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This summer it has been hard to keep sustainability issues out of mind. We’ve sweltered under a scorching sun in places that aren’t used to it. Swedish colleagues have told me about the forest fires raging in their home country. When I exchanged emails at the end of July with my colleague Dr Vivi Niemenmaa about the upcoming CIPFA International Conference (in which she will be one of the specialist speakers on sustainable development goals), she mentioned that she had never known Helsinki to be so hot. A little internet research suggested the most likely explanation is the jet stream (which usually insulates the cold arctic air from warm southern winds) has been breaking down. Further afield we have seen dramatic (and tragic) heatwaves in Japan and California.
There is a key difference between the United Nation’s Sustainable Development Goals (SDGs) and their predecessor, the Millennium Development Goals. SDGs are aimed – overtly – at all of us. They apply to the parts of the world that industrialised first just as much as those still in the process of industrialising. At the European Court of Auditors, the SDGs have already hit our agenda in work that we have been doing over the last few months on flooding and desertification, with SDG 15 – on halting land degradation - an invaluable point of reference. But we’re only just getting started. Here are three ways I believe the SDGs are going to impact on the work of accountants and auditors in the public sector over the next few years.
Reporting: Vincent Tophoff wrote persuasively in Public Finance International last month on the need to make financial reports more accessible. Countries around the world are going to need to report on progress (or otherwise) on the SDGs over the next decade and more. There will be a great pressure to align performance indicators and non-financial information with the SDGs. Not everyone will be as radical as the Finns, who told me earlier this year that they are examining the option of aligning the whole national budget with the SDGs. But SDGs are going to impact on government financial reporting everywhere, and we need to be ready for this.
Benchmarking: It is one of the hazards of working on public sector performance that it is difficult to compare performance between jurisdictions. The SDG reporting exercise is going to provide a wealth of comparable information on key public sector activities. It should become much easier to measure commitment in terms of what is achieved rather than what is spent.
Governance: The SDGs cover a broad range of public activities and objectives. Achieving the goals will – as OECD have pointed out – require cross-cutting initiatives to align policy goals and outcomes. This will pose both organisational and informational challenges for the public sectors, and the professional skills of accountants should be a key element in meeting these challenges.
I am writing this in a peaceful Tuscan square, not too far from Siena. Siena boasts one of the great secular frescos: Lorenzetti’s del Buono e del Cattivo Governo (the Allegory of Good and Bad Government). Two panels show city and countryside prospering under good governance. Two show the economic, social and environmental damage of bad governance. When Lorenzetti painted his fresco it was – I imagine – possible for a responsible city government to achieve all it needs to prosper on its own. Today’s challenges demand a global response, and the SDGs are going to affect all of us.