How Can Businesses Effectively Measure Indirect Contributions to the SDGs, Such as Influence Over Industry Norms?

 In the pursuit of the Sustainable Development Goals (SDGs), businesses are increasingly being asked not only to account for their direct actions but also to measure their indirect contributions—such as their influence over industry norms, policy shifts, and broader societal changes. While the direct impact of a company’s operations on sustainability is relatively easy to measure, quantifying its indirect contributions, particularly its influence on industry-wide standards and the broader business ecosystem, poses a unique challenge.

However, as businesses continue to embrace their role in achieving the SDGs, understanding and measuring these indirect contributions becomes increasingly vital. These contributions can play a pivotal role in driving wider change and establishing practices that encourage sustainable development across entire sectors.

In this blog, we’ll explore how businesses can effectively measure their indirect contributions to the SDGs, such as their influence on industry norms, policy development, and supply chain transformations.

1. Defining Indirect Contributions to the SDGs

Before diving into how businesses can measure these contributions, it's important to understand what indirect contributions to the SDGs really mean. While direct contributions often focus on a business's operations, such as carbon emissions, resource usage, or employee well-being, indirect contributions are more subtle and involve:

• Shaping industry standards and norms: Companies can influence the practices and behaviors of others in their sector, encouraging the adoption of more sustainable practices across the value chain.

• Advocating for policy change: By influencing policymakers or participating in global forums, businesses can contribute to regulations that promote sustainability at a systemic level.

• Promoting awareness and education: Businesses can raise awareness on social, environmental, and economic issues by engaging with consumers and stakeholders, which can indirectly impact the adoption of sustainable practices by others.

• Setting market trends: A business can indirectly impact SDG progress by setting trends that others follow, such as pushing for sustainable product design, ethical sourcing, or climate-friendly innovations.

Given that these indirect actions are often systemic, measuring their impact can be more challenging than tracking direct metrics. Nevertheless, businesses can use several methods to gauge and demonstrate their influence.

2. Collaborative Efforts and Industry Partnerships

One of the most effective ways to measure indirect contributions is through collaboration with industry groups, nongovernmental organizations (NGOs), and other businesses. When businesses work together to set standards, advocate for policy changes, or share knowledge, their combined influence can create significant ripple effects throughout the industry.

Businesses can measure their impact in these partnerships by tracking the following:

• Industry adoption of new standards: How many companies within the industry adopt the standards or practices that your business has championed? By tracking the shift in industry norms (such as the widespread adoption of sustainability certifications or supply chain transparency initiatives), businesses can measure their influence on industry-wide practices.

• Co-authored research or reports: Businesses can collaborate on studies, policy briefs, or other publications that reflect their influence over the broader industry. Tracking the citations or adoption of these works can help quantify their indirect impact on industry norms.

• Industry recognition: Being recognized by industry peers for leadership in sustainability can serve as an indicator of the indirect influence a business has on sector-wide practices. The number of invitations to participate in industry roundtables, conferences, or public consultations provides further insights into a business's ability to shape industry direction.

3. Tracking Policy Changes and Regulatory Influence

Another key measure of indirect contribution is a business’s ability to influence policy changes and regulatory frameworks related to sustainability. Businesses can engage with governments, international organizations, and trade associations to help shape public policies that promote sustainable development, such as regulations on carbon emissions, fair wages, or resource management.

To measure these contributions, businesses can:

• Monitor legislative or regulatory changes: Track whether and how the policies or regulations businesses have advocated for have been adopted by local, national, or international governments. If a company has influenced or participated in the drafting of sustainability-focused policies, measuring the adoption and impact of these policies is a key way to quantify indirect contributions.

• Track government or regulatory engagement: Businesses can assess their involvement in policy dialogues, conferences, and public consultations where they contribute to sustainability discussions. Analyzing their level of participation, as well as the impact of their input, can provide insights into their role in shaping the regulatory landscape.

• Public policy outcomes: Companies can also measure how public policies have aligned with the SDGs over time and assess whether their input has led to meaningful changes that support the broader development agenda.

4. Supply Chain Influence and Supplier Development

Many businesses have significant influence over their supply chains, especially in industries with concentrated supplier networks or where the company holds a dominant market share. These businesses can indirectly promote sustainability by requiring suppliers to meet specific ethical, environmental, and social criteria, thus pushing the entire supply chain to adhere to SDG-aligned practices.

To measure this influence, businesses can track:

• Supplier compliance with sustainability standards: By tracking how many suppliers meet sustainability or ethical standards, businesses can quantify the ripple effects their policies have across the supply chain. If suppliers are adopting SDG-aligned practices—such as reducing waste, increasing transparency, or improving worker conditions—this reflects the indirect impact a business has had on improving broader industry practices.

• Supplier development programs: If a business has implemented programs that help suppliers improve their sustainability practices (e.g., training, funding for green technology), it can measure the success of these initiatives by tracking the number of suppliers involved and the measurable impact on environmental and social performance.

• Sustainability audits: Regular audits of supplier sustainability practices can show whether the business’s efforts to influence the supply chain are having an impact. This includes measuring how many suppliers are adopting certifications for sustainability or ethical sourcing, such as Fair Trade, Forest Stewardship Council (FSC), or B Corp certification.

5. Consumer Awareness and Behavior Changes

A business’s influence over consumer behavior is a powerful form of indirect contribution. As companies promote sustainable products, ethical practices, and environmental awareness, they can drive shifts in consumer expectations and demand for sustainable goods. Tracking the impact of these efforts on consumer behavior provides valuable insights into the societal changes that businesses are helping to foster.

Businesses can measure their influence on consumer behavior through:

• Consumer surveys and feedback: Conducting surveys to gauge consumer awareness of sustainability issues or their purchase decisions influenced by sustainability claims can help businesses understand the extent of their impact. This feedback can reveal whether consumers are making more informed decisions based on a company’s advocacy for sustainability.

• Product sales data: By tracking sales of sustainable or eco-friendly products, businesses can gauge how well their efforts to promote sustainable consumption are resonating with consumers. An increase in the demand for these products is an indicator of broader consumer behavior change.

• Marketing and messaging impact: Businesses can measure how their marketing campaigns focused on sustainability are influencing customer perceptions and attitudes. Metrics such as engagement rates on social media, website traffic, and media mentions related to sustainability topics can serve as indicators of influence.

6. Employee Engagement and Advocacy

Lastly, businesses can measure how their internal culture fosters SDG-aligned behaviors among employees, who can become powerful advocates for sustainability both inside and outside the organization. Companies can track:

• Employee participation in sustainability initiatives: Tracking the number of employees involved in sustainability programs, such as volunteering for environmental initiatives or contributing to SDG-related projects, shows how the company is fostering internal advocacy.

• Employee advocacy outside the organization: Companies can measure how employees are promoting sustainability through their personal networks, online platforms, or in their professional spheres. Employee engagement can act as a proxy for the wider societal impact a company is achieving indirectly.

Conclusion

While direct contributions to the SDGs are often easier to measure, businesses must also assess their indirect contributions to achieving these global goals. Whether through shaping industry standards, influencing policy change, developing more sustainable supply chains, or shifting consumer behavior, businesses can play an essential role in advancing the SDGs across sectors.

By tracking these indirect contributions through collaboration, policy engagement, consumer feedback, and supply chain influence, companies can better understand the broader impact of their actions. In doing so, they can showcase their leadership in driving systemic change and contributing to the long-term achievement of sustainable development goals.