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Our Sustainability and ESG Goals
Dr. Reddy's integrated annual and sustainability report for the Fiscal Year 2025 is out. This edition acknowledges 40 years of Dr. Reddy's by taking you through our most significant milestones.
Our progress was recognized in our ascent to the Dow Jones Sustainability World Index, improved position in the S&P Global Sustainability Yearbook, and silver medal status by EcoVadis.
We scored “A” in Climate Change & Supplier Engagement and “A” in Water Security. We are the only Indian pharmaceutical company to achieve CDP’s Leadership Band rating of A/A– in Climate Change, Water Security & Supplier Engagement (only 2% of companies globally received an “A” in 2024).
Sustainability is deeply embedded in our purpose and forms the core of our organization.
Our journey began with APIs in 1984, and we evolved from small molecules to large molecules and from APIs to finished formulations over the decades. Amidst this evolution, what has remained constant at the heart of our organization is a deep commitment to patients and the customers we serve through our core principles of collaboration and sustainability.
By the end of FY2025, we had served over 756 million patients and continue our endeavours to reach over 1.5 billion patients globally by 2030. This means almost one in every five people on this planet will use Dr. Reddy’s product or service. The health of people is strongly linked to the health of our planet. That's why our integrated report also shows how sustainability and business are strongly linked.
Our ESG (Environment, Social & Governance) Goals
BUILDING THE FUTURE RESPONSIBLY
Our ESG goals are deeply embedded in our business strategy, guiding our efforts to create a significant and lasting positive impact on the planet and its people. We have made fair progress across several of these goals, even as a few continue to present challenges. We are committed to advancing our ESG journey, ensuring that as we prosper, we do so responsibly and with resilience.
Environment – Planet First
| Theme | Description | Target | FY 2025 Progress |
|---|---|---|---|
| Reducing carbon emissions | Adopting renewable power | 100% renewable power by 2030 | 100% renewable power by 2030 |
| Progressing towards carbon neutrality | Carbon neutrality in our direct operations (Scope 1 & Scope 2) by 2030 | 60% Carbon neutrality Achieved so far | |
| Reducing carbon emissions in the supply chain | 12.5% reduction in indirect carbon emissions across our supply chain (Scope 3 emissions) by 2030 | 5% decrease in reported Scope 3 emissions against FY2021 | |
| Reducing carbon emissions in the supply chain | 12.5% reduction in indirect carbon emissions across our supply chain (Scope 3 emissions) by 2030 | 5% decrease in reported Scope 3 emissions against FY2021 | |
| Water Positivity | To be a water positive organisation | Be water positive by 2025 | Continued to be a water Positive company post achieving the target in FY2023 |
Social - Healthcare Reach
| Theme | Description | Target | FY 2025 Progress |
|---|---|---|---|
| Access | Serving maximum patients with care | Serve 1.5 billion patients by 2030 | ~756 million patients served |
| Affordability | Introducing first-to-market solutions | *40% of our new launches to be first-to-market in our #priority markets by 2030 | 29% |
| Innovation | Improving treatment standards regularly | 3 innovative solutions every year from 2027 to improve the standard of treatment | Toripalimab and Evenity launched in India |
Equitable Growth
| Theme | Description | Target | FY 2025 Progress |
|---|---|---|---|
| Diversity, equity, and inclusion | Enhancing women leadership | At least 35% women in senior Leadership by 2030 | 20.4% |
| Promoting gender parity | Gender parity by 2035 | 21.8% | |
| Equal opportunity for the persons with disabilities (PwDs) | Include at least 3% persons with disabilities (PwD) in our workforce by 2030 | 0.43% | |
| Wage parity among the extended workforce | ^100% living wages for our on-premises extended workforce by 2025 | Living wage benchmarks were validated for all locations and all On-roll employees are compliant to living wages |
Governance – Trusted Relationships
| Theme | Description | Target | FY 2025 Progress |
|---|---|---|---|
| Corporate Governance | Committed to upholding the highest standards of compliance and ethics | Meet the highest standards on compliance and ethics backed by Robust corporate governance | Zero material deviations recorded During the year |
| ESG Disclosures | Transparency and communication around our ESG performance | Enhance disclosure on our ESG progress to reach the top Quartile by 2025 | Enhanced ESG disclosures with wider coverage of KPIs, increased reporting frameworks, and double materiality assessment |
| Strategic Suppliers | Embedding ESG principles across our supply chain | 100% strategic suppliers to be compliant with our chosen ESG framework by 2030 | 73% of strategic suppliers (India Spend) assessed |
What we achieved in the past year:
Sustainability & Green Chemistry in Dr. Reddys API Operations
ESG in the pharmaceutical industry is an essential prerequisite. In our core API business, our focus on innovation-led affordability gives our customers access to the most complex active ingredients, while maintaining their drug development needs has also given an edge to our own generics business, enabling us to deliver higher quality at competitive costs.
We are present across multiple channels, with customer engagements along different points in the development and manufacturing value chain—from discovery and CDMO (Contract Development and Manufacturing Organization) services to development, manufacture, and sales. Through integrated discovery and CDMO services, we have executed more than 500 projects over 20 years.
- 15–18% improvement in Process Mass Intensity (PMI).
- 20–22% waste reduction for 9 high-volume products.
- No use of hazardous solvents like acetonitrile in the 8 evaluated products.
- In-house capabilities to apply green chemistry principles.
- Focus on reducing hazardous substances and improving sustainability.
- Focus on energy efficiency, water conservation, and waste reduction.
- Adoption of low-temperature evaporator (LTE) technology replacing conventional systems.
- Implementation of membrane bioreactor (MBR) systems for improved water treatment.
- Lifecycle Assessment (LCA) conducted for Sitagliptin HCL and Quetiapine Fumarate APIs.
