The health of people and planet are inextricably linked, so pharmaceutical companies understand the science of climate change more than most. The sector’s leading businesses were early signatories to the UN’s Race to Zero campaign, and quick to calculate their carbon footprint. They’ve set science-based targets, joined the Health Systems Task Force created by His Majesty King Charles III, and continue to invest in decarbonisation.
The results are impressive. One of our clients, AstraZeneca, cut its Scope 1 and 2 greenhouse gas emissions in half within seven years and is investing $1 billion in its Ambition Zero Carbon programme. This programme includes engaging with its partners to address the challenge that lies ahead: reducing Scope 3 emissions throughout its value chain.
As with global businesses in other sectors, most of the greenhouse gases generated by pharmaceutical companies can be found in complex networks of customers and suppliers. Unlike the switch to renewable energy and green transport that’s delivered heavy reductions in Scopes 1 and 2, these Scope 3 emissions are bigger and also harder to control.
Take Sodexo’s role as a food and workplace management provider for some of the biggest names in pharma. Every day, thousands of our colleagues are helping to create exceptional employee experiences in manufacturing facilities, R&D hubs and corporate offices. As a result, the carbon emissions associated with every coffee we brew, every dish we serve, every product we use and every ounce of waste we generate become part of our clients’ Scope 3 emissions.
How to undo these Scope 3 knots is something we’ve been exploring with like-minded [pharma] companies in our new community of practice. We’re also accelerating our work with our own supply chain, which includes 4,000 partners in the UK alone, accounting for £800m annual spend and 34% of our emissions.
As part of our net zero supply chain engagement strategy, by January 2030 we will only work with supply partners who can demonstrate tangible progress through published reporting. We’re already engaging with partners that account for 75% of our supply chain emissions and helping SMEs to decarbonise and work with their own suppliers more effectively. This is vital to reaching our own goal of net zero by 2040 and also to supporting our pharma clients as they strive to reach theirs. Even in pharma’s tight regulatory environment that often dictates who can provide what, the sector is increasingly asking suppliers to take demonstrable action.
Setting deadlines for suppliers doesn’t just help tackle the climate crisis, it can also provide competitive edge. Sustainable supply chains are resilient supply chains, supporting longer term continuity and cost certainty. And with the next generation of talent thinking carefully about their employer’s green credentials, every company in the pharma value chain should be paying attention if they want the best people on their side.
In April 2023, research we conducted with YouGov showed that 75% of UK private sector workers expect their employer to operate sustainably. Gen Z in particular is looking for companies to take action and for opportunities to make better choices themselves. In turn, this creates opportunities for pharmaceutical companies to win the war for talent while they decarbonise.
From our YouGov research, we know that workers’ top three sustainability expectations are reductions in plastic usage, sensible energy consumption and responsible waste management. Reducing food waste in particular will be critical, because food systems are responsible for around a third of all greenhouse gas emissions.
The modern workforce is looking for clear commitments, visible action and the chance to make sustainable choices. In short, they’re looking for a net zero culture. This puts the workplace at the centre of the fight against climate change, and requires all supply partners to be working to the same goal.
The net zero office can be split broadly between back office functions and employee-facing services.
In the back office, it could mean:
For employees, it could mean:
To extract the biggest benefits and reduce costs as well as emissions, the net zero workplace will require a solid strategy, strong governance, the right partners and the right data. We’re already helping some of our clients to bring the net zero office to life, creating a solution that’s tailored to their particular needs.
Companies aiming for a net zero workplace can take action straight away by engaging their workplace suppliers. This involves reviewing the available data, finding the gaps and making a plan to get the insight that’s missing. The focus can then move to governance, including setting a strategy that inspires and working with suppliers to develop shared ambitions and plans.
Then, the focus can shift to implementation. This is about embedding sustainability into all standard operating practices, like nudging employees towards climate-friendly options and building the right metrics into supplier contracts. Moving forward, it’s reporting progress openly and celebrating success that will help companies to accelerate their plans.
The net zero workplace can offer an employee experience that exceeds expectations on sustainability. One that speaks to growing concern about the urgency of climate change, particularly among Gen Z, and one that takes full advantage of people’s willingness to consider lower-carbon (and often lower cost) choices.
The emission reductions that pharma workplaces need can’t all be delivered overnight. The employee experience remains paramount. So, while cutting meat from menus is not yet on the cards, the growing popularity of plant-based dishes shows that change is in the air. By working with the right suppliers in the right way, pharmaceutical companies can stay ahead of the curve.