Welcome to Illumina's very first ESG Investor Event. I'm Brian Blanchett from Investor Relations. During today's event, we may share information that could be considered forward-looking statements. You should refer to our SEC filings for a discussion of the risks and uncertainties that could cause results to differ materially from our expectations. It is our intent that all forward-looking statements regarding our financial results and commercial activity made during today's discussion will be protected under the Private Securities Litigation Reform Act of 1995. Over the next hour, we are going to hear from Francis deSouza, Illumina's CEO, with an overview of ESG strategy, and then he'll be joined by Sam Samad, CFO, and Sharon Vidal, Global Lead ESG, in a fireside chat moderated by Maggie Lake, journalist and ESG communication specialist.
You can submit questions via the chat at any time during today's event, and we will do our best to get to those. If we don't cover your question, we will be holding small group follow-up meetings to provide more in-depth Q&A. You can schedule those through our Investor Relations team. At Illumina, ESG is embedded in our business, and we look forward to sharing more about our program and how our ESG strategy is linked to our long-term value creation. I will turn it over to you, Francis.
Hello, and thank you for joining us for today's inaugural ESG event. Throughout our history, Illumina's relentless focus has been to unlock the power of the genome. Making genomics useful for all is our purpose and our promise to our customers who work toward new discoveries every day and the lives they touch. We're continuing to advance access to genomics around the world with over 8,000 employees and more than 7,000 customers globally. In the early days of genomics, we pioneered technology that has the capacity to see into the genome. Since then, we've endeavored to develop new innovations to make the genome more accessible, affordable, and useful to enable extraordinary breakthroughs and advancement for all. At the intersection of biology and technology, genomics enables discoveries that were unimaginable even a few years ago.
That has never been clearer than in the last year as we responded to the global pandemic. The first SARS-CoV-2 genome was sequenced on an Illumina sequencer in early January 2020, and a mere 42 days later, the first batch of a messenger RNA vaccine developed from that viral genome data was shipped. Genomic technology continues to be on the front lines of the diagnostics, research, vaccines, therapy development, and surveillance. These technologies will help us not only monitor pandemics, but hopefully prevent them in the future. Genomics is being integrated into clinical practice at a faster rate than almost any innovation in the history of medicine. Today, it is creating a path towards personalized medicine and inspiring hope worldwide. Illumina also serves an important role in combating climate change in our planet, one of the most critical challenges of our lifetime.
Scientists are leveraging genomics to identify crops that tolerate higher temperatures and track fish populations to guide sustainable practices. Genetic information is also being applied to biodiversity studies and conservation efforts. With the wrap-up from COP26 and the drive for change, genomics will no doubt play a role. We are working tirelessly to create the leading-edge technology that enables clinicians and researchers to not only understand the genome, but also fully tap into its power and make our mission a reality. Our mission, unlocking the power of the genome to improve human health, guides everything we do, from our business approach to how we approach our corporate social responsibility program and application of ESG themes. We see ESG as a way to deepen our impact on human health by serving as a champion for patients, the community, and our planet.
All our decisions are reviewed through the lens of ESG. When we create long-term plans on how we create shared value for our stakeholders, we ask ourselves, "How can we make a positive impact on humanity, not just with our technology, but with our actions? How can Illumina contribute to a more sustainable and equitable future for all?" Illumina will keep innovating and improving health. By incorporating ESG into our business, we will solidify our path to deliver long-term sustainable performance and value creation. To support this long-term value creation mindset and ESG oversight, we have an active, independent, and diverse board. This strong governance supports our strategic management of material ESG issues. We also have relevant topics presented to the subcommittees, like risk, human rights, cybersecurity, diversity, and compensation.
To operationalize our ESG strategy and support the integration of ESG themes into our business, we have also established an ESG Executive Steering Committee that meets quarterly and is chaired by Sam Samad, our CFO and executive sponsor. Select ESG targets are included in our annual corporate goals and influence executive compensation through the management performance scorecard. The EAB provides guidance regarding current and emerging ethical issues on our products and the topics relevant to the genomics industry. As leaders in genomics, we are steadfast in our commitment to ethical use of genomic technologies and the application used to benefit humanity. Our first step in creating our formal ESG strategy was to engage our stakeholders and conduct a materiality assessment. Understanding what was most important to our stakeholders helped inform our most material ESG themes and how Illumina can create the most impact.
