Sustainability Strategy
Sustainability is central to BB Biotech’s business strategy, driving long-term success and value creation for shareholders and stakeholders alike. We aim for growth while considering environmental and societal needs. As an investment company, we are positioned to support sustainable development for the benefit of all our stakeholders.
Sustainability is integrated into our investment process as a key factor in assessing risks and opportunities during due diligence. We believe the most significant ESG aspect of medical development is the positive societal impact of novel therapeutics, as biotech companies aim to create drugs for unmet medical needs. Below are our four strategic focus areas in a sustainability context.
Full integration of sustainability into business strategy
ESG and sustainable investing are widely recognized, and BB Biotech is committed to integrating sustainability at the Board, Investment Manager, and portfolio levels. These principles are the foundation of our responsible corporate practices, essential for creating value for our stakeholders. Guided by these values, we follow a clear and transparent ESG policy and investment guidelines that define our environmental, social, and governance standards.
Maintaining CO2 neutrality of business operations and initiating the Net-zero process
The Investment Manager is committed to achieving net zero by 2050, with a goal to reduce CO2 emissions per employee (FTE) by 30% by 2030. The carbon footprint was first measured in 2021, with business travel, commuting, heating, and electricity being the main sources of emissions. To address this, we prioritize video conferencing, encourage public transport with financial incentives, and use natural lake water for office heating and cooling in Küsnacht. By offsetting CO2 emissions through high-quality climate projects in Switzerland, the Investment Manager was certified by Swiss Climate for the fifth consecutive year in 2024.
The Investment Manager is committed to achieving net zero by 2050, with a goal to reduce CO2 emissions per employee (FTE) by 30% by 2030.
Increase gender diversity and promote inclusion
BB Biotech values diversity within its Board of Directors and the Investment Management team, believing it drives business success. A culture of respect and collaboration across languages, cultures, and nationalities fosters innovation and long-term success. The diverse backgrounds, experiences, and networks of the Board members help attract qualified professionals and ensure effective oversight in the highly technical biotech field.
This diversity, along with an inclusive environment, supports investment decision-making aligned with the company’s long-term strategy. Gender diversity is reflected with three experienced women on the Board out of six board members. A formal policy requiring at least 30% representation has been implemented.
Anchoring sustainability in the investment process
BB Biotech systematically reviews its investments for sustainability risks and compliance with fundamental human rights, following principles like the UN Global Compact. In addition to strict exclusion criteria, environmental, social, and governance (ESG) factors are integrated into the analysis of each company, using ratings from MSCI ESG Research. While investments in «ESG laggards» are allowed, they require a detailed and well-documented justification. If material ESG issues are identified, they are brought to the attention of the companyʼs management as part of a systematic stewardship process.
Sustainability Governance
Effective sustainability governance is key to embedding sustainability in our business and investment practices while identifying opportunities and challenges early. This requires a clear regulatory framework for managing sustainability issues. Both the Board of Directors and the Investment Manager actively oversee sustainability governance. The Boardʼs Sustainability and Governance Committee, working with the Investment Management Team, ensures a robust sustainability strategy and meets at least four times a year.
ESG Governance structure
A sustainability working group at the Investment Manager is tasked with leading the implementation and integration of sustainability in all business areas. This working group consists of members from different business departments. It monitors current developments in the area of sustainability and anticipates their impact on the business model of BB Biotech. It supports the Board of Directors and the Sustainability and Governance Committee in the formulation and further development of the sustainability strategy. The sustainability working group is therefore also responsible for managing and implementing projects in the business units and areas of activity.
