The UN Sustainable Development Goals (SDGs) are perhaps the most ambitious and far-reaching initiative in human history to address the major economic, social, and environmental challenges confronting our planet. The SDGs are predicated on the notion that efforts to alleviate poverty have to go hand-in-hand with endeavors that simultaneously seek to build economic growth, while addressing a range of social needs including education, health, and employment opportunities, while tackling climate change and environmental protection. One of the most significant challenges of achieving the UN SDGs by the target year of 2030 is the funding gap between funds that can be sourced from the multilateral funding organizations and the financial requirement needed to fund the SDGs. Initial estimates suggest that achieving the SDG targets would require annual incremental investments of between $5 to $7 trillion. Governments cannot fund this level of investment and will require significant private funding to meet these funding gaps. To attract private capital, projects must be financially sustainable and provide transparent and reliable financial systems. Private/public partnerships and creative financing structures may be necessary to provide investors with an appropriate return. In addition, local regulation may need to adjust to encourage investment in critical infrastructure. We believe an innovative system of “Sustainable Development Credits” or “Impact Credits” can drive and accelerate both public and private investment into critical projects of social importance, and in particular infrastructure projects. It is also important to be mindful of the aphorism, that “If you can’t measure it you can’t fix it.” Not only would the UN have a better tracking mechanism for quantifying and defining progress, but so would all the other players in the sustainable ecosystem. Impact Credits enable measurement, which is the basic step forward to fixing these profound challenges.
“Sustainable Development Credits” (SDCredits)
To appreciate the power of projects that have tremendously critical impact beyond what people normally appreciate, imagine the construction of roads or communications networks. In both cases financial entities and business would be satisfied with industry standard rate of returns. But imagine if investors could not only make their financial returns, but in addition investors could also receive “Impact Credits” and “Sustainable Development Credits” (also known as “SDCredits”). Critical infrastructure generally provides benefits to residents, users and nations well beyond their single purpose which many people might associate with a particular infrastructure. Road and communications infrastructure can provide important positive social impacts in health, women empowerment, economic development, and education as well. A nation, a company and an investor should be acknowledged for the social and developmental impact that goes far beyond the one dimensional conception that many view infrastructure as providing. “SDCredits” represents the investment of capital into projects with impact toward achieving UN Sustainable Development Goals. It provides “value” to Corporate Social Responsibility funds and philanthropic investors through social purpose, trading and visibility. SDCredits fall under the larger category of financial services, including brokerage of environmental and social impact commodities credit, exchanges and consulting.
The UN has established SDG goals in 2015 but, in the absence of an enforcement mechanism, can leverage such Credits through information “dashboards” that will help move countries toward achieving their goals by the year 2030. Corporate social responsibility funds and others would like to help countries meet their goals but want acknowledgment, transparency, security and tracking. A KPMG report indicates that while 40% of the top 250 companies mention SDG’s in their sustainability reports in some way, many are still unclear about how to report progress and few highlight it as a priority. Without “Impact Credits” and very few businesses currently see the business case for action. “Impact Credits” also fall under the larger category of financial services, namely, brokerage of environmental and social impact commodities credit, exchanges and consulting. The funds from the issuance of the SDG credit would be used to support the project. The Holder would list the credits in their annual reports and or annual sustainability reports. And individuals throughout the ICT sector would more rapidly become beneficiaries of connectivity-enabled social impact.
Contact Us to Learn More Interested parties can contact Geeks Without Frontiers to further discuss bespoke solutions and financial advisory/consulting services for SDCredits (also known as Sustainable Development Credits) and Impact Credits.