Sustainability – An opportunity for the Chemical Industry
- Dr Neil Hawkins, Chief Sustainability Officer & Corporate Vice President-Environment, Health & Safety, Dow Chemical Co.
This article outlines the possibilities and potential, with Dow’s own examples, on creating a roadmap to attain the goals of sustainability.
Abstract Sustainable Development Goas (SDGs) adopted by the United Nations are meant to make the world, through collective actions, a healthy, sustainable and prosperous planet. The SDGs provide business and industry unprecedented opportunities to come up with solutions needed to enable sustainable growth. Since 95 percent of the manufactured goods are due to chemistry, some way or the other, this means that the chemical industry has to take centre stage as innovators and solution providers.
This article outlines the possibilities and potential, with Dow’s own examples, on creating a roadmap to attain the goals of sustainability.
Our planet faces daunting economic, social and environmental challenges, including feeding a growing population globally, mitigating climate change, and boosting economic development while promoting a path toward more sustainable environmental practices. To address these challenges, the world’s governments adopted the United Nations Sustainable Development Goals (SDGs) in 2015. These 17 goals and 169 targets are helping guide and shape global development through the year 2030. Together, the SDGs offer a vision of a better future – a future where the world is free from poverty and injustice and where our collective actions support a healthy, sustainable and prosperous planet.
If this ambitious vision is to become a reality, it is evident that business must take a role in achieving these global goals. The size and scale of the issues facing our society will need the innovation, finance and management skills that business provides. At the same time, the SDGs provide business with an unprecedented opportunity to translate global challenges into business solutions that help build economies and put the world on a more sustainable path. To give an idea of the scope of the opportunity, a report entitled ‘Better Business, Better World’ by the Business & Sustainability Development Commission identifies a $12 trillion market for achieving just four of the 2030 goals – food and agriculture, cities (e.g., housing, transportation and water), energy and materials, and health. In each of these markets, the chemical industry is a vital source of innovation.
The Chemical Industry and the SDGs: An Opportunity to Lead
The SDGs provide an unprecedented opportunity for the chemical industry to take center stage as innovators and solutions providers. Because 95 percent of the world’s manufactured goods are created from chemistry, our industry has the ability to transform lives and play a central role in innovating more sustainable products and business models. However, to fully realize our potential in helping advance SDGs, our industry must go beyond “business as usual” and adopt a shift toward a more purpose-driven perspective that fully integrates the triple bottom line. Sustainability can no longer be marginalized as a “nice thing to do.” It must be a driver of long-term strategy for business growth.
At Dow, we see the role of business as a catalyst for change. Our ability to innovate gives us an enormous opportunity to advance human progress, even as we advance our profitability. In fact, we mapped our sustainability goals to the SDGs and believe that if we achieve our goals, we will make a significant contribution to sustainable development of the planet. Announced in 2015, our 2025 Sustainability Goals address the larger picture of sustainable development and challenge our company to be a constructive partner in helping bring chemistry, public policy innovation, and value innovation to solve global challenges. In fact, a common thread across our goals is our focus on finding collaborative business models that
will lead to transformative and more sustainable ways to do business. Not just for Dow – but for other companies, communities and society too.
In fact, through our 2025 Sustainability Goals, we hope to help redefine the role of business in society. That on the surface may sound audacious, but it’s built on a humbling reality: No single company can make this transformation to a more sustainable future happen on its own. As a global science company, we have the talent and tools to help impact climate change, energy, food production, sustainable infrastructure and water. However, if we don’t have the right public policy environment and a value chain that puts these solutions to effective use, the benefits of addressing these challenges may not materialize.
Plastic waste and marine debris is a good example. Concerns regarding plastic waste recently has come to a tipping point of public concern and regulatory action. Technology exists for tackling this issue, but the problem will take time to solve. Today, Dow is collaborating with Ocean Conservancy, the Ellen MacArthur Foundation and the Closed Loop Foundation to find long-term solutions. In 2016, we announced a commitment to spend $2.8 million over two years to drive solutions that address global marine debris and litter. As part of that commitment, we are supporting the launch of the first quantitative research in the Asia Pacific region into the impact of plastic waste and debris on the Edogawa and Ohiri Rivers. Together with Tokyo University of Science and the Japan Plastic Industry, we are examining the impact of waste management solutions and providing data on waste volumes passing through the river to help local communities and governments improve existing systems.
We also are collaborating with local governments and other stakeholders in Asia Pacific to help turn plastic waste into long-lasting roads in Asia Pacific. In India, Dow worked with the cities of Bangalore and Pune and waste collectors to bring together the people and materials needed for 40 kilometers of roads – diverting 100 metric tons of waste from landfills. Volunteers picked up the plastic waste, which was taken to local recyclers, who grinded the material into small pieces. Those pieces were then sent to local asphalt plants and added into the asphalt mixture, resulting in roads that last two times longer than traditional roads. In Indonesia, Dow worked with the government and various stakeholders to complete the first plastic road trial in Depok. Approximately 3.5 metric tons of plastic waste materials were mixed into asphalt to create a 1.8-kilometer-long road. Our goal is to convene with the right collaborators and develop a common understanding of the problem and the causes behind it. While the case is clear that realizing the SDGs can improve the environment and build markets, moving from words to deeds can be challenging, requiring companies to identify the best opportunities to mobilize their organizations and form alliances with relevant stakeholders. This can be made even more challenging, considering the buzzwords that are the subject of debate and discussion in industry, government and the media. Let’s take a look at a few.
