We drive sustainable solutions BASF SRI Story

Transcription

1 We drive sustainable solutions BASF SRI Story June

2 Cautionary note regarding forward-looking statements This presentation contains forward-looking statements. These statements are based on current estimates and projections of the Board of Executive Directors and currently available information. Forward-looking statements are not guarantees of the future developments and results outlined therein. These are dependent on a number of factors; they involve various risks and uncertainties; and they are based on assumptions that may not prove to be accurate. Such risk factors include those discussed in the Opportunities and Risks Report from page 111 to 118 of the BASF Report BASF does not assume any obligation to update the forward-looking statements contained in this presentation above and beyond the legal requirements. 2

3 Sustainability along the value chain Our commitments Suppliers BASF Customers We source responsibly We produce safely for people and the environment We produce efficiently We drive sustainable products and solutions We value people and treat them with respect 3

4 Sustainable development UN Sustainable Development Goals and material aspects provide strategic frame 1 No poverty BASF material aspects Energy and climate Food Water Resources and ecosystems Responsible production Products and solutions Partnering Employment and employability BASF particularly contributes to: 2 No hunger 3 Good health 4 Quality education 5 Gender equality 6 Clean water and sanitation 7 Affordable and clean energy 8 Decent work and economic growth 9 Industry, innovation and infrastructure 10 Reduced inequalities 11 Sustainable cities and communities 12 Responsible consumption and production 13 Climate action 14 Life below water 15 Life on land 16 Peace and justice 17 Partnerships for the goals Match High Medium Low 4

5 Sustainability along the value chain Our commitments Suppliers BASF Customers We source responsibly We produce safely for people and the environment We produce efficiently We drive sustainable products and solutions We value people and treat them with respect 5

6 We source responsibly Enhancing sustainability along the supply chain Joint initiative Together for Sustainability of leading chemical companies since 2011 Standardized and shared supplier evaluations and audits Implementation of follow-up processes, development of action plans Sustainability assessments for 513 suppliers received from an external service provider in raw material supplier sites audited on EHS in goal: evaluation of 70% of the relevant suppliers with regard to their sustainability performance (status 2017: 56%) 6

7 Sustainability along the value chain Our commitments Suppliers BASF Customers We source responsibly We produce safely for people and the environment We produce efficiently We drive sustainable products and solutions We value people and treat them with respect 7

8 Verbund unique competitive advantage Actively managed in line with market requirements Geismar Antwerp Ludwigshafen Nanjing Freeport. Kuantan Combined heat and power plants and integrated energy Verbund prevented 6.5 million tons of CO 2 emissions in 2017 Synergies in logistics and infrastructure, minimization of waste > 1 billion of cost savings per year 8

9 Waste management BASF Verbund helps to prevent and reduce waste Global waste volume 2017 (million tons) Waste is managed based on the following hierarchy: 1. Avoid Recycled or thermally recovered Incinerated or disposed of Reuse 3. Recycle 4. Energy recovery (e.g., waste-to-energy incineration) 5. Other incineration 6. Disposal such as surface or underground landfills 9

10 Resource efficiency Responsible use of carbon sources We are committed to resource efficiency and climate protection BASF uses carbon raw materials responsibly: 82% of carbon converted to products, 17% consumed for process energy and converted to CO 2, 1% waste 1 Comparisons with European emissions trading benchmarks show that our chemical plants operate at above-average energy efficiency 23 million tons of CO 2 emissions by BASF worldwide in 2017 compared to million tons p.a. for one coal-fired power plant Customers use of BASF s climate protection products sold in 2017 avoided 570 million tons of CO 2 equivalents (thereof 6% attributable to BASF) 2 In 2017, BASF achieved CDP leadership status once again 1 BASF carbon mass balance calculation (2017, non-audited) 2 Based on the chemical industry standard of the International Council of Chemical Associations (ICCA) and the World Business Council for Sustainable Development (WBCSD) 10

11 Energy efficiency Greenhouse gas emissions halved and volumes of sales products doubled since 1990 Greenhouse gas emissions (indexed 1 ; base 1990) % 48% Specific greenhouse gas emissions per ton of sales product declined by 75% (status 2017) since goal: Reduction of specific greenhouse gas emissions per ton of sales product by 40% versus 2002 (status 2017: 35.5%) goal: Introduction of energy management system ISO at all relevant sites 2 (status 2017: 54.3% of BASF s primary energy demand) % Volumes of sales products Absolute GHG emissions Specific GHG emissions 1 BASF Group excluding Oil & Gas; International Financial Reporting Standards 10 and 11 since 2013; figures for 2012 restated; no restatement for 2011 and earlier 2 Representing 90% of BASFʼs primary energy demand 11

