Corporate responsibility and the Millennium Development Goals

When the countries of the world agreed ambitious targets for combating extreme poverty, hunger and disease at the UN Millennium Summit, 2015 sounded a long way off. Now, with just seven years to go, it feels uncomfortably close.

Some progress has been made towards the Millennium Development Goals (MDGs). The proportion of people living in the worst poverty has fallen, child mortality has declined and more children in developing countries go to school. But at the halfway point, 1.6 billion people still lack the most basic sanitation, and Aids prevention is failing to keep pace with the epidemic: by the end of 2005, more than 15 million children had lost one or both parents to the disease.

Beyond humanitarian reasons, the goals matter to companies because meeting them will boost economic growth and reduce disruption to operations. Many companies have embedded the targets on disease, poverty and environmental degradation in their sustainability strategies. Others have made major long-term commitments to work with civil society and government to realize them. As a result, the MDGs are now inextricably linked with the reputation not just of individual companies, but of business in general. Indeed, hitting the targets is now widely seen as a test not just of the credibility of the UN, but of companies' claims to be responsible citizens.

This puts business in a bind. It can expect a disproportionate amount of the blame if the goals are not met. Yet, by itself, it cannot hope to make more than a tiny dent. In the key areas of trade policy and the governance of developing countries, business influence is limited - and practically non-existent when it comes to government spending. Denmark, Luxembourg, the Netherlands, Norway and Sweden are the only rich countries that have met their pledges on development assistance, which the UN says is essential to success. Overall, government spending in this area actually fell between 2005 and 2006.

What, then, should companies do, besides creating jobs? First, follow up the call of international business leaders last July for an urgent review of progress towards the MDGs - a call echoed late last year by the mining company Anglo American (EP9, issue 7, p7). Second, promote open markets. Third, help small entrepreneurs, exploiting specific areas of business expertise - fair trade in the case of retailers, microcredit in the case of financial institutions. Fourth, extend social services, notably health programmes, beyond the immediate workforce to family members. Fifth, ensure that operations meet international social and environmental standards. Finally, follow up on the promises made at the Earth Summit in Johannesburg and work with NGOs and other bodies. Given the challenges, teamwork is essential.