«Transparency serves as a unifying factor for our employees»
Before Maria Paola Chiesi took over her current role as Vice Chair of the Board of Directors of the internationally operating Chiesi Group, she spent nine years as Head of Shared Value & Sustainablility at Chiesi Farmaceutici, where she was responsible for monitoring and measuring the Group's environmental and social impact. Inspired by this experience, she initiated the process of transforming Chiesi into a Benefit Corporation, which strengthened the company’s position by obtaining the B-Corp certification.
By Thomas Scheiwiller with Maria Paola Chiesi
How would you describe what is special about Chiesi Farmaceutici in a few sentences?
The uniqueness of our company lies in its foundation within a family deeply entrenched in values such as integrity, ethics, and purpose. Our company’s purpose resonates with the personal values and goals of our employees, fostering a sense of belonging and shared mission within our teams. This translates in lived practice rather than a simple code to be respected, ignored, or breached.
We prioritize a value-driven approach always focusing on the long-term vision while delivering on our mission daily. Thus, we consider and embrace future generations by design. In our value system, purpose takes precedence, with financial considerations serving as a means to support that purpose. We strive for growth that encourages innovation and inclusivity, understanding that our financial resources are nourishment for our overarching mission.
What are the advantages or disadvantages of being a private, family-owned company when you compare it with a similarly sized listed company?
One of the primary advantages lies in the significant autonomy and flexibility we, as a family-owned company possess. In fact, we have the freedom to make decisions grounded in our long-term goals and values, enabling us to adapt swiftly to changes and pursue innovative strategies that align with our vision.
On the flip side, family-owned businesses may encounter challenges in terms of visibility and reputation compared to their publicly traded counterparts. To tackle this issue, we've implemented proactive measures to boost our transparency, eventually enhancing our credibility and reliability from an external perspective. By doing so, we not only aim at bridging the visibility gap but also reaffirming our commitment to ethical business practices, fostering trust with stakeholders and attracting opportunities and talents that align with our values.
Can you give us a bit of context about the decision to become a B Corp certified business? Are there specific benefits that you can share?
Our work in neonatology has brought us close to the most fragile patients: premature infants. This unique proximity to them and their families, unlike other therapeutic areas where we operate, has fostered in us a heightened sensitivity, which aligns seamlessly with our previously mentioned core values. This led to the inception of the Chiesi Foundation, aimed at enhancing basic access in LMICs. Not being a for profit organization, the work of the Chiesi Foundation compelled us to ponder our impact and how to measure it, defining impact as the societal change we strive to enact. Then, we started thinking of extending this paradigm to the company as well.
We thus solidified our commitment by legally establishing ourselves as a Benefit Corporation in Italy and the US in 2018, followed by achieving the status of Société à Mission in France in 2021.
Then, we explored ways to measure and analyze our overall impact. Recognizing the B Corp certification as the most rigorous and scientific system, in 2019, we pursued certification for the first time.
These initiatives sparked a company-wide improvement plan, engaging all employees and fostering strong motivation and a shared sense of purpose. Additionally, we observed a notable increase in both individual and team creativity, alongside a newfound sense of accountability. This holistic approach not only aligns with our core values but also enables us to drive positive societal change while cultivating a more fulfilling work environment for our staff.
How do you get shared value and sustainability integrated in your business?
At the beginning of our journey, back in 2015, we viewed sustainability through the lens of CSR (Corporate Social Responsibility). However, we found this approach unsatisfactory as it did not address the dimension of impact, which we consider crucial, as I mentioned earlier. In fact, we moved towards focusing on analyzing our impact, and we transitioned towards the concept of Shared Value, which is created when both social challenges and business opportunities are being addressed together, connecting a company success with social progress. According to this, we then developed sustainability plans inherently integrated into the business strategies.
Our most recent step taken towards this direction is to have merged the functions of Shared Value & Sustainability and Strategy into a single department.
“We must ensure measurement tools don’t become a mere compliance exercise that absorb significant resources without generating a clear impact.”
What is your take on the ever-increasing sustainability-related regulation: does it help you achieve your goals? Is it defining a level playing field for all companies? Or is it deferring attention from the strategically relevant topics and absorbing important resources?
Sustainability-related regulations and emerging standards are highly valued, especially when it comes to standardizing measurement practices. Until recently, there was a lack of clarity on what metrics to measure and how to do so effectively in the realm of sustainability. Establishing common measurement criteria and language is essential for thorough analysis, benchmarking against peers, and continuous improvement. Moreover, it plays a pivotal role in fostering awareness.
