New Paper: Valuing the SDG Prize

Valuing the SDG Prize quantifies the value of business opportunities across four key systems: food; cities; energy and materials; and health and well-being. The findings for these systems are highlighted in Better Business, Better World, the Commission flagship report, released on 16 January 2017.

Across the four industry systems, AlphaBeta, which conducted the research, finds 60 opportunities that could be worth collectively more than US$12 trillion annually by 2030. While this is based on revenue and savings rather than value added, it represents around 10 percent of forecast global GDP in 2030. The 15 largest opportunities account for over half of this prize. These are: (1) affordable housing, (2) circular models in automotive, (3) improving energy efficiency in buildings, (4) the expansion of renewables, (5) circular models in appliances, (6) risk pooling in healthcare, (7) remote patient monitoring, (8) reducing food waste in the value chain, (9) forest ecosystem services, (10) circular models in electronics, (11) telehealth, (12) electric and hybrid vehicles, (13) improving energy efficiency in non–energy intensive industries, (14) low-income food markets, and (15) energy storage systems.

The geographic distribution of these SDG business opportunities depends on the industry system. Overall, more than half of the value of the opportunities in each industry system will be generated in developing countries.

The identified SDG-related business opportunities could also create almost 380 million jobs by 2030, which is more than 10 percent of the forecasted labour force in 2030. Almost one-fifth of the total employment potential – around 70 million jobs – comes from just one opportunity: affordable housing. We estimate almost 90 percent of jobs will be created in developing countries, including 23 percent in Africa and 59 percent in developing Asia.

Substantial investment will be needed to capture the SDG opportunities. We estimate that the total annual investment required for all 60 opportunities across the four systems is around US$4 trillion. Though these investment costs are large, more than US$20 trillion in sustainable investment assets are under management globally already, and the size of this asset pool is growing fast. We expect that while the global supply of capital will be adequate to achieve these business opportunities, it will be challenging to ensure the investment reaches the regions where it is most needed, especially in the developing world. Beyond capital investment, there will need to be additional radical departures from current approaches. The largest required shifts are in engaging with public policy and product innovation

The Business Commission would like to thank AlphaBeta for providing the analytical support for this project.