Forces For Good Podcast Season 4 — Episode 3: How do we all win in the Race to Zero?

Carbon is everywhere. It’s what diamonds are made of. It’s what trees breathe in and what we breathe out. It’s essential to life on Earth — and yet, too much of it is threatening our planet’s future.

In this episode of Forces for Good, we zoom in on one of the most urgent issues of our time: decarbonization. How can businesses—from small enterprises to global corporations—lead the race to zero emissions? And what does it actually take to make that sprint?

Host Irving Chan-Gomez is joined by Jane Eisenhardt from UN High Level Climate Champions, who explains why net zero is a race we can’t afford to lose, and Cecilia Plicco from Chiesi Pharmaceuticals, a certified B Corp proving that even high-emission industries can transform products and processes for a low-carbon future. 

Listen now: https://lnk.to/B-Lab-Forces- For-Good-Decarbonization

TRANSCRIPT: Episode 3 — How do we all win in the Raze to Zero?

This is Forces For Good, a podcast from B Lab, the nonprofit network powering the global B Corp movement. I’m your host Irving Chan-Gomez. Forces For Good takes a hard look at how businesses are helping to solve the biggest social and environmental challenges of our time. 

For the first 2 minutes of this episode, pretend you're sitting in a chemistry class. 

We're talking about Carbon. Element 6 on the periodic table. The stuff Diamonds are made of. The stuff we breathe out as carbon dioxide and trees and plants filter back into oxygen so we can keep breathing.

Carbon and its compounds are necessary to life on earth - but carbon emissions are also threatening it. In this episode, we're not just giving you a chemistry lesson.

We're here to talk about decarbonization and how businesses can reduce the harmful emissions contributing to our warming world.

Jane: All of the things that run our modern lives from shopping, to building things to traveling, moving around. These are all things that contribute to carbon emissions and those technologies, the modern things that we have. It brings us so many benefits and things that have really advanced humankind, but at the same time, there's a huge consequence. And I think we started seeing that at the beginnings of the environmental movement through pollution to our natural ecosystems. But now we see it impacting our day-to-day all the time. People not having access to certain things, losing resources, losing food, losing green space, all of that sort of stuff. Some disruptions we're seeing to our lives on a daily basis really come down to a changing warming world from carbon emissions.

That's Jane Eisenhardt from The UN High Level Climate Champions. She is Engagement and Acceleration Manager to their campaign, Race to Zero. 

Jane: So race to zero. Is really focusing on driving forward net zero, it seems pretty intuitive with the name Race to Net zero. But what that really means is Race to Zero asks all actors who commit to the campaign, um, to work towards a state of net zero. And we define that as actors reducing emissions following science-based pathways, with any remaining GHG emissions, attributing that to the actor being fully neutralized for like, for like removals. So for example, permanent removals for fossil carbon emissions. And then exclusively claimed by that actor, either within the value chain or through purchase of valid offset credits Race to Zero really believes that it's about everyone everywhere. And it's not just about reducing emissions, but we're changing the future world we wanna live in. 

Nature is a beautiful thing. It provides a way to keep our planet at just the right temperature to support life. Greenhouse gases trap heat in the atmosphere keeping our planet warm even when the sun isn't shining. 

 Roughly two thirds of greenhouse gas emissions are carbon dioxide.

Without greenhouse gases we might be living in another ice age! 

But due to our modern lifestyle there is wayyy too much carbon in the atmosphere.

That means the earth is heating far more than it should.

This causes rising sea levels, more extreme weather patterns and threats to crops and wildlife- all the things we know today as Climate Change. 

Jane: I think the race against time is one of the key metaphors that comes up when thinking of the race to zero. Like we do know, science isn't changing. We do know that we're time bound with the goals and with the commitments that have been made by actors. So in that sense, I would say the speed part. Feels like there isn't wiggle room, right? Like we know that there're certain milestones we need to hit and certain trajectories that are really key for keeping temperatures within a safe and healthy, um, threshold. So in that sense, I think the speed part feels like there isn't a wiggle room necessarily.

Decarbonization isn't easy. We can't completely stop carbon emissions overnight. But Jane is completely right. This is a Race. Every industry, no matter how high their emissions, has to race toward zero. 