However, we must ensure these tools don’t become a mere compliance exercise or a superficial checklist that is time-consuming and absorbs significant resources without generating a clear impact. They should not serve as a smokescreen or justification for corporates to do ‘their part’. Additionally, the rules must integrate specific features for every sector to be truly effective and relevant.
Only then can they genuinely help corporates in adopting and fostering sustainable business practices.
How does Chiesi Farmaceutici balance the economic profitability, the investment in R&D, and the shared value and sustainability approach? And how do you explain it to your stakeholders? Can you give us a specific example to illustrate that?
A clear example of this can be found in our carbon minimal pMDI (pressurized metered-dose inhalers). Since one of the greatest contributors to our GHG emissions comes from the propellant gas contained in some of our devices for inhalation drugs for chronic respiratory diseases such as asthma and COPD, reducing emissions from these therapies, and thus the impact we have on the planet, is a key focus. This is why, we announced in 2019 the development of the first carbon minimal pMDI containing a low global warming potential propellant. This solution aims to achieve a 90% reduction in carbon footprint, requiring an investment of more than €350 million. At the same time, we are also continuing to invest in Dry Powder Inhaler (DPI) technology to make sure we provide all the therapeutic options that asthma and COPD patients need both now and in the future.
Also, we can find several examples in our rare disease business side, where we continuously invest in R&D to develop new treatments. In fact, since its establishment in 2020, the rare disease business unit increased its portfolio from two to ten products, representing a significant increase in access to therapy in only four years. We are currently supporting two research programs that aim to develop differentiated large molecule therapeutics for neurological disorders and systemic disorders with central nervous system involvement, which, if successful, may open a new frontier in medical care and overcome significant unmet patient needs.
Could you briefly summarize how the way you report to and communicate with the outside world has changed over the last few years and extrapolate a bit into the future?
Since becoming a Benefit Corporation and obtaining B Corp certification, our approach to transparent communication of financial, business, and sustainability metrics and results has significantly evolved. This shift is driven not only by legal and certification requirements but also by the immediate benefits we've observed. Among our communication efforts, we share annually our Impact Report, a key requirement of the Benefit Corporation legal status, as well as our Sustainability Report, which we've been producing since 2017, trying to align with CSRD disclosure requirements even before its entry into force.
We've significantly increased internal communication of results and objectives, as transparency serves as a unifying factor for our employees and fosters trust, enhancing a sense of belonging.
Additionally, we've recently embarked on direct interactions with stakeholders through stakeholder engagement initiatives/laboratories. This approach goes beyond mere communication or listening; it involves co-creation, leveraging the company's expertise and the stakeholders' needs. This expanded stakeholder engagement encompasses all areas of impact, surpassing our previous engagement efforts solely in the healthcare space.
“Since becoming a B-Corp, our approach to transparent communication has significantly evolved.”
More specifically: are there obvious ‘business cases’ for the Sustainability-related topics and if so which ones?
Initially, our commitment and actions towards sustainability may have been perceived as an 'extra' or merely a 'best practice.' However, with evolving regulations, sustainability has transitioned from being optional to imperative for companies to remain viable in the long term.
In essence, the business case for sustainability extends beyond ethical considerations; it is about securing long-term profitability, resilience, and relevance in an increasingly complex and interconnected global economy.
Are there peers or role models you would say you look up to?
We firmly believe in the power of dialogue and collaboration as essential tools for self-improvement and growth. In our quest to constantly evolve, we actively seek guidance and inspiration from various sources. It started with a discussion with a company from our local ecosystem, Davines, which triggered a first reflection on the Benefit Corporation Business Model. After meeting an international influencer such as Patagonia, we took the decision to move ahead and, today, we look to large B Corp like Danone to gather examples and insights on how to address the challenges that our company faces.
Chiesi Farmaceutici has around 7000 employees in 30+ countries. How do you get everybody on board with regards to Shared Value and Sustainability? How much is happening top-down and how much bottom-up?
We have an effective employee engagement program called We Actively Care For Tomorrow - We ACT, which has been in place since before we were officially certified as a B Corp or changed our bylaws to include the responsibility aspect. The program includes a variety of ways to reach people - from a training that almost everyone at Chiesi has gone through, including the top level, to an annual Sustainability Day where we focus on celebrating and recognizing that these incredible goals we have achieved have been achieved through a collective effort.