We're currently refreshing this materiality assessment to remain attuned to our stakeholders' needs, and the results will be included in our April CSR report. Our strategy and our reporting approach aligns around international frameworks and a commitment to provide transparency on our progress. We are signatories on the United Nations Global Compact, the Women's Empowerment Principles, CEO Action for Diversity & Inclusion, and most recently, the Business Ambition for 1.5°C. We have employed comprehensive ESG reporting, including GRI, SASB, and TCFD, and our recently updated climate targets were verified by the Science Based Targets initiative to be in line with the 1.5°C pathway. All of these inputs led to the creation of our CSR strategy and our focus areas.
Our five focus areas, accelerating access to genomics, empowering our communities, integrating environmental sustainability, nurturing our people, and operating responsibly are the pillars of our approach. Our five focus areas link to the United Nations Sustainable Development Goals. While we support all seventeen, we have identified eight that we can most uniquely influence and are most material to Illumina. Health and wellbeing, education, gender equality, innovation, reduced inequalities, responsible consumption, climate action, and partnerships. These concepts have always been core to who we are as a company and have framed our mission in the common language of the SDGs to clearly articulate how embedded they are within our goals. Our first CSR focus area is accelerating access to genomics. There is a vital need to make genomic technology and precision medicine available to all, regardless of social status, income, or geographic location.
We aim to increase the equity of data diversity to ensure that genomes can be interpreted in the appropriate context of global diversity. Our efforts to improve human health can be magnified if all people and places have access to genomic technology. Implementation of genomics thus far has been almost entirely restricted to more developed nations. While the pandemic and climate action focus have highlighted the vast opportunity for genomics, it has also highlighted challenges, like inequity of access to healthcare, and magnified the need to bring the power of genomics to all. Earlier this year, we committed $60 million over five years to a global pathogen genomics initiative in partnership with the Bill & Melinda Gates Foundation and other public and private entities targeting low and middle-income countries to build critical public health capabilities in areas of need.
This morning, we announced a $120 million commitment over the next five years to expand our iHope Network by partnering with Genetic Alliance in support of establishing the new iHope Genetic Health program. The new effort aims to rapidly scale access to clinical whole genome sequencing at labs across the world and reach thousands of rare disease patients each year in resource-limited communities. We know that our technology can find answers for these patients where no others can and dramatically change lives. At least half of iHope Genetic Health's efforts will be focused on areas of the world in need outside the U.S., with a minimum of one-third of our donations dedicated to patients in Africa. We have a short video to share on this. We are eager to accelerate access for these communities around the world, and we are excited to launch this impactful expansion.
In addition to our philanthropy, we will continue to innovate and develop technology that provides unprecedented access to the genome with more data processing power, more efficiency, and greater affordability. We have reduced the cost of sequencing by over 99% since 2006, from $150,000 to $600 a genome. We have shared our commitment to driving costs down even further to a $100 genome and beyond. With our Genomics Accelerator program, Illumina for Startups, we're helping to expand the genomic ecosystem and broaden access for innovation. Our market access team continues to support expanding payer coverage and reimbursement and achieve the 1 billion lives covered milestone this year. Through innovation, philanthropy, education, and collaboration, we are working to break down barriers and enable this access to genomics at scale.
Fostering a culture that empowers our communities through strong corporate citizenship is key to connecting to our mission. We have a unique responsibility as a leader in genomics to contribute to the greater good. Every day, we strive to provide meaningful opportunities for employees to engage in their communities and connect with organizations that matter the most to them. Our corporate giving connects our CSR focus areas with the themes of access to genomics, diversity of genomic data, patient support, independent medical education, disaster response, genomic literacy to STEM education, and sustainability. Across these areas, we contribute more than $13 million of philanthropy in 2020 and are on track to exceed that amount this year. Part of our employee value proposition is our strong commitment to giving back to our communities.