- Water conservation and reuse initiatives at API sites.
Highlights for the year
API (Develop, manufacture, and sell APIs to customers globally)
- 1650+ active drug master files (DMFs).
- 65+ products in pipeline.
- 111 DMFs filed in FY 24
API+ (Institutional and B2B sales of value-added offerings above the API)
- Currently in 25+ countries
Our Community Initiatives
Education
- Enhance the quality of education and provide equal learning opportunities to the children from the marginalised communities through:
- Kallam Anji Reddy Vidyalaya and Junior Vocational College
- School Improvement Programme (SIP)
- Sashakt scholarship for girls
Livelihood
- Provide skills to youth for enhancing their employability and to enhance livelihoods by extending support to small and marginal farmers through:
- Placement linked skilling programme for youths and Persons with Disability
- Healthcare Skilling in the non – medical healthcare sector
- Agriculture programme focusing on capacity and income enhancement of small and marginalised farmers.
Health
- Making healthcare accessible and affordable and reliable for the communities through:
- Rural healthcare services at the doorstep through Community Health Intervention Program
- Tele-counselling support for mental health through the Roshni Helpline
- Include at least 3% persons with disabilities (PwD) in our workforce by 2030.
- Improving primary healthcare services to improve the quality of primary care services in the selected Primary Healthcare Centres
Environmental Sustainability
Promoting sustainable agriculture practices and wildlife conservation through:
- Climate Smart Agriculture and Regenerative Agriculture practices
- Conserving Tigers and their habitat in the Eastern Ghats.
Sustainability in the pharma industry is a vital aspect. Our strength in innovation, ethical values, and focus on bringing critical, life-saving products early to market secures a unique kind of sustainability for us. In addition, our leadership across global markets indicates our strong alignment with our & Good Health Can’t Wait agenda.
Pharmaceutical companies’ sustainability is an increasingly important topic for the entire world. While we renewed our goals in 2023 to adapt to changing stakeholder expectations, address climate change, and our resolve to work on material issues, we continued to examine more ways to make an impact. We consulted a more extensive set of global pharmaceutical sustainability and pharmaceutical standards and frameworks, and these findings guided our ESG reviews with the leadership and Board.
Combining a top-down and bottom-up approach, using more tools such as our updated enterprise risk management findings, we set 14 bold and ambitious goals across the ESG dimensions to form our vision for 2030. Each of these goals considers our critical material topics, the external environment in which we operate, and the business and social impact we can create.
Our Sustainability Framework
At Dr. Reddy’s, we are committed to taking meaningful action for a sustainable future. With our long-standing commitment to protecting the environment, we are working on solutions that help minimize the impact of our operations, driving improvements in multiple areas at various stages of the product life cycle.
Looking at issues of maximum importance to our stakeholders and the business, we are in the process of identifying material issues and building our strategic sustainability framework. We will develop ambitious goals and management targets for each focus area, with multiple milestones, incorporating governance systems and processes, monitoring, and disclosing our performance for each goal, and ensuring independent third-party assurance.
We are determined to play our part in upholding the more prominent global perspective and sustainable development in pharmaceutical industry. We will align ourselves with the United Nations sustainable development goals (UN SDGs), mapping them with our top material issues, allocating internal resources, taking relevant actions, and building technical capabilities. We are also working on greater integration of ESG into our business and building stronger stakeholder relationships by intensifying dialogue and communicating our vision and progress around material issues.
We are determined to play our part in upholding the more prominent global perspective. We will align ourselves with the United Nations' sustainable development goals (UN SDGs), mapping them with our top material issues, allocating internal resources, taking relevant actions, and building technical capabilities. We are also working on greater integration of ESG into our business and building stronger stakeholder relationships by intensifying dialogue and communicating our vision and progress around material issues.
The ESG principles underlie our business strategy. We address customer needs and create value for all stakeholders by addressing unmet needs. We are conscious of our footprint and impact and believe that addressing sustainability challenges is the need of the hour. Therefore, we continue to follow the best practices to make our business more sustainable.
R&D Operations Guided by Sustainability Framework
Since 2010, Dr. Reddy’s has been committed to the UN Global compact corporate responsibility initiative and its principles in the environment, sustainability, and green chemistry. As an active pharmaceutical ingredient supplier, our primary goal is to develop products that will provide a reliable supply of products of superior quality for the pharmaceutical industry. Also, we ensure that our APIs are produced using eco-friendly processes so that our customers can sustainably access our APIs.
Robust Supply chain
Our supply chain process is based on a strategic model to ensure a practical, reliable, and sustainable supply of goods and services based on a segmented operation. A scorecard is generated for all the KPIs, and we monitor the progress toward each goal. In addition, a well-defined Supplier Code of Conduct (SCOC) governs our supply chain management. We also have a dedicated SCM (Supply Chain Management) team that addresses all sustainable sourcing elements with special emphasis on supply continuity, quality and compliance, supplier relationships, capacity and capability building, supplier, and performance management, and aligning the partners with our vision of sustainability.
- Strong partner network - Intelligence to get early alerts on issues, enabling us to take corrective actions.
- Cross-industry collaboration groups - Support groups of transporters, shippers, airlines, etc. came together for information sharing and solutions.
- We are opening ourselves to new possibilities - Adopting new solutions such as moving cold chain products by road and sea, expanding our logistics footprint to new ports and airports, introducing new origin and destination pairs, and exploring digital technology (e.g., digital signatures for regulatory documents).
"Sustainability is at the core of our mission at Dr. Reddy’s. We are committed to minimizing our environmental footprint, empowering communities, and ensuring ethical business practices. Together, we can build a healthier planet for future generations".
Deepak Sapra,
CEO, Pharmaceutical Services & Active Ingredients.
Let’s discuss API sourcing
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