Sustainability isn’t just a buzzword: It’s an important component of saving our planet. The chemical industry has made great strides towards this goal, and more is yet to come. In this episode, Victoria Meyer flies solo as she breaks down three approaches the industry is taking to tackle sustainability. Victoria looks at these three critical components: Collaboration, Education, and Design, and she analyzes how they fit into the scheme of things. Tune in to learn more about the chemical industry’s drive for sustainability.
This episode is sponsored by AVEVA.
Watch the episode here
Listen to the podcast here
Three Critical Components to Tackling Sustainability In The Chemical Industry
In this episode, I am presenting a solo podcast and the focus is on sustainability. As I record this, we are wrapping up Earth Week. Some people call it Earth Month and there’s also Earth Day. In any case, April seems to be a month that’s focused across the world on sustainability, the Earth, and what we’re doing. It seems like a good time to be talking about the evolving approaches to sustainability in the chemical industry.
Focusing On Sustainability
What I want to focus on are three strategies or approaches that companies across the chemical industry are taking when we start focusing on sustainability. First, let’s talk a little bit about sustainability because it’s an area that has evolved quite a lot. When I first started hearing about companies and I was at Shell at the time talking about sustainability, I didn’t fully understand it.
Where we are now, we’ve got the UN Sustainable Development Goals which are seventeen goals that are focusing on areas around the environment, reducing poverty, and the impact that we have in the world and on people, as well as things like carbon and greenhouse gas emissions. When we talk about sustainability in the chemical industry, we’re often focused on the environmental aspects of it. That’s what I’m going to focus on. It covers areas around greenhouse gas emissions, carbon capture, recycling and other things.We have a challenge of scale. There's not a sufficient amount of physical recycling to get back the finished goods, whether they be bottles or film or anything, into the recycling system. Click To Tweet
To a large extent, there are two areas that companies talk about and seem to be focused on when we talk about sustainability. That’s greenhouse gas emissions, and then it’s about recycling and sustainability in plastics. Plastics is the focus area. A lot of times, our focus is on solid materials because they are readily recognizable in the environment and to consumers, including us and the people inside the chemical industry who are consumers of chemical products.
Why is this so critical? In the last few years, we’ve seen such a heightened focus on sustainability on our major chemical companies taking action, particularly, the plastics companies and the folks that are producing polyethylene, polypropylene and PET. Fundamentally, ethylene is the backbone of the chemical value chain. 60% of ethylene goes into polyethylene. That’s a whole heck of a lot of value and product that goes there.
Another 15% in there goes into MEG which goes into PET, which often is seen both in durable goods as well as in plastic bottles, etc. There’s this whole aspect of visibility and demand. It’s about continuing to have a license to operate in the world today and in the future. Frankly, we’re all citizens of Earth and we need to start protecting it and acting that way. There’s this whole recognition and enlightenment that’s taking place.
When I talk to people across the industry and when they talk about it, one of the challenges is scale. There are some ambitious targets about net-zero, reduction of greenhouse gas, increasing the amount of recycled material or recyclable material that are in consumer packaging, and other things. Yet, we have a challenge of scale. There’s not a sufficient amount of physical recycling to get back the finished goods, whether they be bottles or films or anything into the recycling system.
There is a vast array. It’s a huge fragmentation in mechanical recycling and collection across the world. This is a global issue. It’s local, regional and personal but the reality is it’s also a global issue. Across the world, we have an insufficient amount of collection and mechanical recycling that enables the next piece, which is around advanced recycling. Advanced recycling is a critical protocol and focus area for the chemical industry and our plastics manufacturers because it takes what is many times viewed as unrecyclable material.
One of the challenges in recycling is things like contamination, food waste, and other things that are retained in the materials that you want to be recycling. Through the process of advanced recycling, you can work through that. You don’t have the same concerns about food contamination and other contamination because the process itself cleanses, clarifies and cleans it up. It puts it back into a state of chemical feedstocks that can then be used for more plastics, more materials, and more things that we rely on as a world.Even people who make EPS would recognize that we need to have a better packaging solution. Click To Tweet
2025 is coming quickly and so is 2023. That’s where a lot of these targets are set across the industry. It’s not just in the industry but also in the governmental regulations to try to meet sustainability targets. What I want to talk about are three strategies and approaches that companies are taking when they look at sustainability, how they are tackling the challenge and the opportunity of sustainability and sustainable chemicals, and keeping that going.
Approach #1: Collaboration Is Key To Sustainability
The first one is collaboration. One of the things I’ve been hearing everywhere when I talk to people, companies, and if you look in the press, you’re seeing the same thing. Collaboration is key and there’s a huge consortium focus. In North America, we’ve got CyclyX, which is a consortium that a number of major petrochemical companies are part of. You’ve got Pyrex, which is in Europe and you’ve BOTTLE which is in the US Department of Energy. Amazon is one of the big companies that’s part of that.
