Matching SDGs to Investment Screens
The UN’s SDGs are designed to be the “shared blueprint for peace and prosperity for people and the planet”. However, we’ve seen SDGs referenced in only a few of Investment Policies and Guidelines statements we’ve collected as part of the ongoing analytical work underlying our recent whitepaper ‘Good Intentions’. In fact, just three out of the 55 Investment Policies & Guidelines statements (IP&Gs) we examined feature SDGs as a framework to screen investments against.
Leaving aside - for the moment - possible reasons for the low usage, we note an exception to that backdrop: the Evangelical Church in Germany (EKD), which uses SDGs extensively to assist in the screening of government bonds, both in an exclusionary and positive scope.
The table below from EKD's Guidelines for Ethically-Sustainable Investment
in the German Protestant Church (p.56) shows how various SDGs are matched to positive and negative screening criteria.
An example of EKD's approach that we can point to is SDG Goal 14 (fourth from the right) – Conserve and sustainably use the oceans, seas and marine resources for sustainable development. EKD has matched SDG 14 to an exclusion criterion which “endanger[s] creation due to poor climate change performance”. Conversely, SDG 14 is scored as a positive screen to various ecological criteria such as “climate change performance” & “protection of human health and protection of ecosystems”. All screening in this example is to assist with investment in government bonds.