The Role of the Private Sector in Achieving SDG 16

Author:
Tamar Ghunashvili
Senior Manager, Strategic Communications
UN Global Compact Network Georgia
As we mark the 20th Anniversary of Principle Ten: Anti-Corruption, it is essential to reflect on the journey since nearly two decades ago when United Nations Member States adopted Agenda 2030-a transformative framework designed to combat poverty, inequality, and environmental challenges through 17 Sustainable Development Goals (SDGs).
SDG 16 stands out as a cornerstone for fostering peaceful and inclusive societies, ensuring access to justice, and establishing accountable, effective institutions.
In an era where corruption continues to undermine governance and social stability, the call to action has never been more urgent. Embracing the principles of transparency and integrity, especially in the private sector, is crucial for achieving SDG 16 and creating a just and equitable future for all.
SDG 16 directly addresses issues like corruption, weak institutions, and lack of transparency, which hinder development and obstruct the achievement of all other SDGs. Corruption diverts resources, exacerbates inequality, distorts markets, and erodes public trust. In 2016, the IMF estimated the annual cost of bribery alone to be about $1.5 trillion to $2 trillion. Bribery and corruption impede business growth, raise transaction costs, and create an unlevel playing field. This ultimately creates social instability, fuels mistrust in public officials and institutions, and undermines the rule of law. Indeed, an estimated 4 billion people worldwide continue to live outside the protection of the law. There is also still a gulf between the quality of governance globally, including government effectiveness, regulatory quality, and, pertinent to the private sector in particular, control of corruption. Corruption and bribery scandals can cause major societal instabilities. Sustainable Development Goals are deeply interconnected. Progress on SDG 16 contributes to advancing other SDGs by reducing inequalities, fostering partnerships, and creating stable environments for economic growth.
For example:
SDG 1 (No Poverty): Peaceful societies with strong institutions reduce conflict and foster economic stability, directly impacting poverty reduction.
SDG 3 (Good Health and Well-being): Transparent governance ensures that healthcare resources are effectively distributed and reduces corruption in health services.
SDG 5 (Gender Equality): Inclusive institutions help address gender-based violence and protect women’s rights.
SDG 8 (Decent Work and Economic Growth): Stable legal frameworks support economic growth, creating jobs and sustainable business environments.
The private sector is uniquely positioned to contribute to SDG 16 through initiatives that build trust, transparency, and ethical behavior in business operations.
United Nations Global Compact Sustainable Development Goal #16: Peace, Justice and Strong Institutions

Why SDG 16 Matters to Business
The UN Global Compact outlines three critical challenges for businesses in relation to SDG 16: corruption, violent conflict, and weak rule of law. Addressing these challenges is crucial for businesses to operate in stable, predictable environments where they can thrive.
Businesses can contribute by implementing conflict-sensitive policies, conducting risk assessments, and engaging in partnerships for peacebuilding and anti-corruption efforts.
How Businesses Can Support SDG 16
Promoting Ethical Business Practices: Companies should establish governance frameworks that encourage transparency and accountability, including anti-corruption policies and compliance programs.
Building Ethical Supply Chains: Through diligent procurement processes and transparency, businesses must ensure their supply chains are free from corrupt practices.
Supporting Strong Institutions: Companies can advocate for legal reforms that strengthen anti-corruption measures and collaborate with governments to foster more effective governance.
Case Studies
Siemens: Siemens implemented robust compliance systems, becoming a leader in corporate governance.
Shell: Through its support of the Extractive Industries Transparency Initiative (EITI), Shell promotes transparency in resource-rich, high-risk countries.
Unilever: The company has stringent anti-corruption protocols and regularly audits its global operations to ensure compliance.
The private sector’s engagement is vital for advancing SDG 16 by championing transparency, ethical practices, and the establishment of accountable institutions. By proactively implementing anti-corruption policies and participating in collective action initiatives, businesses mitigate risks and play a pivotal role in fostering peaceful, just, and sustainable societies. The UN Global Compact serves as an essential platform for companies to align their operations with universal principles, share best practices, and collaborate across sectors to tackle corruption and enhance governance. By committing to the principles of the Global Compact, businesses can amplify their impact and contribute significantly to the realization of SDG 16, ultimately paving the way for a more stable and equitable world for all.