Australian SDGs Hub For Business

                                

In a world where nearly 2.2 billion people are living below US$2/day, stable employment with decent pay is critical to eradicating poverty.1

The levers required to achieve Goal 8 include economic growth, improved productivity, greater access to banking and financial services for all and policies that support entrepreneurship and innovation. Goal 8 also seeks to increase training and education, reduce the proportion of youth not in jobs, and eradicate forced labour, modern slavery and human trafficking.

The International Labour Organization expects that global unemployment will climb to 201.1 million in 2017 and 203.8 million in 2018, from 197.7 million in 2016 as labour force growth continues to outstrip job creation.2

In Australia, an unemployment rate of approximately 5.7% is good from a historical perspective, although the Reserve Bank of Australia has indicated that a lower rate should be possible.3 Australia has also seen slow wages growth.

 

How is this relevant to business?

Businesses have a responsibility to ensure that the work they provide is decent and provides minimum standards including in relation to safety and wages.

The business case for sustained, inclusive and sustainable economic growth, full employment and decent work for all is self-evident. For the private sector, these goals represent the prospect of increased sales, new markets and market segments, and lower risk.

“Jobs are the cornerstone of economic and social development. Jobs give people better standards of living and increased spending power, driving demand for products and services.” (PwC, 2016)

 

What can business do?

Companies can undermine Goal 8 when they are unwilling to take stock of the real impact their products and services have on society. This includes a failure to check how and where suppliers are sourcing their inputs and treating their workers.

Businesses should measure and understand their socio-economic impact and adjust their strategy based on these learnings. By putting a value on economic impact (e.g. job creation, promotion of good and ethical ways of doing business), companies enhance reputation. This provides leverage to increase sales and improve access to capital.

It is a fundamental duty of business to provide a safe and healthy working environment. A company that harms its people harms its own future viability, making safety performance a key non-financial indicator of business health and management quality.

Businesses that are transparent about their performance on benchmarks such as safety, human rights and customer satisfaction are better equipped to engage with their value chain and also justify their social license to operate.

Act Responsibly

  • Respect human rights including in the supply chain
  • Ensure a safe workplace

Find Opportunity

  • Promote skills training, virtual learning platforms, secondments and partnerships to increase capacity and innovation in developing markets
  • Integrate small to medium sized suppliers into supply chains and provide them with support such as training and connections to supplier networks
  • Increase local sourcing and local employment including for women, youth and Indigenous people
  • Develop the capacity of entrepreneurs and SMEs in countries of operation to increase local sourcing, job creation and incomes
  • Provide targeted internships for young people from disadvantaged backgrounds to promote social mobility and enhance company performance through increased workforce diversity

 

Links between Goal 8 and the UN Global Compact’s ten principles

Human Rights & Labour (UN Global Compact Principles 1, 2, 3, 4, 5, 6)
Respecting human rights in the workplace is fundamental to meeting the challenge of SDG 8. All forms of forced and compulsory labour, including in supplier networks, undermine the goal which seeks to promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all.

Environment (UN Global Compact Principles 7, 8, 9)
Sustainable economic growth requires companies to be environmentally responsible. Processes need to be efficient in terms of raw material inputs and pollution, and shift companies toward a circular economic model where waste can be reused.

Anti-Corruption (UN Global Compact Principle 10)
Corruption threatens economies and societies. It has been estimated that the annual cost of bribery alone is US$1.5-to-$2 trillion (roughly 2% of GDP).5

“Depending on its pervasiveness, corruption affects some or all drivers of potential and inclusive growth, such as macro-financial stability, public and private investment, human capital accumulation, and total factor productivity. Low rates of inclusive growth can also lead to increased incidence of corruption, creating a negative feedback loop that can become self-fulfilling and long lasting.” (IMF, 2016)

 


1 United Nations (2016), http://www.un.org/sustainabledevelopment/wp-content/uploads/2016/08/8_Why-it-Matters_Goal-8_EconomicGrowth_2p.pdf

2 International Labour Organization (2017), http://www.ilo.org/wcmsp5/groups/public/—dgreports/—dcomm/—publ/documents/publication/wcms_541211.pdf

3 Reserve Bank of Australia (2017), http://www.rba.gov.au/speeches/2017/sp-gov-2017-02-24.html

4 Australian Council of Trade Unions (2017), http://www.actu.org.au/actu-media/speeches-and-opinion/speech-by-actu-secretary-sally-mcmanus-at-the-national-press-club

5 IMF (2016), http://www.imf.org/external/pubs/ft/sdn/2016/sdn1605.pdf

GOAL TARGETS

8.1
Sustain per capita economic growth in accordance with national circumstances and, in particular, at least 7 per cent gross domestic product growth per annum in the least developed countries

8.2
Achieve higher levels of economic productivity through diversification, technological upgrading and innovation, including through a focus on high-value added and labour-intensive sectors

8.3
Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services

8.4
Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation, in accordance with the 10-year framework of programmes on sustainable consumption and production, with developed countries taking the lead

8.5
By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value

8.6
By 2020, substantially reduce the proportion of youth not in employment, education or training

8.7
Take immediate and effective measures to eradicate forced labour, end modern slavery and human trafficking and secure the prohibition and elimination of the worst forms of child labour, including recruitment and use of child soldiers, and by 2025 end child labour in all its forms

8.8
Protect labour rights and promote safe and secure working environments for all workers, including migrant workers, in particular women migrants, and those in precarious employment

8.9
By 2030, devise and implement policies to promote sustainable tourism that creates jobs and promotes local culture and products

8.10
Strengthen the capacity of domestic financial institutions to encourage and expand access to banking, insurance and financial services for all

8.a
Increase Aid for Trade support for developing countries, in particular least developed countries, including through the Enhanced Integrated Framework for Trade-Related Technical Assistance to Least Developed Countries

8.b
By 2020, develop and operationalize a global strategy for youth employment and implement the Global Jobs Pact of the International Labour Organization

 

FURTHER RESOURCES

The UN Global Compact’s library contains a range of resources on ensuring decent work including in supply chains.


For more goal-related tools, go to the Inventory of Business Tools webpage on the SDG Compass website. Businesses can explore and find commonly used tools when assessing their impact on SDGs.