“On Earth Day, we’re pleased to highlight Cardinal Health’s progress in addressing greenhouse gas emissions across our operations, supply chain and logistics network,” said Megan Maltenfort, VP of sustainable business practices at Cardinal Health. “As shared in our most recent Sustainable Business Report, sustainability is a priority for Cardinal Health — it’s about operational resilience, long‑term value creation and patient care.” Across the enterprise, we’ve deployed energy efficiency projects and expanded renewable energy efforts; we’ve also been working collaboratively with suppliers and industry peers to address emissions across the healthcare value chain.
Progress toward science‑based climate goals
Our climate strategy is anchored by science‑based targets approved by the Science Based Targets initiative (SBTi), a respected global body that validates emissions reduction goals aligned with climate science, Maltenfort explained. We’re focused on two near-term targets:
By the end of fiscal 2025, we had reduced our Scope 1 and Scope 2 emissions by 17%, and 73% of our top suppliers by spend had set science‑based targets.
To guide and accelerate progress toward these targets, we follow a comprehensive climate action plan developed in fiscal 2024. The plan brings together multiple decarbonization levers that will continue to evolve as technology advances, market conditions change and the business grows. In the near term, we have focused on improving facility-level energy efficiency, expanding the use of onsite solar and improving transportation efficiency.
Expanding solar energy and improving energy efficiency
We’ve recently signed power purchase agreements with solar developers for projects at nine of our U.S. facilities, expanding the company’s renewable electricity portfolio. We expect construction on some of these projects to begin this calendar year.
In addition, in fiscal 2025, we deployed 28 energy‑efficiency projects across our portfolio, investing $2 million to generate nearly $1 million in annual cost savings, and expected to avoid more than 4,500 metric tons of CO₂e each year. These projects, including equipment upgrades, LED lighting and HVAC replacements and other improvements, must meet specific financial and environmental targets to be funded, and they must deliver cost and energy savings for our sites.
In many of our facilities, employees participate in regular gemba walks to identify opportunities to reduce energy and water use, increase recycling and adopt more efficient equipment. Over time, teams have completed LED retrofits, adopted electronic documentation to reduce paper use and installed motion‑sensor water fixtures.
Collaborating across the healthcare value chain
“A significant portion of healthcare‑related emissions comes from purchased goods and services and transportation,” Maltenfort said. “The healthcare industry understands that we can have much more impact when we collaborate. That’s why we’re actively engaged in CHARME.”
This collaborative, formally known as Collective Healthcare Action to Reduce MedTech Emissions, is convened by the Sustainable Purchasing Leadership Council and co‑chaired by Kaiser Permanente and Vizient. It brings together 40 health systems, medical device and equipment suppliers, distributors, Group Purchasing Organizations (GPOs), and other industry stakeholders to define and implement best practices for reducing GHG emissions from the MedTech supply chain. Participants believe that working together across the supply chain will enable us to make significant reductions in GHG emissions; Cardinal Health is among CHARME’s inaugural members.
Empowering suppliers through shared tools
Driving sustainable business performance among our suppliers is a critical component of supply chain decarbonization. We continue to build relationships with our less mature suppliers — those who may not yet be calculating GHG emissions or do not disclose emissions. We’ve learned that many suppliers are doing more than they are disclosing; we’ve provided them with resources to help with GHG emission calculations, goal setting, and industry best practices.
In fiscal 2025, to develop shared resources for the healthcare industry and reduce survey fatigue for shared suppliers, we worked collaboratively with industry peers through the National Academy of Medicine (NAM) Climate Collaborative to develop a standardized supplier survey. The Health Sector Climate Action Survey provides an easy and consistent way to collect the most important climate-related information from suppliers.
“This free, easy‑to‑use tool provides a consistent way to engage suppliers in data collection, goal setting and climate action,” Maltenfort said. “The intent is for suppliers to fill this out one time and then share it with all of their customers.”
Picking and packing innovations
Over the past two years, the Pharmaceutical Distribution (PD) team has re‑engineered picking, packing and shipping processes to reduce the number of totes used across the network by more than 11 million annually.
One of the contributing factors has been that many of our pharmaceutical distribution centers implemented processes for shipping small products (the size of a grapefruit or smaller) in bags instead of totes.
Using more bags and fewer totes has provided multiple benefits, including reduced operational costs, improved management of unexpected increases in order volume, greater on-time delivery, and fewer delivery errors. What’s more, the PD team’s data show that there are fewer damage claims for products that are delivered in bags.
“This initiative has also increased efficiency in loading delivery vehicles, because vehicles can now handle larger order volumes,” Maltenfort said. “Sometimes, using bags rather than totes mean that the same amount of product can be shipped in smaller vehicles. The conversion from totes to bags was the primary driver that resulted in a 1.2-million-mile reduction in line haul miles, and the avoidance of 489 metric tons CO2e emissions.”
Looking ahead
Our progress reflects our broader commitment,” Maltenfort said. “We want to advance healthcare while protecting the planet that supports it. With science‑based goals, a robust climate action plan and collaboration across the industry, we continue to scale what works, drive emissions reductions, support suppliers and customers, and integrate sustainability into our operations.”
We invite you to read more about this work in Cardinal Health’s Fiscal 2025 Sustainable Business Report.