The Jupiter Fixed Income team have engaged with Organon on a range of topics, from diversity to their carbon emissions.

 

Organon is a healthcare company that aims to deliver impactful medicines and solutions for women. We were impressed by Organon’s work on all aspects of Environmental, Social and Governance (ESG) issues and were clear in vocalising that it can be a tool for progress of their company, employees, customers and society as a whole.

 

This is what their CEO said in the opening remarks of their 2021 ESG report: “Together, we are guided by our purpose – to help women and girls achieve their promise through better health. By addressing gender-related disparities in health, we are building a more sustainable future for women, families, economies, and society. Our purpose is inextricably linked to our corporate vision and strategy, and underpins our environmental, social, and governance (ESG) approach as a framework to serve the interests of each of our key stakeholders. Our Board of Directors oversees our ESG strategy, and together with our Executive Leadership Team, works to ensure the strategy is implemented and embraced across the organization.”

 

The Chair of the Board added: “Our Board is highly diverse, and our directors bring a range of skills, perspectives, and life experiences to their roles. We all agree, however, on the importance of strong ESG practices to the company’s financial success, resilience, and ability to achieve our corporate purpose”

 

Of note, 69% of the directors are women – the highest level of female representation by far of any healthcare company in the S&P 5001 .

 

The following comment on their vision forms the basis of why we believe Organon could continue to do well from an ESG perspective: “We are a global healthcare company with the vision to create a better and healthier every day for every woman. We seek to deliver innovation, improve access, and expand choice to help address the unmet medical needs of women, and ultimately improve their lives. Across the globe, women have vast unmet medical needs. For decades, very few companies have dedicated resources to innovation and improving women’s health. We are investing in high-need areas that have no established precedent and where we believe the current standard of care is unacceptable to meet the needs of patients”

Environmental 

Organon have stated that they are aiming to reduce Scope 1 and 2 GHG emissions by more than 25% from adjusted 2020 levels. Their goal is to have at least 70% of their supplier spending to be devoted to suppliers that have GHG emissions reduction programs. As of the full year of 2021, Organon have disclosed that their scope 1 and 2 emissions totalled 57.9 million TCO2.

 

They are currently working on their Scope 3 measurement accounting (target publication date end 2025) and their TCFD analysis. We came away with the impression that they are fully committed to measuring their Scope 3 GHG emissions, setting targets and becoming a leader in the space.

 

In Oss, Netherlands, Organon have begun a solar panel project that involves installing solar panels on their production facilities and new warehouse. Pre-existing solar panels installed in 2020, have generated 105000KWh per year. Along with the new solar panels installed in 2021, Organon estimate that the total amount of energy generated will be around 475000KWh. In Brazil, Organon have also improved fleet routes and consolidated deliveries, enabling a reduction in their fleet from 30 vehicles a month to 10, averting more than 100 tons of CO2 emissions each year. In the Cramlington facility in the UK, Organon have installed two 2MW wind turbines, saving 2986 tCO21 in 2021, as well as an adjacent biomass plant from which it derives both electricity and steam supply.

 

By 2025 Organon aim to reduce water usage in their operations by >5% from adjusted 2020 levels. Their goal is that at least 70% of our overall spending with suppliers will be devoted to those that have water reduction programs.

 

Organon say that by 2023, their goal is that packaging of all products will be designed according to their sustainable packing guidelines and that by 2025, at least 80% of the operational waste at their six owned manufacturing sites will be reused, recycled, or otherwise used beneficially.

 

Organon have said that over the long term, their ambition is to preserve and increase biodiversity at their manufacturing sites and offices. By 2025, their goal is to invest in projects that preserve and restore biodiversity at all their sites and major office locations. They have loosely stated that by 2025 they wish to invest in projects that preserve and increase biodiversity at or near all their sites and major office locations and that by 2050, their ambition is to preserve and increase biodiversity at their locations and in their communities.  

Diversity 

Organon publish their UK Gender pay gap here:. When compared with the Gender Pay Gap (GPG) of their previous company structure, this GPG has improved by 4%. Importantly they say: “Our mean pay gap reflects a positive journey in reducing the gap to a near ideal 0 of -1.1%. At Organon, we can only be successful in our commitment to listening to women and advancing women’s health if we listen firstly to our own women within our workforce.” We encouraged them to publish comparable data for the entirety of their workforce.  

The charts below shows the percentage of males and females in each quartile:  

Social 

We spent the remainder of our meeting talking about the social initiatives at Organon which they are very passionate about.

 

Their R&D and business development activities are focused on four cornerstones of women’s health: contraception and fertility; maternal and peripartum conditions such as postpartum haemorrhage (PPH), preeclampsia, and preterm labor; disorders unique to women such as endometriosis, fibroids, polycystic ovary syndrome (PCOS), and bacterial vaginosis (BV); and menopause. They will potentially expand these activities to diseases and healthcare issues that disproportionally affect women.
Organon have a goal for expanding access to medicines and healthcare in low to middle income countries:

 

“Our Her Promise Access Initiative is working with other organizations around the world to help girls and women prevent unplanned pregnancies. The initiative is part of a multi-agency, global effort to expand contraception availability to 69 of the lowest income countries. The initiative began in 2012 at the London Summit on Family Planning.
The resulting program—known as FP2020—brings together stakeholders including non-government organizations (NGOs), government agencies, and pharmaceutical companies. We began our participation when we were a part of our former parent. As part of this coalition, we partner with NGOs to provide patients with Nexplanon® (etonogestrel implant) (sold as Implanon NXTTM in many countries outside the United States) which is a birth control implant that goes into women’s arms. The program also distributes Marvelon™, Mercilon™, CerazetteTM, and ExlutonTM contraceptives and birth control pills. And we have already had an impact. Well before we spun, more than 20 million women had received Nexplanon through our access program, helping to prevent an estimated 40mm unintended pregnancies2 .”

 

Organon mentioned that they are working with the Gates Foundation to double Implanon NXT volumes to 10 million units per year that will be made available to FP2020 countries and continue the previously established access price through 20253 .

 

In the United States, their Patient Assistance Program (PAP) provides certain biosimilar products free of charge to patients in crit