CEO’s Round Table
Managing Director, Covestro (India) Private Limited
Chemical Industry Digest posed a set of seven questions to CEOs of a few leading companies to know what their understanding of sustainability is and how they are going about their activities towards sustainability. Their views are presented here.
Chemical Industry Digest (CID): Sustainability means many things to many people. It could be resource efficiency, avoiding or minimizing bad effects on the environment of any material or product or emissions from manufacturing processes. Some link it with CSR activities too. Can we get some clarity on this along with what the benchmarks are if any for sustainable manufacturing in the chemical industry?
Ajay Durrani (AD): Sustainability is a highly complex matter as it touches on the overall integrity & construct of our planet and its eco-system, our society and the way we create prosperity in all its various forms. This is why Covestro’s approach to sustainable development is based on the triple-bottom line principle to serve “people, planet, profit”: With everything we do we aim to deliver a positive impact on at least two of those three dimensions while not harming the other.
We always bear this basis for our decision making in mind. We are committed to foster increased value on the economic, environmental, and social levels, all at the same time and are a strong advocate for the United Nations Sustainable Development Goals.
Ajay Durrani is Managing Director & CEO of Covestro (India) Private Limited (formerly known as Bayer MaterialScience Pvt. Ltd). In this role, he is responsible for leading the development and expansion of Covestro’s business across the Indian sub continent.
Durrani has over 21 years of experience in the chemical industry with a focus on achieving continuous and improved business performance. He has a master’s degree in Marketing Management from Jiwaji University, Gwalior with professional qualifications from Boston School of Business in Switzerland, INSEAD Singapore and Indian School of Business in Hyderabad. Business activities of Covestro India are in polymer products, such as polyurethanes, polycarbonates and coatings, adhesives and Specialties.
We believe in extending this mission of sustainable growth to the last mile of our value chain.
Thus, it’s our commitment to make 100 percent of our suppliers compliant with our sustainability requirements. We also aim to reduce our specific greenhouse gas emissions – those generated per metric ton of product produced – by 50 percent when compared to our base year 2005.
CID: Many materials/products that are being used now are not satisfying the sustainability criteria. What should companies do to green existing products or replace them totally with more benign and environmentally friendly materials/products? Should companies revisit their existing product portfolios and even their manufacturing processes to reorient them towards sustainability requirements? What
do you practice?
AD: Covestro is constantly pushing boundaries to increase the share of alternative resources in the production of its plastics – but only if this really does help the environment. Should the process require additional energy, or should the production or transport of the alternative resources release more CO than the appli
2 cation saves, our company will decide against it.
As mentioned we have replaced up to 50% crude oil used in manufacturing polyols with CO . Hardeners
2 for high-performance coatings in the automotive and furniture industry too were traditionally based on fossil – and therefore non-sustainable – raw materials. We have now coating hardeners based on renewable resources. From a point of view of manufacturing polyurethane, isocyanate and polyols are the two main components. Therefore, to make the production more sustainable Covestro adopted the use of gas phase technology.
CID: The World Environment Day this year on 5th June had the theme ‘Beat Plastic Pollution’. As you are aware a large part of the primary basic petrochemicals is converted into plastics or polymers which are non-biodegradable and creating mammoth pollution of our seas, rivers and land. Would you agree that from the sustainability perspective plastics was a ‘bad’ material ab initio and would this also be the inadequacy of chemistry not to have foreseen the consequences?
AD: The world has produced over nine billion tons of plastics since the 1950s. 165 million tons of it have trashed our ocean, with almost 9 million more tons entering the oceans each year. Since only about 9 % of plastic gets recycled, much of the rest lies in the environment or landfills. This cannot be wiped out in a jiffy.
I believe we would be doing a disservice to polymers if we only restrict the discussions on the inadequacy of the chemistry or the impact on nature. More than polymers itself, it is the application which determines its contribution. As a matter of fact, there have been several industries where polymers continue to play the role of a catalyst in environmental protection and promote a healthier life.
That being said, there is no doubt that there is an urgent need to introduce polymers which have a lesser environmental impact. A case in point is the innovation from Covestro wherein we have replaced 20-50% of the crude oil used to manufacture polyols with carbon dioxide. This has a dual impact – reduces the bur-
den on the crude oil as well as utilizes the carbon dioxide from the environment in a constructive manner.
It is also important to adopt bioplastics. There have been many challenges to the adoption of bioplastics. One of the foremost being that they are a recent invention. Any innovation requires climbing through the usual growth trajectory before gaining acceptance as a mass product, regardless of the benign nature of the material/idea. Second, absence and lack of strict regulations is a major impediment to the adoption of bioplastics. Third, the incremental appreciation in the cost of utilizing bioplastics has been a deterrent in markets which are more cost competitive. However, we have been witnessing this to be a waning trend across sectors and economies.
