COP27 spoke of urgency and cooperation. What does this mean for biotech?

COP27 spoke of urgency and cooperation. What does this mean for biotech?

Let’s talk sustainability models, targets, and frameworks.

Contributor: Matt Kingston

As a sustainability professional, I understand the long term benefits of sustainable change. What did not occur to me until recently, however, is just how rapidly this change must occur. This year’s COP27 reinforced the Paris Agreement target of limiting warming to 1.5°C compared to preindustrial times, which means that GHGs must drop 50% by 2030. This is 7% per year, for seven years. As much as I don't like to use the word, this situation is indeed, unprecedented. But, if the history of our technological advances are any indicator of our potential, we are very capable of achieving this and other challenging targets outlined in the recent COP27 meeting.

What was COP27?

COP or Conference of Parties is an annual meeting of world leaders, business leaders, and NGOs, to discuss sustainability concerns, develop solutions, and solicit public partnerships and pacts to promote sustainable change. The decided outcomes of COP meetings can then inform government and business sustainability decisions, which can then lead to top-down change and market shifts. This year was the 27th COP, held in Sharm El Sheikh, Egypt, with the first being in Berlin in 1995.

COP27 Africa's COP Sharm El Sheikh

COP27, often called “Africa’s COP”, was held in Sharm El Sheikh, Egypt.

COP27 had a number of challenging targets, the bulk of which involved maintaining our 1.5°C Paris Agreement limit, and the even more important and often overlooked “just transition,'' which decries the need for equitable social change as we drive towards our long term climate goals. Hearing speakers urge the World Bank and lending organizations to become more climate focused in long term financing, and proposing that insurance underwriters become more climate focused to drive sustainability initiatives was, to me, a hopeful sign of the turning tide. Other compelling ideas included the trillions of dollars to be deployed annually in developing nations, beginning in 2030, which could turn into a technological leap-frogging opportunity for the “global south”, again hastening our progress and betterment as a species. The just transition is by design an assurance that opportunity and funding will find its way to the global south, driving environmentally sustainable initiatives while simultaneously lifting nations out of poverty. This can allow for the building of advanced green infrastructure which can benefit the planet, while developing employment opportunities, education and personnel training pipelines, and boosting a sustained and permanent economic output, raising the standard of living and quality of life globally.

These targets are indeed very challenging, and biotech shares part of the global burden to accelerate towards achieving these goals. To do so, strategies to track and maintain progress in sustainability are necessary; not only to avoid greenwashing, but also to avoid becoming overwhelmed by the sheer magnitude of these objectives. But biotech and the rest of the world haven’t really had to implement and deploy sustainable frameworks to at such a pace before, nor have we had such gargantuan global targets requiring such a rapid concerted effort, even if we include the Montreal Protocol, so this is all very new to many of us. In a grip-it-and-rip-it sort-of way, we are all learning as we go, and we must move with our best foot forward. We cannot wait for the perfect plan. Urgency and cooperation were my key takeaways from this year’s COP, and I am very curious to see how the COPs of the future will look, based on our progress.

What does this mean for us in biotech?

As My Green Lab CEO James Connely noted in their COP presentation, “The Surprising Carbon Impact of Science: Progress on the UN Race to Zero”, biotech and science as a whole are fairly high-polluting industries, with a total carbon impact growing 15% to 260 million tCO2e (tonnes of carbon dioxide equivalent). This is greater than the semiconductor or the forestry and paper industry, or about half of the total GHG output of the UK. While we do have a number of great initiatives and strong players actively trying to make a difference, we still need to double down on setting and achieving targets in order to align with these global goals. From a market perspective, we will likely experience increasing downward regulatory pressure on carbon in the coming years, and possibly even water, so there is an opportunity for businesses to get better before things get worse by proactively addressing these two areas. Water usage is especially salient in labs around the world, so if a biotech company can operate well with less resources, like water, by the time the market becomes a constrained resource environment, that organization will flourish. It's like a “hope for the best, but plan for the worst” type of scenario. A lot of great organizations are already making great strides in sustainability; and if those organizations keep thriving and moving forward, other players in the market will follow suit, eventually leading to a global shift in the industry, which can then shift the sociotechnical backdrop.

Biotech champions

While this talk of sustainable change is all fine and good, most of us see the mountain of not only the human hours needed to make these goals a reality, but also the challenges of change management. What’s interesting about the fight for a sustainable future though is that we don't need to convince everyone to jump on board; in fact, we don't even need everyone to believe in climate change. We just need enough players in the market to make the necessary adjustments, and when the market shifts, those players will flourish while the others die off. To be sustainable will not only become a norm, but a necessity to operate business. Among those who will survive, biotechnology companies have the opportunity to champion the sustainability movement and thrive in a climate-focused market.

A sustainability model to chew on

So what can sustainability in science look like?

