2Sustain

My posts about sustainability initiatives in retail and grocery retail are still attracting readers, so I thought you might be interested in hearing about similar programs that are now underway in the pharmaceutical sector.

According to MedTRACK, the top three pharmaceutical companies by market value are: Johnson & Johnson; Roche Holdings, Ltd.; and Pfizer, Inc. I took a look at each of their websites and discovered some very interesting information about how each company is working to meet the challenges of corporate sustainability.

When I visited the Johnson & Johnson website, it was easy to find the link to the company’s fifth annual sustainability report, a 44-page document that lists J&J’s key successes in three major areas: business/workplace, social, and environmental. While the report does a nice job of detailing the company’s progress in each of these fundamental aspects of sustainability, I specifically enjoyed reading the three pages (p.19-21) devoted to “Supporting Sustainability in Our External Supply Chain.” J&J operates 150 manufacturing plants worldwide and has thousands of suppliers. According to Mike McGranaghan, Chief Procurement Officer for the Johnson & Johnson Family of Companies, the company is still maturing its sustainability efforts, but even so, he lists what he calls “real pockets of excellence,” including:

•    a long-term supplier diversity program
•    forest products purchasing guidelines (designed to help the corporation make decisions on paper products and paper based packaging in alignment with environmental and sustainable forestry goals)
•    an environmentally friendly transportation program, and
•    external manufacturing standards.

“From purchasing decisions like where we source paper, to distribution and logistics decisions that could impact our contribution to climate change, we can use our considerable purchasing power to influence our suppliers,” McGranaghan says. “Society is asking more from us. We are increasingly being expected to ensure that our suppliers are mindful of their environmental and social responsibilities, and it’s important that we provide leadership in this area.”

Case in point: J&J is now working with its Global Energy group to get a handle on the carbon footprint of its external supply chain, an issue McGranaghan describes as “just cresting the horizon.”

Over at the Roche website, I discovered that Roche has bundled news of its sustainability programs into its 94-page Annual Report. The discussion of “safety, health, and environmental protection” begins on page 80 and includes interesting details about how Roche calculates the “environmental footprint” of its business as a whole. Using the “eco-balance” method designed by the Swiss Agency for the Environment (BAFU), the company is able to compare its inputs (raw materials and energy) versus its outputs (emissions and waste). For 2007, Roche ended up with an eco-balance number of 5.15, a 5% reduction from 2006.

Roche also uses a measurement called the "Eco-Efficiency Rate" (EER) to gauge the effectiveness of its environmental expenditures in relation to sales and the environmental impact caused by the company’s operations. The more efficiently sales increase while expenditure on environmental protection is limited and environmental harm reduced, the higher the EER value. In 2007, Roche’s EER was 67.19, an increase of more than 30% from last year.

In addition to reports on eco-efficiency and eco-balance, Roche’s website also includes pages of data illustrating the company’s safety, health, and environmental performance, and it’s easy to find information regarding Roche’s greenhouse gas output, energy and water consumption, waste disposal, emissions into water, and more.

Turn to page 61 of Pfizer’s 122-page 2007 Corporate Responsibility Report, and you’ll see a similarly thorough accounting of Pfizer’s environmental impact. As part of its Pfizer’s sustainability program, the company has established these five specific goals regarding the environment:

•    to reduce CO2 emissions by 35% per million dollars of sales by the end of 2007 from its baseline year 2000
•    to meet 35% of its global electricity needs with clean energy sources by 2010
•    to phase out Class I ozone depleting compounds (ODCs) in HVAC and industrial process equipment
•    to reduce its ozone depletion potential from ODC release by the end of 2007 by 80% from its 2002 baseline
•    to reduce releases of volatile organic compounds (VOCs) by the end of 2008 by 40% on an absolute basis from its 2002 baseline

More details are available at the Pfizer website, including a very cool page describing Pfizer’s commitment to green chemistry.

This brief survey of three leading pharmaceutical companies suggests that this sector is working hard toward a sustainable future –and they’re doing so without sacrificing the bottom-line. In his letter that starts on page 2 of Pfizer’s Corporate Responsibility Report, Jeff Kindler, Pfizer’s CEO, sums it up nicely, I think.

“Of course, sustainable programs of corporate responsibility work best when we invest in the health of communities and invest in the health of our business,” he says. “This means that for Pfizer, corporate responsibility must be the work of every department –on every day.”