Novartis Targets Full Supply-Chain Carbon Neutrality by 2030

By Miranda Greenberg -

September 3, 2020

Novartis has set a target to achieve full carbon neutrality across its supply chain by 2030, in addition to its already stated target for carbon neutrality in its own operations by 2025. This new target replaces a previous target aiming for a 50% reduction (from a 2016 baseline) in carbon emissions across its supply chain.

The 2030 target for carbon neutrality encompasses three scopes (Scope 1, 2, and 3). Scope 1 are emissions from sources that are owned or controlled by Novartis. Scope 2 are emissions from the consumption of purchased energy (e.g. electricity), and Scope 3 are emissions that are a consequence of Novartis operations (e.g. supply chain, business travel).

The targets include three areas: (1) climate, to be carbon neutral in Scope 1, 2, and 3 by 2030; (2) waste, to be plastic neutral by 2030; and (3) water, to achieve water neutrality and enhanced water quality wherever the company operates by 2030.

These targets by 2030 accelerate a timeline and scope of previous targets set for 2025: (1) to be carbon neutral in its own operations by 2025; (2) reduce waste disposal by half by 2025; and (3) reduce water consumption by half in its operations and to have no water quality impacts from manufacturing effluents from its own operations by 2025.

Novartis reported the progress that it had made through the first half of 2020 in meeting its initial 2025 goals: (1) it achieved 14% of being carbon neutral in its own operations (Scope 1 and 2) by 2025; (2) it achieved 53% of its goal of reducing its water consumption by half by 2025; and (3) it achieved 87% of its goal of reducing water consumption by half in its operations and to have no water quality impacts from manufacturing effluents from its own operations by 2025. With respect to its water consumption and manufacturing effluent targets, the company has an ongoing assessment of its suppliers.

Novartis’ environmental goals are part of a larger environmental, social and governance (ESG) strategy. It focuses on four key strategic ESG pillars defined as material by stakeholders: (1) ethical standards; (2) pricing and access; (3) global health challenges; and (4) corporate citizenship. The company has developed targets against key elements in each of these areas. These include addressing access and global health challenges, which are areas with the highest unmet need worldwide and where Novartis can have the greatest material ESG impact and its target for carbon neutrality to include its entire supply chain by 2030. The company updated its progress in all of these areas in a briefing by Novartis executives held earlier this week (September 1, 2020).

Source: Novartis (Press Release) and Novartis (ESG presentation)