Earlier this year, Corporate Knights, a Toronto-based sustainability performance research and media company, released their Global 100 Most Sustainable Corporations rankings. The annual ranking is based on an assessment of more than 8 000 large global companies with revenues > US$ 1 billion. You can obtain more information via this link.
As one would have expected, renewable energy companies dominate, with Ørsted and Schneider Electric, bagging second and first spots this year. Pharmaceutical companies feature on the list, albeit at number 16 (Eisai), 65 (Sanofi), 71 (Takeda), 82 (AstraZeneca) and at 98 (Novo Nordisk).
The fact that pharmaceutical companies feature at all is something to welcome but at the same time the fact that so few pharmaceutical companies feature in the top 100 is disappointing.
Given how processes for the development, production, distribution and disposal of drug products use huge amount of natural, human and economic resources, a lack of interest in sustainability is potentially problematic and only helps further dents the sector’s image as well as its future sustainability.
With society increasingly placing high expectations on corporate entities, it is no longer enough to simply have good intentions, actions must follow words.
But first, what is sustainability?
Sustainability is one of those things that carry different meanings to different people. Sustainability experts say it is simply a business strategy that takes into account an organisation’s operations and their social, ecological and economic impact.
The consensus today is that sustainability is actually good business; a focus on sustainability boosts an organization’s top and bottom lines. This is why a recent survey of top executives at Fortune 500 firms revealed that they now consider sustainability a necessity for competitiveness and future survival.
Examining sustainability literature reveals three main pillars: the environmental, the social and, the economic— this is what is also referred to as profits, planet, and people. The idea here is that by actively addressing environmental and social issues companies can contribute to the society’s sustainability while also achieving their own long-term value (profitability, return on capital, etc).
The environmental pillar is what the majority of us are familiar with, thanks in part to Greta Thunberg . It is concerned with the reduction of carbon footprint, water usage, non-decomposable packaging, and wasteful processes, as part of a supply chain. Cleaning up these processes has been shown to be cost-effective, and financially beneficial while also positively impacting the environment at large.
The social pillar is about treating employees and the communities within which the business operates fairly and responsibly. Some of the important aims here include compassion and provision of responsive benefits, such as better maternity and paternity benefits, flexible working, staff development opportunities, etc.
And, finally, the economic pillar is about running businesses in an economically sustainable way; to be profitable and produce enough revenues long-term. It is not about making money at any cost, rather companies should aim to generate profit in accordance with other elements of sustainability.
Embracing these three pillars, namely social, environmental and economic sustainability is what economists refer to as the Triple Bottom Line.
There is currently no official universal measurement of sustainability in existence, and instead, organisations have developed industry-specific tools and practices to judge how social, environmental and economic principles function as part of a company.
Some success stories in Pharmaceuticals sector
AstraZeneca, Eisai, Biogen, Glaxo and Novo Nordisk are pharmaceutical companies that have both worked toward energy efficiency, waste reduction, and other ecological measures. They have also focused on social impact via partner initiatives in the areas of health and safety.
Across the industry as a whole, there is a major shift in thinking, with many companies imposing targets or starting initiatives aimed at reducing the impact of their activities and products on the environment.
Many are exploring ways to produce their products more efficiently and in a sustainable way; such as implementing ‘green’ IT practices designed to lower energy consumption; plastic neutrality and water sustainability.
But there’s still a lot to do
As mentioned earlier, the development, production, distribution, use and disposal of drug products has a major impact on environment. For instance, drugs taken by humans and animals find their way into rivers, lakes and even drinking water, and can devastate both aquatic ecosystems.
Sustainability needs to be a priority for any business operating in the sector. And increasingly, people of all walks of life are demanding for it. Very soon, companies will be called to account for all their operations, from carbon footprint, harmful emissions, water usage, etcetera.
The expectation today is that resources should be used responsibly, and where possible, reused to suit the global increase in population.
How do we move from here?
Obviously, there is no “one right solution” on sustainability. The best solution depends on the ambitions and stakes at each company.
Sustainability experts recommend a few useful actions outlined below:
1] Strategic commitment to sustainability: Corporate and business strategies need to be aligned with sustainability.
2] Compliance: There has to be a commitment to comply both with the spirit and letter of the law as it relates to waste management, pollution and energy efficiency.
3] Proactiv response: Rather than wait for a crisis, companies need to develop sustainability strategies today.
5] Transparency: Transparency is pre-condition for measuring and improving sustainability practices. Therefore, companies need to openly communicate with all key stakeholders, openly and truthfully, acknowledging their failures as well as their successes.
To conclude, sustainability remains a major challenge, a challenge that no single company can address. Although the pharmaceutical sector has a lot to do, it is encouraging to see a number of companies embrace sustainability policies. Sustainability is a megatrend that won’t be going away anytime soon.