One of our own five sustainability targets, which we aim to achieve until 2025, is to invest at least 80 percent of our R&D budget in projects aligned with the Sustainable Development Goals (SDGs).
CID: When it comes to the development of entirely new products/ materials do you employ principles of sustainability ab initio? Are such principles & practices employed in your R&D? Do you feel the global public pressures towards cleaner environment & sustainability would give an impetus to R&D?
AD: Sustainability is at the core of all our efforts and is our strategic vision. We keep an eye on the entire product lifecycle. This includes the raw materials, production, and processing, as well as the application, disposal or recycling of our products. Sustainability governs everything we do, and we want to improve in each area: from research and development – including joint projects with our customers and other partners – to sourcing, production and distribution.
There is absolutely no pressure on us as we have been at the forefront of building a brighter tomorrow through sustainable practices. We are committed to the goals and provisions set out in the United Nations Global Compact (UNGC) and have signed the UNGC Charter.
Furthermore, one of our own five sustainability targets, which we aim to achieve until 2025, is to invest at least 80 percent of our R&D budget in projects aligned with the Sustainable Development Goals (SDGs). Thus, sustainability is an integral part of our R&D and how our business moves forward.
CID: End of the pipe treatment means not good chemistry; minimizing deleterious effect of environment is another approach; Recycling & reuse is being adopted in some cases and cradle to cradle/circular economy are being touted. What would be the most practical approach – in the short term and what is required to be done in the long term?
AD: As I mentioned earlier, sustainability has to meet the needs of the present without compromising the well-being of future generations. To which we need multiple approaches that can answer both short term and long-term problems. We have already achieved a breakthrough in this direction with our cardyon technology. The material (polyol) produced using this technology contains 20 percent CO and is a precursor for foam used in mat
2 tresses and upholstered furniture. Covestro brought the first industrial-scale production plant for this polyol on stream in 2016, and in the future, we are expecting to increase the share of CO to up to 40%.
We are also working in cross-industry consortiums on methods to make carbon dioxide and waste flow of other industrial sectors usable as raw materials for our products.
In order to live up to the growing significance of circular business models and the need for the more efficient use of resources, a central coordinating office for the circular economy was implemented in 2017.
CID: Another major problem is that of climate change, global warming due to emissions of greenhouse gases. This can be mitigated by manufacturing processes shifting to low carbon or no carbon load on environment. Are R&D efforts moving in this direction? Can a shift to renewable feedstocks from petro feedstocks help? In your manufacturing are you trying to reduce the carbon load of your processes?
AD: Shift to renewable feedstock from petro will definitely help. We need to move towards more biobased polymers. At Covestro, we use innovative manufacturing processes, such as the oxygen depolarized cathode technique in chlorine production that saves as much as 30% of electricity. Similarly, employing gas phase technology can also save 40% energy and up to 80% solvent usage in the manufacture of the foam component TDI (toluene diisocyanate), a precursor for flexible polyurethane foam.
In order to increase our carbon productivity we formed the Carbon Productivity Consortium with external partners and developed a methodology that identifies nine levers along the value chain that help to make a better use of fossil fuel carbon as a resource, to use alternative resources and to move towards a closedlooped model. This methodology is open source as we want to encourage our business partners as well as
Between 2005 and 2016, CO emissions in all company locations of Covestro decreased by 12% despite the fact that the production volume in our 17 most important locations across the world increased by almost 57%. Towards the end of 2016, we were already producing 40.9% fewer specific CO2 emissions compared to the reference year 2005.
other industries and public institutions to become as carbon productive as possible, to overcome the challenge to ensure our society’s prosperity while minizing, if not reversing, our negative impact on the climate.
CID: Can you give some examples/ achievements of your company’s efforts on the sustainability front?
AD: Between 2005 and 2016, CO emissions in all
2 company locations of Covestro decreased by 12% despite the fact that the production volume in our 17 most important locations across the world increased by almost 57%. Towards the end of 2016, we were al- ready producing 40.9% fewer specific CO emissions compared
2 to the reference year 2005.
With a specific focus on India, we set up the Eco-Commercial Building as a proof of our commitment to push boundaries towards a brighter tomorrow. In the last few years, it has become a net positive energy building. This means that we generate and save more energy than what is consumed by the building. Similarly, we have been working with companies, partners and NGOs to contribute to social causes using our solutions.