The Chemical Footprint Benchmark Supports Businesses, Investors and Purchasers in Assessing Chemical Risks
In the first initiative of its kind to publicly benchmark corporate chemicals management, a select group of 24 leading edge businesses, including Levi’s, Seagate and Johnson & Johnson have stepped forward to participate in the Chemical Footprint Project – a crosscutting effort by NGOs, universities and sustainability consultants.
“First came carbon, now it is time to measure the corporate chemical footprint. This is the obvious next step in sustainable business practice. Publishing the chemical footprint will close a gap in sustainability reporting, something really sought after by investors and it will help purchasers find the best suppliers”, says Sonja Haider, Senior Business and Investors advisor with the NGO ChemSec, one of the contributors to the project.
Results of the project are published today in a first inaugural report. Key findings include:
- Senior leadership matters: The 29% of firms with Board-level oversight or senior management incentives performed better overall than firms with no such accountability.
- Companies need comprehensive policies: Without policies that address chemical hazards in manufacturing, supply chains, and packaging – in addition to products — companies face hidden liabilities and chemical risks.
- Disclosure lags practice: Across every indicator category — Management, Inventory, Footprint, and Disclosure — companies have more chemicals management practices in place than they state publicly. For example, 83% have a legally restricted substances list, but only 17% of those companies make that list public.
- “Design for Health” sets leading edge: “Design for Health” companies, whose entire product portfolios are based on minimizing or eliminating chemicals of high concern, performed well above the average company score.
- Chemical footprint measurement is new and challenging: Before they can reduce their chemical footprints, companies need to know the chemical ingredients in their products and identify chemicals of high concern, so it’s no surprise that in this first year, companies scored just 27% of possible points for measuring baseline chemical footprint.
Signatories to the Chemical Footprint Project include investors and institutional purchasers with over $2.3 trillion in assets under management and $70 billion in purchasing power.
“Growing awareness around chemical safety issues is fostering change and reshaping business standards across many sectors. As a leading bank with a strong focus on sustainable investing we are looking for proactive companies embracing this evolution to create more financial value while offering safer products. Those companies are building the future of their industries. The Chemical Footprint Project helps us engaging with them”, says Guillaume Krepper, Sustainable Investment Analyst at Bank J. Safra Sarasin, signatory of the Chemical Footprint Project.
Why are chemicals important to businesses and investors?
Chemicals are used in the production of all kinds of articles, like clothes, electronics, cosmetics and toys for example, and some of them are very hazardous. In the past, however, company disclosure regarding use of hazardous chemicals has not generated the same level of transparency as for example carbon. Recent developments show this is about to change, with not only customers increasingly demanding to know what is in the products they buy. Also investors and the companies themselves are starting to realize that the use of hazardous chemicals poses real financial risks and need to be properly managed.
About the Chemical Footprint Project
The Chemical Footprint Project was founded by the environmental non-profit Clean Production Action, the research institute Lowell Center for Sustainable Production at the University of Massachusetts- Lowell, and the sustainability consultancy Pure Strategies. Its mission is to transform global chemical use by measuring and disclosing data on business progress to safer chemicals. The NGO ChemSec is the main European contributor to the project.