Climate Change Data

Environmental Metrics

ESG Focus Areas

• Product Quality and Patient Safety
• Eco-efficient transportation and operation
• Better health for employees and communities
• Ethics and Compliance
• Partnerships and Engagement
• Access to healthcare and community health
• Employee recruitment, engagement and retention

Environmental Achievements

• LED lighting retrofits expected to save 1.5 million kWh of electricity annually
• Diverted 15,307 tons of recyclables away from landfills in FY18
• Reduced water use by 11.4% in the U.S. from FY17 to FY18 (due in part to fewer facilities after the formation of Change Healthcare)
• Signed a long-term agreement to purchase solar power for a major McKesson facility, expected to reduce costs and produce electricity equal to approximately 74% of the facility’s annual consumption in FY19
• Switched to 100% renewable energy in warehouses in Belgium from FY17 onward

Social Achievements

• $100 million donation to start a new foundation to combat the opioid epidemic
• $10 million donation to McKesson Foundation
• $4.3 million in cash and product donations
• $1+ million in employee donation matching
• $700,000 donated for disaster relief in FY18
• 14,000 employees participated in Community Days at 130 locations
• 31 employee honorees for the McKesson Community Heroes program
• 2.4 billion steps for McKesson in Motion
• 76,000 patients reached through Giving Comfort
• Completed 441 Six Sigma projects in FY18, with more than $130 million in fiscal impact

Governance Achievements

• Code of Conduct available in 10 languages
• Guided by ICARE and ILEAD shared principles
• Employees can raise concerns through a whistleblower line, compliance officers, human resources, and managers

Climate Goals & Targets

Environmental Challenges

• Opioid epidemic in the U.S.
• Fuel consumption for transportation
• Workplace injuries
• Water scarcity
• Paper use
• Energy consumption in facilities

Mitigation Strategies

• Invested millions to enhance anti-diversion program
• Launched a foundation dedicated to combating the opioid crisis
• Advocating for solutions to prevent opioid diversion and misuse
• Optimizing delivery routes and use of delivery vehicles
• Driver education on eco-efficient driving
• Energy reduction for outsourced and in-house fleets
• Initiatives like safe lifting, pre-shift stretching, ergonomic design, and slip, trip, and fall prevention in distribution centers
• Smart irrigation program (pilot)
• Going digital (paperless invoices, two-sided printing, electronic handheld scanners)
• Increasing LED lighting across facilities
• Replacing inefficient heating systems

Supply Chain Management

Supplier Audits: Regular audits and checks around authorizations and certifications

Responsible Procurement

• Supplier qualification procedure; McKesson’s Sustainable Supply Chain Principles (MSSP) for private-label suppliers outside the U.S., Canada, and Europe

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: ISO 9001 (eleven businesses in Europe), LEED (U.S. offices in Irving, Texas; Richmond, Virginia; Scottsdale, Arizona; and San Francisco, California), German Sustainable Business Council (European headquarters in Stuttgart)

Third-party Assurance: McKesson’s Internal Audit team (environmental data); plans to pursue external assurance for FY19 report

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Product quality and patient safety
• Eco-efficient transport and operations
• Better health for employees and communities

Environmental Achievements

• 11% reduction in Scope 3 CO2 emissions from employee air travel
• Switching to renewable energy in Belgian warehouses (since FY17)
• Long-term agreement to purchase solar power in the US
• LED lighting implementation expected to reduce energy consumption by up to 40% in distribution centers, pharmacies, and offices; European distribution centers expect to save more than 3,300 tons of CO2 emissions per year through LED lighting alone.
• More efficient heating systems in 50 European pharmacies saving energy equal to 200 tons of CO2 emissions yearly.
• Smart irrigation programs expanded to five sites, saving enough water to fill 4.4 Olympic swimming pools each year.

Social Achievements

• Launched a national foundation (FORE) with $100 million to combat the opioid crisis.
• Contributed $2.3 million in cash and merchandise to support charitable organizations.
• McKesson Foundation disbursed more than $3.7 million to support cancer care and employee community engagement.
• Employees supported 1,183 organizations, volunteering at the workplace and in their free time.
• Expanded employee relief fund to Canada and introduced $1,000 grants for evacuation assistance.
• Improved injury rates in US distribution centers and offices (11% decline in total recordable injuries and 15% decline in lost-time injuries).
• Online doctor access for patients in the UK through LloydsPharmacy.
• Electronic health records access for First Nations families in Canada through RelayHealth.

Governance Achievements

• Formed a standing Compliance Committee on the Board of Directors.
• Enhanced political contributions and lobbying policy for the third consecutive year.
• Independent Board Chair appointed.

