Based on the results of a survey conducted in October-November 2021, this report provides an analysis of the level of awareness and penetration of the SDGs among GCNJ member companies and organisations, as well as progress on five of the global goals: SDG 5, (Gender Equality), SDG 8 (Decent Work and Human Rights), SDG 13 (Climate Change), and SDG16 (Preventing Corruption),which are the main focus of the UN Global Compact, and SDG 12 (Circular Economy) which is a focus for accelerate efforts by Japanese companies. Companies and organisations are looking to prioritise the integration of these five SDGs into their activities.
Highlights of the SDG Progress Report 2022
- Awareness and penetration of the SDGs: The low level of awareness of the SDGs among middle management and employees has long been an issue, but this has improved by nearly 40%, reaching approximately 80%. The SDGs are finally being recognised and understood internally within companies and organisations.
- Gender Equality: Systems and information disclosure are being established in "compliance" with domestic laws and regulations, such as “Act on the Promotion of Female Participation and Career Advancement”. On the other hand, the "Gender Equality" required by the SDGs is the elimination of gender discrimination which is structured in society and the economy, as well as the reform of systems and awareness based on gender roles. Shifting gears from “female participation and career advancement” to the “promotion of gender equality” will ensure globally accepted and highly effective activities. Moreover, this is also effective as a foundation for “female participation and advancement” and "diversity and inclusion (D&I).
- Decent Work and Human Rights: 90% of the member companies and organisations have made efforts to address the policies, commitments, and remedies indicated in the "Guiding Principles on Business and Human Rights (UNGPs)". However, only about 75% of members are engaged in due diligence for human rights. Overall, there is weak recognition that human rights is an issue not only for workers but also for consumers and local communities, so there is an urgent need to address the implementation and review of specific items indicated in the Guiding Principles.
- Circular Economy: Many companies collect used containers and products through collaboration between manufacturers and retailers(etc.), and then recycle them in partnership with recyclers, switching containers and packaging to recycled materials and recycled resources. In the future, it is expected that companies will work to establish and realise further recycling systems and new business models that go beyond the 3Rs, including changes in consumption patterns such as sharing and product servicing.
- Climate Change: About 70% of member companies and organisations have set net-zero targets for 2050, and about 80% have identified Scope 1 and Scope 2 greenhouse gas emissions. More than half have identified and integrated climate change risks and opportunities into their strategies and plans, and are responding to the trend toward increased climate change-related disclosure. Moving forward, support is needed to reduce the costs of decarbonisation and to address technical challenges.
- Preventing Corruption: Anti-corruption measures have gone beyond documented measures, such as clarification of policies and preparation of rules and regulations, and have reached organisational measures such as internal reporting system and disciplinary procedures for violators. On the other hand, conducting interviews with employees in both domestic and overseas groups, due diligence and educational training for suppliers and third parties are lagging behind, and risk assessment and management systems for third parties need to be reinforced.
- Status of Actions on Materiality other than five SDG goals: Other than the five SDGs above, SDGs 3, 7, 9 and 11 make up the goals that are positioned as materiality with specific numerical targets. In order for companies to continuously work on achieving specific SDGs, and to be understood and shared by internal and external stakeholders, it is crucial to create a story that combines business sustainability and social challenges, and ensure that it is communicated widely.
- From a cross-sectional study, the following points are observed:
- More than 80% of the member companies and organisations stated that they have integrated the SDGs into their management strategies. However, this is insufficient to achieve the SDGs. In particular, for SDGs 5 (Gender Equality), SDG 8 (Decent Work and Human Rights) and SDG 16 (Preventing Corruption), challenges were found in basic progress. It is very much expected that businesses aiming to expand globally should review and improve their efforts.
- As seen in “female participation and career advancement” and the 3Rs, initiatives by companies and organisations are strongly influenced by policies, laws and regulations. It is necessary to go beyond these, understand what needs to be done, and work on the SDGs.
- Common to all five SDGs, it is vital to listen to stakeholders in the value chain/supply chain, gather data, and strengthen strategies and approaches, as well as to develop a structure to realise the goals.
- There is a significant difference in activities between large companies with global operations and small- and medium-sized companies and organisations. It is important for companies and organisations to utilise their strengths, and depending on the environment and the progress of their efforts, to utilise government and NGO support as appropriate. Companies must also cooperate and collaborate with each other.
- It is essential to shift gears in all sectors to move closer to achieving the SDGs, which have been negatively influenced by the COVID-19 pandemic. The time is fast approaching when it is no longer sufficient to simply say “we are contributing to the SDGs by our own standards”. Aligning organisational sustainability with social sustainability is the key step to becoming a company or organisation that truly contributes to the achievement of the SDGs.
*This is the English translated version of the Japanese report published in February 2022