For starters, sustainability is not exclusively ecological. The biotech/pharma industry has done a great job at beginning to focus on and mitigate the environmental toll that we are taking on our planet, but we need to acknowledge the social toll as well. How do we effectively integrate and balance social and environmental sustainability, without turning targets into trade-offs? As a corporate sustainability instructor for MBA students, I think Kate Raworth’s “Doughnut Economy” model is the most inclusive and comprehensive ideology that can be used to help address this dilemma. It is a one-stop shop for all things sustainability, and it needs to be on our radar. The Doughnut Economy allows us to operate within the ecological boundaries of our closed earth system, while simultaneously increasing the livelihood of everyone on the planet.

The Doughnut Economy can be thought of as such:

“a compass for human prosperity in the 21st century, with the aim of meeting the needs of all people within the means of the living planet. The Doughnut consists of two concentric rings: a social foundation, to ensure that no one is left falling short on life’s essentials, and an ecological ceiling, to ensure that humanity does not collectively overshoot the planetary boundaries that protect Earth's life-supporting systems. Between these two sets of boundaries lies a doughnut-shaped space that is both ecologically safe and socially just: a space in which humanity can thrive.” (Doughnut Economics Action Lab)

The Doughnut Economy Model. Source: Kate Raworth

Organizations need to know that it is possible to not only live within the ecological limits of our environment, but also provide the social foundation that is needed by people all over the world, at the same time. Biotech is in a great position to adopt the doughnut; as biotech companies generate their products and services from natural sciences, they are often more acutely aware of the limitations of our natural resources and ecosystems, and how they affect all areas of humanity.

That said, an ideology only informs the decisions we make moving forward. In order to build something out of an ideology, we have to start where the rubber hits the road, and start measuring our impact.

How to start adopting sustainability in your business

1. Set and commit to a sustainability target.

A sustainability target is like any other critical business target or KPI, like profit, in the sense that it must be made and upheld in high importance. Target setting can feel daunting, especially for organizations who genuinely want to do things right. Organizations have to balance ambitious targets with their ability to actually hit them to avoid the risk of reneging on a target—or worse, greenwashing. But by applying the same principles to a sustainability target that we would to a traditional revenue growth target, we soon see that we can move stepwise through the incremental targets that pop up between where we are and where we want to be.

As an example, if one were to set a greenhouse gas (GHG) target of 50% reduction by 2030, a stepwise approach that could follow could include performing process and infrastructure audits to identify hot spots, such as freezers, fume hoods, or high energy use equipment. You can then allocate resources appropriately to maximize use efficiency and wind down GHG outputs at an annual increment appropriate to hit your target at 2030 and beyond.

2. Adopt a base sustainability framework that will help you hit your targets.

A number of sustainability organizations have been around for years and can help with setting appropriate and achievable targets, as well as guiding the transition towards them. They do this by offering valuable sustainability frameworks for evaluating and tracking performance, often for either a small fee or for free.

Frameworks can offer guidance on how to choose a target appropriate to your organization and industry, how to measure it and set benchmarks, and how and where to report your performance. A number of industries and regions are already mandating reporting using specific frameworks; and while companies can choose to be proactive or reactive in their sustainability approach, as time progresses, we can expect not only these mandates, but also the benefits of sustainable operations to increase.

We decided to begin our sustainability framework journey by joining the United Nations Global Compact (UN Global Compact). The UN Global Compact offers an enormous amount of learning tools that will help us determine appropriate targets and metrics, and will help us develop our sustainability reporting framework. They are the largest corporate sustainability movement in the world, with over 15,000 businesses on board. Started in 1999, UN Secretary General Kofi Annon formed the UN Global Compact when he called upon businesses to step up and commit to upholding the Ten Principles, which “take into account the fundamental responsibilities of business in the areas of human rights, labour, environment and anti-corruption.” Thinking back to the Doughnut Economy model from earlier, these Ten Principles fit well into the social foundation and ecological ceiling that all biotech companies could adopt. We are excited to answer the call and join the UN Global Compact, learn from its members, and fully utilize its available resources to become leaders in sustainability.

3. Continue building on this basis with additional frameworks that work with each other.

An important bonus of using the UN Global Compact resources is that they also play well with other reporting frameworks, such as the Global Reporting Initiative (GRI) and Task Force on Climate-Related Financial Disclosures (TCFD), among others. This is key because not every jurisdiction and market will follow the same universal standard. Depending on the area you are operating in, you may have to comply with various reporting structures and standards. At that point, to only have a single sustainability framework may not suffice. You will want to adopt additional, complementary sustainability measurements and frameworks to align with the different regulations.

Post-COP27: Acting on the climate crisis

In biotech, where we harness nature to produce value, we are primed to lead in sustainable business efforts. As a whole, we are in the eleventh hour of beginning to realize the implications of our actions, so the pressure to address the environmental impact of business is on. Models like Raworth’s Doughnut Economy offer insights that we must cling to when pushing towards environmental sustainability goals to ensure a just transition; frameworks offered by the UN Global Compact can give us the more granular technical tools and expertise that allows us to set benchmarks and reach tangible targets that align with the overarching theory. After seeing all of the calls to action at COP27 from high level government officials and organizations, I for one am imbued with a sense of hope. We have the tools; we have the drive; and we have the demand to fight climate change and social injustice. All we have to do now is put our foot on the gas (of the electric car, of course).