The top companies in the chemical industry have a long way to go in phasing out hazardous chemicals and in developing safer alternatives to reduce their impact on human health and the environment, a new study from International Chemical Secretariat (ChemScore) report revealed Thursday
Although 38 out of 50 companies, or 76%, are actively marketing greener and sustainable products on their websites, none have public information on global hazardous chemicals production which has a significant environmental footprint, the study showed.
ChemScore is the annual ranking of the world's 50 largest global chemical companies based on their environmental impact and treatment of hazardous chemicals to set the benchmark for a sustainable chemicals industry.
The ranking covers companies' hazardous chemical portfolio, the development of safer chemicals and circular products, their management and company transparency and their response to regulations.
ChemScore finds that only four out of 50 companies, or 8%, showed evidence of a public strategy to phase out existing hazardous chemicals and all continue to produce hazardous chemicals in 'dangerously high numbers'.
'The chemical industry has a significant environmental footprint. At a time of climate crisis and the devastating decline in biodiversity globally, investors expect the industry to reduce its impact on the environment and human health,' Eugenie Mathieu, a senior analyst on the Aviva Stewardship Funds at Aviva Investors, was quoted as saying in the report.
'As an investor, we are keen to identify which chemical companies are leading in the transition to a more sustainable future by providing solutions and greater transparency, and which are stuck in 'business as usual',' she underlined.
The companies in ChemScore have combined revenue of over $860 billion while the United Nations Environment Program estimates the size of the global chemical industry will double by 2030 from $5 trillion in 2017.
Thailand's Indorama tops the rankings and is closely followed by Netherland's DSM as both score 29 and 28 respectively out of 48 in total for demonstrating lack of controversies and developing safer chemicals through circular production.
US companies Air Products rank third with a score of 24.8 and Avery Dennison fourth with 22.6 while UK company Johnson Matthey has the fifth-highest score of 20.2.
The remaining 45 companies scored under 20, 33 of which ranked under 15.
- Chinese and Taiwanese companies rank bottom
China's Sinopec, Taiwan's Formosa Chemical & Fibres and China's Wanhua Chem rank bottom of the list, with little effort made to develop safer chemicals and with a substantial lack of transparency, according to the report.
Wanhua Chem scores 4.5 out of 48 while Taiwan's Formosa Chemical&Fibres and Sinopec score 3.6.
The report revealed that Germany's BASF, with a score of 15 out of 48, touts its 'environmentally friendly solutions' on its website but there is no mention of the global production of hazardous chemicals in its 30-page 'safety in production'.
According to ChemScore, BASF has at least 127 different hazardous chemicals in its portfolio.
US company Dupont de Nemours, with a score of 10.4 out of 48, has at least 36 different hazardous chemicals in its portfolio and no public strategy with phase-out plans for its existing hazardous chemicals.
- Recommendations to reduce impact on health and environment
Emine Isciel, head of climate and environment at Storebrand Asset Management, called for a more holistic approach to sustainable investing. She said that although the past decade has seen sustainable investors, or ESG investors, focus mainly on climate change and carbon emissions, the chemical industry is a huge energy consumer and its products can have detrimental effects on human health and the environment.
'At the same time, the chemical industry is also an enabler. The world needs it to be progressive and help solve the current climate crisis,' she said.
People around the world are found to have digested measurable levels of hundreds of hazardous chemicals and been exposed to toxic chemicals that have resulted in many health problems, she explained.
Hazardous chemicals are also released in large quantities across the earth, accumulating in nature and wildlife and threatening to disrupt fragile ecosystems.
ChemScore offers companies three recommendations to reduce their impact on human health and the environment, the first of which is through companies innovating safer alternatives to hazardous chemicals in their portfolios.
The second recommendation is in developing a circular economy at the start of the supply chain to provide material that can be reused and recycled in the industry.
The third is in having more transparency so investors feel safe in supporting chemical companies and to understand which hazardous chemicals they are currently producing.
By Nuran Erkul Kaya