9
Current State Landscape
Competing Priorities
The latest United Nations Global Compact-
Accenture CEO Study on Sustainability found that
CEOs are navigating unprecedented uncertainty.
Among the 2,600 CEOs across industries surveyed
for the study, 93% of CEOs said they are facing ten
or more simultaneous global challenges to their
business.
15
In addition to challenges from threats
to public health, ination and price volatility, and
talent scarcity, it has been a very difcult few years
nancially for health systems. Hospitals ended
2022 with higher expenses due to ongoing stafng
shortages and fewer patient discharges.
16
According
to a survey of more than 900 hospitals, November
2022 was the 11th straight month of negative
operating margins.
17
Recent healthcare CFO survey
data suggests that 60% of healthcare organizations
defaulted or were unable to meet terms on bond and
loan covenants, and 74% of CFOs cited supply chain
disruption as a threat to their business in 2023.
18
The good news is that despite these competing
priorities, CEOs understand that sustainability is not
only a climate imperative, but also the foundation
for security, growth, and resilience. In the UNGC-
Accenture CEO Study on Sustainability, 98% of
CEOs see it as part of their role to make their
business more sustainable, up from 83% in 2013.
Leading CEOs are already embedding sustainability
into their businesses by launching new products
and services for sustainability (63%), enhancing
sustainability data collection across their value chains
(55%) and investing in renewable energy sources
(49%). Nearly half (49%) are transitioning to circular
business models, and 40% are increasing R&D
funding for sustainable innovation.
19
Sector Momentum
According to a 2022 Accenture study of Global
2000 companies, the health and life sciences
sector companies combined have set the fewest
net zero targets of all industries; only 10% of health
companies and 33% of life sciences companies
had net zero goals in place. However, momentum
is beginning to grow. The proportion of companies
setting net zero targets began to increase from 2021
to 2022, with a 6% increase for health companies
and a 9% increase for life sciences companies.
20
In October of 2020, the National Health Service
of England (NHS) became the rst health system
to commit to net zero emissions, with a goal of
2040.
21
In April 2022, over 100 health organizations
committed to the White House and Department of
Health and Human Services (HHS) Health Sector
Climate Pledge, committing to reduce emissions by
50% by 2030 and achieve net zero by 2050, publicly
accounting for progress annually.
22
In addition to an increasing number of individual
net zero targets, there has been a considerable
increase in climate action in the health sector over
the last several years. Over 60 countries, including
the United States, committed to the 2021 COP26
Health Program, pledging to develop more climate-
resilient and low-carbon health systems. In 2022,
over 100 healthcare organizations committed to
the White House and Health and Human Services
Health Sector Climate Pledge, agreeing to 1) reduce
emissions by 50% by 2030, achieve net zero by 2050,
and to publicly report data on progress, 2) develop
an inventory of supply chain emissions (Scope
3), and 3) create action plans to develop climate
resilience. With federal health system commitments,
this Pledge includes 15% of all U.S. hospitals.
23
The
Joint Commission, the largest standards-setting and
accrediting body in healthcare, not only committed
to the White House pledge but also has targeted
climate change as a top strategic priority. Jonathan
B. Perlin, MD, PhD, The Joint Commission’s new
president and CEO, believes “Decarbonization
and sustainability are critical to a health agenda,
especially because climate change is having a direct
and inequitable impact on the health and well-
being of people globally”.
24
In March 2023, the Joint
Commission published for public comment a new
proposed Leadership Standard (LD.05.01.01) requiring
hospitals to address environmental sustainability,
including measuring and reducing their greenhouse
gas emissions.
25
After receiving negative industry
feedback, the Joint Commission announced they
were considering introducing the new standard as
optional rather than as a mandatory requirement.
26