Transparency of impact

As we reach the middle of 2022, I am hopeful that the pandemic will shift to endemic and ease the country’s health and economic challenges. However, this hope is tempered by the knowledge that we now face new hurdles in the ecosystem and environment that contribute to the widening gap between rich and poor. Thus, there is an urgent call for organizations to help bridge this socioeconomic gap and solve societal problems through approaches that embed impact at their core.

The Philippine-Swiss Business Council (PSBC) recently published the first edition of the PSBC Impact Stories, which features the sustainability and social responsibility initiatives of 10 of our member-companies. Co-developed with the Global Reporting Initiative (GRI), the publication was inspired by the call of Swiss Ambassador Alain Gaschen for the Swiss-Philippine business community to integrate sustainability in all aspects of their operations and re-calibrate their corporate psyche and strategic directions to align with the Sustainable Development Goals (SDGs).

The initiative also took inspiration from former trade and industry secretary Ramon Lopez, who encouraged local businesses to practice sustainability in their supply chain to mitigate their impact on the environment that, for example, DDC Land, Inc. demonstrated in their impact story.

From the narratives of the 10 featured companies, we found their biggest motivations for weaving social impact into their business: bring global sustainability targets into local practice, champion issues closely related to their business mission, scale impact amidst an economic downturn, help bridge the gap in accessing essential resources, enhance value proposition and deliver long-term value to the stakeholders.

Many of these companies’ initiatives were focused on achieving SDG 3 (Good Health and Wellbeing), 11 (Sustainable Cities and Communities) and 12 (Responsible Consumption and Production), with significant breakthroughs made on SDG 13 (Climate Action).

Remarkable leadership was demonstrated by companies in paving the way for net-zero journeys (Holcim), plastic neutrality (Nestle) and paper-less efficiency (Dashlabs.ai).

Taking action on what matters most starts by measuring the performance of a company’s impact.

To know whether we are getting closer or farther from achieving our goals, companies will need to gather evidence by looking at and assessing their core business activities, public-private partnerships and philanthropic activities.

Offering a pragmatic methodology, Novartis presents its Social, Economic and Environmental (SEE) Impact Valuation, which standardizes how the company measures and discloses the environmental, human, social and economic value they bring to society.

I value the transparency that guides organizations to report both the positive and negative impacts we create. The process enables us to be deliberate in reflecting on and monitoring our impacts, setting targets, creating a systematic framework and consistently sharing practices – from the simple single-use plastic elimination to more complex ones like rethinking consumption habits – to learn more from each other.

It is a fundamental principle that we can’t manage what we don’t measure. Take the case of SDG 3 – “Ensure healthy lives and promote well-being for all at all ages” – which is a pre-condition to achieve sustainable development.

If We Can’t Measure It, We Can’t Fix It,” a joint report to the G20 Presidency and B20 Health Taskforce, highlighted the value of investing in health from a micro and macroeconomic perspective.

Prepared by the WifOR Institute, the report discussed how these approaches can be made consistent to suggest a set of common metrics to G20 countries measuring the Return on Investment of Health Investments. Doing so can optimize future health investments, lead to better preparation for future pandemics and strengthen multilateral collaboration.

Governments are aiming to keep costs down. Over 80 percent of current health spending comes from pooled sources. Public budgets on health are overstretched across the globe. However, the reality is health investments are necessary to achieve sustainable development. Annual new investments of up to $371 billion are required in lower- and middle-income countries to achieve SDG 3, according to World Health Organization (WHO) estimates.

Health expenditures are expected to increase to $11 trillion by 2030, with health spending set to outpace gross domestic product (GDP) growth. Convincing the right stakeholders to invest in health and cost-effective solutions is crucial for sustainable growth.

There has been a paradigm shift – the health economy has become a driver for growth and employment. Innovative research-based pharmaceutical companies like Novartis, Roche and Zuellig recognize this important transformation.

Roche Philippines played a pivotal role in ensuring that RT-PCR and antibody tests were immediately made available, helping achieve a 5000 percent increase in the pre-pandemic supply of several critical medicines for COVID-19 management.

In 2021, Novartis contributed P8.1 billion to the GDP of the Philippines. Sixteen percent of the company’s total GDP contribution stems from innovation in medicines.

Publishing these narratives fulfills a bigger advocacy: to encourage companies to measure and report the impact of their initiatives. Ultimately, any organization would want to determine just how their actions have contributed to positive changes or how they responsibly managed their negative impacts, if any.

Ideally, companies would also undergo a comprehensive measurement where they map the total impact of the business on the society, economy and environment throughout their supply chain, operations, business activities and the ensuing outcomes of these activities.

As the social context in which businesses operate continues to evolve, we hope to promote story telling as an avenue to learn from each other and elevate practices. At the same time, the PSBC wants to demonstrate the power of networks in tackling complex social problems by aligning our resources to mobilize strategic action on the issues that we commonly want to address.

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Christine Fajardo is the chair of the Philippine-Swiss Business Council (PSBC) and Country Corporate Affairs head of Novartis Healthcare Philippines Inc.