Maria Paola Chiesi · Direttore Shared Value & Sustainability, Chiesi Farmaceutici

Good evening. No, I don't think they can hear me. Hello, test, test, test.

Good evening, and thank you to the Foundation for Sustainable Development for inviting me. For me it's now a regular appointment to be here and hear your reactions. This morning I arrived a bit late, I apologize, but the earthquake got in the way.

Why is this important for us? Chiesi Farmaceutici is a company that deals with health, and health and climate change are closely connected, even though they're rarely discussed together. The direct costs of health damage from climate change are estimated by the WHO at $24 billion by 2030. At the same time, healthcare systems contribute 5.2% of global emissions — a very important figure that's rarely discussed. At COP26, 50 national healthcare systems committed to decarbonization, which means all their suppliers, including pharmaceutical companies, must also decarbonize. Recognizing this interdependence, we committed in 2019 — alongside our path to becoming a benefit corporation — to become carbon neutral by 2035, which will mark 100 years since the company's founding.

It was born through a plebiscite. When we became a benefit corporation, we gathered all our management and asked: facing the social challenges of Agenda 2030, what is the most important challenge for us? The management said almost unanimously: climate change. So we committed to carbon neutrality by 2035. We were among the first to join the Climate Pledge and wrote this commitment into our statutes — making our goal of achieving a zero-emission economy explicit and undeniable. First, we built competencies. Even now, expertise is scarce — imagine three years ago. We created a dedicated team of engineers, because as Jeffrey Sachs says, it's engineers who study these things and know how to solve them. We also got burned by some consultants because external expertise was low at the time. We investigated protocols extensively. We followed the GHG Protocol, which isn't a universal standard — it's English, not even European — but it's the best available. The first step is taking inventory. Our 2021 data, public in our sustainability report, shows 95% of our emissions come from Scope 3 — indirect emissions. Scope 2 is very low because we already source 100% energy from renewables. Most Scope 1 and 3 emissions come from our products — mainly asthma and chronic bronchitis medications, including classic asthma inhalers. Those inhalers contain fluorinated gases with a powerful climate-altering effect. We were among the first to introduce them, replacing CFCs that caused the ozone hole. In the early 2000s it seemed like a solution, but it wasn't — not all consequences were studied. These gases contribute only about 0.1% of global emissions, but for us it's everything — it's all of our emissions. Once the inventory is done, you need a reduction plan. We set net zero for Scopes 1 and 2 by 2030, and Scope 3 by 2035. We had this validated by the Science Based Targets initiative and made it transparent through CDP. The actions include reducing energy consumption — very difficult in a highly regulated sector where developing a drug takes 15 years and changing a comma on the package insert requires ministerial approval; switching to renewable energy; electrifying the vehicle fleet; reducing air travel — COVID helped us here; green logistics. But most importantly, developing products with a new propellant, HFO. This year we're introducing a new quantitative indicator: the carbon budget — a maximum emissions budget for Scopes 1 and 2. If you exceed the carbon budget, you walk. We're usually very good at meeting our budgets. Products represent the vast majority of our emissions, so difficult choices must be made. A key aspect is lifecycle assessment — a carbon footprint model for current drugs that also serves as the design template for future drugs. For current drugs: reduce waste through patient training, reduce excessive use, and recover and recycle inhalers. Used inhalers still contain about 40 doses of safety propellant mandated by regulators — all propellant that could be released into the environment. We launched a project called 'Recupera e Respira' — Recover and Breathe — for recycling used inhalers in Italy and England. We also freeze and capture all gas escaping during production. But to truly solve the problem, you must go to the root: replace the propellant. We started at the end of 2018 — seven years of clinical studies to re-evaluate efficacy and safety, and to re-industrialize from zero. Three hundred and fifty million euros of investment. This will bring us, by 2027, an inhaler that reduces its carbon footprint by 90%. I'm certain that if we don't do this, we'll be off the market in a few years, because when all healthcare systems decarbonize, they won't accept pharmaceutical products with this type of emissions. The sustainability of the company, the sustainability of society, and the sustainability of the planet are totally interconnected.

I have the presumption to think that for us it was actually an evolution of a values tradition that came from my grandfather. But what we can observe is that young people who come to work with us say the first thing is: 'I want to come here because you're a benefit corporation, because you have a purpose, because we believe in what you do.' And that's something that never happened before. Thank you.