There’s this recognition that there is no single solution that one company cannot solve this problem. Why do people go into these collaborations and consortiums? One is to focus and harness resources. Harnessing the best minds, the best ideas, and the best opportunities. The power in numbers. Two is to create an alignment of standards and regulations. There is huge fragmentation not just in the US but over the globe in terms of what the standards are, how you measure them, and how you report against them in terms of recycling standards and reuse standards.
By pulling together and creating these consortiums, companies are able to better effect change, have a bigger voice and impact, and have more data to be able to drive alignment of standards and regulations to be able to focus and boost sustainability. We see a lot of collaboration coming around in advanced recycling. In the US, ACC is taking the lead in helping to drive support for advanced recycling, which is a critical enabler of circularity across the plastics value chain.
The first tactic that companies are using here is collaboration. I want to make sure I make note of it because it feels like we’re seeing a huge boost in consortium-focused collaboration around advanced recycling. It’s that tail end of how we handle the materials that are in the environment and our world that we want to recycle, reduce, recycle and reuse.
In the middle is the Alliance To End Plastic Waste. It’s a great one to highlight. They’ve been around for a few years and they are focusing on the middle ground to create opportunities for consumer recycling around the world. There’s this recognition that a big part of the issue that we have is the consistency of recycling, waste bins and recycling standards. That’s an area that the Alliance To End Plastic Waste is helping focus on. A number of our global players, members and supporters are part of that organization to make that happen.Sustainability is part of everyone's job today to some degree. Click To Tweet
Approach #2: Education
The second strategy or tactic that companies are taking is education. It’s around communication and storytelling. I will be the first to say that there’s still a huge gap here. The chemical industry has a long way to go. When we think about education, it’s education for consumers, education for investors, education for employees, and education across the value chain.
How does that show up? Number one is around ESG reporting or sustainability reports. Some companies have been doing this for a long time. Some companies are now starting to jump into this. It has become a requirement. ESG is the buzz and ESG reporting is getting more and more critical for both public and private companies. ESG reporting and sustainability reports are elements of storytelling that the industry and companies can provide about what the inherent circularity is within that company or your manufacturing sites.
The efficiencies that we already see. We know that our industry has improved efficiency over the years. With efficiency are sustainability and circularity. It was Calvin Emanuel who talked about the fact that inherently, our industry is built on engineers, chemists and business people who recognize that inefficiency is costly. The chemical industry is built in many ways on this efficiency, which is around reuse. When a process generates heat, we figure out how to take that heat and bring it back into the process elsewhere as steam or as other aspects to make a more efficient process.
Reducing leaks, not just because they impact the environment but because we’re losing critical products or raw materials, and we want to contain them. Through the years, our processes are more efficient and we’ve all seen this. They are cleaner and that inherently creates more sustainability. Part of the whole aspect of ESG and sustainability reporting is reporting on that. It’s setting a baseline. It’s talking about progress, and it’s demonstrating the things that we do.
The other side of education that still has a way to go is around the benefits, and some companies are doing some amazing work on it. For a long time, the chemical industry has had a blind spot about the need to tell its story. Of course, our products are good. We’re doing good work, we’re helping to clean the world, and we are making things more efficient. There has been an assumption that people, the population, government regulators, and businesses around us recognize the benefits so we haven’t told our story well.
Some companies are starting to tackle this. One that comes to mind is Epsilyte. I hosted Jon Timbers, the Chief Sustainability Officer for Epsilyte. Epsilyte is a manufacturer of EPS, expanded polystyrene or often known by the brand name Styrofoam. It is a product that has a bad name and likes to be hated everywhere. You see and hear all kinds of things like, “We should get rid of the product. We should ban the product. We should do whatever.”
We should educate people about the use and the proper use of the product. What’s interesting with that is now, about 67% of EPS goes into durable goods. Much of it is in home and building insulation, which then lowers energy consumption, lowers greenhouse gas emissions and helps the world be more sustainable. It also increases the sustainability profile of not just the industry but the individual companies and people’s homes that are using it.
It’s figuring out how to educate the industry and the individuals around not blanketing a product and labeling it as bad but rather, “These are the benefits of it. Let’s make sure we’re using it correctly.” EPS and durable goods are great. Even people that make EPS would recognize, “We need to have a better solution when it comes to packaging, food packaging, and single-use products.” It’s still in use. It will continue to be in use.
