India's chemical industry is the main bulk provider to the pharmaceuticals industry in the Western world. While growth of the industry in India obviously creates economic benefits, it also contributes to country's severe water pollution crisis, as a result of the waste generated in the manufacturing process.
Water pollution related to pharmaceutical manufacturing in India has been identified as an important driver of antimicrobial resistance.
Nordea began addressing water pollution in pharmaceutical manufacturing in India in 2015, by engaging both with companies and through the global industry body, the Pharmaceutical Supply Chain Initiative (PSCI).
Since then, its persistent campaign has begun to bear fruit. Earlier this year, the Indian Ministry of Environment, Forest and Climate Change published a draft bill to limit concentrations of antibiotics discharged by pharmaceutical factories into waterways.
Notable steps along this journey include twice investigating the environmental and health impacts of the pharmaceutical industry in Hyderabad. Both times pollution with heavy metals and industrial solvents in the water at concentrations that were higher than maximum regulatory limits or safe exposure levels was discovered.
Nordea says, in response to the findings in the reports and to its expectations as an investor, PSCI developed an action plan, taking an industry-wide approach to address chemicals in the environment, focusing on capability-building and education of Indian suppliers.
In 2018 Nordea was invited to join the newly established PSCI advisory board, as the only investor.
The PSCI principles, which all member organizations have to adhere to, were reviewed in 2019 and now include sustainable sourcing, managing releases of active pharmaceuticals into the environment, and human rights.
As of today, Nordea meets with PSCI and companies to discuss progress made, and in 2019 over 200 companies involved in chemical manufacturing attended PSCI's supplier conferences in India.
Water pollution in Indian pharmaceutical manufacturing is Nordea's most prominent example of how it tries to engage, individually or collaboratively with other investors, and tries to promote better corporate governance, risk management, performance or disclosure standards on a wide range of ESG-related issues. EF