With programs like skills-based volunteering, paid time off, volunteer awards, and matches for donations, we make it easy for employees to get involved, give back, and connect with our mission in a way that aligns with their core values. Human health and the health of our environment are intertwined, connecting our company mission to improve human health with our commitment to operate responsibly and sustainably. In late September, we announced our expanded climate action plan. We set science-based emission reduction targets across our entire value chain that are consistent with keeping global warming to 1.5 degrees above pre-industrial levels. These targets have been officially verified by the Science Based Targets initiative and include SBTi's most ambitious guidelines. We also committed to a long-term target of net zero emissions by 2050.
To achieve these targets, we will continue our focus on energy, water, and waste reduction across our facilities, including increasing on-site solar power, purchasing more renewable energy, and investing in renewable energy credits. In addition, now that we have our Scope 3 data, we will be creating targeted initiatives to address the most material categories in our value chain and partner with our suppliers to encourage their own path toward net zero. We have integrated design for environment principles into our product development and product stewardship, addressing both the products currently on the market and those in development. Because vulnerable populations are disproportionately susceptible to the economic and physical impacts of climate change, we added a layer of philanthropy to our climate action plan. This is aligned to our giving strategy and ensures we support a just transition to a decarbonized future.
We recently awarded a grant to GRID Alternatives that will provide clean, renewable solar installations to communities of concern and tribal nations near each of our main operating locations in the U.S. Each installation also includes local job training and placement for solar installation, serving as a bridge to help make a difference in our communities, support the transition to clean energy jobs, and bring renewable energy to under-resourced communities. In addition to the integration of sustainability in our business, we are enabling efforts in this field to apply our technology to agrigenomics, sustainable food, climate change studies, biodiversity, and conservation research. The University of Sydney is working with wildlife genomics groups on koala conservation. They're using Illumina whole genome sequencing to gain insights that will help protect the species from climate change, disease, and other risks.
On a larger scale, the Earth BioGenome Project has a goal of sequencing and annotating the genomes of all 1.5 million known species over a 10-year period. The aim is to create a digital backbone of sequences that will serve as critical infrastructure for biology, conservation, agriculture, medicine, and the growing global bioeconomy. EBP aims to help with biodiversity and responsibly stewarding its resources. Illumina is providing 100 reference quality genomes and also participating in the development of technology for the sequencing of genomes from single cell and small multicellular organisms. With an extraordinary mission comes the need for extraordinary people and leaders at every level. Every day at Illumina, we have the chance to do once in a lifetime work, transforming human health and driving scientific innovation. We know the best ideas will come from a diverse, inclusive environment where everyone feels safe, respected, and supported.
Fostering an inclusive and healthy workforce is a foundational principle for our operations and essential for innovation. To that end, we are deeply committed to supporting and empowering our employees. Our Culture of Care has been built upon the principles of employee trust, flexibility, transparency, and well-being. It includes cultural competence, equal opportunity, pay equity, inclusive benefits, employee resource groups, supplier diversity, and community engagement. Our efforts also reflect the labor principles within the United Nations Global Compact. Part of this Culture of Care includes investing in and developing our people so they enjoy long and fulfilling careers at Illumina. Our Training and Development programs embody our belief that opportunities always exist to grow and learn, regardless of where you are in your career. This growth mindset begins with valuing learning over knowing, together with seeking new ideas and embracing challenges while developing.
From soft skills to technical knowledge, online learning to coaching clinics, we empower our employees to shape their own careers, taking advantage of the frequent opportunities to progress at Illumina. Within our workforce, we relentlessly practice and embed diversity, inclusion, and fairness in all we do. We will continue to drive, measure, and reward inclusive leadership at all levels. We will deepen fairness by continuously reducing bias across key processes, and we will communicate with transparency internally and externally. In our latest CSR report, we disclosed EEOC diversity demographic data, including details on each EEOC category by level and equivalent reporting as found on the EEO-1 disclosures. Our diversity and inclusion approach extends beyond our workforce and includes our suppliers and community.
We're committed to establishing collaborative partnerships with qualified small and diverse suppliers, and we recognize the importance of ensuring our supply base reflects the diversity of the communities in which we live, work, and serve. Globally, we encourage the use of local businesses wherever possible to support economies where our employees work and live. Our goal is to achieve 20% spend with diverse suppliers by 2030. In 2020, we achieved 16% with $152 million of spend to diverse suppliers in the U.S. We remain committed to global pay equity and are proud to have again confirmed a net zero gap in pay. We believe no one should be paid differently based on their gender, race, age, ethnicity, sexual orientation, or national origin. While we have made progress on representation in our workforce, there is still work to do.