Jane: For an effective decarbonization strategy in certain industries, it's just really getting the right actors in the room to think about, like, how can we transform value chains?

How can we transform products? How can we transform industry? And how can we push for the changes we need to see within policy, um, for that to go at the speed and scale that we need to. So I think that's where we're seeing some of the progress is through alliance building and really starting to think about what kind of economy and world we need to have in the next five years, 10 years, 20 years, and then start outlining what actions. Need to happen to get that done. So I think that kind of movement building has been a huge success to date, and now we're in that era as we're kind of nearing 2030 and starting to take stock of if we're on track or not. For our 2050 climate targets. We're starting to see many industries, including hard to abate, start to look at, okay, what are the concrete actions that. Need to happen and need to happen fast? So I'd say with that, the key to success is prioritizing where there's the most impact and emission reduction potential.

So the race to zero is definitely a marathon or maybe some kind of crazy relay with serious sprinting components. But even high emissions industries with a hard time decarbonizing are joining the race. 

Meet Cecilia Plicco from B Corp Chiesi Pharmaceuticals. She’s Senior Director for Shared Value and Sustainability. 

Cecilia: What is really resonating with me and with all the colleagues that are working. Uh, all over the world sustainability initiatives are really the values and how much this is really connecting to the culture and the purpose of the company. Also, being a pharmaceutical company, we have a social purpose.

By nature, we do impact the health of the people that are in a way cured by the medication we produce. So, being in the healthcare sector, we feel the responsibility, and this was also. In a way it was naturally brought into our journey. When it comes to the emission, it is recognized that the healthcare sector is responsible. And many people are surprised by this, by the 5% of the global emission, meaning, everyone that contributes to, let's say, the delicate sector, we really believe that the climate crisis is a crisis. So by definition we feel a responsibility in also taking care of the impact we have on our planet. We started with carbon neutrality in 2019, but we switched to net zero. Now we have a net zero commitment that was also recognized last year by SBTi, which is more, in a way, ambitious than carbon neutrality because it takes reduction first and then all that is coming after.

So, this is also how we always try to look beyond what is the standard, what is compliance, and try to push more and more to improvements and to challenging ourselves in order to improve our positive impact and decrease our negatives.

The first step toward halting global warming is to achieve net zero emissions. Companies can balance their residual emissions with carbon removal. That can be done through investing in mitigation efforts and in high integrity carbon credits. These investments play an important role in decarbonization but must always be used in addition to emissions reduction. In B Lab’s new standards, carbon credits do not count toward a company’s overall emissions reduction. 

Serious changes to products and processes are crucial to reaching net zero and beyond. Chiesi has worked to do exactly that. Here’s an example…

Cecilia: One of the categories that we are tackling with our strategy is the, uh, what is called use of soul products, but basically the mission that are produced by our patients when they use our products and particularly. Inhalers for the cure. So for this reason, uh, as we knew and we are aware, this is, uh, uh, one of the, is the most relevant, uh, uh, piece of our emission. This project is called Carbon Minimal Inhaler and will reduce by minus 90% the emission, uh, compared to similar inhalers that are currently on the market. So this is a huge commitment.

Change can be slow in the healthcare industry because of approval processes and product development. Cecilia says developing and bringing the Carbon Minimal Inhaler to market cost 350 million euros. 

Cecilia: And we took it because, uh, on the one hand, we wanted to preserve the health of our patients, so ensure that our patients could keep the possibility to use inhalers, but on the other side, because we knew the impact of our inhalers. So in that way we could, we, we will be able to decrease. The impact of our activities is 90%. We do have an ambitious target scope one and two net zero by 2030 and Scope three by 2035.

Here's another technical explanation. I'll try to keep it short since we've covered this a bit in other episodes. 

 Scope 1 emissions are direct emissions. Those that come from company owned vehicles or factories. 

Scope 2 emissions are indirect. An example would be the electricity that's purchased and used in a company's offices. 

Scope one and two emissions are a bit more within a company's control so they're easier to reduce. 

