Climate transition – emerging risk

Risk description

The lack of a Group strategy to address climate-related transition risks (as defined by TCFD^[3]), wider environmental challenges, and future resource scarcity could cause damage to Solvay reputation, business losses, undervaluation and difficulty attracting long-term investors.

Climate transition risks stem from various causes:

• Policies and legal context: regulations and actions to limit CO₂ emissions, for example increasing the price of greenhouse gas (GHG) emissions,
• Technology: unsuccessful investment in new, lower-emission technologies,
• Markets: lack of adaptation to changing customer behavior,
• Reputation: negative stakeholder attitudes if their climate change concerns are not addressed effectively.

Apart from greenhouse gas emissions (GHG), Solvay activities’ environmental impacts come from:

• Use of raw materials from fossil or non-renewable resources,
• Energy consumption,
• Water use,
• Waste production (solid or liquid, hazardous or safe),
• NO_x, SO_x, Volatile Organic Compound (VOC) or dust emissions.

Prevention and mitigation actions

• Solvay’s strategy focuses on businesses with higher added value and less environmental exposure,
• Every year, the Sustainable Portfolio Management (SPM) tool assesses the environmental exposure of our sales and our innovation projects portfolio. SPM includes climate-related criteria aligned on 2°C scenarios,
• The Carbon Intensity action plan has a 40% reduction target for 2025 (reference year 2014).

2017 main actions

• Appointment of an Executive Committee Supervisor for climate and the start of work on a comprehensive climate strategy roadmap,
• A new plan and 2020 targets for air emissions (SO_x, NO_x, VOC), water usage, and hazardous waste.