We are committed to increasing the representation of women in senior leadership and to improving the representation of ethnic and racial diversity in our workforce and leadership. We're in the process of developing quantitative targets that will be shared in our next CSR report. Our people make Illumina such a special place, and they remain one of our greatest advantages. As macro trends resulting from the pandemic continue to shape the labor market, we are well-positioned to attract top talent, looking for a purpose-driven company and flexibility in working conditions. We are outperforming peers in our industry, and current employees continue to be engaged and proud to work for Illumina. Our ESG program supports our path to deliver long-term sustainable business performance and value creation.
It's making an impact, and while we are proud of the early recognition we have received, there is much to do, and we see our ESG programming as part of our commitment to continuous improvement. We are dedicated to making a positive impact on humanity, not just through our technology and solutions, but through our actions. By doing so, we aim to help shape a more sustainable and equitable future for all. We look forward to making the opportunities ahead of us a reality together. Thank you. I will now invite Maggie Lake to join us, and we will begin our fireside chat.
Thank you for that overview, Francis, and hi, everyone. I'm Maggie Lake, and I'm honored to be the moderator for Illumina's first ESG Investor Event. I'd like to invite Francis as well as Sam Samad, Chief Financial Officer, and Sharon Vidal, Global Lead of ESG, to join me, and we'll get started with a few questions. Welcome, everyone. Thank you so much for being here. It's such an important time to be having this conversation, so I'm excited about it. Francis, if I can, let's start off with you. You mentioned that your industry was a critical part of the race to combat and contain the COVID pandemic. Thankfully, it seems like we're at a point where we're starting to turn the corner. Many believe this won't be the last global health crisis that we face.
What role will genomics and DNA sequencing play in identifying and importantly preventing future pandemics?
Thank you, Maggie. Genomics has played a critical role in fighting this pandemic. Everything from first identifying the causative pathogen associated with the outbreak to tracking its transmission routes, seeing how it's mutated, as well as providing the foundational data that was used to develop the vaccines and some of the therapies that are used to fight the outbreak. As we look to the future, genomics will continue to play a more important role in terms of helping combating outbreaks and helping preventing them from becoming the next pandemic. It'll do that in a number of ways. We're already seeing the beginnings of a rollout of a global genomics-based pathogen identification network that'll help us identify outbreaks wherever they're happening in the world earlier and allow us maybe to combat them regionally before they spread more globally.
This is important not just in terms of preventing the next pandemic, but we also know that many of the root causes associated with the pandemic are also the same root causes behind climate change. There are many reasons to take climate change action to improve human health, and help prevent the next outbreak. The other thing we've learned from this pandemic is that it is very powerful when we all come together as a global community focused on solving a problem. This pandemic showed us the power of all of us working together to address this challenge, and it's exactly that kind of cooperation and collaboration that'll be essential to fighting climate change. It's also shown us how interconnected we all are, that in the end, none of us is safe until all of us are safe.
We're walking out of this pandemic with a greater appreciation, not just for the power of genomics in terms of how it'll help us in the future, but also the importance of all of us coming together to address the big issues facing humanity.
Absolutely. I think as terrible as this period has been, one of the encouraging things is that collectively, we do have people around the world stopping and saying, "We need to rethink what's possible here." Sam, how did the experience of the pandemic inform your thinking around ESG? Because we heard Francis just make, I think, this important link now between climate and health and people's health, people's wellbeing.
Yeah. Thank you, Maggie, and thanks for hosting us today. You know, the way I'd look at it actually is our ESG strategy having one in place enabled a fast response to the pandemic. We really focused on our customers and patients as key stakeholders, our people and our community. You know, these were all rooted in our ESG approach and really embedded in our business. Let me give you some examples about some of the things that we did.
For instance, for our customers and patients, you know, we were able to across a broad cross-functional group in our organization, invest in a commercial response, which is our COVIDSeq Assay, and that went from ideation to emergency use authorization in 45 days, and we were able to launch it for our customers and make sure that we're really part of the solution for COVID surveillance, and to some extent, COVID testing. We really focused on our supply chain and making sure that there is no disruption in our supply chain at a time that's very critical and that's very challenging, as you know.
