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48% of businesses in Ukraine invest up to UAH 100 million in sustainable development projects

11/ 11/ 2021
  This year, the European Business Association has launched the Sustainable Development Index together with Naftogaz of Ukraine and Kyiv National University of Trade and Economics. For the first time, the study was conducted on the integration of the UN Sustainable Development Goals into the corporate strategy and the development strategy of Ukraine. According to the study, the integrated value of the Sustainable Development Index amounts to 3.17 points on a 5-grade scale, thus appearing to be in the neutral plane. View the presentation Business Sustainable Development Indicators  96% of respondents are committed to the Sustainable Development Goals. Meanwhile, 83% have appropriate strategies/policies/plans in which these commitments are laid out. 58% dedicate separate non-financial reports to the SDGs, while about 25% of respondents present information on the SDGs in the relevant section of the annual report. The largest number of non-financial reports derive from companies in the fuel and energy sector (73%), FMCG (55%), as well as IT and telecommunications (50%). Businesses actively invest in sustainable development projects – 96% have approved budgets for the SDGs. Thus, 48% of such budgets amount to 1 to 100 million UAH annually. The companies that spend the most money on the SDGs are mainly in the fuel & energy sector and IT & telecommunications. Meanwhile, companies in the field of consulting, auditing, and legal services allocate less than 0.5 million UAH for sustainable development projects. At the same time, almost half, namely 48% of companies plan to increase funding for such projects. According to the participants, the main benefits that businesses receive from the implementation of sustainable development projects are improved loyalty to the company from employees, improved business reputation in the country of operation, as well as the improved perception of the company by consumers of its products/services and local communities. At the same time, the larger the amount of annual investment, the more respondents indicate an improvement in the perception and loyalty of local communities – 33% of those who invest less than 0.5 million UAH and 69% of those who invest 10 to 100 million UAH annually in sustainable development projects. Besides, the growth of investment also contributes to the improvement of business reputation in the international environment and access to international finance and loans, as reported by 44% of respondents. Environmental protection is a priority for all companies, especially in the field of waste management which is addressed by 81% of respondents. At the same time, 64% are engaged in tree planting, 49% in energy efficiency programs, and 40% in environmental modernization. The second priority belongs to education – 65% of companies say that they cooperate with universities and/or participate in dual education programs. Besides, companies are also involved in the social and professional integration of people with disabilities (41%). Svitlana Mykhailovska. EBA Deputy Director for Advocacy. As we can see from the results of the study, business is becoming a full player in fostering sustainable development goals. At the same time, companies consider that the environmental issues are the least reflected in the state strategic policy. Therefore, it is important to encourage such businesses to invest with the predictable government policies, including in the environmental area. I really hope that with the new leadership of the relevant ministry, qualitative environmental changes will be implemented. Oleksandr Romanyuk. Director of the Exploration and Production Division. An interesting finding is that the fuel & energy companies invest the most in sustainable development projects and are most meticulous in reporting their SDGs progress implementation. Naftogaz joined the UN Global Compact last year, we are also a reliable partner of more than 450 communities in 11 regions of Ukraine. For example, we have the educational scholarship competition Development Energy held for the second time. This spring, thanks to this competition, 50 projects received funding of UAH 100,000 each. In the near future, we will select another 25 winning projects. This study has once again confirmed that we are moving in the right direction, and the people and the country need this move. The State Sustainable Development Indicators  According to the business, the integration of the Sustainable Development Goals into the national development strategy of Ukraine is taking place at a slightly slower pace. Respondents rated the level of integration of social components the best (2.91 on a 5-point scale) and the environmental components the worst – (2.67 on a 5-point scale). More than half of the companies believe that this is due to a lack of funding, insufficient expertise, and low awareness of the need to implement the principles of sustainable development, as well as a lack of inter-institutional cooperation. Also, all companies consider that the main difficulties in implementing sustainable development are rooted in the regulatory sphere. In addition, there is a link between investment and regulatory barriers – the more a company invests, the more often it encounters with such barriers - from 26% of those who invest less than 0.5 million UAH, to 50% of those who invest from 10 million to 100 million UAH. The main incentives for increasing progress in the implementation of the Sustainable Development Goals (both in the state and business) respondents consider regulatory changes (including reduction of bureaucratic procedures), support for innovative projects (financial, organizational, consulting, and info), as well as financial instruments to endorse business and the state – tax benefits, soft loans, grants from state funds and international organizations. For reference: The Sustainable Development Index has been launched by the European Business Association in 2021. The study was conducted in September-October 2021, it involved 75 professionals who care about sustainable development in the EBA member companies. The purpose of the study is to assess the current state of implementation of the UN Sustainable Development Goals in business and the state, to identify mechanisms that will improve progress in their implementation, to identify factors that hinder or may contribute to the sustainable development of the business and the government. The integrated index consists of two equivalent components: Assessment of the level of integration of the UN Sustainable Development Goals into a company’s strategy; Average assessment of the level of integration of economic, environmental, and social components of sustainable development into the national strategy of Ukraine.  

