Industrial manufacturers and producers have long understood the importance of environmental and social responsibility, and governance often referred to as "sustainability." However, recent developments in the investor community have sparked new interest in this area. For example, one of the world's largest investment firms, BlackRock, with nearly $7 trillion under management (including huge stakes in leading industrial manufacturers and energy companies), recently announced that sustainability issues would be at the center of its investment strategies moving forward. The company anticipates that this will create a strong foundation for client portfolios. According to BlackRock's CEO, climate change is almost invariably the top issue raised by clients around the world. This will result in a significant reallocation of capital that will occur "sooner than most anticipate."
Industrial Manufacturing Sustainability Goals Map to the United Nations Goals
While it may be too early to determine the full impact of this investment approach, leading manufacturing companies are beginning to formulate well-thought-out strategies to manage sustainability proactively. Many companies are now aligning corporate sustainability goals with the United Nations Sustainable Development Goals (SDGs). SDGs are a collection of 17 global goals designed to be a blueprint for achieving a better and more sustainable future for all. The goals were established in 2015 by the United Nations General Assembly by all 193 UN members and intended to be achieved by the year 2030, which are part of UN Resolution 70/1, the 2030 Agenda. A few examples of the UN goals which are of particular interest to manufacturing include:
- Ensure availability and sustainable management of water and sanitation
- Ensure access to affordable, reliable, sustainable and modern energy
- Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work
- Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation
- Ensure sustainable consumption and production patterns
- Take urgent action to combat climate change and its impacts
- Conserve and sustainably use the oceans, seas and marine resources for sustainable development
- Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
New business models, digitalization, and emerging practices are differentiating the leaders from followers, with sustainability now front and center with investors and consumers alike.