“The purpose of our company is sustainability,” said Claus Stig Pedersen, head of corporate sustainability at Novozymes. That’s why the organization has decided to use the U.N. Sustainable Development Goals as a test to determine if new business development projects are a good fit.
The Danish enzyme manufacturer was looking for a new way to measure social and environmental wellbeing last year. When the Sustainable Development Goals were published in September, Stig Pedersen suggested that his company use them as metrics, “because what’s better than a shared commitment from 193 countries?”
Novozymes’ board quickly approved the proposal. As a first step, they’ve refined the 169 targets in the 17 SDG goals into 15 “material” impact categories that are relevant to the business: poverty, health, gender, sanitation, food supply, water supply, energy supply, land use, acidification, climate change, nutrification, forest, resources, chemicals and waste.
These impact areas will be used to evaluate the effectiveness of future projects. “If it’s good enough for the world, it’s also good enough for us,” Stig Pedersen explained. Now, technology impacts will also include a measure of the impact on people — ideally, the number of people impacted. For example, if an enzyme product can improve agriculture yields, there will likely be a boost in human health. If a product can reduce industrial use of formaldehyde, this will also have a positive impact on human health.
This methodology will not only be used to measure the impact of the organization, but also to determine the return on investment for a particular project and, in turn, to determine whether the company should move forward with a given project or not.
When asked what would happen if a project showed a high social or environmental return but not big profit, Stig Pedersen laughed. “This is going to be very exciting, isn’t it? We don’t have a plan to handle it yet; we are going to have to see how it goes.”
This isn’t entirely new ground for the biotech company; environmental and social issues have long been a consideration. However, up until this point, they were something of a negative screen — negative environmental and social consequences could derail a project. Now, these SDG impacts will help Novozymes determine which projects can have a positive impact on the society and the planet, and this positive benefit can be the nudge that moves a borderline project forward.
When asked if this new plan would have any impact on Novozymes’ exceptional sustainability reporting, Stig Pedersen explained that, while it might have some impact on how the company reports its impacts, “this is much more about business development.”