This year, the European Business Association has launched the Sustainable Development Index together with Naftogaz of Ukraine and Kyiv National University of Trade and Economics. For the first time, the study was conducted on the integration of the UN Sustainable Development Goals into the corporate strategy and the development strategy of Ukraine. According to the study, the integrated value of the Sustainable Development Index amounts to 3.17 points on a 5-grade scale, thus appearing to be in the neutral plane.

View the presentation

Business Sustainable Development Indicators 

96% of respondents are committed to the Sustainable Development Goals. Meanwhile, 83% have appropriate strategies/policies/plans in which these commitments are laid out. 58% dedicate separate non-financial reports to the SDGs, while about 25% of respondents present information on the SDGs in the relevant section of the annual report. The largest number of non-financial reports derive from companies in the fuel and energy sector (73%), FMCG (55%), as well as IT and telecommunications (50%).

Businesses actively invest in sustainable development projects – 96% have approved budgets for the SDGs. Thus, 48% of such budgets amount to 1 to 100 million UAH annually. The companies that spend the most money on the SDGs are mainly in the fuel & energy sector and IT & telecommunications. Meanwhile, companies in the field of consulting, auditing, and legal services allocate less than 0.5 million UAH for sustainable development projects. At the same time, almost half, namely 48% of companies plan to increase funding for such projects.

According to the participants, the main benefits that businesses receive from the implementation of sustainable development projects are improved loyalty to the company from employees, improved business reputation in the country of operation, as well as the improved perception of the company by consumers of its products/services and local communities. At the same time, the larger the amount of annual investment, the more respondents indicate an improvement in the perception and loyalty of local communities – 33% of those who invest less than 0.5 million UAH and 69% of those who invest 10 to 100 million UAH annually in sustainable development projects. Besides, the growth of investment also contributes to the improvement of business reputation in the international environment and access to international finance and loans, as reported by 44% of respondents.

Environmental protection is a priority for all companies, especially in the field of waste management which is addressed by 81% of respondents. At the same time, 64% are engaged in tree planting, 49% in energy efficiency programs, and 40% in environmental modernization. The second priority belongs to education – 65% of companies say that they cooperate with universities and/or participate in dual education programs. Besides, companies are also involved in the social and professional integration of people with disabilities (41%).

Svitlana Mykhailovska EBA Deputy Director for Advocacy
As we can see from the results of the study, business is becoming a full player in fostering sustainable development goals. At the same time, companies consider that the environmental issues are the least reflected in the state strategic policy. Therefore, it is important to encourage such businesses to invest with the predictable government policies, including in the environmental area. I really hope that with the new leadership of the relevant ministry, qualitative environmental changes will be implemented.
Oleksandr Romanyuk Director of the Exploration and Production Division
An interesting finding is that the fuel & energy companies invest the most in sustainable development projects and are most meticulous in reporting their SDGs progress implementation. Naftogaz joined the UN Global Compact last year, we are also a reliable partner of more than 450 communities in 11 regions of Ukraine. For example, we have the educational scholarship competition "Development Energy" held for the second time. This spring, thanks to this competition, 50 projects received funding of UAH 100,000 each. In the near future, we will select another 25 winning projects. This study has once again confirmed that we are moving in the right direction, and the people and the country need this move.

The State Sustainable Development Indicators 

According to the business, the integration of the Sustainable Development Goals into the national development strategy of Ukraine is taking place at a slightly slower pace. Respondents rated the level of integration of social components the best (2.91 on a 5-point scale) and the environmental components the worst – (2.67 on a 5-point scale). More than half of the companies believe that this is due to a lack of funding, insufficient expertise, and low awareness of the need to implement the principles of sustainable development, as well as a lack of inter-institutional cooperation.

Also, all companies consider that the main difficulties in implementing sustainable development are rooted in the regulatory sphere. In addition, there is a link between investment and regulatory barriers – the more a company invests, the more often it encounters with such barriers – from 26% of those who invest less than 0.5 million UAH, to 50% of those who invest from 10 million to 100 million UAH.

The main incentives for increasing progress in the implementation of the Sustainable Development Goals (both in the state and business) respondents consider regulatory changes (including reduction of bureaucratic procedures), support for innovative projects (financial, organizational, consulting, and info), as well as financial instruments to endorse business and the state – tax benefits, soft loans, grants from state funds and international organizations.

For reference:

The Sustainable Development Index has been launched by the European Business Association in 2021. The study was conducted in September-October 2021, it involved 75 professionals who care about sustainable development in the EBA member companies.

The purpose of the study is to assess the current state of implementation of the UN Sustainable Development Goals in business and the state, to identify mechanisms that will improve progress in their implementation, to identify factors that hinder or may contribute to the sustainable development of the business and the government.

The integrated index consists of two equivalent components:

  • Assessment of the level of integration of the UN Sustainable Development Goals into a company’s strategy;
  • Average assessment of the level of integration of economic, environmental, and social components of sustainable development into the national strategy of Ukraine.

 

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