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Note 14: Eco-premium solutions

Eco-premium solutions help to create value for our businesses and our customers. They provide top line growth opportunities because of their improved performance in areas such as raw material use, manufacturing processes and product innovation.

These solutions demonstrate improvements in our own operations and across the entire value chains in which we operate. Downstream, we seek to offer solutions that allow our customers, or their customers, to reduce their footprint. Upstream, we achieve improvements by working with our suppliers to reduce their eco-footprint, or to identify new and lower footprint process, formulation or application routes to meet our customers’ needs.

We have an ambition to increase the share of revenue from eco-premium solutions to at least 30 percent in 2015. This is a challenging objective because the measurement will be taken against the mainstream, or standard, product in the market, which is a moving target.

Our businesses carry out an annual assessment of their portfolio.

Eco-premium solutions
in % of revenue

Eco-premium solutions in % of revenue (bar chart)

In 2011 we focused on a more detailed understanding of our markets and the mainstream solutions when applying the eco-premium solutions definition. This led to the conclusion that we need to restate 2010 and 2009 numbers on a comparable basis.

The total revenue relating to eco-premium solutions was about €3.5 billion in 2011. The proportion of revenue from eco-premium solutions has increased to 22 percent (2010 restated: 21 percent). This is divided between Specialty Chemicals (24 percent), Performance Coatings (15 percent) and Decorative Paints (27 percent).

We have seen lower growth in some markets and faced market movements with the result that some of our eco-premium solutions portfolio is now mainstream in some markets or regions (e.g. move to water-based paints and coatings). This now excludes some products from our eco-premium solution listing.

On the other hand, we have placed new products and solutions in the market that are better than the current mainstream solution, which compensate for points explained above, leading to an increase of 1 percent in eco-premium solutions when compared with 2010 (using the restated numbers).

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