Circular economy: Today’s linear economy – in which natural resources are extracted, made into products, used and thrown away – is unsustainable, considering our growing population. Moving toward a circular economy – in which as few resources are used as possible and kept in circulation as long as possible – offers the chemical industry a chance to work across value chains to create value to help decouple growth from consumption.
For us, moving toward a more circular economy begins in the product design, so the product can be optimized for reuse or recycling. For example, in 2017, we delivered the first certified renewable low-density polyethylene to customers. In addition, adopting a mindset that moves away from a “take-make-dispose” economic model to one that is regenerative has led us to innovate and collaborate in new ways and across multiple value chains. For example, we are exploring how to give new life to old mattresses by recycling polyols. We are working with municipalities in water-stressed regions to reuse water for our operations. We also are piloting programs that convert plastics that once went to landfills into valuable energy resources.
Product life cycle: As the number of regulations increases worldwide, chemical companies are being
Moving toward a circular economy – in which as few resources are used as possible and kept in circulation as long as possible – offers the chemical industry a chance to work across value chains to create value to help decouple growth from consumption.
held increasingly responsible for the safety of products they manufacture. We have developed a comprehensive compliance program that addresses all phases of the chemical lifecycle – from research and development, testing, manufacturing, transportation, usage and disposal. Life Cycle Assessment (LCA) is a useful methodology for examining the total environmental impact of a product or service. For example, our coatings materials business is using LCAs to inform and drive innovations in raw materials and technologies that can help coatings formulators develop more sustainable paints and coatings.
LCAs track a product or service from raw material sourcing through end-of-life (cradle to grave). They are typically conducted in accordance with recognized ISO 14040-14044 standards and validated by external and independent third parties. Many factors are taken into consideration; for architectural paints and coatings, these would include the raw materials that go into the paint formulation, as well as how the paint is applied, how it performs and how long it lasts. The results of an LCA can help decision makers choose more sustainable options and assist in the implementation of green procurement programs and eco-label certifications
Cradle-to-cradle certification: A company’s true commitment to sustainability requires not only reducing the negative impacts from its operations, but more importantly, changing its products and services to be more sustainable and help address environmental and social challenges. A growing number of companies are relying on Cradle to Cradle CertifiedTM Product Standard to verify the material health and positive impact of the products they create. The Cradle to Cradle Certified Products Program is an independent, third-party verified certification program that certifies products and materials that are developed to respect human and environmental health, designed for future use cycles, and that utilize clean energy and water throughout the supply chain. Cradle to Cradle product certification is awarded at five levels (Basic, Bronze, Silver, Gold, and Platinum), with each higher level imposing a more rigorous set of requirements. The lowest score in any quality category establishes the product’s overall score. Certified products are required to show continuous improvement every two years. An example is our building insulation products from Dow Building Solutions were certified by the Cradle to Cradle Certified program. However, the process of evaluating the sustainability profile of our products does not end with Cradle to Cradle Certification. Because the program looks at the entire product life cycle – from manufacturing to disposal – we are able to identify key priorities for continuous improvement.
Only by integrating the SDGs into the core of corporate strategies can our industry truly contribute to meeting everyone’s needs without depleting the planet’s resources. When our business presidents talk about our business strategy, they focus on Dow’s 2025 Sustainability Goals and the link to the SDGs. When we talk to customers about how we are a leading and progressive company, one value proposition of doing business with Dow is that we are aligning ourselves with the sustainability trends of the future, which includes the SDGs.
The SDGs also are a common part of our commercial discussions and conversations with the research community. It generates some really interesting questions: as we aspire to head towards a world of no hunger and zero poverty, what kind of business opportunities open up? As we bring people out of poverty and into the middle class, what kind of demands for products and services does that create?
Our 2025 Sustainability Goals are not a tick-box exercise, relegated to our sustainability report. They are rigorously incorporated into the normal business unit goals and therefore become functional goals, geographic goals, working group goals and personal goals. This is the kind of discipline that needs to happen within a company to make the SDGs real. Solid data, robust reporting and public accountability are the tools to optimize a business’ impact, allow for sustainability contributions to be tracked, and help form
A growing number of companies are relying on Cradle to Cradle CertifiedTM Product Standard to verify the material health and positive impact of the products they create. The Cradle to Cradle Certified Products Program is an independent, third-party verified certification program that certifies products and materials that are developed to respect human and environmental health, designed for future use cycles, and that utilize clean energy and water throughout the supply chain.
alliances with relevant stakeholders.
This process may sound daunting. But by not acting, our industry not only risks the tremendous growth opportunities before us, but our reputations and regulation. For examples, increased concerns regarding the safe use of chemicals in commerce and their potential impact on the environment as well as perceived impacts of plant biotechnology on health and the environment have resulted in more restrictive regulations and could lead to new regulations.
Earning the Right to Operate
At Dow, we believe the companies that define the 21st century will earn their right to operate by delivering value to society. And they will recognize that the old mindset—that companies have to choose between doing well and doing good—is neither practical nor valid. To succeed long term, a company must create value for society as well as its shareholders.
Beyond the bottom-line benefits, our sustainability goals have helped our company and employees embrace a more entrepreneurial mindset. To embrace risk and to find the opportunity in challenges. To search out collaborative opportunities with diverse partners and tap into a wide variety of stakeholders’ strengths throughout the value chain to deliver the best possible path forward. To rethink old business models and try new ones.
Overall, the SDGs offer a tremendous opportunity for the chemical industry. It is an opportunity where doing good for people can translate into business opportunities as well. That is a win for society and for our industry.