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Will we finally have a green frontrunner in the chemical industry?

Chemical Industry

Will we finally have a green frontrunner in the chemical industry?

Published on 28 May 2019

One big dream that I’ve had since I started working for ChemSec ten years ago, is to see a big chemical producer taking the lead in the transformation to sustainable chemistry.

Two years ago, Akzo Nobel published a sustainability strategy, which included some very interesting ambitions from a producer’s point of view, but it was not detailed enough to make me jump up and down with excitement.

A couple of weeks ago, the Dutch chemical company DSM made a public statement, announcing that they aim to phase out all chemicals of high concern from their coating resins product line.

This is of course big industry news and something that will be followed with great interest by all kinds of stakeholders.

ChemSec’s Executive Director Anne-Sofie Bäckar already mentioned this statement in an opinion piece a couple of weeks ago. Since then, DSM has released a more detailed background document that aims to explain what the phase-out plan actually means in detail.

“DSM announced that they aim to phase out all chemicals of high concern from their coating resins”

So, one morning I brewed myself a cup of coffee, sat down in my sofa and opened the document, eager to see what could be expected from this strategy.

And since I know there are more people just like me out there, I thought I’d share my thoughts on it.

So, here we go.

Right from the start, it leaves me wanting more. DSM’s strategy is to phase out all chemicals of concern from the company’s Coating Resins and Functional Materials (CRFM) product line. Why not go for the whole product portfolio? Maybe I’m greedy, but the rationale behind the phase-out applies to all products containing chemicals of high concern.

Hopefully, in a few years, DSM will expand the strategy to include all its products.

What I don’t get is why they feel the need to carve out their own definition of what a chemical of high concern is. Why not just use REACH’s definition of a SVHC? DSM’s definition covers a lot of problematic substances, but does not include endocrine disruptors and sensitizers, for example.

Why exclude these groups? If it’s difficult to find clear criteria for them, I would like to refer them to the SIN List where these are clearly defined.

What pleased me more, however, is to see them mention circular economy as a key strategic objective for DSM, stating that the strategy is necessary for promoting and enabling recycling.

“Hopefully, in a few years, DSM will expand the strategy to include all its products”

This is the first time I’ve seen a chemical company explicitly mention circular economy and phase-outs in the same statement. It’s also the first time I’ve seen a chemical producer put forward an actual phase-out plan and not just vow to create new, benign products.

This of course means renouncing some of the profits from existing products at a first stage, which is admirable of them. However, as the demand for safer products grows, the strategy will most definitely profit them in the future.

DSM states that it wants to become the sustainability leader in the coatings industry, staying ahead of future regulatory changes.

This is great, and something we have been saying for years: Companies should not wait for chemicals legislation to enter into force. They should be proactive and responsible in their chemicals management and not let legislation set the pace for chemical substitution. This will future-proof their business and save them money in terms of safety measures and short-notice process changes.

The company says it is their “ambition to have no sales of products containing chemicals of high concern by 2025”. This sounds good to me, even though I think ambition is a pretty weak word. DSM also states that in some very specific circumstances the company must allow itself certain exceptions to the strategy (see document for full list of exceptions).

Although I agree that these exceptions are probably needed, I think the number of exceptions should be very limited. I also think that DSM should be transparent about them, and the volumes used, in a yearly report.

On the other hand, it makes the strategy all the more credible. During a phase-out process, there will be challenges along the way, for example, background levels and procedural difficulties. Realising this tells me that DSM has done its homework.

“But talk is cheap.
Now the real work begins”

Towards the end of the document the company says that expert opinions will be used to test safer alternative candidates, which is great. I’m glad to read that there seems to be a strategy in place for avoiding regrettable substitution.

All in all, I’m optimistic about this statement from DSM. However, talk is cheap, and now the real work begins. It will be exciting to see how things unfold over the coming years, including the reaction from competitors and investors.

At ChemSec, we’re hoping for a domino effect. Which chemical producer will be next to announce a similar strategy?

Sonja Haider
Senior Business and Investors Advisor