Chief Executive Officer - CDMO, Cohance Lifesciences

The Evolving Role of CDMOs in Driving ESG Excellence Across Pharma Supply Chains

The pharmaceutical supply chain is transforming. Sustainability, resilience, digitalization, and operational excellence are no longer independent priorities; they are deeply interconnected drivers of long-term competitiveness and business continuity. For CDMOs positioned at the centre of the global value chain, advancing ESG performance while building resilient networks is both a responsibility and a strategic imperative.

ESG as a Strategic Differentiator

We must move past viewing ESG as a compliance exercise; at Cohance Lifesciences, it is an integral component of business strategy and operational excellence. Pharmaceutical companies increasingly select partners based on their ability to advance sustainability objectives, demonstrate regulatory readiness, and strengthen supply chain resilience. Consequently, ESG considerations are embedded into supplier relationships, manufacturing operations, and strategic partnerships.

This requires a structured approach to supply chain management. We incorporate ESG criteria into supplier selection, qualification, and performance evaluation processes, aligning our procurement framework with internationally recognized standards such as ISO 20400. Beyond implementing a Supplier Code of Conduct, we promote continuous improvement through supplier audits, training programs, and collaborative engagement across our value chain.

Our performance is also assessed through independent sustainability benchmarks. Cohance Lifesciences has been awarded the EcoVadis Gold Rating, placing the company among the leading organizations evaluated for sustainability performance. We have also achieved a CDP rating of A- for Water Security and B for Climate Change, reflecting our focus on environmental stewardship, climate action, and governance.

“The future of pharmaceutical supply chains will not be defined by cost and quality alone. Leadership will belong to organizations that effectively integrate sustainability, transparency, resilience, and innovation across their entire value chain.”

Addressing Scope 3 Emissions Through Partnership

Climate related challenges cannot be addressed by individual organizations acting alone. Because a significant proportion of environmental impacts occur beyond direct operations, managing Scope 3 emissions remains one of the pharmaceutical industry's most complex challenges. At Cohance, these emissions represent a substantial share of our overall footprint, predominantly through purchased goods and services, logistics, and downstream value chain activities.

Addressing these emissions requires close collaboration with suppliers and customers. We are reducing environmental impacts by strengthening supplier engagement, increasing local sourcing where feasible, adopting more resource efficient manufacturing pathways, and expanding material recovery initiatives. Local sourcing and selective backward integration not only reduce transportation related emissions but also improve supply reliability and resilience during periods of geopolitical uncertainty, logistics disruptions, or raw material shortages.

As a member of the Pharmaceutical Supply Chain Initiative (PSCI), we work with industry peers and suppliers to advance responsible business practices, environmental performance, ethical conduct, and continuous ESG improvement across the pharmaceutical supply chain.

Digital Transparency and Data Driven Networks

Increasingly complex global networks require greater visibility and traceability. Investors, regulators, and pharmaceutical clients expect comprehensive ESG disclosures, reliable supplier data, and transparent reporting of environmental performance.

Digital technologies provide important capabilities in this area. Digitally enabled supply chain ecosystems can provide near real time information on material flows, emissions, compliance indicators, and operational risks. By leveraging advanced analytics, artificial intelligence, and machine learning, organizations can improve forecasting accuracy, strengthen supplier monitoring, identify emerging risks, and support evidence-based decision making.

For CDMOs, these technologies provide an opportunity to improve both sustainability performance and supply chain resilience while meeting growing stakeholder expectations for transparency.

Advanced Manufacturing as a Sustainability Tool

Historically, automation and digitalization were justified primarily by productivity and cost considerations. Today, they are increasingly important tools for improving environmental performance.

Process optimization can reduce raw material consumption, energy usage, water intensity, and waste generation. Predictive analytics improve equipment utilization and reduce unplanned downtime, lowering resource intensity across manufacturing operations.

