The life sciences industry faces the challenge of adapting to ESG requirements, which are becoming an integral part of sustainable development. In the face of global climate changes, increasing demand for resources, and the need to provide access to innovative therapies, this sector must take decisive action. According to the KPMG report titled “Unravelling Sustainable Business Transformation in Life Sciences”, 79% of companies in the sector plan to increase investment in sustainable development over the next three years, of which 28% declare a significant increase in expenditure.
Climate change, rising demand for water and challenges related to therapy access are just some of the problems faced by the life sciences industry. The introduction of circular solutions, the development of artificial intelligence and systematic collaboration between organizations are key to survival and development in this rapidly changing environment. It is estimated that the healthcare system, including the life sciences sector, is responsible for 4.4% of global carbon dioxide emissions today.
Early implementation of sustainable solutions can bring numerous benefits to companies, including access to green subsidies, which will gradually decrease with the popularity of new standards. According to the KPMG report “Unravelling Sustainable Business Transformation in Life Sciences”, ESG leaders can achieve even 2.5 times higher pre-interest, taxes, depreciation and amortization (EBIDTA) profits compared to firms lagging in ESG reporting. What’s more, as many as 53% of respondents from the life sciences sector see changing their ESG approach as crucial for their organizations’ survival, and 79% plan to increase investment in this area over the next three years, of which 28% declare a significant increase in expenditure.
“The life sciences sector in Poland has a chance to play a key role in promoting sustainable development, going beyond standard ESG requirements. Companies that take action to reduce their carbon footprint and manage natural resources rationally not only gain the trust of investors and consumers but also build their position as leaders in the industry. By investing in innovation and transparency, organizations can strengthen stakeholder relationships and better prepare for future challenges, such as regulatory changes or rising social expectations. In this way, the life sciences sector not only meets current needs but also shapes a future based on responsibility and sustainable development.” says Sabina Sampławska, Partner in Tax Consulting, Leader of Life Sciences Consulting, KPMG in Poland.
“Ambitious climate goals in the life sciences sector inspire action – the English National Health Service’s (NHS) net zero target by 2045, including their supply chain, can serve as an example. Similar goals are also set by global players. Stakeholder expectations and regulatory requirements of the European Union will not bypass companies operating in this sector in Poland – especially since they face their own unique challenges. They are often a higher carbon footprint of economic activity compared to other European countries and limited water resources in our country. It’s important for the sector to change its business models, which will allow the minimization of risks associated with climate change – including health risks, such as threats related to heatwaves and extreme weather events or changes in the occurrence of diseases previously limited to tropical regions” says Justyna Wysocka-Golec, Partner Associate in Consulting, Leader of the ESG, Decarbonization and Biodiversity Team, KPMG in Poland.
The life sciences industry faces the challenge of implementing a sustainable transformation, which will not only help combat global issues, but will also open new development opportunities. Implementing ESG strategies is not only a necessity, but also a chance to gain a competitive advantage. Companies that prioritize sustainable development can expect financial support and long-term business benefits.
The full content of the report “Unravelling Sustainable Business Transformation in Life Sciences” can be found at: https://kpmg.com/pl/pl/home/insights/2024/08/zrownowazona-transformacja-w-sektorze-life-sciences.html.
Source: https://managerplus.pl/esg-nowy-imperatyw-dla-branzy-life-sciences-29598