Bottom-up, we also have "We ACT Ambassadors" who volunteer their time and resources to drive this cultural change. There are committees, such as Diversity and Inclusion, that play a crucial role, and very impressive are the employee networks, Chiesi Affinity Networks, where people come together on their own initiative to take action for the benefit of underserved or marginalized groups.
Top-down, it is a clear commitment that goes beyond words. Not every company's board of directors would be willing to change its bylaws. The same is true for our senior management, who dedicate resources to sustainability improvement and reporting. Our strategic sustainability plans are approved and supported by top management, and we know that sustainability is a factor in their day-to-day decisions.
Where do you see the most important issues and challenges in the biopharma sector today and in the future?
Given the highly regulated nature of the biopharma sector, maneuvering through complex regulatory frameworks, and adhering to diverse requirements poses significant challenges for companies. This complexity often impedes quick and agile adaptation to changes within the industry.
In addition, to reclaim Europe’s role as a hub for innovation in the biopharma sector, we need a regulatory environment that fosters investment in innovation, research, and development. This will prevent Europe from solely consuming innovations produced elsewhere, fostering a renewed focus on homegrown advancements, and ensuring the strategic autonomy of the region.
The increasing shift to digital methods is surely another challenge we must embrace, especially considering its growing prominence in our sector, particularly in R&D.
A critical aspect relates to ensuring the smooth flow of the supply chain, to prevent shortages of components and products necessary for the development of our medicines. Therefore, implementing robust supply chain management strategies and contingency plans is imperative.
Finally, but not least, it is essential to join forces among companies, regulators, and suppliers within our sector, to find better solutions to the environmental sustainability issues of our practices and the negative impacts they have, such as the use of plastic containers. It does not make economic or efficiency sense for each entity to act independently, without putting the well-being of patients and everyone involved at the center. On certain matters, which are common to all and do not represent competitive advantages, especially those that have a direct impact on patients, a common solution must be found together.
“Our company’s purpose resonates with the personal values and goals of our employees.”
What are the biggest challenges for Chiesi Farmaceutici in the medium term?
At the end of the day, whatever short or mid-term, sector-specific challenge Chiesi may face, it pales in comparison to the broader and more significant challenges the world confronts. Therefore, I’d say that the biggest challenges we currently see are the same ones humanity faces, and our greatest concerns are maintaining harmony among nations, avoiding wars, addressing health equity globally and fighting climate emergency to ensure the survival of ourselves and future generations.
What would your recommendations to other companies be if they wanted to go “the Chiesi way”?
Innovate: Companies also need to be open to new ideas and challenges. Embracing fresh perspectives, be it from diverse talent pools or emerging trends, fuels innovation. At the same time, investing in innovation becomes imperative for companies seeking to thrive in today's dynamic landscape.
Collaborate: involve all your employees, along with stakeholders and partners (value chain), in this journey. Doing so increases the chance of fostering a cultural shift that collectively guides the company towards a prosperous future, while ensuring a positive impact on the planet and society.
Integrate environmental but also social considerations and KPIs to monitor social and environmental performance into business discussions, at the same level of financial performance. Connect your managers’ remuneration to social/environmental results, not just financial ones.
Understand Your Impact: Our commitment to social and environmental responsibility, as well as integrity, has been ingrained in our mission since our inception 85 years ago. Chiesi recognizes that we operate within a broader context, where global challenges such as climate change and healthcare accessibility directly affect us. We acknowledge our role and responsibility in addressing these challenges.
About: MARIA PAOLA CHIESI
Since 1995 Maria Paola Chiesi has been working at Chiesi Farmaceutici. In 2015 she took over the role of Director of Shared Value & Sustainability and in 2021 was appointed president of the Chiesi Foundation. In 2023, Maria Paola has been elected Vice Chair of the Board of Directors of Chiesi Farmaceutici. She holds a Degree in Medicinal Chemistry and Pharmacological Sciences and a Master in Business Administration (MBA).
About Chiesi Farmaceutici
Chiesi is an international, research-focused biopharmaceuticals group that develops and markets innovative therapeutic solutions in respiratory health, rare diseases, and specialty care. With over 85 years of experience, Chiesi is headquartered in Parma (Italy), operates in 31 countries, and counts more than 6,500 employees.