You know, for our people, we really leveraged our C ulture of Care programs to make sure that our employees are protected, that we accelerated certain cash payments, that, you know, they feel like they have flexibility during a really tough time for them and their families. Then for our communities, you know, we dedicated over $10 million in COVID philanthropy in the early days of COVID to make sure our communities as well are getting the support of Illumina. Really, the ESG framework that we have really put into action enabled us to mobilize our response.
If we pick up on that, how do Illumina's ESG goals fit into the overall financial strategy now looking beyond COVID-19?
Yeah. Very connected. I mean, with a financial lens, we know that ESG having a very clear, well-executed ESG strategy leads to better business outcomes. There have been a lot of studies done on this by various consulting firms that show that companies with high ESG ratings, you know, for the period between 2013 and 2020 have significantly outperformed their peers across various financial metrics. You know, I would look at the links between ESG or the financial links to ESG, I should say, are really about investment and value.
Mm.
You know, ESG is not just a cost center. It's about, it's really a center of value creation. With that end in mind, we are making investments, and I'm focused on Illumina making investments to include sustainability into our product design, our facilities. You know, Francis alluded to some of that in the earlier remarks, we are investing. Let me give you some examples on that, for instance. We're investing in more efficient data processing, like our DRAGEN ORA Compression technology, for instance, which results in decreased power consumption per gigabase, really revolutionary technology for compression. We're investing in less foam coolers for our packaging and a more sustainable footprint around our packaging of our products, where we have innovation that helps drive down the cost of our products as well.
Across our sites, we are making investments in clean renewable energy, offering electric vehicle charging stations to employees at no charge, you know, making sure our facilities really are focused on clean renewable energy and a lower carbon footprint. Really, all of these investments, you know, that I'm focused on from a financial standpoint are linked to our core business and to the UN Sustainable Development Goals for climate, innovation, and health and wellbeing.
Yeah, Sharon, one of the conversations that's happening in financial circles is really having a common language to talk about this. The SDGs were so important in establishing talking about the goals. What are you doing in terms of, you know, taking that foundation of corporate responsibility that existed and creating a framework around it at Illumina so that you are having that clear communication? How's the ESG CSR strategy evolving to reflect that it is at the core of the company strategy?
Sure. Well, Maggie, while our formal CSR program has been maturing only over the last couple of years, both Francis and Sam mentioned that the sustainable development goals, like health and wellbeing or gender equality and innovation, that these themes have been part of our business. Now we're able to provide a more structured ESG approach that helps link our efforts back to the mission and are helping us focus on the most material topics. Using internationally accepted frameworks, we created a system of accountability and transparency that helped evolve our reporting to clearly articulate what our strategy is to everyone from internal employees to investors.
On the decision to disclose more externally, you mentioned you're only in your second year of disclosure, but the reporting framework is pretty comprehensive, so walk us through the decision-making around that. How has it evolved?
Sure. Well, we were very intentional about approaching our non-financial ESG reporting with a high level of transparency. We chose the GRI reporting framework for our first report because it offered the most comprehensive baseline that we felt appealed to the widest group of our stakeholders. It allowed us to develop a really strong baseline for reporting with KPIs specific to our business and still have the flexibility to share the narrative that goes with the data and really all the stories that make Illumina unique. As our, you know, as part of our ongoing stakeholder engagement, after we released our first CSR report, there was a resounding request from the investor community to add SASB and TCFD, and we listened. In our second report, we expanded to include SASB and TCFD.
It also included third-party data verification for our emissions, and we expanded the reporting to include EEOC diversity-level demographic data. Now, this expanded reporting really helped advance our program by further linking to the industry-specific material topics from SASB, and it provided a framework to look at climate risks as well as opportunities through TCFD. These ultimately helped us scope our net zero path and SBTi target verification.
It reminds me of a phrase I hear often whenever I'm talking to executives and particularly CFOs, that if we can measure it, we can manage it, right? It's so important to have all those frameworks in place. Francis, one of the things that struck me in your opening remarks was really the sort of speed of the change in the industry, especially when you're talking about those costs coming down. How is innovation driving more access, and what other levers will help with the democratization of sequencing this technology?