12 Global water stewardship Strong commitment to local water management Further increase of water stress areas expected worldwide (climate change, population growth and economic development) Growing competition among water users expected (e.g., households, agriculture, industry) In 2017, BASF was again awarded with the top A leadership grade for sustainable water management from CDP 2025 goal: Introduction of sustainable water management at Verbund sites and sites in water stress areas 2 (status 2017: 45.2%) 1 Representing 93% of BASF s entire water abstraction 12

13 Process safety and occupational safety Global safety standards at all sites to minimize risk and impact of incidents Gobal safety standards (rate 1 ) Process safety incidents (PSI) 1 PSI rate: 2.0 in goal: reduction of the worldwide PSI rate to 0.5 Lost-time injuries (LTI) 1 LTI rate: 1.4 in 2017 Average LTI rate in the German chemical industry: 9.4 (in 2015) 2025 goal: reduction of the worldwide LTI rate to Process safety incidents (PSI) Lost-time injuries (LTI) 1 BASF Group, per one million working hours; global alignment of reporting systems

14 We create chemistry for a sustainable future Sustainability goals overview and status 2017 Procurement 2020 goal 2017 Product stewardship 2020 goal 2017 Sustainability performance assessment of relevant suppliers 70% 56% Risk assessment of products 2 >99% 76.2% Employees 2021 goal 2017 Women in leadership positions 22-24% 20.5% Long-term goal 2017 Non-German senior executives 38.9% Senior executives with international experience >80% 84.6% Production 2025 goal 2017 Process safety incidents Lost-time injury rate Annual goal 2017 Health Performance Index > Energy & climate protection 2020 goal 2017 Greenhouse gas emissions 3 40% 35.5% Introduction of ISO energy management system 4 90% 54.3% Water 2025 goal 2017 Sustainable water management at Verbund sites and sites in water stress areas 100% 45.2% Products & solutions 2020 goal 2017 Proportion of sales generated by Accelerators 5 in product portfolio 1 Per one million working hours 2 For products >1 metric ton per year 3 Per metric ton of sales products; excl. Oil & Gas, baseline At all relevant sites (primary energy demand, local energy prices) 5 Products with substantial contribution to sustainability 28% 27.3% 14

15 Sustainability along the value chain Our commitments Suppliers BASF Customers We source responsibly We produce safely for people and the environment We produce efficiently We drive sustainable products and solutions We value people and treat them with respect 15

16 Sustainable Solution Steering Methodology to steer our portfolio 68.3% 27.3% 4.3% 0.1% Substantial sustainability contribution in the value chain Meets basic sustainability standards on the market Specific sustainability issues which are being actively addressed Significant sustainability concern, action plan in development >60,000 product applications analyzed ( 58.4 billion in sales, 97.5% of BASF s portfolio) 27.3% Accelerators strong growth in their markets deliver margins above the average represent majority of BASF s R&D pipeline 68.3% Performers <1% Challenged products 2020 goal: increase the share of Accelerators from 23% (2014) to 28% 16

17 Innovations for a sustainable future Examples with significant contributions to sustainability SLENTITE high-performance insulation material Trilon M alternative to phosphate for dishwashing detergents Acronal MB from biomass to dispersions ecovio biodegradable polymer solution Vault biological seed treatment for enhanced nitrogen fixation FWC Four-Way Conversion catalyst removes particulates 17

18 Sustainability along the value chain Our commitments Suppliers BASF Customers We source responsibly We produce safely for people and the environment We produce efficiently We drive sustainable products and solutions We value people and treat them with respect 18

19 We drive sustainable solutions Systematic sustainability performance assessments since 1996 Eco-Efficiency Analysis SEEBALANCE Carbon Footprint AgBalance Investment evaluation Sustainable Solution Steering Advanced IT solutions for customers Value-to-Society Corporate 1996 Portfolio and digital solutions Products in the value chain 19

20 Value-to-Society: changing the perspective Assessing and valuing how business changes the well-being of people Traditional reporting Quantified output (, CO 2 e, LTI ) Impact valuation / Value-to-Society Valued financial and pre-financial impacts ( ) Input raw materials Output tco 2 e Outcome climate change Impact costs of floods etc. 20

21 Impact valuation gains momentum It is not a question of if, but rather when impact valuation is implemented Business examples WBCSD Redefining Value Impact Valuation Roundtable Increasing number of companies is piloting in all sectors First companies go public Disclosure CDP (formerly Carbon Disclosure Project) Reporting schemes started the discussion Standardization Natural Capital Protocol Social Capital Protocol Natural and Social Capital Sector Guidance ISO and

