SASB for Healthcare

What is SASB?

The Sustainability Accounting Standards Board (SASB) is an independent nonprofit organization that develops and maintains industry-specific standards for sustainability reporting. These standards help companies disclose financially material environmental, social, and governance (ESG) information to investors and other stakeholders in a consistent, comparable, and decision-useful way. Originally founded in 2011 and later merged into the IFRS Foundation under the International Sustainability Standards Board (ISSB), SASB standards remain a cornerstone of corporate sustainability disclosure worldwide.

SASB and the Healthcare Industry

The healthcare sector occupies a uniquely sensitive position in the sustainability landscape. Companies operating in this space — from pharmaceutical manufacturers and biotechnology firms to hospital systems and managed care organizations — handle highly personal patient data, develop products that directly affect human health, and operate within a tightly regulated environment. SASB recognizes this complexity by providing dedicated standards for multiple healthcare sub-sectors, including Health Care Delivery, Drug Retailers, Medical Equipment and Supplies, and Managed Care.

For a pharmaceutical company, SASB standards require disclosure of how it manages drug safety, clinical trial transparency, and pricing practices — all issues that carry direct financial risk through litigation, regulatory penalties, and reputational damage. A hospital network, on the other hand, faces different but equally significant demands around patient safety outcomes, workforce management, and access to care in underserved communities. For example, a large integrated health system must report on its patient safety culture, including metrics such as hospital-acquired infection rates and sentinel event disclosures, because these figures are directly tied to reimbursement rates under value-based care models and can materially affect revenue.

Investors increasingly use SASB-aligned disclosures to assess the long-term viability of healthcare investments. A biotech company that cannot demonstrate responsible clinical trial practices or adequate pharmacovigilance exposes itself to pipeline risk that goes far beyond scientific uncertainty. Similarly, a medical device manufacturer that fails to account for supply chain ethics — particularly with regard to conflict minerals or labor standards — faces growing pressure from institutional shareholders who rely on SASB data to make informed capital allocation decisions.

Key Requirements

SASB standards for the healthcare industry cover a range of sustainability topics that are considered financially material. The specific requirements vary by sub-sector, but the following areas represent the most critical disclosure obligations for companies operating across the healthcare value chain:

• Drug and Device Safety: Companies must disclose policies and procedures for post-market surveillance, adverse event reporting, and product recalls. This includes quantitative data on the number of recalls and the total units recalled, categorized by severity level under FDA classification.
• Affordability and Fair Pricing: Pharmaceutical and managed care companies are expected to report on pricing strategies, revenue from government programs such as Medicaid and Medicare, and any material legal or regulatory proceedings related to drug pricing practices.
• Ethical Marketing and Clinical Trial Transparency: SASB requires disclosure of promotional practices, including total expenditures on direct-to-physician marketing and adherence to codes such as the PhRMA Code on Interactions with Healthcare Professionals. Clinical trial data must be registered and results made publicly available.
• Counterfeit Drug and Supply Chain Integrity: Drug retailers and distributors must report on the percentage of products sourced from verified and audited suppliers, along with any instances of counterfeit or substandard product interceptions.
• Patient Privacy and Data Security: Health care delivery companies and health insurers must disclose the number of data breaches, the number of patients affected, and the percentage of employees who received data security training, given the sensitivity of protected health information (PHI) under HIPAA.
• Patient Safety and Quality of Care: Hospitals and health systems must report on patient safety indicators, including rates of hospital-acquired conditions, readmission rates, and outcomes data tied to value-based purchasing agreements.
• Access to Healthcare: Companies must address geographic or socioeconomic barriers to access, including charitable care programs, sliding-scale fee structures, and patient assistance programs for high-cost medications.
• Environmental Footprint of Facilities and Operations: Healthcare organizations are significant energy and water consumers. SASB requires disclosure of total energy consumed, percentage from renewable sources, total water withdrawn, and progress against reduction targets.
• Workforce Management: Given the critical shortage of skilled clinical workers, companies must disclose employee turnover rates, voluntary and involuntary separation rates, and investment in workforce training and development programs.

Implementation Steps for Healthcare Companies

Implementing SASB standards can appear daunting given the volume and specificity of required disclosures. However, breaking the process into structured stages makes it manageable for organizations of any size, from a regional medical group to a global pharmaceutical corporation.

