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Strategies to become a Certified B Corporation, and the benefits to the industry, its stakeholders, and the world.
Increasing healthcare costs and the needs of a growing and aging population risk becoming an unsustainable burden for governments around the world that prioritize their population’s health. Concurrently, drug development is an increasingly expensive and rigid process, with expanding timelines and higher levels of risk that may become unbearable for pharmaceutical companies. The healthcare system is fragile and complex, but working to minimize the environmental impact of business and clinical development operations can position companies to become drivers of positive change toward a more sustainable future.
In 2015, the United Nations launched the 17 Sustainable Development Goals (SDGs) as part of the 2023 Agenda for Sustainable Development defining goals, targets, and indicators that the global community must achieve in order to safeguard the planet and society.1 Reaching these goals will require global collaboration and the involvement of key stakeholders including governments, institutions, businesses, advocacy organizations, and individuals. The SDGs are a valuable framework to achieve true sustainability in the pharmaceutical industry.
Pharmaceutical companies are responding to the call-to-action and taking more proactive steps toward appropriate and workable solutions. In recent years, there has been an emergence of Certified Benefit Corporations (B Corps)—companies that meet the highest standards of social and environmental performance, public transparency, and legal accountability. B Corps represent one of the most advanced models in terms of positive social and environmental business impact. This type of business is present in 150 industries and in more than 70 countries,2 and B Corp laws have been passed in 37 states in the US thus far.3
To become B Corp certified, companies must achieve a minimum score (≥80 out of 200 points) on the B Impact Assessment (BIA), which is used to measure a company’s impact on its workers, customers, community, and environment.4 B Corps are also required to publish a yearly impact report for transparency. But achieving B Corp status should not be the end goal; it should be the starting point toward building a business philosophy that will guide all future decision-making. It will take considerable investment and time and involve collaboration with multi-stakeholder groups from discovery stage through product disposal.
Companies pursuing B Corp certification will need to start by assessing current business practices; identifying inefficiencies in the value chain; engaging in health economic studies; and developing and adopting new policies, services, and processes to align with SDGs. In just one example, after achieving B Corp certification in May 2019, Chiesi started a global improvement plan including a sustainability strategic plan to increase the company’s positive impact on society and enable the natural integration of sustainability into its business model. The process to become B Corp certified lasted more than a year and a half, and during this time we identified actions for corporate and local improvements across countries where Chiesi has a presence.
Some companies like Chiesi are also rethinking traditional R&D processes, considering ways to reduce waste and energy consumption, pledging to become carbon neutral, and focusing on plastic neutrality and water sustainability. There are opportunities for companies to adopt purchasing policies that favor “green” energy from certified renewable sources rather than electricity, natural gas, and diesel, which are often used in R&D and production processes. Companies must also focus on their partners, including affiliates and manufacturing sites, when identifying opportunities for efficiency and optimization. This might involve reviewing energy methods, energy metering installation, and a new approach to partner selection.
To ensure that R&D processes are sustainable, companies can create a tool such as the Life Cycle Perspective tool to evaluate the impact of drugs at all key stages of development, from pre-clinic to commercialization.5 The tool addresses two main areas: the use of priority chemicals and process optimization. For both areas, it evaluates qualitative aspects and quantitative data by using the best available resources on the market along with CO2 calculation tools. It also gives a clear perspective of the impacts of a drug during specific phases of research and clinical development and the improvement targets that can be developed over time.
Aspiring B Corps should start by focusing on their most relevant products or pipeline drugs. In Chiesi’s case, the company focused on its pressurized metered-dose inhalers (pMDI) for asthma and COPD, which have the largest impact on the environment because of the Global Warming Potential (GWP) of the propellant and the high production volumes. We calculated the environmental impact of these inhalers using a Carbon Footprint Systematic Approach tool that analyzes the entire life cycle of the product. As a result, Chiesi launched a first-of-its-kind inhaler recycling program through which aluminum canisters are reused, plastic components are returned to the supply chain, and any remaining propellant gas is reused in electrical appliances.
Becoming a B Corp also requires an open and continuously transparent relationship with patients, their advocates, healthcare institutions, the medical community, and the entire system of stakeholders that surrounds the development, manufacturing, and commercialization of drugs. It is important to be transparent about sustainability targets as well as taxes, economic contributions, clinical trials and data, and reporting of a company’s impact, whether it is positive or there are areas for improvement.
The pharmaceutical industry has made important strides toward transparency, but more can be done. For example, companies might make clinical study data more readily available to external researchers, clinicians, and patients for both ongoing and completed trials. Transparent communications can help to ensure that pharmaceutical companies meet their sustainability targets and gain and maintain the confidence of stakeholders including current and future investors and employees.
It is also important that large, profitable organizations including pharmaceutical companies give back to local communities and contribute to the economic, social, environmental, and cultural sustainability of the societies in which we live and work. This can be done through local initiatives such as corporate volunteering, collaborating with local nonprofit organizations, funding school breakfast clubs, providing support for homeless shelters, and helping rehabilitate people who are incarcerated. These types of initiatives are sustainable partnerships that can provide a positive experience to different communities as well as a company and its employees.
There will be a range of challenges that B Corps need to address both before and after certification, but the benefits can be considerable for businesses, patients, and the greater society. In addition to the environmental impact of sustainability practices, such as reduced CO2 emissions, waste, and energy use, achieving B Corp certification can also attract new talent. Certification can establish and promote a company as being employee-centric and about more than just profit. Research shows that focusing on the well-being of employees makes them more engaged and eager to improve their work—engaged workforces are 22% more profitable and twice as likely to succeed as those with less-engaged workforces.6
B Corp status can also positively impact a company’s reputation among stakeholders including patients, clinicians, investors, industry partners, and employees. For one, in recent years, more patients are paying attention to how their healthcare choices impact the environment. By adhering to B Corp standards that are transparent, patients can see how companies are making a difference and may be more inclined to support them or buy their products.
Sustainability practices can also help generate economic value for industry stakeholders—in 2019, 78% of the economic value generated from Chiesi’s business was distributed to stakeholders based on the London Benchmarking Group methodology for community investment calculation.5 Companies that exclude social and environmental considerations from their operating missions risk losing market share and damaging shareholder value.
In addition, registering as a B Corp can save companies money over the long term. B Corps have access to B Corp community data, allowing members to learn from others about best practices and the most cost-effective means to be sustainable. The certification process also helps companies identify unnecessary and wasteful spending.
Global health and improving the quality of life of patients are the ultimate goals for pharmaceutical companies. Today’s world is facing unprecedented challenges that require new behaviors, practices, and mindsets in order to shape effective solutions and continue to work toward our collective goal. Many companies have committed to being part of the solution, not the problem. Embracing the SDGs is an important decision to orient a company’s behavior in those areas where actions will make a critical difference for the long-term sustainability of the planet and humankind.
Giacomo Chiesi, head of global rare diseases, Chiesi Group