22 Value-to-Society: a comprehensive assessment Economic, social and environmental impacts in monetary terms based on a PwC model Contributions to gross domestic product (value added) Contributions to society beyond gross domestic product Net income Amortization Depreciation Wages Taxes Human capital Health & safety Air emissions Water emissions Water consumption GHG Land use Waste Economic Social Environmental Impact categories Consistent application at corporate, project, and product level Value chain Corporate level: production cycle supply chain, own operations, customer industries Project and product level: use phase and end-of life integrated on a case-by-case basis 22

23 BASF s Value-to-Society 2017 Net positive contribution to sustainable growth in each step of the assessed value chain Full external supply chain 1 Own operations Customer industries 2 Net income Amortization Taxes Wages & benefits Human capital Health & safety Air emissions GHG Land use Waste Water consumption Water emissions billion Value contribution from BASF procurement Value contribution from BASF operations Value contribution from BASF sales 1 Indirect suppliers, direct suppliers 2 Customers in industries supplied by BASF 23

24 Benefits and limitations of Value-to-Society Complementary information to demonstrate relevance and interdependencies Positioning Progress monitoring Decision making Communication Reporting Advocacy Over time Industry benchmark Relevance of impacts Risk exposures Business opportunities Required data accuracy and granularity Required maturity level of quantification and valuation methods 24

25 We create chemistry for a sustainable future Sustainability is a core part of our strategy and fully integrated into our management systems Sustainability creates growth opportunities. We assess our contribution to a sustainable future along the entire value chain. We improve our understanding of the inter-dependency of financial and non-financial impacts. Our Value-to-Society approach is aligned with existing standards, and is pragmatic and auditable. We engage in relevant networks to share our learnings. 25

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27 SLENTITE High-performance insulation panel for construction SLENTITE PU aerogel as solid panel with best in class thermal insulation Flexible scope of design thanks to very slim panel (25 50% less than industry standard) Construction solution for reduced energy consumption Slentite SLENTITE Perspective Strong growth potential in a market of 1.3 billion First boards from pilot plant are being commercialized Start of large scale production in

28 Trilon M Chelating agent for more sustainable detergents and cleaners Trilon M alternative to phosphate for automatic dish washing Fast growing global market demand driven by regulatory changes and consumer demand 2015: Start-up of a new Trilon M world-scale plant in Alabama, USA 2016: Expansion and flexibilization of production facilities in Ludwigshafen Compared with alternative chelating agents Trilon M is readily biodegradable and shows high performance meets eco-label requirements has better eco-toxicology profile 28

29 Acronal MB From biomass to dispersion for premium paints Biomass balance approach First BASF binder for interior paints based on the biomass balance approach launched in 2016 Replacing fossil raw materials with renewable feedstock at the beginning of the production process Less greenhouse gas emissions Premium paints Renewable BASF Verbund production steps Feedstock Fossil Allocated Products Conventional Enabling interior paints that combine environmental responsibility with uncompromising premium quality 91% of interviewed professional painters in Germany see an increase in sustainability aspects in tenders 29

30 Epotal and Ecovio paper coatings From a Challenged product to a business opportunity 1. Identification of the Challenged product: Polyfluorinated substances as coatings for paper packaging (environmental concern) 2. Development of action plan: Start of a research project 3. Launch of Accelerator product substitution: Recyclable Epotal and biodegradable ecovio paper coating 30

31 Vault biological seed treatments Fixing nitrogen for legumous crops Legumous crops need nitrogen through fixation for highest yield potential Soybeans need approximately 4.5 lbs of nitrogen per bushel, 50 60% of which from nitrogen fixation Nitrogen that is not fixed is lost to the air, soil or water BASF s Vault seed-applied inoculants: Bradyrhizobia japonicum is fermented to develop robust rhizobial inoculants Vault inoculants improve root nodulation and architecture for more nitrogen-fixation potential Results include improved crop yield potential, resource efficiency, and long-term nitrogen use options for growers sustainability 31

32 Four-Way Conversion catalyst (FWC ) FWC reduces emission of gaseous pollutants and particulates HC CO NOx Particulates Leading position: Global mobile emissions catalysts patents N 2 CO 2 H 2 O FWC Combines a 3-way conversion catalyst with integrated filter on a ceramic substrate Reduces gaseous emissions Precious metal-based catalytic coating removes exhaust gases from engine emissions 2 Removes particulates Filters and combusts particulates Complies with emissions limits Helps OEM meet EU 6c regulatory standards FWC introduced in 2013 Sustains BASF s leading technology position 0 BASF Competitors Hydrocarbons, carbon monoxide, nitrogen oxides 32

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