1. Identify the applicable SASB standard for your sub-sector. Visit the SASB standards library and confirm which industry classification applies to your primary business activity. A company with mixed operations — such as a vertically integrated health system that also operates a pharmacy benefit manager — may need to apply more than one standard and disclose accordingly.
2. Conduct a materiality assessment aligned with SASB topics. Map each SASB disclosure topic against your business model to determine which issues represent the greatest financial and reputational risk. Engage your finance, legal, compliance, and operations teams in this exercise to ensure that the materiality judgment reflects cross-functional expertise rather than a single department's perspective.
3. Audit existing data infrastructure and identify gaps. Determine which metrics you already track in your existing operational and financial systems. Common gaps in healthcare organizations include environmental data (energy, water, waste), patient-level safety metrics at the enterprise level, and supplier audit documentation. Assign data owners for each metric and establish data collection protocols.
4. Establish or update internal policies to align with SASB requirements. If your organization lacks a formal drug safety reporting procedure or a clinical trial transparency policy, these must be developed or updated before meaningful disclosure is possible. Policies should be reviewed by legal counsel to ensure they satisfy both SASB expectations and existing regulatory requirements under FDA, CMS, and HIPAA.
5. Integrate SASB disclosures into your annual reporting cycle. Align the SASB data collection process with your financial reporting calendar. Many companies begin ESG data collection in the third quarter for inclusion in their annual sustainability report or proxy statement published in the spring. Consider using dedicated ESG reporting software that includes SASB metric frameworks to reduce manual data aggregation errors.
6. Engage with external assurance providers. Institutional investors are increasingly requesting third-party verification of SASB-aligned data, particularly for metrics related to patient safety incidents and data breach frequency. Engaging an accredited assurance provider adds credibility to your disclosures and reduces the risk of greenwashing allegations.
7. Communicate results to stakeholders and iterate annually. Publish your SASB index — a structured table mapping each required metric to where it can be found in your disclosures — in your sustainability report or as a standalone document. Solicit feedback from key investor stakeholders and benchmark your performance against healthcare sector peers. Use this feedback to improve data quality and target-setting in the following reporting cycle.

Frequently Asked Questions

Is SASB reporting mandatory for healthcare companies?
SASB reporting is not legally mandated in most jurisdictions, but it is increasingly expected by institutional investors, ESG rating agencies, and sustainability-focused capital allocators. In the United States, the Securities and Exchange Commission has proposed climate disclosure rules that reference SASB-aligned frameworks, and the European Sustainability Reporting Standards (ESRS) under the Corporate Sustainability Reporting Directive (CSRD) share significant conceptual overlap with SASB topics. For publicly traded healthcare companies seeking access to ESG-focused capital or inclusion in sustainability indices such as the DJSI or MSCI ESG Ratings, SASB-aligned disclosure has become a de facto requirement.

How does SASB differ from the Global Reporting Initiative (GRI) in a healthcare context?
While both frameworks address ESG topics, they serve different primary audiences and apply different methodologies. GRI standards are designed for a broad range of stakeholders — including communities, employees, and civil society — and use a double materiality lens that captures both financial impact and societal impact. SASB, by contrast, focuses specifically on investors and uses single materiality, meaning it prioritizes only those issues likely to affect enterprise value. For a healthcare company, this means GRI may require more extensive disclosure on community health impact programs, whereas SASB focuses narrowly on the financial risks and opportunities tied to drug pricing, patient safety litigation, or data breach exposure. Many healthcare organizations choose to report against both frameworks to satisfy investor-facing and stakeholder-facing audiences simultaneously.

What specific metrics should a hospital system prioritize when beginning SASB reporting?
For health care delivery organizations, the highest-priority SASB metrics typically include patient safety indicators (hospital-acquired condition rates, falls, and medication errors), data security incidents (number of breaches and patients affected), employee turnover rates among clinical staff, total energy and water consumption, and revenue from government healthcare programs as a percentage of total net revenue. These metrics are both frequently requested by investors and practically achievable for most hospital systems that already collect quality and operational data for CMS reporting and Joint Commission accreditation purposes.

How should a pharmaceutical company handle SASB disclosures related to drug pricing controversies?
SASB requires pharmaceutical companies to disclose information about pricing practices and any material legal proceedings related to pricing, but it does not prescribe a particular pricing strategy. Companies should report factually on the percentage of revenue derived from government programs, the existence of any active antitrust or pricing-related regulatory investigations, and the structure of patient assistance programs. Transparent narrative disclosure that contextualizes pricing decisions within the cost of research and development, regulatory approval, and post-market safety monitoring tends to be better received by investors than minimal boilerplate language. Companies that have experienced significant public scrutiny over pricing — as many specialty pharmaceutical firms have — are advised to engage proactively with their investor relations and legal teams when drafting these sections.

Summary

SASB standards provide healthcare companies with a rigorous, investor-focused framework for disclosing the sustainability risks and opportunities that are most likely to affect long-term financial performance, from patient safety and data privacy to drug pricing and environmental footprint. Organizations that implement SASB reporting with discipline and transparency not only improve their standing with institutional investors and ESG analysts, but also build the internal data infrastructure and governance practices that underpin operational resilience. If your healthcare organization has not yet begun its SASB journey, now is the time to act — the competitive and regulatory environment is moving rapidly, and early movers consistently demonstrate stronger stakeholder trust and more favorable access to sustainability-linked capital.