Introducing SDG 10 on reducing inequality
The universal response to decreasing inequality through SDG 10 is much more comprehensive than in the previous MDGs. By referencing within and among nations, this SDG highlights how much inequality is a challenge for every country and not just the developing ones.
Progress made through the MDGs
The previous MDGs have made some progress in addressing the issue of inequality. There has been a significant reduction in poverty, which means that 750 million fewer people are now living on less than $1 per day while gender equality has made some gains with more girls being enrolled in school in the developing countries. However, data shows there is an increase in income inequality in both developing and developed countries. In fact, income equality rates are at their highest levels for the last half century.
Some level of income inequality cannot be controlled and is even welcome as it helps in driving progress. However, high and rising income inequality levels are a great threat to stability for both in and across countries. Inequality is related to several challenges including environmental degradation, poverty, persistent unemployment, conflict, violence and political instability.
Besides the clear adverse costs of inequality to human life, it is also one of the biggest limitations to achieving positive economic potential. For instance, the UN has said that a 5% reduction in child deaths for mothers in developing nations can lead to a significant 8% improvement in GDP a decade later.
There is also more focus placed on the key structural factors behind inequality and poverty (poor representation, discrimination and lack of sufficient wage, social and fiscal policies, etc.) not just dealing with the symptoms (low incomes, health or education. Thus, the targets used in this SDG have a broader scope to reflect the many fundamental social, institutional and economic factors that must be tackled so as to ensure inclusive progress.
Main targets of SDG 10
- Progressively attain and sustain the income growth rate of the bottom 40% of the populace at a higher rate than the nationwide average.
- Promote and empower the political and economic inclusion of everyone in the world, regardless of age, disability, race, sex, religion, economic, ethnicity or origin or any other status.
- Reduce outcome inequalities and guarantee equal opportunity, including through removing discriminatory practices, laws and policies and promoting necessary legislation, action, and policies.
- Adopt policies, particularly wage, social protection and fiscal policies, and increasingly attain greater equality.
- Enhance the monitoring and regulation of global institutions and financial markets and reinforce the adoption of the regulations.
- Ensure better representation for developing nations in making decisions in global financial institutions to deliver effective, accountable, legitimate and credible institutions.
- Facilitate regular, safe, responsible and orderly mobility and migration of people, through implementing well-planned migration policies.
- Adopt the idea of differential and special treatment for developing nations, in agreement with WTO treaties.
- Encourage development assistance through foreign direct investments into least developed nations, African nations, small island states, and other landlocked developing nations, in line with their nationwide programs and plans.
- Reduce the general transaction expense of migrant remittances to below 3% and remove remittance corridors that have costs greater than 5%.
Several factors including strong indicators for guiding and monitoring progress, political will for international and regional cooperation for rebalancing the universal system and reinforced policy coherence are vital for achieving the targets of SDG 10.
Dealing with internal country inequalities requires enhanced fiscal and policy space to enact country-specific policies necessary for improving the lives of everyone, especially the income and financial outlook of the poor people. The two main variables in this context will be wages and jobs. Job creation is the best way of sustainably dealing with poverty, particularly where the labor force is rapidly expanding. However, increasing wages is also critical to expanding domestic demand, progressively viewed by experts as a key component of sustainable growth. Countries will, therefore, have to create the type of productive capacity and infrastructure that results in more diversified economies, in particular leaving the overdependence on single commodities and attaining some level of progress in more complex industrial activities.
Addressing the imbalances that arise from the global financial system will demand universal reforms of investment, monetary, trade, financial and fiscal systems so as to lessen volatility. Global conventions on issues like tax evasion and avoidance to stop the utilization of tax havens and tax competitions to circumvent financial responsibilities would assist in ensuring adequate financing for the useful long-term projects required to attain the sustainable and inclusive development paths.
Even though universal reform is going to be gradual, better regional stability can be enhanced by creating alternative institutions and rules to offer some level of protection against financial shocks. To achieve this, capacity building of existing financial institutions is necessary along with an economic cooperation space. For instance, China’s success in development and reducing inequality has depended on a broad range of active industrial strategies, shrewd capital controls and dynamic monetary and fiscal policies.
How can companies contribute to SDG 10?
Here are some of the ways companies can make a distinctive and active contribution to SDG 10:
- Improving job quality – While job creation is very important, of equal importance, is the job quality, including considering the wages currently being paid to workers, especially starting from the lowest levels. Analysing wages is important as it enables workers to have better livelihoods and provide the essential needs like health, education and housing.
- Provide training opportunities – Companies must proactively offer their employees the chance to scale up the career ladder to better-paying jobs. The company must offer these training opportunities to all employees, including the lowest sectors that may require it most.
- More inclusive policies in agreement with national legislations – Companies must promote equal opportunity and empowerment. One way of achieving this is through researching the barriers currently preventing minority groups, women and other socially disadvantaged people from fully accessing and participating in the company and also value chain, as well as providing ways to overcome these barriers.
While achieving SDG 10 targets may not necessarily be easy, it still remains an important goal that is likely to promote inclusive and sustainable development by encompassing all the spheres of scientific, social and economic development.