Yeah, there are a number of levers that we need to pull on to make sure that genomics is accessible to all. As you pointed out, you know, just the affordability of the technology is one we should absolutely keep pushing on, and that's something that we at Illumina have been committed to from the beginning. We took the market price of sequencing a genome down from $150,000 in 2006, 2007 to $600 today. We have lowered our prices by over 99% in that timeframe. We're not stopping there. We've committed to taking the prices from $600 even further down to $100 a genome.
This is important because affordability is one of the key levers in terms of making genomics more accessible. There are other levers we need to pull. At Illumina, we distribute our products in over 140 countries around the world. It is important that we make our products available by taking them to the local markets around the world. In addition to that, we need to make sure that the patients that need the tests are able to get the test and that they're able to afford it.
Mm-hmm.
We have our market access teams that work with the payer communities, private payers, national health systems, public payer systems, to make sure that we help provide the evidence that'll allow them to do reimbursement for these tests. Our teams have now worked to generate reimbursement coverage for over 1 billion people around the world. Affordability and accessibility is only part of the equation. We also need to make sure that the genomic data being collected is representative. If we look today at all the genomic data that's been collected, only 3% of the analyzed genomes come from Africa, and that's unacceptably low. This is important because that genomic data is used as the basis to develop genomic diagnostic tests, vaccines, therapies.
If that data is not representative, then what that means is that our healthcare tools for the future will work better for some communities and worse for others, and that's not okay. We're doing a lot of work to help drive access to genomic tools and make sure that the databases that are being collected are representative of the communities that are being served.
Absolutely, and that has got to be a critical part of the puzzle moving forward. You know, Sam, during Francis's presentation, he talked about the decision to have the ESG function sitting with you as well, and I think it's very telling at this point in time that we have the CEO, the CFO, and the ESG lead on this call. What is the connection? You talked about the value, and you talked about your human capital. What's the connection between your ESG strategy and how it's helped you mitigate risk?
Yeah, there's a very, very strong connection. You know, in my role as CFO, I'm really focused on two key things, ensuring that we are protecting and growing our long-term value as a company and for our shareholders, and also in terms of managing risk. That's a key responsibility that I have. Let me link that to ESG and what that means. It means supporting our investment in our ESG focus areas, as I mentioned earlier. It means making sure that we have consistent reporting standards that we publish. It also means that we're using the ESG lens for risk mitigation and identifying opportunities on our most material environmental and social impact topics.
You know, two key risks that we are dealing with today and one that's been amplified by the pandemic are climate change and human capital risk. You know, those are really critical risks. I think climate change, we all realize and understand that it's probably the single biggest threat facing humankind today. You know, reducing risk from those two areas will make our business more resilient and bring long-term value to shareholders. I think Illumina plays a key role in not just reducing risk for Illumina, but reducing risk for, you know, humankind as a whole. In terms of the climate change, you know, we've created our Climate Action Plan, which will build resilience in our business and protect our business.
We also believe that we have a tremendous opportunity for innovation through the use of our technology in response to climate change, through the field of agrigenomics, for instance. You know, on the human capital side, which has been definitely exacerbated throughout this pandemic, I think ESG can be a real competitive advantage here. You know, we can use a strong ESG program as a tool for retaining and attracting top talent. You know, the focus of and themes of diversity, pay equity, and opportunities for employee development are all key, I'd say, retention and attraction of top talent tools that we can use to mitigate that risk that we have.
Absolutely. Especially when you're talking about new entrants into the workforce, the younger workers that will be needed to sustain that. I saw a few years ago a report by Deloitte that there would be a 2 million person job shortfall in STEM fields by 2025. Add to that the competitive labor market we're seeing, and you can understand why that would fall into the category of being a major risk that you need to be paying attention to. Sharon, you know, your Climate Action Plan that Sam just mentioned included those science-based targets that have been verified, and you made a commitment to net zero in your direct operations and value chain by 2050. You added a layer beyond SBTi to achieve carbon neutrality in your direct operations, and I've also heard all of you talk about philanthropy.
How does that fit in with the overall approach?
Sure. Well, on the philanthropy side, our giving strategy aligns to support each of our focus areas for CSR. When we announced that expanded Climate Action Plan, we felt it was important to share our intent to invest in sustainability projects. Those could be projects that, you know, enable a just transition to a low carbon economy, or they link to biodiversity conservation, or it prepares the next generation that you referenced by incorporating environmental DNA lessons or genomics more into the STEM education curriculum.