Climate Goals & Targets

Environmental Challenges

• Opioid epidemic in the US
• Climate change (energy consumption, transportation)
• Resource scarcity (water, paper, waste)
• Workplace injuries

Mitigation Strategies

• Initiatives to prevent opioid diversion, public policy recommendations, contributions to FORE.
• Energy efficiency initiatives, renewable energy sourcing, optimized transportation.
• Recycling and reuse programs, water conservation, reduction of paper use.
• Safety training programs, injury prevention initiatives, ergonomic design.

Supply Chain Management

Responsible Procurement

• McKesson Sustainable Supply Chain Principles (MSSP)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: ISO 9001 (10 businesses in Europe), LEED (multiple US offices and distribution center), WELL (multiple US offices)

Awards & Recognition

• Disability Equality Index (best place to work)
• Human Rights Campaign (best place to work for LGBT equality)
• Forbes (best employers for diversity)

Environmental Metrics

ESG Focus Areas

• Greenhouse gas emissions reduction

Environmental Achievements

• Committed to set science-based targets to reduce greenhouse gas emissions.

Social Achievements

• Named a “Most Admired Company” in the healthcare wholesaler category by FORTUNE, a “Best Place to Work” by the Human Rights Campaign Foundation, and a top military-friendly company by Military Friendly.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Costly and disruptive legal disputes and settlements, including regarding our role in distributing controlled substances such as opioids.
• Potential losses not covered by insurance.
• Adverse impacts from changes in tax legislation or challenges to tax positions.
• Significant charges from impairment to goodwill, intangibles and other assets or investments.
• Cybersecurity incidents and potential significant computer system compromises or data breaches.
• Significant problems with information systems or networks.
• Unsuccessful retail pharmacy profitability.
• Harm from large customer purchase reductions, payment defaults or contract non-renewal.
• Risks associated with contracts with government entities (future funding and compliance).
• Harm from changes in relationships or contracts with suppliers.
• Adverse impacts from healthcare reform (changes in pricing and reimbursement models).
• Adverse impacts from changes or disruptions in product supply (difficulties in sourcing products and changes in pricing due to the effects of the COVID-19 pandemic on supply chains).
• Adverse impacts as a result of distribution of generic pharmaceuticals.
• Adverse impacts from an economic slowdown (including the effects from the COVID-19 pandemic) or recession and by disruption in capital and credit markets.
• Adverse impacts from fluctuations in foreign currency exchange rates.
• Adverse impacts from events outside of control, such as widespread public health issues (including the effects from the COVID-19 pandemic), natural disasters, political events and other catastrophic events.
• Adverse effects from global climate change or by legal, regulatory or market responses to such change.
• Uncertainties and risks related to vaccination distribution and related ancillary supply kit programs.

Mitigation Strategies

• McKesson’s commitment to transform its operating model resulted in annual pre-tax cost savings in excess of $400 million, achieving the company’s three-year target of $400 million to $500 million by the end of Fiscal 2021.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• FORTUNE’s “Most Admired Company”, Human Rights Campaign Foundation’s “Best Place to Work”, Military Friendly’s top military-friendly company.

Environmental Metrics

ESG Focus Areas

• Diversity, Equity, and Inclusion (DEI)
• Climate Change
• Sustainability
• Opioid Crisis
• Human Rights

Environmental Achievements

• Committed to setting science-based targets for scope 1, 2, and 3 greenhouse gas (GHG) emissions.

Social Achievements

• Launched "Leading Inclusively" and "Ignite Inclusion" programs to promote inclusion.
• Employees volunteered over 26,500 hours.
• McKesson Foundation disbursed nearly $4.5 million to support various causes.
• Reached a settlement to resolve the substantial majority of opioid lawsuits.

Governance Achievements

• Created an executive steering committee to focus on ESG.
• Renamed the Governance and Sustainability Committee and the Compensation and Talent Committee to refine ESG oversight.
• Revised Corporate Governance Guidelines for better coordination.
• Implemented a policy requiring directors with more than 12 years of tenure to offer annual resignations.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic challenges.
• Opioid crisis.
• ESG-related risks and opportunities.

Mitigation Strategies

• Collaborated to ensure stability of critical services.
• Settled the vast majority of opioid lawsuits.
• Created an executive steering committee to coordinate ESG efforts.
• Implemented various programs to address opioid crisis and improve ESG performance.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Science Based Targets initiative (SBTi)

Awards & Recognition

• Best Places to Work for LGBTQ+ Equality (9th year in a row)
• Military Friendly Employer (6th year in a row)
• Best Place to Work for Disability Inclusion (6th year in a row)

Environmental Metrics

ESG Focus Areas

• Diversity and Inclusion
• Sustainability

Social Achievements

• Recognized by Forbes as one of America's Best Large Employers in 2023.
• Recognized by Newsweek as one of America’s Greatest Workplaces for Women in 2023.
• Named a 2023 Industry Top-Rated ESG Company by Sustainalytics

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Awards & Recognition

• Forbes America's Best Large Employers 2023
• Newsweek America’s Greatest Workplaces for Women 2023
• Sustainalytics 2023 Industry Top-Rated ESG Company