Stakeholder Engagement and material ESG Topics
With our business model unchanged, material ESG topics remained the same as for the previous year. With respect to our continuous stakeholder dialogue, following aspects were considered during 2024:
Stakeholder | Engagement | Activities 2024 | Topics | |||
Shareholders | • BB Biotech is in regular contact with its shareholders. • Throughout the year, regular dialogue with investors is maintained. In accordance with the listing rules of SIX Exchange and XETRA, important business developments are published by means of press releases or ad hoc announcements. At the same time, these announcements are published on the company's website. • The notices to shareholders required by Swiss company law are published in the Swiss Official Gazette of Commerce SOGC. | • Annual general meeting • Conferences and events • Roadshows/ investor meetings • Corporate website • ad hoc publications • Media releases • Annual and interim reports | • Economic performance • Portfolio companies • Sector developments • Macro developments • Share performance- Sustainability | |||
Employees at the Investment Manager | • Employees are regularly informed about business developments, changes in the company and product updates. Communication takes place through various channels such as emails and townhall meetings. • The Investment Manager also conducts company-wide surveys to monitor employee satisfaction and engagement and ensure employees understand the business. Employee feedback is forwarded to management, which uses it to drive specific actions. | • Continuing education • Talent attraction and retention | • Safety and health • Sustainability • Strategy • Next Generation | |||
Analysts and Distribution partners | • Our distribution partners are supported by a dedicated Investor Relations and Sales team. Analysts and distribution partners have regular personal contact with their key account managers and receive regular newsletters with product and business information. • You can sign up for the free email distribution list. | • Key Account Manager Relationships • One-on-one meetings • Conferences and events • Complaint handling • Survey | • Products • Sustainable products • Customer relationship and satisfaction | |||
Suppliers | • BB Biotech and the Investment Manager are in constant contact with their suppliers and service providers. If possible, local suppliers and service providers are preferred. Each supplier or service provider undergoes pre-qualification to ensure compliance and correspondence is maintained throughout the business relationship to verify requirements, make payments and negotiate contracts. | • Direct dialogue | • Responsible procurement • Traceability | |||
Portfolio companies | • In the interest of our shareholders, we engage with management as a professional investor. • Activities: Meetings with company representatives on all levels (top management, Board of Directors, IR, etc.) | • Management meetings (senior management, Board of Directors, IR) • Voting at general meetings • Exchange of experience | • Sustainability • Innovation • Cost structure • Capital structure • Corporate Governance | |||
ESG rating agencies | • We engage with rating agencies and provide transparency in order to be fairly assessed. | • Meetings • Participation in survey • Training of employees based on feedback | • Small vs. large caps • Coverage • Rating methodology | |||
Regulator | • BB Biotech regularly reports to regulators as part of its business and complies with rules and regulations. | • Exchange of experience • Events • Annual and interim reports | • All ESG-related topics • Reporting standards | |||
Media | • Media office at the Investment Manager conducts active media relations with a high level of service. For balanced reputation management, the topic of sustainability has a high priority. | • Key Account Manager Relations • One-on-One meetings • Unofficial media roundtables | • All ESG-related topics • Company developments • Product and sector updates |
Material ESG topics identified
The materiality assessment helps the Board of Directors and Investment Manager identify key sustainability issues by considering stakeholder expectations. The analysis continuously enhances sustainability management by understanding stakeholder needs and evolving material concerns. The materiality matrix guides corporate processes, identifying opportunities and risks and enabling appropriate actions.
Materiality matrix
Throughout 2024 the key material topics have not changed vs. the prior reporting period, i.e. BB Biotech still derives eight central topics from the materiality matrix, which are taken into consideration as part of sustainability management and the strategy.
- Economic performance
Financial solidity and delivering long-term total returns to shareholders ensure that BB Biotech AG is and remains a reliable and value-adding partner for all its stakeholders. - CO2 emissions
By 2030, the Investment Manager aims to reduce the CO2 emissions of its business operations per employee (FTE) by 30%. - Corporate governance and business ethics
BB Biotech recognizes that sound corporate governance and a clear management structure with defined roles and responsibilities are critical to the long-term success of the company. - Transparency
BB Biotech’s corporate governance complies with internationally recognized standards. We disclose transparent information about our governance. This enables our stakeholders to verify the quality of the company and supports investors in their investment decisions. - Diversity and inclusion
Diversity and equal opportunities are part of the corporate culture practiced by BB Biotech and the delegated Investment Manager. Accordingly, we promote potential as well as skills and competencies equally among all employees across all age groups. - Employee development and retention
Our corporate culture is based on mutual respect and trusting cooperation. Regular feedback and development meetings, as well as recognition and appreciation of performance, are important prerequisites for the company’s success. - Employee engagement
The Investment Manager commits to conduct a Group-wide employee engagement survey every three years to assess employee satisfaction and the need for improvement. - Responsible investing/Sustainable products
Our investment process implements formal ESG investment guidelines and therewith all investments are systematically reviewed for sustainability risks and breaches of elementary human rights. Besides upholding strict exclusion criteria, environmental, social and governance factors are integrated into the fundamental analysis of every company through an ESG integration process. ESG ratings compiled by the global leading ESG research provider MSCI ESG Research are incorporated in this process.
Further details on the management of material ESG topics follows in the chapters after we introduce the relevant SDGs.