We're proud to support projects like what Francis mentioned with the GRID Alternatives, bringing clean, renewable energy and job training, and also projects like donating sequencers to organizations that are helping to like the Turtle Survival Alliance, where our donations of MiSeq and iSeq are being used to sequence turtles that are intercepted from illegal trade, and we help identify what's the accurate habitat and reintroduce them back to the wild, and many more like these. The aim was really to approach our Climate Action Plan holistically and be able to connect that back to each of our focus areas.
Absolutely. Sharon, turtles was unexpected. I've learned a lot from this. You know, It's important that we, as we talked about earlier, have those frameworks for communicating with your employees, your shareholders, but I hear from many executives that one of the real challenges in this area as you're trying to execute on ESG is through the supply chain, right? You know, making sure that the message and the practices are through the supply chain. How are you approaching that?
Yeah, you're absolutely correct. I mean, moving beyond the internal discussion is and will be vital. In order to measure and address that broader value chain impact, we completed our Scope 3 assessment this year, and we found 89% of our emission footprint sits in our value chain. It will take collective effort to make change. The highest contributors to our value chain emissions came from the purchase materials category and transportation. We see our suppliers as partners in this journey, and we wanna help enable them on their own sustainability paths. Now that we have the data, we'll be working on, you know, educating our suppliers, informing them of our own commitment, providing resources to help them on their own, you know, net zero path, as well as encouraging more disclosures for them to share their direct emission inventories.
It's not, you know, a one-way command. It is definitely about partnerships and how we can collectively offer more sustainable products. On the transportation side, most of that impact is emissions from air travel of our products. We have projects ranging from distribution network planning, supplier location mapping, and projects that link all the way back to product design, knowing that there are connections between cold chain requirements, stability, packaging, and the transportation needs that are associated with each of them. We're really just getting started on our Scope 3 work, and there is much to do. We've shared our results in the CDP submission from this past summer for the first time, and we'll have more details in our next CSR report in April.
Sam, I know you work in close coordination. Following that Scope 3 assessment, you also made some changes to the company's investment policy. Tell us about that.
Yeah, we did. You know, when our treasury team evaluated our the company's investments, Illumina's investments, we discovered there was a material amount of emissions associated with some of them. We found out that we had some work to do. You know, our investments accounted for 7% of our Scope 3 impact within our value chain and sat in the top five categories contributing to our greenhouse gas inventory. You know, we wanted to make some key changes. Once we had that data, we really set out to modify our policy to eliminate investment in energy and utility sector bonds unless there was an associated issuance identified as a green, social, or sustainable bond. Really the analysis showed that we could change our approach without really any expected impact to our returns, but really helping to just green our investments overall.
Francis, in your opening remarks, you mentioned this connection that genomics is playing in sustainable agriculture and studying biodiversity and conservation. Sharon and Sam touched on it as well. I think you referred to it as the bioeconomy, which I love. Can you tell us more about this? Do you expect this to be an area of growth for the company?
People are using genomics not only to catalog the diversity that we have today so that we can protect it in the future, but also understand how to make our ecosystem more suited to the climate change that's coming, to increase soil salinity that's emerging, and set us up better in terms of food security and be more efficient in the future.
This is where I think there's so much really interesting science and innovation happening and, you know, sometimes it's daunting to talk about the challenges, but when you start to look at this part of the market, I think it's so exciting. Sam, of course, you wanna fund that growth, right? There's been a lot of innovation in financial markets around ESG-linked bonds and loans. Is that something that you might consider looking at in the future?
Yeah, absolutely. It's a really exciting area, and there's some exciting trends here. You know, just before COP26, there were some forecasts issued about sustainable finance, and definitely there's some, you know, increase in this forecast in terms of sustainable bond issuances. That, that's an area that we're very interested in. Maybe just to give you a bit of background around our capital structure and our focus on, you know, debt financing. Prior to 2021, really, we've been more focused on issuing or financing our borrowing needs through convertible debt, not really looking at fixed debt. We had our inaugural debt issuance though in 2021 in anticipation of the close of the GRAIL acquisition. We issued our inaugural investment-grade bonds. We also put in place an inaugural revolving credit facility.
