Seven multinational pharmaceutical companies, including Japan’s Takeda Pharmaceutical [4502:JP], America’s Pfizer [PFE:US], and British-Swedish multinational AstraZeneca [AZN:LN], have reached an agreement to collaborate in evaluating the greenhouse gas emissions of their suppliers, as reported by Nikkei Asia on June 7. As pharmaceutical firms commonly share suppliers, the partnership can help reduce redundancy in emissions data submission for suppliers. Over 1,000 suppliers will utilize a system designed by Schneider Electric [SU:FP] to track power consumption, water consumption, and trash volume, and translate these inputs into greenhouse gas emissions.

Such collaboration is not new, as some vehicle manufacturers, such as BMW [BMW:GR] and Mercedes-Benz [MBG:GR], also collaborate to examine their suppliers’ greenhouse gas emissions. In addition to collaborating with other partners, corporations may also conduct supply chain emissions assessments individually. Volkswagen [VOW:GR] determined in 2019 to improve supplier evaluation by implementing a supplier incentive and punishment mechanism to lower supply chain pollution and encourage suppliers to fulfill Volkswagen’s environmental emission criteria. Emissions data from the supply chain are increasingly gaining the attention of companies, as such emissions will be required for disclosure in upcoming regulations, including the Corporate Sustainability Reporting Directive (CSRD) proposed by the European Commission, and climate disclosure rules proposed by the United States Securities and Exchange Commission (SEC).

Sources:

https://asia.nikkei.com/Spotlight/Environment/Climate-Change/Takeda-big-pharmaceuticals-team-up-to-monitor-suppliers-emissions#

https://www.cdmfund.org/22542.html

http://www.xinhuanet.com/energy/20220317/aab189cf7f144fa8a59e3565d07a764e/c.html

https://finance.sina.com.cn/tech/2022-05-16/doc-imcwipik0070686.shtml?finpagefr=p_114