Scope 3 emissions are basically everything else, so they're harder to reduce and harder to track. Examples are the emissions from products once they're sold or distribution networks or supply chain emissions from contractors and even the emissions from employees commuting into work in their personal vehicles.

Cecilia: When it comes to scope three, this is our challenge as it is the challenge for every company because. In the Scope three, there are the emissions that are not controllable by the company. So are in a way, either in our case, from our patients, as I was explaining before, when they use the products that we, uh, produce. But on the other side, and this is, um, most part of our Scope three, then we have the supply chain that counts for 30%.

Our Scope three emission. And in this sense we are lucky to have a procurement team that is really committed to jump on board of this journey since the very beginning. So they really took this as a transformation in the way they manage our value chain and our partner relationship. So the relationship with our suppliers, but then net zero on net zero we have a specific focus. So we do know which are the suppliers that are in a way waiting the most. 

When it comes to emission, this supplier also has different maturity. So what we are working on is on the one end data, and you mentioned it is not easy to have primary data and this is one of our focuses. We are improving because we want to be as much as accurate in our GIG emission inventory and with some suppliers. We are still working to get it. In a way, precise data because  in some cases data on that side are estimated. So we have a target on primary data, uh, and we have tools that are supporting us in going towards this objective. But then we also have a mature supplier on which we are working more on the strategy. We work on training, we work on sharing best practices. We really try to, particularly for those who are most relevant when it comes to emission. Uh, really to try to have a tailored approach, and this will be, in any case, the challenge for the next three years in order to support our 2035 target.

A lot of large companies - Chiesi being one of them - have set lofty climate goals and are working toward net zero emissions but this energy transition is going to take effort from everyone!

 I've been working with B Lab for 9 years now and the term SME comes up a lot. Many of our listeners may know that this term refers to Small and Medium Enterprises. The exact definition varies but at B Lab we consider SMEs to be companies with less than 250 employees. Jane explains why SMEs are important. 

Jane: The big brands in our lives that have a lot of power and influence we're asked a lot, oh, well what if you know, they just meet their goals and that's enough. Right? Like their influence in their scale is so impactful that that's all we need to see for transformation. SMEs are the backbone of the global economy, so we know that SMEs make up the majority of actors in the race to zero, but we also know that they make up projections of 80 to 90% of businesses worldwide.

They're all around us and we're not always thinking about the scale and influence that they have in our lives and how they make up, you know, the supply chain.

And so even companies with a small footprint like an SME, it's still critical for them to keep up with the changing economy. And so that kind of upskilling climate education, innovation, transition, there's huge benefits. For acting on climate too. It's not just sacrifices. So these companies that are front runners are also unlocking new solutions. They're unlocking new products. They're designing the world we'll be living in. And if we don't move everyone along in that transition, then people will. What has happened in history will continue to be left behind. So I think for that reason, Race to Zero really talks about, you know, everyone needs to get across that finish line in time. And so that's why we need to work together in a multi-stakeholder approach.

You know, small businesses a lot of times are mom and pop shops or startups or people that just had a dream and a vision to run something within their community and then they're pulled on to meet these other demands in the climate space. And it's a big ask.

Climate action may be a big ask but it’s one we have to make!  Businesses and the planet can't afford to ignore it.

Jane: I think a lot of businesses, and you see this all the time with B cores, are also seeing that putting that hard work in is worth it. It's not just worth it for, you know, brand building or meeting the needs of other stakeholders who are asking you to do these things.

But you see real business benefits like building and resiliency, even if it takes more upfront work. A lot of the small businesses that we work with say once they start. Taking on climate initiatives and embedding it in the business, they really feel like they have a more stable business model over time.

I'd say another thing that makes it easier is there are real cost savings, which I think compared to large companies for small and medium sized companies, it's harder to realize that because you have to invest upfront and that's really hard when you're. You know, running month to month as a smaller business, but over time there really are benefits and reductions, especially when we think about energy. So I think that there's some ways that it is really beneficial, not just for the planet, but also for people.

As a B Corp, Chiesi has found a community to support their ambitious climate goals. And they're setting an example for other pharmaceutical companies in a hard to abate industry.

