A Theoretical Review of whether Corporate Social Responsibility (CSR) Complement Sustainable Development Goals (SDGs) Needs

Abstract

In 2015, of the world’s population, 10 percent lived in extreme poverty, 11 percent was malnourished, 5 percent had no access to basic healthcare, 20 percent lived in fragile settings, 35 percent of women had experienced physic al or sexual violence, 36 percent lacked basic sanitation facilities, and 1 5 percent lacked electricity. The United Nations proposed to address these global i ssues through 17 Sustainable Development Goals (SDGs) which were accepted by 193 member countries. These committed countries are implementing the SDG agenda with all the available human, financial and technical resources. A recent review of SDG implementation across twenty six countries suggests that the progress is constrained by financial resources, which is resulting in geographically fragmented implementation and lack of integration amongst the goals. It has been reported that there is an annual gap of USD 2.5 tri llion for the implementation of SDGs. As public resources, especiall y in develo ping countries, are already stretched, various alternative resourc e mechanisms are being explored to address the resource gap. The global communit y considers businesses an important stakeholder in achieving the S DGs through their resources and innovations. It has been argued that developmental activities and funds under corporate social responsibility (CSR) can be leveraged towards this objective. Institutional theory is a good early point indicator to study business response to social and environmental needs. Stakeholder theory has a perfect alignment with CSR philosophy to cater to multi ple stakeholders. Social Contract theory and Political theory help stu dy “mandatory” nature of CSR that is being introduced over last decade in multiple countries globally ranging from mandatory reporting to mandatory spending. In this context, businesses have a unique opportunity to use SDGs as a framework for improving CSR engagement in line with changing societal expectati ons. Through impact assessment and a strategic sensitivity to global su stainable development challenges, businesses may contribute to shared value creation, enhance positive impact by poverty alleviation and betterment of liveliho ods, health and education, and reduce negative impacts like resource consumption, pollution, human rights violation across all processes.