25 years sustainability strategy
October 23, 2019
“Sustainable development in the areas of economy, environment and society will be the key factor for success in the 21st century,” said Jürgen Strube, Chairman of the Board of Executive Directors of BASF (1990-2003). His foresight would indeed “sustainably” shape BASF’s future: In 1994, BASF adopted its “Vision 2010,” which oriented the company to the principles of sustainable development. At the time, BASF was one of the first companies worldwide to publicly commit to sustainable development. It thus took on a pioneering role which continues to this day in the company’s work on sustainability.
BASF has been actively engaged in environmental protection and social causes since well before 1994. For example, it established its first workers’ housing estate in 1872 to address the shortage of accommodation for workers. And at the beginning of the 20th century, BASF introduced effluent treatment and fly ash catchers for smokestacks, demonstrating early on its commitment to resource-conserving and environmentally friendly processes. The Verbund system links production facilities, energy flows and infrastructure to enable highly efficient chemical production.
But what is new since 1994 is that balancing economic, environmental and social interests – the core concept of sustainability – is a guiding principle for BASF. Since that date, economic success has no longer been the sole priority in the company’s decision-making. Vision 2010 can therefore be thought of as the “birth certificate” of sustainability at BASF. In the explanations of the Vision’s core concepts, BASF stated its commitment to the principles of sustainable development and pledged to act in accordance with these principles.
Milestones over the past 25 years: methods, engagement and reporting
Guided by Vision 2010, BASF began increasingly incorporating sustainability aspects into its business processes. When developing new methods to analyze and evaluate the sustainability of processes and products, methods such as the Eco-Efficiency Analysis (1996) and the corporate carbon footprint for all of BASF (since 2008) contribute to a better understanding of how products and plants contribute to sustainability. Starting in 2005, social indicators can also be evaluated using the SEEbalance® method. Since 2013, BASF has been managing its product portfolio according to sustainability criteria with the Sustainable Solution Steering method. That same year, the value-to-society approach was developed as the foundation for a holistic analysis of corporate value added.
The focus of Vision 2010 is also demonstrated by BASF’s involvement in global organizations and initiatives. BASF has intensified its dialog with stakeholders, for example, since 1999 in the World Business Council for Sustainable Development and since 2005 in the World Economic Forum. BASF is committed to social and environmental principles as a cofounder of the U.N. Global Compact, an initiative between companies and the United Nations. Since 2013, BASF’s Board of Executive Directors has been regularly meeting with thought leaders in its Stakeholder Advisory Council to discuss key sustainability issues that affect BASF. In 2019, BASF joined forces with other companies to establish the global Alliance to End Plastic Waste, which aims to combat plastic pollution in the environment.
Sustainability aspects are also increasingly being depicted in the company’s reporting. BASF took a step towards greater transparency in 1985 when it launched its first global BASF environmental protection guidelines. The first environmental report was published for the 1988 reporting year. With the publication “Social Responsibility” in the year 2000, the BASF Group released its first report on the social dimension of its corporate activities worldwide. Starting in the 2007 business year, BASF began presenting the connections between the company’s financial, environmental and social performance in an integrated report, making the company a trailblazer in integrated reporting at that time.
Sustainability in BASF’s corporate strategy
Since 1994, there has been a growing focus on sustainability in BASF’s strategy. In 2004, BASF announced four strategic guidelines, one of which was: “We ensure sustainable development.” In 2011, BASF defined sustainability as part of its purpose: “We create chemistry for a sustainable future.”
As part of the further development of its strategy in 2018, BASF set itself new targets: The company aims for CO2-neutral growth until 2030. And it wants to increase sales of its Accelerator products – those which make a considerable contribution to sustainability in the value chain – to €22 billion by 2025. In addition, BASF wants to promote sustainability via its procurement and support its employees to thrive and perform at their best. It also continues to pursue the existing sustainability goals relating to safety and water.
What will the future bring?
At BASF we have a long tradition of collaborating with our customers to create environmental, social and economic value. Looking to the future, we see a new growth curve, which is essentially about the more efficient use of resources. This will require rethinking the entire added-value process. Right now, we are already working on the solutions for the future. This includes everything from Carbon Management to ChemCycling and new accounting and steering approaches which measure the monetary value of not just the economic side of value creation but also the environmental and social impacts. We are optimistic that with our projects we can contribute to a better future.