The latest IPCC report warned that climate risks are greater than thought so far. The challenges are as real as the opportunities for value and growth: US$ 12 trillion of market opportunities and 380 million new jobs could be generated by achieving the Sustainable Development Goals (SDG).

Business is expected to be an active part of the solution. What's needed is real action, based on science-based targets, with a clear roadmap, KPIs, stakeholder engagement and communication around real progress – a hands-on approach focusing on impact, rather than words and promises.

For example, committing to a net zero carbon emission target alone is not satisfying stakeholders any longer when it comes to positive climate action. In 2020, software giant Microsoft made waves by announcing it will be carbon negative by 2030. Today, stakeholders want to see a concrete sustainability roadmap leading to science-based targets and question tools such as compensation.

Many challenges cannot be faced and solved alone, as they go beyond the sphere of influence of a single business. A key concept of sustainable commitment: multi-stakeholder initiatives such as the One Planet Business for Biodiversity coalition, initiated by Danone during the UN Climate Summit 2019, whose members are committed to preserving and promoting biodiversity in agriculture and food production. Or for a more socially sustainable production of cocoa: the World Cocoa Foundation as well as national initiatives such as the German Sustainable Cocoa Forum, in which, for example, Mars Germany and Nestlé Germany are partners. These initiatives bring together stakeholders from business, politics and civil society to jointly advance sustainability.

In fact, it turns out that, taking the example of Germany, almost all companies (98%) in this country cooperate with NGOs on social engagement, especially at the local level, according to a study by Bertelsmann Foundation. Regarding international cooperation on major global issues, however, we in Germany are still far from leveraging all the opportunities. Not even half (43%) of companies operating across national borders collaborated with international NGOs in 2019.

The potential advantages for companies are obvious: external expertise, credibility, greater reach, and often lower risk for the individual company. But why do NGOs and initiatives collaborate with private sector companies? What should cooperation look like from the NGO perspective, and how can it be initiated? Here are two examples: the Global Nature Fund (GNF) and the PREVENT Waste Alliance of the German Ministry for Economic Cooperation and Development (BMZ).

Global Nature Fund: shrimp trade and mangrove ecosystems

GNF is an international foundation for the environment and nature, with global projects ranging from biodiversity protection in South America to clean drinking water in South Africa and healthy mangrove forests in Bangladesh. There, a multi-stakeholder GNF initiative is advocating for a sustainable transformation of the shrimp trade to protect ecosystems.

"Tropical coastal mangrove forests are among the most important and productive ecosystems on our planet," said Ralph Dejas, project manager at Global Nature Fund. "The uncontrolled expansion of shrimp aquaculture, especially in South and Southeast Asia, is a major reason for their destruction. At the same time, sustainable shrimp farming offers great economic potential to promote mangrove conservation and restoration."

GNF operates more than 50 pilot farms with local partners, partly organized as cooperatives. Especially important is the signal effect for the other farmers, who thanks to these pilot projects see that the sustainable concept works. Trade in western countries is an especially important partner to place sustainably produced shrimps in supermarkets and to create awareness among consumers. This requires a credible system and transparent communication along the entire supply chain. At the same time, companies invest in consulting, training or on-site quality assurance.

The best way to get into talks as a potential new partner is through personal contacts and based on grown trust, says Dejas. "Some NGOs are initially sceptical about certain corporations, to what extent greenwashing could be an issue. On the other hand, big brands can often be used to create a big impact."

Many companies are sensitized by new and coming supply chain legislation and really interested in working together towards shared goals. This is also expected by GNF: Corporate partners must be prepared to actively accompany the pilot projects and constructively engage in the joint dialogue with a view to move forward.

It doesn't have to be exclusively harmonious. "A dialogue can only be good if there are sometimes contrary opinions," says Dejas. "Simply signing something, nodding and putting on a green cloak, that doesn't work. Most companies know words have to be followed by actions.”

BMZ's PREVENT Waste Alliance: circular economy instead of waste

The PREVENT Waste Alliance was founded knowing a circular economy must unite all perspectives, also globally. Initiated by the German Ministry for Economic Cooperation and Development (BMZ), the multi-stakeholder initiative brings together business, science, civil society and government institutions to address the challenges of waste management in developing and emerging countries.

"We can move away from a linear model of doing business only when we work together," says Elena Rabbow, responsible for communications at the PREVENT secretariat. "We need to change production and consumption habits in a sustainable way. To achieve the SDGs, we need new business models, cooperation, innovation and the financial power of the private sector."

The Alliance’s pilot projects range from financing models such as extended producer responsibility and plastic credits to the integration of informal waste pickers. Around 150 of the 220 PREVENT members are from the private sector, ranging from local start-ups in developing and emerging countries to multinationals. They include manufacturers, producers, waste collectors and recyclers.

Above all, the members contribute their specific expertise to the numerous working groups. In the working group on e-waste, for example, the focus is on a solution-oriented exchange to make the handling of e-waste more sustainable worldwide.

"Recyclers from different parts of the world don't see each other as competitors, and often solutions from one country offer important insights for other regions," says coordinator Daniel Hinchliffe. "Sometimes, there are no easy solutions, but exchange can help enormously. We show what's feasible through our pilot projects."

It is important for interested companies to contribute their expertise and resources to PREVENT. "In doing so, you have to be willing to take the concerns and needs of various stakeholders seriously and be open to developing solutions through stakeholder engagement," says Rabbow.

A mistake that corporates make occasionally: “It's not enough to simply join the PREVENT Waste Alliance," says Rabbow. "Over time, circularity should become the core of everyday economic activity." But even small companies shouldn't be shy about entering the dialogue: "The hurdle is low."

Regulatory activity such as the EU's Circular Economy Action Plan are currently driving companies to become more active. Many are aware that a shift in thinking towards a circular economy is essential for economic success in the future. To succeed, we must work together.

Companies can be part of such carefully chosen and managed strategic partnerships to meet stakeholder expectations and gain reputation and impact around key sustainability topics.