If any of you guys are in Texas, you’ll know that Whataburger likes to deliver their drinks in nice EPS foam cups that keep them cold. Is it the right answer? Maybe yes. Maybe no. There are some EPS products that are coming out that are more environmentally friendly, biodegradable, and without impacting the environment. Figuring out how to educate customers, markets, regulators and consumers about sustainability in the industry and how products are benefiting sustainability, reducing energy use, and reducing greenhouse gas emissions more broadly is still critical.
Approach #3: Designing For Sustainability
The third area in strategy and tactic that chemical companies are taking as it relates to sustainability is design. I participated in a month-long event that BASF provided for their company, their customers, and people in the industry called Sustainable By Design. In many ways, it was a bit of an a-ha to me. It made sense. Inherently, I understood some of the aspects of Sustainable By Design, but it also made me rethink the different angles.
There are a couple of aspects of this that are about design. Number one, chemical plant designs are designed for sustainability. Sustainability via efficient operations reduces leaks and energy consumption by maximizing raw material to finish product conversion. That aspect of efficiency also equates to sustainability. We have been designing that way forever, decades, hundreds of years, as long as the chemical industry has been involved in all of its shapes and forms. That’s one aspect.
The other aspect is around partnering with customers and suppliers to design for sustainability. What do I mean by that? It’s a rethinking of products, maybe consumer products, business products, durable products, and the chemicals and the interfaces that go into them. There are a couple of examples that come up. One is Steelcase, which is a large manufacturer of office equipment. Historically, an office chair has 72 components. That’s a lot. Who would have thought it? At the end of its life, how do you understand how you recycle 72 components? They’re coming up with some ways to educate consumers and plan for it.
The other flip side is designing for sustainability. When you start at the beginning of your design process, what are the materials that you’re using that are readily recyclable, sustainable, durable, and designed for that? Can you limit the use of certain products or make it simpler for consumers, businesses, and end of life to recycle, reuse, and create a more sustainable environment? They’re doing that with some of their office chairs. They are becoming single component chairs that are made of recyclable material and are able to be recycled at end of life.
End to end, coming from plastic into a durable good and exiting as plastic into advanced recycling. The other area that we talk about became apparent to me personally. It’s things like labels. We’re getting a multitude of products in the mail. They are coming in plastic packaging that the packaging itself is recyclable. The little labels have a symbol on them. The mailing label that’s affixed to it is often the big question mark. How recyclable is that label?
We’re seeing consortiums and partnerships across businesses to ensure that aspect of it is also recyclable. Sustainable by design is about starting at the beginning and thinking about what the use case is and what that end case is. The third area that companies are focusing on is the design of not just their own facilities but also with their customers. How can we have products together that are more sustainable, and that are designed upfront to have a lower emissions profile and a higher recyclability profile?
What we know is inside North America, there are more than 400 brands that have pledged to increase the use of recycled plastics in consumer products and packaging. It requires a design focus both on the consumer products company but also on the chemical industry as a supplier. When we look across the globe, that increases. There’s still a significant gap. What’s interesting to me is this is a growing area.
I talked to an executive who said that, years ago, his role had almost nothing to do with sustainability. Now, as the leader of a global business, he spends 75% of his time thinking about sustainability or having facets of his role focusing on sustainability. That’s a significant difference. When we look across our employee base, I did an informal survey with a group of people in the industry.
On average, people are spending less than 25% of their role contributing to corporate sustainability goals. These were mostly major big corporations that have some pretty big goals. That was part of the pool that was used for this survey so we still have a long way to go. If it’s 25%, that is way more than a decade ago. Over a decade ago, sustainability was in the hands of the sustainability office, whoever that was. There’s a huge recognition that sustainability is part of everyone’s job, to some degree. If it’s not a high percentage, at least it’s a smaller percentage.
There is a continued focus and growth that we’re going to see over the coming decade, especially as we approach collectively these 23 goals that are set across all countries. We see it in the US, Asia and Europe. 2030 is a pivotal year. The road to 2030 as it relates to ESG and sustainability is pivotal. That’s what I’m seeing now. There are three big areas that companies are focusing on when they think about sustainability. It’s the approach around collaboration, education and design.
I hope you guys have enjoyed this episode. Let me know how you and your company are tackling sustainability. Are you hitting one or all of these three areas or is there something I’m missing? Let me know. Shoot me an email, send me a LinkedIn message and I would love to hear from you. Thanks for reading. Keep liking, following, sharing and reading. Your sharing and commenting matter. We appreciate that. Have a great day.
This episode is sponsored by AVEVA.
- Alliance To End Plastic Waste
- Calvin Emanuel – Past Episode
- Jon Timbers – Past Episode
- LinkedIn – Victoria Meyer
Love the show? Subscribe, rate, review, and share! https://thechemicalshow.com