Cecilia: When it comes to B Corp, network pharmaceutical companies are still few. We do work, within the big core community with other companies, even beyond the pharmaceutical sector to share experiences and to share our journeys.

We have, uh, put in place a water recovery system, energy efficiency system, like these are practices that we often share with our manufacturing companies and other even companies within the B Corp community. When it comes to the industry, I think the pharmaceutical industry is quite committed to sustainability. I mean, maybe it's also part of the social dimension that comes with the sector, but in general, there is commitment in different areas within the industry. ,

In a sector such as ours, highly regulated, when we speak about circularity, when we speak about, uh, innovation in products. We really need to have a systematic approach. So the industry, yes, but also the, uh, healthcare system. And even patients, for example, I make an example. We work and we promote as a company. Um, take-back scheme, meaning, uh, mm-hmm. The products that are in a way, not anymore in news, uh, how we recover this. So this is something we are exploring at national level because this is really something you need to look at currently, considering the national dynamics, even sometimes the local dynamics of waste management, public administration, uh, uh, care Institute of Pharmacy, and so on and so forth. So this is really something. It's an easy example because it can touch everyone because,but it really needs cooperation. So it cannot be the company by itself. And this is true for every other, other challenge. This is typical of the pharmaceutical sector. So these are topics that we discuss within the industry and there are networks and there is a possibility to discuss this.

How can companies start their race to zero? Let's go back to the marathon metaphor. You wouldn't wake up one day and decide to run a marathon the next. First you might consider your fitness level. Let's use that as an analogy for taking the B Impact Assessment.

Cecilia: I think one of the key elements for us was really to have a framework and tools to measure our performance. So being aware of our impact, first, we really focus on data, and even as I said, B Corp. B Corp really for us we approach as a way to measure and improve our impact.

Once you know your fitness level, you might start following a training plan and run shorter races.

Cecilia: The fact that it continuously pushes companies to look beyond and, uh, go to the next level. This is really something that, uh, it resonates with us. And, uh, this is also one of the reasons we decided to start this journey and to start this journey as a group. So still now, we have the B Corp standard adopted in all our 30 offices and the production site and center so we are presenting to over 30 countries.

And by the time you finish that shorter race you've caught the running bug. You can run longer and longer races until you reach that marathon distance and beyond. 

Cecilia: It's a long term commitment. When we adopted the legal form of Benefit Corporation, we explained what this meant. From a formal point of view, this was a major change and as I said, we decided to go for the governance changes also in countries where, even where there is not the legal form. So I think this is something important. And sometimes we hear the difficulty of having people engage on this topic. And we know it's a challenge. And every year we try to innovate the way we communicate. We educate on sustainability, but it's something we need to continue to invest on. And we believe it's, it's also key in this transformation to ensure sustainability, it's also pushing for a cultural transformation.

We want to encourage any business leader or anyone at any career level to lace up their shoes and start this race toward decarbonization. Jane and her team at Climate Champions understand that it's hard but you’ve just got to find the start line.

Jane: I think if you were to look up what do I need to do to reach net zero? It feels like you have to transform everything within your business and your world all at once, overnight in the next few years. And yes, we need to get a lot done in a short amount of time, but it's most important to prioritize where you have the highest level of impact. So I'd say start where it makes most material sense for you. Um, start where you can not only reduce emissions, but. Also see real changes for the company. I think energy is one of the first places a lot of businesses go to because not to say it's easy, it's not, but it does have a pretty straightforward approach. It's something that a lot of others have already done, and again, there's cost savings.

So I would say getting started where you feel like you have control is a good place.

If you'd like to learn more about B Corps and purpose driven companies visit BCorporation.net. And listen to the rest of our season! Please subscribe, rate, and review the podcast on Apple Podcasts, Spotify, or wherever you listen. Your ratings and reviews help Forces for Good reach new audiences, so we thank you for your support.

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The views and opinions expressed are those of the interviewees and do not reflect the positions or opinions of the producers or any affiliated organizations.

The podcast was brought to you by B Lab. Special thanks to Sherri Jordan for coordination. Forces for Good is produced by Hueman Group Media. 

I’m your host, Irving Chan-Gomez. Thanks for listening. And I look forward to catching you in the next episode!