Once companies have developed a compelling impact thesis, as well as measurements for investors and stakeholders (based on their capabilities, assets, and geographical area), the key is to adopt a strategy—and make the right type of investments—to maximize impact.
A key factor for achieving success with an SDG strategy is ensuring that the right corporate investments are made—and constantly evaluated—through a dynamic and integrated capital-allocation process, particularly for companies undergoing sustainability transitions.
According to the strategy consultancy McKinsey, companies that actively reallocate resources to align with changing strategy deliver better, less volatile returns than those with less dynamic resource- allocation processes. CFOs are essential in integrating strategy-setting and capital-allocation processes, including mergers and acquisitions (M&A) and divestment.
While making traditional corporate investments in physical or financial assets is important, contributing to the SDGs requires other kinds of investments: people (human capital), community development (social capital), environmental protection (natural capital), and innovation (intellectual capital).
In this Blueprint, we introduce a wide range of corporate investments that support SDG strategies across industries, helping companies create value through multiple capitals. In addition to that, we will also introduce techniques to integrate the SDGs into investment assessments and corporate governance.
