The opening of COP27 has brought an intense global focus on climate change and the towering demands needed to reach carbon net zero and to protect the environment.
United Nations General Secretary Antonio Guterres called for an ambitious approach to climate action to ‘answer the planet’s distress signal’.
The life sciences industry is coming under advancing scrutiny as its significant role in creating carbon dioxide emissions becomes more evident and pressure mounts on every part of the supply chain.
But healthcare companies can welcome, rather than fear, the attention as it provides an opportunity to demonstrate Environmental, Social and Governance (ESG) excellence and create business value.
The 2022 CMS Global Life Sciences & Healthcare Forum heard from experts how ESG can be a lever for growth as well as societal good.
Jan-Frederik Jerratsch, Managing Director & Partner in Berlin, Boston Consulting Group (BCG), told delegates: “Right now, our industry is in the spotlight. But this pressure creates an opportunity. Those companies that are able to deal with this in a better, smarter way will create business value and will create societal value for the greater community.”
Around 20 per cent of carbon reduction measures can have a cost benefit while between 60 to 80 per cent can be cost neutral, added Charline Wurzer, a medtech and healthcare specialist at BCG.
She added that companies can build supply chain resilience through better environmental practices and reducing waste and emissions by sourcing materials closer to production bases.
“By near sourcing, you move to cleaner energy sources for the production and reduce your logistical route, so decarbonizing whilst also increasing resilience,” she added
“Getting the right regulatory and legal framework is important in these measures. The legal aspect is very important in establishing better, cleaner contracts with suppliers and along the supply chain.”
Companies can also leverage business advantage by having innovative sustainable projects that set them aside from market competition.
Jan-Frederik Jerratsch observed: “We're seeing increasing regulatory and societal scrutiny and increased scrutiny from investors with capital allocation being increasingly tied to sustainability goals. Our healthcare clients see that if you want to be an attractive employer, if you want to retain the best talent, you have to be ambitious in the space.”
Gabriela Staber, a life sciences & healthcare partner at CMS Vienna commented: ‘We are seeing a huge effort within life sciences to contribute positively to protect the planet and environments. Establishing legal frameworks that make this possible are an essential element of arresting climate change. Life sciences companies are facing increasing legislative and regulatory demands and we are working with clients across the supply chain and it is rewarding to be part of the drive for greater sustainability at this critical time.”