This was really an important milestone for the company and really, I would say, a path towards the maturing of our capital structure and our financing efforts. As we look forward, I think there are some really interesting models in the ESG financing space, such as sustainability-linked bonds that we're very interested in. You know, they could help us advance our carbon transition. It's something we're definitely evaluating as part of our capital structure evolution as we go forward.
Yeah, there's certainly a lot of action in that part of the market right now and big growth expected. In addition, Sam, to using the type of instruments that you're using, I understand that you're applying an ESG lens to the way you approach underwriting. What are you doing in that space?
Absolutely. Yeah, we did that with our the mentioned inaugural debt issuance that I talked about just now, but we are embedding ESG at the core of the business strategy. We've been able to innovate around SDG 5: G ender Equality, SDG 10: Reducing Inequities, you know, both of those. When we looked at evaluating partners for our bond issuance, we really applied a lens of diversity. We wanted to look at firms that have, you know, really diverse representation and diverse ownership. We ended up choosing four firms who were actively involved in the bond issuance, who were diverse-owned firms. They received a share in the bond economics. They received an allocation of Illumina bonds to distribute to their investor clients.
Really proud that we had that focus and that we got to involve four high-quality, diverse-owned firms.
I think this is a fantastic example of when you have ESG at the core of your business decisions, how you can really start to enact change and sort of start to tackle those problems even earlier on. It's a fantastic experience for those firms to now have that and be able to build on that resume. Sharon, we've been talking about COP26 throughout this discussion. SBTi launched net zero commitment guidelines right ahead of the summit. Do you plan to follow those guidelines or go for verification?
We do. I'm happy to report that based on their new release standards, that we are already aligned, meeting the requirements for their new net zero framework. We've already scheduled a verification appointment with SBTi for their earliest available window, and that's in March. We're hoping to get updated net zero verification in time for our April CSR report.
Yeah, it's good news, I suppose, that they're oversubscribed.
Right.
You're waiting until March to get in there. I think that's a good sign for all of us. Francis deSouza, as I think about this, you know, one of the hardest things about this change that we're all going through, and this embrace of ESG is even though it plugs into the purpose, change management, that aspect of it can be the most difficult. Really making sure it's not just embedded in your executive team, which clearly it is, but throughout every layer of the company. You're only going to be successful if everyone in the company is sort of operating with this in mind. How are you approaching that?
Yeah. We absolutely see ESG as fundamental to how we do business at every level of the company. We engage with our Board of Directors on ESG. We set up an ESG Steering Committee, but we've also embedded it into cross-functional groups throughout the company that work on ways to operationalize our ESG strategy and engage with our employees at all levels. These functional groups have relevant targets, for areas like, for example, supplier diversity or energy efficiency, and emissions reductions for packaging reductions, and even volunteering participation goals. These KPIs are regularly reviewed, and then we report out on them.
Choosing to have the ESG function report directly to our Chief Financial Officer was one way that we implemented to make sure that the lens of ESG continues looking at the horizon and that we continue to focus on the long-term value with adequate support from investments that we're making in our business outlook.
Yeah. It's so important for the employees, I think, to understand that commitment, and have it be clearly communicated. Francis, we're just about out of time, but I'd love to get some final thoughts from you.
Thanks, Maggie. We believe that Illumina is uniquely positioned to leverage our technology, innovation, and market expertise to promote the health and wellbeing of everyone. Genomics will be key to predicting, preventing, and treating disease, and will also be a powerful tool for climate resilience. It's the mission our company was built on. The opportunities to drive the progress of genomics and make it more impactful for our patients, our communities, and our planet are boundless. This is what drives our employees every day. Building a better, more equitable, and more sustainable future, all while providing long-term value for our shareholders.
I'd like to thank Francis, Sam, and Sharon for this conversation and for everyone for joining us online. Additional information can also be found on the Illumina CSR website. Keep a lookout for their next report scheduled to be published in April 2022. Thank you for joining us.
Brian Blanchett here with Investor Relations, and it looks like we have come to the end of our time. For those of you that have submitted questions or are interested in a follow-up conversation, reach out to the Investor Relations team to schedule. That will conclude today's event. Thank you.