At Cohance, these manufacturing technologies are complemented by investments in renewable energy, alternative fuels, and green chemistry. Our scientists and process development teams play a critical role in developing more sustainable manufacturing routes through yield improvement, process intensification, solvent recovery, catalyst recycling, and optimization of reaction pathways. These approaches reduce the consumption of raw materials, solvents, utilities, and energy while lowering waste generation.

Importantly, higher process yields and resource efficiency contribute directly to Scope 3 emission reductions by reducing the quantity of purchased materials, packaging inputs, and transportation required per unit of product manufactured. At the same time, improved process efficiency can lower Scope 1 and Scope 2 emissions through reduced fuel and electricity consumption.

Advancing Circular Economy Practices

Circular economy principles represent a significant opportunity for the pharmaceutical sector. While technical and regulatory barriers have historically limited adoption, meaningful progress can be achieved when CDMOs and pharmaceutical companies collaborate early in process and product development.

Solvent recovery, catalyst reuse, waste valorisation, and sustainable packaging solutions offer measurable environmental and operational benefits. Rather than viewing circularity solely through a compliance lens, the industry should recognize its potential to improve resource efficiency, reduce waste generation, and support long term sustainability objectives.

Governance and Verifiable Accountability

Strong governance remains the foundation of a credible ESG strategy. As sustainability reporting requirements continue to evolve, organizations must provide reliable, auditable, and transparent data.

At Cohance, sustainability considerations are integrated into management structures, investment decisions, and risk management processes. To ensure transparency, we report performance against globally recognized frameworks including GRI, the UN Global Compact, and the Sustainable Development Goals, supported by external assurance of sustainability data.

Integrating ESG with Supply Chain Resilience

Recent geopolitical and climate related disruptions have demonstrated that supply chain continuity and ESG performance are closely interconnected. Many risks to supply continuity originate from environmental, social, or governance factors.

Our Business Continuity Management System, certified under ISO 22301, reflects this integrated approach. Through supplier mapping, contingency planning, alternative sourcing strategies, and strategic inventory management, we strengthen the resilience of our operations and support uninterrupted supply of critical pharmaceutical products.

Navigating Geopolitical and Regulatory Shocks

Trade restrictions, regional conflicts, and evolving regulatory requirements require organizations to balance efficiency with resilience. This includes maintaining diversified supplier networks, evaluating regional manufacturing capabilities, strengthening local sourcing strategies, and developing alternative supply routes where appropriate.

Cross border collaboration and transparent information sharing remain essential for maintaining continuity within global pharmaceutical supply chains during periods of disruption.

Redefining Strategic Partnerships

The definition of a strategic partner is evolving. Technical expertise, quality performance, and commercial competitiveness remain important, but increasingly they must be complemented by shared sustainability objectives and transparency.

Future focused partnerships are characterized by data sharing, collaborative problem solving, and joint accountability for ESG outcomes. Performance metrics increasingly include emissions reduction, resource efficiency, responsible sourcing, and resilience indicators alongside traditional quality and delivery metrics.

Cross-Industry Learning

The pharmaceutical sector can draw valuable lessons from industries such as automotive, consumer goods, and electronics. These sectors have demonstrated significant progress in supplier transparency, circular economy implementation, and lifecycle management approaches.

Adapting these practices within the pharmaceutical industry's regulatory framework can help accelerate ESG progress while maintaining the quality, safety, and compliance standards essential to healthcare products.

The Road to 2030: What Defines Leadership?

By 2030, industry leadership will likely be defined by the ability to integrate sustainability, digital intelligence, scientific innovation, and resilience into a unified operating model. Organizations that continue to face fragmented data, limited visibility beyond tier one suppliers, and disconnected sustainability initiatives will find it increasingly difficult to meet stakeholder expectations.

For CDMOs, the evolution is clear: we are no longer solely contract manufacturers. We are strategic partners that contribute to sustainable process innovation, responsible sourcing, supply chain resilience, and long-term value creation. ESG is not simply about reporting metrics; it is about applying science, data, and collaboration to build a resilient and sustainable pharmaceutical ecosystem that creates lasting value for patients, customers, and society.