As we look to the start of 2022 and beyond, Syneos Health Communication’s Social Impact team continues to track Environmental, Social and Governance (ESG) developments—as these efforts will inevitably shape our future. Companies, in and outside of healthcare, continue advancing society through both commitments and actions aimed at addressing environmental and social challenges, including climate resiliency, DE&I and access to healthcare. With the seismic shift we’re witnessing with ESG, we know internal and external stakeholders are expecting more—encouraging ambitious commitments and exploring the ways to leverage resources, even green financing. Here’s what we’re tracking:

EU leads ESG progress by connecting community and company impact.

Inspired by the UN Guiding Principles, Germany passed new legislation mandating human rights due diligence throughout the supply chain, and similar EU legislation is expected to follow. Companies can expect extensive financial penalties, and removal from public tenders, if they violate this mandate. Also, the EU’s Recovery Plan launched 600+ tenders, including many for healthcare systems, which will require businesses to disclose Green, Digital and Resilient (GDR) information, such as alignment to net zero commitments, corresponding action plans and disclosures on Scope 1, 2 and 3 greenhouse gas (GHG) emissions. We expect that, while the EU is leading ESG policy at the moment, other regions and countries will follow suit. 

Environmental goals and actions are elevated to the next level.

As companies make substantial strides toward their net zero commitments, leaders are announcing even greater “climate positive” goals. For example, IKEA announced that it will be climate positive by 2030, or reducing more GHG emissions than their value chain emits. We’ve seen this take shape for the LA Clippers, as well, through their plans to construct the first climate positive arena. This will operate 100% carbon-free and feature solar-powered batteries with enough on-site energy storage to power events. Lastly, Meta recently announced a goal to be “water positive” by 2030, or to restore more water than it consumes. Calls for similar immediate action have been echoed throughout the year—this month in particular—as climate activists took to the streets of Glasgow (and around the world) during COP26. The message for companies and governments is clear: close the gap between words and actions and adopt science-based targets to limit expected global temperature increases.

Sustainability-related financing is skyrocketing.

Issuance of green, social, sustainable and sustainability-linked bonds doubled in the first half of 2021, and in some cases, tripled compared to the same period in 2020. Green bonds, which support climate or environmental projects, issued in the first half of 2021 exceeded that for the whole of 2020, at $248.1 billion (read up on Walmart and Mondelēz). Sustainability-linked bonds (SLBs) are also quickly growing; they set performance targets related to a company’s ESG strategy and increase interest due if the beneficiary does not meet them (read up on Novartis, Teva and General Mills). When engaging in sustainability financing, particularly SLBs, it’s important to have a strong ESG strategy to serve as a foundation, and to be able to communicate effectively to the broad range of stakeholders, such as banks or second party opinion providers, essential for this type of collaboration. 

We at Syneos Health Communications will continue track and provide counsel on these developments. Are you navigating this ever-evolving ESG space, too? We’d always looking to discuss what’s next, and how we can partner with you to lead you into the future. 

About the Author:

Rose Anna Kaczmarcik, MPH, has more than ten years of experience in healthcare communications. Her public health mindset has proven invaluable to consumer, pharmaceutical, biotech, and non-profit organizations looking to reach and engage key influencers. She has extensive experience with corporate social responsibility (CSR), stakeholder engagement and public health advocacy. Rose Anna has a background in chemistry and healthcare ethics and received a Master of Public Health from Boston University.