A New Way To Prioritize Investment in the SDGs
Even before a magnitude 7.0 earthquake devastated Haiti in January 2010, the nation faced a plethora of challenges. Half of the population lacked access to clean water, and three-fourths lived on less than $2 a day. Multiple indexes ranked it among the poorest and most corrupt countries in the world. These problems remained despite the fact that billions of dollars in foreign aid had flowed into the country. Why hadn’t the funding changed anything? Part of the reason, according to a report from the National Academy of Public Administration, was that donors failed to prioritize what mattered most in Haiti: building good governance and political stability. Instead, they doled out aid based on their own varied and uncoordinated agendas.
Now a similar lack of prioritization threatens the success of the Sustainable Development Goals, an ambitious agenda for solving humanity’s most pressing problems. Ratified in 2015 by all 193 member states of the United Nations, the SDGs are meant to serve as a 15-year roadmap for governments, foreign aid agencies, multilateral organizations, grassroots groups and others involved in international development.
While well-intentioned, the SDGs have been criticized for their broad scope and lack of a prioritization strategy. Consisting of 17 goals and 169 targets, they aim to do everything from eliminating poverty and hunger to promoting economic growth and industrialization to improving environmental sustainability.
“It’s like ‘No targets left behind,’” joked Mark Suzman, chief strategy officer at the Bill & Melinda Gates Foundation. Bill Gates himself compared the goals to the Bible, saying he’d prefer to begin with “the Ten Commandments.” Peter Pilot, who directs the London School of Hygiene and Tropical Medicine said, “They look more like an encyclopedia of development than a useful tool for action.”
The sprawling nature of the SDGs stands in contrast to their predecessors, the Millennium Development Goals. Established in 2000, that agenda was limited to just 8 goals and 19 targets to be achieved in a 15-year period. The targets were extremely specific, such as halving the proportion of people who live on less than $1 a day or reducing child mortality by two-thirds. Although not every goal was achieved, the United Nations deemed the MDGs “the most successful anti-poverty movement in history.”
“The power of the original millennium goals came from their very clear prioritization of a small number of measurable objectives,” wrote Abhijit Banerjee, an economist at the Massachusetts Institute of Technology, and Varad Pande, a fellow at the Harvard Kennedy School, in a New York Times op-ed. “By emphasizing the sheer modesty of what was being proposed, it made it hard for nation states to ignore the global project,” they wrote.
The reason the SDGs are so much broader lies in the history of their creation. The MDGs were criticized for emerging out of a “top-down” process led by a small group of technocrats, without enough involvement from developing countries. They were drafted in a basement at UN headquarters with such “relative casualness” that the handful of authors almost forgot to include a section on the environment, according to Lord Mark Malloch-Brown, who then headed the United Nations Development Program. Some also criticized the MDGs for focusing too heavily on social sectors at the expense of the economic underpinnings of prosperity.
In response, the SDGs took a different approach. The framework emerged out of a working group of 30 members representing a total of 70 countries. The group’s discussions also drew on 11 thematic and 83 national consultations, door-to-door surveys, and an online survey. The result, according to some, was too many cooks in the kitchen.
“We wanted to cover a galaxy of different needs among all these countries, so the list became a long one. Yet having 169 targets could lead to a directionless, aimless approach,” says William Hynes, a senior economist at the Organisation for Economic Co-operation and Development . “If you don’t take a systematic approach, you misallocate resources and you fragment the effort too much. Prioritization helps you coordinate among very different actors.”
Prioritization is also key because resources are finite. “Theoretically, you can apply resources equally across all 17 SDGs. You’d make some progress, but I expect we can agree pretty quickly that’s not the optimal way to allocate limited supplies of capital,” says Tomicah Tillemann, director of New America’s Bretton Woods II initiative.
Priorities must also be set because some of the SDGs contradict each other. For example, Dr. Jason Hickel, an anthropologist at the London School of Economics, has pointed out that the framework’s goal of achieving least 7 percent annual GDP growth in the least developed countries conflicts with its plan to address climate change and reduce inequality.
Even if stakeholders agree on the need to set priorities, deciding how to rank and sequence competing goals is no easy task. Banerjee and Pande, as part of a UN panel that worked in parallel to the main SDG working group, only managed to narrow them down to 12 goals and 54 targets “despite our attempts to discipline ourselves ruthlessly.”
Traditionally, donors and social impact investors have selected their pet causes based on personal preference. “We pursue whatever strikes our fancy, and there isn’t a real theory about why those are the right priorities,” says Jeff Leitner, a Bretton Woods II fellow at New America. “We ought to be more systematic about making the world a better place. We’re not choosing a college major; we’re investing millions or billions in the welfare of our fellow human beings.”
Even development experts trying to set priorities are limited by their own professional bias. Dr. Lewis Akenji and Magnus Bengtsson of Japan’s Institute for Global Environmental Strategies, argued in 2013 that sustainable consumption and production should be among the SDGs’ highest priorities. Chignon Fan of the International Food Policy Research Institute and Paul Polman of Unilever made the case that ending hunger and malnutrition was “a global ethical task that must be given top priority.” Melinda Gates and Graça Michel, Nelson Mandela’s widow, contended that child and maternal health should be the top focus.
Another approach to prioritizing the SDGs has come from economists who call for a cost-benefit analysis. The Copenhagen Consensus, for example, led by Danish political scientist Bjørn Lomborg, focuses on return on investment — which outlays provide the most “bang for your buck.” The project’s panel of economic experts pinpointed 16 investments thought to generate the best economic value. (The top three focused on expanding micronutrient interventions, subsidies for malaria treatments and childhood immunizations.)
Leitner and his team at New America, in partnership with OECD and GreenHouse, a Chicago social innovation group, are leading a new approach to prioritizing the SDGs: the social stability model. Their goal is to identify the optimal sequence for tackling development targets in way that promotes social stability. To achieve this, they’re launching a survey of some 85 economists, political scientists and social scientists around the world. The survey will whittle the SDGs’ 169 targets down to 117 and ask development experts to rank the top 20 targets. It will also ask respondents about the primary criterion they used to make their choices.
“We’ll be able to say, this collection of experts from around the world says that if you’re trying to make a country more stable, here’s the order in which you should tackle problems,” Leitner says. “Hopefully this will be used as a guidepost by philanthropic organizations, governments and others to help make investment decisions.”
The results could prove especially useful for the mission of Bretton Woods II, which aims to mobilize at least $250 billion held by the world’s largest asset holders toward social investments.
“We’re trying to develop the right intellectual architecture for evaluating these questions and starting to identify areas of consensus among experts in different fields,” Tillemann says. “That’s going to be really valuable to the investment community.”The goal of the survey isn’t to dictate a set of actions for every country and actor. Rather, the aim to develop a general framework for resource allocation, with input from experts, to underpin further discussion and be adapted to national contexts.
“It’s not that everyone needs to follow a prioritized list, but it sets up a discussion about how we think about goals and strategies for achieving the SDGs,” Hynes says. “Sequence is key: There are some things we need to solve first.”
Victoria Marlin of New America provided most of the research on other efforts to prioritize the SDGs.