Collective action within the pharmaceutical sector and lessons on taking effective climate action to reduce emissions

Abstract

Situation
The constant increase in global temperatures is becoming more and more concerning for the future of our planet. The health of the planet is crucial for our existence and for the health of humanity, which is why we need to maintain and care for our environment. The pharmaceutical sector contributes to a lot of greenhouse gas emissions, and the total amount of emissions even exceeds that of the automotive industry. Pharmaceutical companies’ main goal is to improve human health, and therefore, contributing to a healthy environment is also crucial. Pharmaceutical companies have set ambitious climate goals that will need a lot of attention if they are to be fulfilled. More and more collective action initiatives are taking form, such as Energize and projects like Together for Sustainability (TfS). While a lot of progress is being made, collective efforts need to improve, and climate challenges need to be tackled collectively. Johnson & Johnson, as one of the largest pharmaceutical companies in the world, has committed to the SBTi targets and set ambitious goals for itself. They put a lot of emphasis on sustainability and aim to reach their targets across all its 250 subsidiary companies that are spread out over 60 countries.

Problem identification
As the climate impact of the pharmaceutical sector seems to be significantly large, it is important to understand how the climate targets of this sector can be fulfilled. Johnson & Johnson aims to source 100% of their electricity needs from renewable sources by 2025, achieve carbon neutrality for their operations, going beyond their Science-Based Target to reduce absolute Scope 1 and 2 emissions 60% from 2016 levels, and reduce absolute upstream value chain (Scope 3) emissions 20% from 2016 levels by 2030. They are currently on pace to meet their scope 1 and 2 targets. The scope 3 emissions, however, remain significantly larger than the scope 1 and 2 emissions combined. Scope 3 emissions come from other parties that a company works with, which makes influencing them more difficult. Collaboration is needed to stimulate companies across the value chain to contribute to sustainability. Collaboration could be in the form of various projects where companies engage in collective action to achieve certain common goals. Collective action means that multiple parties are engaged in a project that works towards a certain shared goal.
This research aims to explore the current challenges of the pharmaceutical sector with reaching emission targets and how collective action concepts impact the willingness of supplier companies to engage in collective initiatives that focus on reducing emissions. For this study, Johnson & Johnson will be analyzed to get a good understanding of the current state of the pharmaceutical sector...