For life sciences business that contribute to the Pharmaceutical supply chain, the sustainability mission is moving way beyond corporate reporting and is becoming a commercial expectation throughout the supply chain. The world’s leading pharmaceutical companies have made significant progress in setting Science Based Targets (SBTs) aligned to the latest climate science. As these organisations work towards ambitious net zero commitments, their attention is increasingly turning beyond their own operations to those of their suppliers.
That’s because for many pharmaceutical companies, Scope 3 emissions account for more than 70% of the carbon footprint of their products – making supplier engagement one of their most important priorities in achieving their sustainability goals.
Why Scope 3 is getting the attention
Greenhouse gas emissions are categorised into three scopes under the internationally recognised Greenhouse Gas Protocol.
Scope 1 covers the direct emissions generated from sources owned or controlled by a company, such as manufacturing equipment, boilers and company vehicles.
Scope 2 covers the indirect emissions associated with the generation of electricity, heat, cooling and steam a company purchases to operate its facilities.
Together, Scopes 1 and 2 represent the emissions generated by a company’s own operations.
Scope 3 is different.
Scope 3 includes all other indirect emissions that occur across a company’s value chain – from the good and services it purchases through to the products it delivers to customers. And for Pharmaceutical companies, these Scope 3 emissions from their suppliers represent the largest share of their overall footprint.
Could your business be part of Scope 3?
If your organisation supplies or contracts products or services to pharmaceutical companies, the answer is almost certainly yes.
Examples of Scope 3 include:
• CDMOs and CMOs
• API Manufacturers
• Excipient and raw material suppliers
• Packaging manufacturers
• Fill finish partners
• Analytical testing laboratories
• Contract Research Organisations
• Clinical trial supply providers
• Engineering and validation specialists
• Cold chain and logistics providers
• Waste management and recycling partners
• Equipment and technology providers
• Lab consumables suppliers
Every product manufactured, every laboratory test completed, every shipment delivered and every service provided contributes to the carbon footprint of the pharmaceutical products your customers deliver to the market.
And because Scope 3 represents such a high proportion of their emissions, pharmaceutical companies are increasingly requesting product-specific emissions data form their suppliers to support Product Carbon Footprint (PCF) calculations, Life Cycle Assessments (LCAs) and Science Based Targets (SBTs) obligations.
Why this matters now
We’ve noticed a significant shift in big Pharma companies operationalising NetZero commitments over the last two to three years. The focus is no longer solely on annual reporting, but on actively identifying carbon hotspots, understanding what drives them and making targeted interventions to reduce their impact. Interestingly, this momentum is being driven by a combination of internal sustainability commitments and growing external pressures, including the anticipation of future product carbon reporting becoming part of Market Access.
The result? Pharma Sustainability leaders are starting to identify specific hotspots to target, and some Procurement Teams are embedding Net Zero and SBT commitments into their supplier qualification and sourcing frameworks.
The good news is that measuring and sharing product-level carbon data is becoming much easier. Practical methodologies and digital tools are now available to help CDMOs, CROs and Pharma suppliers calculate, manage and securely share emissions data with multiple customers in a consistent way.
Our Sustainability Team has found that applying off-the-shelf tools to complex pharmaceutical processes certainly requires effort, technical know-how and stakeholder engagement but we think there is value to be gained from this for forward-thinking suppliers. Because as Pharma companies intensify their focus on Scope 3 emissions, the suppliers that can confidently provide trusted, product-level carbon data will be best placed to strengthen client relationships, meet evolving procurement expectations and gain a competitive advantage in tendering opportunities.
