 2016 through 2030 under the "2030 Agenda for sustainable development". The agenda consists of 17 goals, such as, "poverty", "hunger", "climate change", "energy", and "education", and a total of 169 targets laid down for more specific goals under these 17 goals for achieving a sustainable human society. Created in succession to the Millennium Development Goals (MDGs) formulated in 2001, the SDGs were adopted in the presence of heads of over 150 member nations. At the September 2017 session of the United Nations General Assembly, 232 indicators were adopted for measuring the progress of each of the targets.
Think proactively about what you can do at your company
The SDGs have become an indispensable guide for companies in avoiding management risks and thinking about future business. As globalization continues and the domestic market continues to shrink, the use of SDGs is extremely effective in expanding business on a larger scale.
“Japanese manufacturing tends to suffer from Galapagos syndrome, and even major manufacturers tend to focus on the domestic market. If you are an SME, there are many cases where your products go international through business partners or parent companies, but most direct transactions are with domestic companies. In this regard, SDGs are not just domestic. To actually address them, we have to be sensitive to actions of the United Nations and the world. In other words, you learn the needs of the world. That provides a chance to capture a wider market.“
As mentioned in previous articles, the number of supplier SMEs that are required by business partners to address the SDGs is increasing. However, Mr. Kato asserts that companies shouldn't need to be told to do so by their business partners.
“As I mentioned earlier, addressing the SDGs isn't just a matter of following the will of our existing business partners, but will also help us expand our market share on our volition. It also increases the company's sustainability. The adoption of SDGs should be seen as a new dawn for SMEs and an opportunity to think proactively about what the company can do.“
Collaborate to earnestly pursue sustainability
If you can add unique value to your products and services, your company will become much more competitive. There are many cases where new value is created by connecting companies from different fields. What does Mr. Kato think about this type of corporate collaboration?
“If companies with unique strengths work together, the result will be considerable. However, I think that collaboration between companies has been mainly aimed at profitability and efficiency. But with collaboration involving SDGs, we should review how the SDGs came into being, and rethink why companies even exist in the context of the 17 goals.
The SDGs are now called “the common language of sustainability”. If it makes sense for companies, and a partnership that earnestly pursues social and global sustainability is realized, new value and excellent results can be attained for both society and the companies involved.
Mr. Kato has worked on environmental issues for more than half a century as the first Director-General of the Department of Global Environment of the Environment Agency (currently, Ministry of the Environment) and as Director of the Research Institute for Environment and Society and as Corporate Adviser of a certified NPO. In that context, he realized and argued that “global environmental issues are the collision between "20th century civilization” symbolized by mass production, mass consumption, and mass disposal, and the finite nature of the global environment.
"The British economist E. F. Schumacher once wrote that "technology recognizes no self-limited principle—in terms, for instance, of size, speed, or violence". A recent example is the smartphone. Technologies related to images and videos are steadily progressing, and server groups that process this data consume an enormous amount of energy."
SDGs as a compass for creating new value
In dealing with global environmental issues, it is also important to review the “values” on which “mass production, mass consumption, and mass disposal” are based. In addition to creating new value, the fundamental perspective of "where to find value” is essential for achieving a sustainable society.
“I have always advocated the value of “knowing what is enough”. The wisdom of traditional Japanese society such as “Mottainai”, “Spiritual richness over material richness”, “Unity with nature”, and “Prizing harmony” have received renewed attention in Japan and internationally. With this in mind, companies are both pursuing cutting-edge technology, and also hoping to achieve sustainability by finding new value in old things."
A recommended method for actually incorporating SDGs into the business is to first imagine a desirable future for the company, and then work backwards to figure out what should be done now. Reviewing the business in this way may lead to rediscovering your company's strengths and potential, and discovering new ideals.
Mr. Kato concluded with a message to readers at the end.
“In light of the shrinking domestic market, I think many SMEs are exploring how the business should develop moving forward. The SDGs are a compass for companies and can be a common language for collaboration. I hope we can make good use of them to create new future-oriented value and enhance the sustainability of society and our companies.“
Coverage date June 25, 2019
＜End of Series 4＞
Series "Creating new value with SDGs as a compass and common language"
Series 1 Sustainable Development Goals (SDGs) have become an important management
Series 2 Various business opportunities to be found within SDGs
Series 3 Increased sales and enhanced management capabilities through SDG initiatives
Series 4 Creating new value with SDGs as a compass and common language
Corporate Adviser, Japan Association of Environment and Society for the 21 Century / Director, Research Institute for Environment and Society
Born in 1939. In 1966, he completed a master's degree in engineering from the University of Tokyo and joined the Ministry of Health and Welfare (currently the Ministry of Health, Labour and Welfare). Transferred to the Environmental Agency in 1971, and was appointed founding director of the Environmental Agency - Global Environment Bureau in the 90s. He has been involved in the formulation of an action plan for the prevention of global warming, the creation of the Basic Environment Act, and preparation for the “Earth Summit”. He retired in 1993 to found and serve as director of the "Research Institute for Environment and Society", and was also appointed representative director of the "Forum to consider environment and civilization in the 21 century" (currently · Japan Association of Environment and Society for the 21st Century). He currently serves as a member of Mainichi Shimbun newspaper's “Japan-Korea Ministry of the Environment” review board, as chairman of PRESIDENT Inc.'s “Environment Photo Contest” review board, and as a member of NK Industrial Research Institute's “Green Forum 21” conference.
Main authored and co-authored works
・“Environmental Thought: Encouraging a Reflective Lifestyle" (PRESIDENT Inc. / co-authored) 2010
・"The Environmental Century: Views of 22 Leaders in Politics and Industry" (Mainichi Shimbun) 2001
・"Conditions for Creating a Recycling Society" (Nikkan Kogyo Shimbun) 1998, et al.
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