Hero: BASF
The world’s largest diversified chemical company made waves this spring with the release of bold sustainability targets for 2020. The German-based company, which reported over €6 billion (nearly $8 billion USD) in profits last year, said it had hit its energy-efficiency and greenhouse-gas emissions marks nine years ahead of schedule. New environmental goals aim to increase energy efficiency in the production process by 35 per cent and emissions per metric ton of sales product by 40 per cent compared to 2002 levels. Water targets are even more ambitious. The company aims to cut water use in half from 2010 consumption levels.
“Since BASF operates in an energy-intensive industry...we are constantly working to secure our worldwide energy efficiency,” said company director Margret Suckale. The corporation has shifted research spending over the past five years to support this goal, with more than a third of the research budget now focused on improving resource efficiency.
Better than most companies in understanding opportunities in an increasingly resource-scarce world, BASF has started to target new areas of growth. These include heat management, water treatment and organic electronics. The company is working to obtain, by 2020, €30 billion (nearly $40 billion) in sales annually from products that are not yet on the market, and it has developed an active venture capital arm that is working to invest in promising startups. In oil and gas, the BASF subsidiary Wintershall will be phasing out all flaring of produced gas by the end of this year. As a company with substantial natural gas holdings, it is working to reduce the carbon emissions associated with the transportation of gas by 10 per cent.
BASF has not been without environmental controversy. It has been criticized by environmental groups for engaging in a double standard regarding emissions reporting in China, and has faced fierce opposition in Europe over its genetically-modified crop initiatives and close partnership with Monsanto. BASF certainly continues to maintain a substantial environmental footprint as a chemical company, but it does stand above its industry peers. Its emphasis on reducing its environmental impact while developing innovative solutions to ecological concerns is laudable.
Zero: Asia Pulp & Paper
Singapore-based Asia Pulp & Paper (APP) is facing a fierce public outcry following reports that it continues to cut down ramin trees in violation of international law. The extensive investigation was conducted by Greenpeace, which found APP involved in widespread pulping of the group of trees collectively known as ramin, which is protected by the UN Convention on International Trade in Endangered Species.
Rainforest destruction has led Indonesia to become the world’s third-largest emitter of greenhouse-gas emissions, largely due to the estimated 35 billion metric tons of carbon currently held in the Indonesian peatlands, which are being systematically released. The areas where ramin grow are particularly sensitive. They are habitat for several endangered species, including the Sumatran tiger, of which there are only 400 left in the world. In a press release responding to the report, APP stated that although it has a policy against ramin cutting, “no system in the world, no matter how rigorous, is 100 per cent failsafe.”
In response to the allegations, which have been independently verified, several high-profile companies have suspended purchases from APP, including Xerox, Danone and a branch of the Collins publishing group. Danone said it “decided to suspend all purchases from this supplier wherever possible under law, until the situation has been clarified and confirmed by independent stakeholders.”
The world’s third-largest pulp and paper company has been skirmishing with environmental groups for years, leading British environmentalist and Corporate Knights contributor George Monbiot to describe it as “one of the most destructive companies on the planet.” In 2005 APP was caught illegally logging in Cambodia, and in 2007 the Forest Stewardship Council officially disassociated itself from the company.
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