SDGs and hidden costs for businesses 

2 mins read

Recently the European Commission published the progress indicators concerning the implementation of the 17 Sustainable Development Goals of the United Nations as identified and defined in the Agenda 2030.

In seeking Sustainable Development in all professional and technological fields, the European Union fully integrates and embeds the UN SDGs.

The indicators demonstrate the progress that has been achieved in the continent in the last 15 years.

Regarding the data on Cyprus, the assessment includes both positive and negative elements.

The most positive is identified in three Goals, “No Poverty”, “Life on Land”, and “Good Health and Well-Being”, in which Cyprus is ranked higher than the EU average and progress is recorded towards their full implementation.

At the same time, the progress also indicates partial development in tech and digital advancement of various sectors (Fintech / Technology).

On the other hand, the survey results show that in relation to “Decent Work and Economic Growth”, it is currently slightly below the EU average.

Greater progress, but still well below the EU average, is made on the “Industry, Innovation and Infrastructure” Goal.

Eight more Goals are well below the EU average, with limited progress recorded.

Of these goals, those of “Peace, Justice and Strong Institutions” and “Gender Equality” are furthest from the EU average.

A Matter of concern also comes from the Goal for “Reduced Inequalities”, which, although it remains above the EU average, has deteriorated.

It is also worth noting that for three Goals, there is no assessment for Cyprus, namely in “Clean Water and Sanitation”, “Life Below Water”, and “Climate Action”.

Most of the EU countries also face problems in their effort to achieve the SDGs — even large economies such as France and Germany.

In the case of Greece, most Goals are below the EU average, but significant progress is being recorded on most of them.

It is worth mentioning that the assessment does not cover the full range of possible negative effects the COVID-19 pandemic may have caused and certainly does not include the spillover effect of the war in Ukraine, such as the further rise of inflation and rising energy costs.

Depending on how long they will last, these developments may affect the targeted implementation of the SDGs in the coming years.

Financial resources

European Commissioner for Economy Paolo Gentiloni said: “The creation of a sustainable and resilient Europe requires significant economic resources”.

The same is true in the case of Cyprus.

Speaking at the Annual General Meeting of the Cyprus Investment Funds Association (CIFA), Minister of Finance Constantinos Petrides emphasised that the shift towards a Sustainable, Green and Digital economy requires significant investments and resources from the public and private sectors.

As he rightly said, this change of direction entails high costs and is something that must be realised early on by Cyprus-based companies and groups.

If not, they will risk losing their path to sustainability. In the best-case scenario, they will face penalties for not complying with and implementing sustainability programs — criteria factors at commercial practice and reputation level.

Clearly, the operational model of previous decades does not work today.

Companies that adapt quicker can lower costs and remain viable for longer periods.

By Nicole K. Phinopoulou, Lawyer, Banking & Financial Services, LLB. LLM. LPC, CISL, University of Cambridge