BETTER BUSINESS BETTER WORLD

The Commission believes it would be valuable to reflect companies’ use of their
influence in an independently compiled “Responsible Political Engagement Index”.
Companies would disclose their performance against the criteria above and an
independent body, such as Transparency International, could compile rankings. The
Commission will explore this idea further in its second year.
5.6 Actions for governments
Just as governments need businesses to help achieve the Global Goals, the reverse
is also true. Governments can help businesses pursue these shared goals firstly by
creating an environment that enables private sector growth. The main elements are
good and accountable governance, the rule of law, effective contract enforcement and
legal systems, and functioning customs regimes. And just as all businesses need to
pay their tax, governments’ spending must be transparent and free from corruption.
If it isn’t, confidence in tax systems will wane and the social contract may unravel.
In addition, achieving the Global Goals requires three specific kinds of government
policy, as noted in previous sections, namely policies to:
• Ensure that prices for goods and services reflect social and environmental
externalities, rather than policies that distort taxes or offer perverse subsidies;
• Align financial regulation with the Global Goals, in particular to incentivise
private sector infrastructure investment. In this regard, the Basel III and
Solvency II regimes should be revisited; and
• Support well-funded public education systems, active labour market policies and
adequate, high quality social protection.
Finally, governments can take on a stronger role in financing infrastructure
projects. As Section 4 discussed, infrastructure is critical to achieving the
Global Goals and stimulating private sector growth. More private sector finance
for infrastructure could be mobilised through blended finance if governments
created the right conditions. For instance, governments can pursue options, most
importantly greater policy predictability, to reduce risks for private finance. They can
also expand the resources of the multilateral development banks in which they are
shareholders, as well as ask them to put more into infrastructure.
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