At the United Nations’ Development Summit in September of 2015, all 193 member states agreed to adopt the 2030 Agenda for Sustainable Development. Providing a “shared blueprint for peace and prosperity for people and the planet, now and into the future,” at the heart of the blueprint lay 17 Sustainable Development Goals (SDGs). These actionable and interdependent goals sought to end poverty, fight inequality and injustice, and tackle climate change.
In order for these goals to be met by 2030, the responsibility cannot be placed on governments alone, nor individuals. Businesses must also play a major role, and they stand to gain a lot from doing so. The challenges that the world is facing globally also affect businesses and limit their potential to grow, such as scarce natural resources, weak financial markets, limited local buying power and lack of qualified talent.
For The Rise Fund, a massive impact investing endeavor headed by Bill McGlashan, the SDGs represent the true north in ensuring its portfolio is making a difference socially and environmentally. As the largest impact fund of its time, McGlashan, alongside partners Jeff Skoll of eBay and rock star-activist Bono, sought to create a fund that could harness the power of capitalism to effect real and tangible change.
The Rise Fund opted for the SDGs as an established framework from the outset to discern the most urgent social and environmental areas of necessity and use them as a guiding reference for assessing the magnitude of impact generated by its investments. With every potential investment, McGlashan and partners would review how that company maps to the ecosystem of the United Nations’ SDGs. Once an investment has been made, they then ask the company to track specific impact-related outputs tied to those SDGs.
Altogether, The Rise Fund has collectively covered 15 unique SDGs through its investments and continues to support progress towards other SDGs that are not directly translatable into investment inputs. As of 2018, roughly a third of the investments are in education, 21 percent go into healthcare, 14 percent in energy and 13 percent in financial services, according to McGlashan.
McGlashan points out that analysts have estimated $30 trillion will be needed in order for the SDGs to be totally realized. He uses the example of the Gates Foundation – one of the largest and most well-known charities around today – which would only be able to cover 1.5 percent of that gap on its own, showing that government intervention and even philanthropy are not going to be enough on their own to achieve the SDG goals.
From eradicating poverty and hunger to tackling the climate crisis, the SDGs encompass the most fundamental challenges we face as a society. They are at the same time both simple and daunting in equal measure but for McGlashan, utilizing the scalability and innovation engine of capitalism and directing it toward impact is one of the most vital steps in getting the SDGs done.
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