Carbon emissions in our full value chain

Our efforts to mitigate climate change stretch beyond our own operations as we work towards reducing our carbon emissions by 50% throughout our whole value chain by 2030.

As most of our carbon footprint comes from our Scope 3 emissions, our ambitions are a key driver for innovation and collaboration with our value chain partners, especially suppliers and customers. In setting these ambitious targets, we’ve taken responsibility for the decarbonization of our operations and made the commitment to help our value chain partners decarbonize theirs. This is also the most challenging target, as it sits outside the scope of our direct control.

We encourage our value chain partners to join us in setting ambitious, science-based emission reduction targets. It’s only through shared responsibility that we can drive significant value chain decarbonization.

Greg Poux-Guillaume, CEO

Carbon footprint in our value chain

Our 50% (absolute) reduction ambition encompasses the categories below, covering around 95% of our total Scope 3 emissions:

• Upstream: Category 1 (purchased goods and services, including packaging)
• Downstream: Category 10 and 11 (application and use of sold products), VOC emissions and Category 12 (end-of-life)

Our 2022 Scope 3 carbon footprint was 13.2 million tons, 9% down from 2021, driven by lower volumes and improvements in our portfolio such as more water-based solutions.

We’re focused on developing increasingly more sustainable solutions and are integrating carbon reduction into our internal plans and tooling. As the development of new solutions, investments in the value chain and market acceptance takes time, we expect the majority of the reduction of our Scope 3 carbon footprint towards the latter part of the decade.

Emission reduction levers

During 2022, we further analyzed the breakdown of our Scope 3 emissions. We identified key levers for reduction which can be grouped into four categories: Energy transition; Application efficiency; Solvent emissions; Circular solutions.

We’re actively running reduction projects throughout the company in these key focus areas, and have set up a governance structure to ensure they’re embedded in future plans, such as our R&D pipeline and supplier engagements.

Upstream emission management

Throughout the year, we engaged with our top 200 suppliers, for example during a live webcast, to share our ambitions and encourage these key stakeholders to do the same. Key impact areas for our suppliers are: increasing process efficiency; moving to renewable energy; and reducing the use of fossil materials and fuels. We’re now working together on joint programs with key suppliers to achieve further carbon reduction in our full value chain.

In 2022, Together for Sustainability (TfS) launched the Product Carbon Footprint Guideline to ensure a consistent measure of carbon emissions along the value chain in the chemical industry and beyond. We fully support this new global guidance and encourage our suppliers to join us in using it as a way of identifying collaborative opportunities. This is in line with our ambition to move gradually from using industry averages to supplier-specific data. For more information about upstream emission management, see Sustainability and risk management with our suppliers.

Downstream emission management

We’re directly engaging with our key customers to align on potential carbon reduction in their processes, for example during coating application. An example is approaching customers using gas to cure our coatings and offering them products that require lower curing temperatures – which can help lower their carbon footprint and save energy costs. With this approach, we aim to become the partner of choice for carbon conscious customers.

There’s an increased demand for coatings that are less carbon intensive. In our Automotive and Specialty Coatings business, demand for ambient and UV curing coatings is rising. We’re looking to collaborate with customers and advise them on carbon reduction strategies for their coating processes.

The innovation and development of our sustainable solutions not only plays a key role, but involves the majority of our approxi­mately 3,000 people in RD&I teams and our €258 million innovation investments.

We saw a sharp increase in customer needs regarding product carbon footprint in 2022, especially in the transportation, energy and buildings segments. We’re now able to provide carbon footprint data where needed and our internal teams are trained to use it in customer collaborations.

Across our value chain

During 2022, we continued to integrate sustainability and innovation into our daily business to work towards our ambitions. For example, through our Paint the Future platform, we actively promote open innovation in areas contributing to carbon reduction (see Tackling climate change together, below).