ESG Database

Healthcare Industry

Climate change and health are closely intertwined. Escalating air pollution and extremely high temperatures are increasing the risk of non-communicable diseases, such as respiratory and cardiovascular diseases. However, the healthcare sector is one of the major sources of greenhouse gas emissions, contributing 5% of global greenhouse gas emissions. These emissions can be categorized into three groups: Scope 1, direct emissions from healthcare facilities like fleet vehicles; Scope 2, emissions from electricity used by facilities; and Scope 3, emissions from the production of pharmaceuticals, medical devices, and hospital equipment within the supply chain, accounting for the majority of emissions at 71%.

Across the entire industry chain, the upstream segment includes companies involved in drug research and development, medical equipment and supplies manufacturing, as well as those providing raw materials and technologies. The midstream segment encompasses various healthcare service providers, including hospitals, clinics, testing labs, nursing facilities, etc. The downstream segment refers to those directly engaging with end consumers, such as pharmacies and long-term care facilities. Healthcare systems around the world are facing growing pressure as disease burden increases, requiring more hospitalizations and medical appointments. Amid rising demand and inefficiencies, issues such as overprescribing, preventable medical errors and provision of low-value care services will further increase emissions, which makes net-zero hospitals and the optimization of healthcare sites (placing healthcare facilities closer to patients) the way to decarbonize the industry. Reducing carbon emissions from the healthcare system not only contributes to mitigating climate change but also safeguards and enhances the health of people around the globe.