Look at the UN Sustainable Development Goals (SDGs, Exhibit 1). All 17 relate to health, whether it concerns the environment, society, or economics. The entire healthcare and life sciences (HLS) sector—including the hospital, insurance, and pharma subsectors—must adapt to and play their roles in mitigating the climate and broader sustainability emergency. Not only is this the right thing to do, but it’s also an economic imperative for HLS organizations.
HLS must start by breaking down the global sustainability context (see our detailed outline here and in Exhibit 2). Then, focus on your most material spheres of influence as an HLS professional, team, or organization—both positive and negative. Finally, look for opportunities for leadership and systemic change (see our framework here).
Exhibit 1: The SDGs connect environmental, social, and economic challenges facing the planet and society
Source: United Nations
HLS firms face climate change and sustainability challenges tied to disease prevalence, the cost of doing business, and regulatory pressures
The HLS sector is at a crossroads. It can take a reactive stance—frantically adapting to extreme weather, new disease patterns, and shifting consumer health needs. Or it can take the lead by embedding sustainability into preventative health, delivering care, and planning public health to ensure they remain viable businesses (the literal definition of sustainability).
Exhibit 2: Healthcare and life sciences must adapt while also mitigating their own impact—by breaking down and aligning to the global context
Source: HFS Research, 2025
Hospitals are at the frontline of climate-driven health challenges
Hospitals are already responding to climate-driven health crises, but the scale of adaptation required is growing. Three areas stand out:
- Heat-related illnesses are rising: A Lancet study predicts a fivefold increase in heat-related deaths by 2050 or sooner in multiple regions. Emergency departments face surging cases of heat stroke, dehydration, and cardiovascular complications triggered by rising temperatures—particularly critical as populations age.
- Zoonotic diseases and emerging infections: Climate change accelerates zoonotic spillover (pathogens jumping from animals to humans). COVID-19 demonstrated the risks, but future pandemics tied to habitat destruction, deforestation, and changing animal migration patterns are a near certainty.
- Climate disaster injuries and displacement: Hospitals already treat injuries from floods, hurricanes, and wildfires. In the US alone, FEMA reported $165 billion in disaster-related damages in 2022, leading to millions of ER visits when there is a growing shortage of clinicians.
Beyond adapting, hospitals must proactively reduce their environmental footprints and promote preventative healthcare:
- Keep people out of hospitals: Public health measures—such as improved social care with expanded access, primary care engagement, and community-based care—reduce emergency visits and improve long-term health outcomes.
- Sustainable hospital operations: Healthcare generates almost 5% of global emissions and about 8.5% of US emissions through energy and water-intensive facilities. The sector must source renewable energy, manage water smartly, and reduce waste.
- Policy and public health advocacy: Hospitals must lobby for policies that address the root causes of preventable hospitalization, such as air pollution regulation, housing improvements, and climate resilience initiatives.
The insurance industry has a dual role in risk and prevention
Health and life insurers face mounting climate-linked payout risks. Three trends are shifting the insurance landscape’s adaptation:
- Heat, water, and weather-related health impacts: Heat-related illnesses, respiratory diseases from wildfires, and flood-related injuries are driving up claim volumes. Swiss Re estimates climate-related insurance claims could exceed $200 billion annually by 2040.
- Disaster-driven life insurance payouts: In 2021 alone, climate disasters caused $120 billion in insured losses, which could triple by 2050. The actuarial models that underpin life insurance policies are increasingly obsolete.
- Healthcare cost inflation: Rising disease burdens mean higher premiums and greater stress on national healthcare funding. Insurers must prepare for more claims, higher costs, and shifting risk profiles.
Insurers are uniquely positioned—beyond adapting—to steer industries toward sustainability through financial incentives:
- Partnering with enterprises for prevention: Leading insurers already reward businesses and individuals that adopt climate-resilience strategies, such as healthier lifestyles, pollution-reducing initiatives, and resilient infrastructure investments.
- Shaping policy for positive outcomes: Like hospital bosses above and pharma firms below, insurers can lobby for climate-conscious policies that promote better public health, such as heat action plans, disaster-resilient housing, and air quality regulations. These actions would reduce system-wide risk.
- Reframing protection models: Insurers must shift from merely pricing climate risks to actively reducing them. Initiatives such as parametric insurance for climate disasters and pay-for-performance health models are essential to making insurance an enabler of sustainability and social equity.
Pharma must rethink treatment, manufacturing, and access
Pharmaceutical firms must prepare for shifting disease burdens and stricter environmental regulations by adopting the following:
- New disease profiles: Pharma must accelerate R&D for treatments targeting climate-driven illnesses—including zoonotic viruses, respiratory diseases linked to air pollution, and waterborne infections from flooding.
- Sustainable manufacturing and packaging: Pharma must address its drug-production footprint. The industry significantly contributes to hazardous waste, emissions, and excessive packaging use. Some, such as GSK and Novartis, are pushing for circular economy models in drug packaging.
- A long-term view on health and social change: Pharma must align drug development and supply chains with climate realities, ensuring that treatments remain accessible amid environmental and social disruptions, including for their own market reach alongside sustainability goals.
Beyond adoption, pharma must also take responsibility for social and environmental impacts to ensure long-term business performance. Pharma has a more long-term mandate than most sectors:
- Overhauling patent practices for global access: Pharma cannot claim sustainability leadership while maintaining restrictive patent policies that limit access to essential medicines. The industry must reform IP practices to ensure affordability globally.
- Addressing emissions and water use: Pharma, like other process industries, emits carbon and consumes water. Companies must develop science-based transition plans.
- Advocating for policy reform: Pharma should leverage its influence to push for regulations on patent law, emissions, and water stewardship, ensuring a level playing field for accountability.
The Bottom Line: The healthcare and life sciences sector must go beyond simply adapting to climate and sustainability pressures to ensure healthier enterprises, societies, and environments.
Hospitals, insurers, and pharmaceutical companies have distinct opportunities and responsibilities, including:
- Hospitals must invest in preventative care, sustainable operations, and policy advocacy to keep people healthy before crises emerge.
- Insurers must surpass risk pricing and proactively shape behaviors, industries, and policies that mitigate climate-linked health risks.
- Pharma firms must align drug access, manufacturing, and regulatory advocacy with long-term sustainability goals.
Sustainability is core to healthcare’s mission. Firms that fail to lead will be forced to react—at greater cost and risk. HLS professionals, teams, and organizations must take decisive, system-wide action.
