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UN Sustainable Development Goals - Goal 10

21 August 2018


 

In September 2015, the 193 countries of the UN General Assembly adopted the 2030 Development Agenda "Transforming our world: the 2030 Agenda for Sustainable Development". Known as the Sustainable Development Goals (SDGs), the 169 targets which make up the 17 goals provide a framework for countries to guide their path towards a more sustainable future. Ethical Screening is investigating how companies can contribute to The Goals. This blogpost focuses on Goal 10 - Reduced Inequalities.

What is Goal 10?

Goal 10 of the Sustainable Development Goals aims to reduce inequality within and among countries. The UN Development Programme (UNDP) reports that income inequality is increasing with the richest 10% earning up to 40% of overall global income. On average (considering population size) income inequality rose by 11% in developing countries between 1990 and 2010. The UNDP recognises that income inequality cannot be effectively addressed without resolving the underlying inequality of opportunities. Targets linked to Goal 10 therefore include those which aim to:

  • By 2030, empower and promote the social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.
  • Encourage official development assistance and financial flows, including foreign direct investment, to States where the need is greatest, in particular least developed countries, African countries, small island developing States and landlocked developing countries, in accordance with their national plans and programmes.

Successfully achieving the targets outlined for Goal 10 will be heavily dependent on the actions taken by governments at regional and national level by; eliminating discriminatory laws and promoting those which encourage equal opportunities; implementing progressive fiscal and social protection policies; and supporting improved regulation of global financial markets, amongst others. However, there is also much scope for the private sector to support this goal.

How can companies contribute to Goal 10?

Recent media headlines have highlighted the aggressive tax avoidance strategies that some multinational corporations (MNCs) employ in poorer countries. It has been estimated that global tax losses through profit shifting by companies amounts to over $500 billion. Such practices undermine economic development particularly in developing countries, where such funds could be used to provide essential public services such as clean water, healthcare, education amongst others.

UK-based companies can now apply for certification under the Fair Tax Mark scheme, which has stemmed from a campaign for greater corporate tax fairness that has been supported by a range of NGOs, civil society organisations, trade unions and churches. The scheme's UK-based Multi-National Standard assesses a company's tax arrangements and rewards them for providing full country-by-country reporting, for example. The Fair Tax Mark believes that only when companies publicly report the profits they make and the taxes that they pay in every country where they make them (in full) can any evidence of profit shifting come to light and companies be held accountable by the citizens of the countries where their actions have an impact. In order to achieve the standard, MNCs must also state and prove that they do not use tax havens for tax avoidance purposes. A number of FTSE350 companies, such as Go-Ahead Group, Marshalls, and SSE are already accredited to the Fair Tax Mark

In addition to foreign direct investment, migrant remittances form a vital external source of finance to developing countries, and frequently directly support and benefit the welfare of migrants' families especially women and children. In 2017, immigrants sent $38 billion (€31.1 billion) back home to Africa, according to a study by the World Bank, which also found that the money could go further if it were not more expensive to send money to Africa than anywhere else in the world. Based on provisional data from the UN, of the $613 billion in total remittances formally recorded worldwide in 2017, over 75% went to low- and middle-income countries. While the global average cost of sending money has slowly decreased in recent years, it was still estimated to be over 7% in 2017, more than double the target transaction cost of 3% to be achieved by 2030 (as set out in Goal objective 10.c). Whilst the money transfer market continues to be dominated by a handful of major operators, which charge high fees, smaller companies such as WorldRemit have begun to emerge which offer more reasonable transaction fees of less than 4%. These alongside options such as mobile money transfers (as described in our blogpost on Goal 1 - No Poverty) offer viable alternatives which enable users to make the most of their money.

People with disabilities are particularly vulnerable as they are often marginalised due to the limited number of opportunities available to them, which may widen inequalities between those with and without disabilities. Increased access to assistive technologies such as hearing aids, wheelchairs, communication aids, and eye glasses can help to address this imbalance by enabling users to gain or re-gain employment, and increase their participation within public and political spheres, for example. The World Health Organization states that globally, more than one billion people need one or more assistive products but currently, only 1 in 10 people in need have access to such products. French company Essilor has partnered with the Queen Elizabeth Diamond Jubilee Trust to take its social business model to Africa, in order to enable those on the lowest incomes to buy a pair of glasses that meet their requirements. This model already operates in India, Bangladesh and Indonesia, where Essilor has a network of businessmen and women to whom it sells glasses for $1 a pair. These are then sold on to customers for $3. The company's CEO is keen to point out that its venture in Africa is not philanthropy but a clear business opportunity in an untapped market, and hopes to have 20 million new wearers of glasses by the end of 2018.

Why is Goal 10 important?

The UN states that inequality threatens long-term social and economic development, harms poverty reduction and destroys people's sense of fulfilment and self-worth. This, in turn, can breed crime, disease and environmental degradation.

Goal 10 is a broad, overarching goal that has strong connections to many of the other global goals that companies can endorse. Further examples include:

  • Fair employment practices through the payment of a living wage, increased union representation to strengthen workers' collective bargaining power; and the sourcing of Fairtrade products to ensure that producers in development countries are paid a fair price (Goal 8 - Decent Work and Economic Growth);
  • Making strong policy commitments to ensuring gender equality for employees (Goal 5 - Gender Equality); and
  • Increased access to affordable medicine and healthcare (Goal 3 - Good Health & Wellbeing), and safe drinking water at a low cost (Goal 6 - Clean Water & Sanitation).

Conclusions

The cases outlined above demonstrate that there are plenty of possibilities for the private sector to contribute to this goal by adopting more transparent operating practices and paying their fair share of tax, and by meeting the demand for low cost assistive technologies in developing countries, for example. The opportunities for companies to support the aims of Goal 10 have yet to be fully realised but are clearly present should they decide to focus on them.

Juliana Burden - Ethical Research Coordinator

21/08/18


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