Change

AkzoNobel Carbon Policy


Climate protection is an integral element of our business objectives. Early in 2009, the Board of Management approved the company’s Carbon Policy, including 2015 and 2020 improvement targets and ambition levels. We continue to focus on improving the energy efficiency and managing the fuel mix of our energy intensive businesses to reduce greenhouse gas emissions and potential carbon costs. We are also committed to reducing the impact of our raw materials and developing solutions that help our customers to reduce their energy requirements.

In addition to internal activity to reduce energy use and greenhouse gas emissions, we support transparent disclosure and business initiatives calling for urgent inter-governmental action. We are signatories of the UN Global Compact’s Caring for Climate platform, and communiqués from the Prince of Wales’ Corporate Leaders Group on Climate, which have urged action towards an international UN Climate Change treaty at each of the annual Climate Change conferences. We still advocate the implementation of global cap-and-trade mechanisms on carbon emissions as a requirement to accelerate transition towards a low carbon economy.

Cornerstones of Carbon Policy

 

Measurement

Measure and report on a cradle-to-gate basis and manage carbon along the value chain.

Reduction

Use a structured and consistent carbon reduction approach, aligned with business objectives.

Communication and advococy

Actively communicate approach and performance to staff, customers, suppliers, investors and the general public and encourage dialog.

Best practices

Promote activities to share good practice, generate efficiencies and accelerate improvement.

Our carbon management and performance is reported through the Carbon Disclosure Project. We have also taken an active part in developing the GHG Protocol Accounting and Reporting Guidelines for product lifecycles and corporate value chains (Scope 3). During 2010, we were one of the companies chosen to road test both standards and carry out a trial assurance process. This pilot was helpful in providing boundaries and some prioritization tools, but reinforced the complexity of this developing reporting activity, and the uncertainty of some measurement processes and current data available. At AkzoNobel, we want to use these measurement activities to help drive performance improvement. During this learning and maturity phase, we will aim to monitor relative improvements by setting clear boundaries and consistent assumptions.

Our framework for measuring the carbon footprint of products and facilities is based on the international Greenhouse Gas Protocol and lifecycle analysis. It was tested with the World Resources Institute and several Dutch NGOs.

During 2009, our businesses identified and assessed the cradle-to-gate carbon footprint of key value chains in order to understand the high carbon areas where improvements will deliver financial and environmental benefits. This indicated that more than 70 percent of the company footprint is from raw materials extraction, processing and transport (Scope 3 upstream), while the remaining 25 to 30 percent is from our own direct emissions and indirect emissions from energy use. During 2010, our businesses have been developing carbon management plans which identify specific improvement opportunities and programs. Examples of programs in place include:

  • Joint activities with suppliers to reduce the footprint of key raw materials
  • Reformulations using lower footprint raw materials
  • Site programs to improve yields, reduce waste and improve energy efficiency
  • Technology and process developments
  • New curing developments to reduce energy use during product application.

2010 is the second time we have assessed the cradle-to-gate footprint of our operations. We have now assessed 286 key value chains (2009: 158). This year’s assessment indicates a total footprint of around 16.0 million tons CO2(e) assessed cradle-to-gate. There was an additional 0.7 million tons Scope1 and 2 CO2(e) reported from Chemicals Pakistan and National Starch (now divested). As in 2009, the cradle-to-gate assessment indicated around 70 percent was from raw materials and transport (Scope 3 upstream) and under 30 percent from our own direct and indirect emissions from energy use.

Since the 2009 assessment we have further developed our raw materials database and the value chains in some businesses. We have restated the 2009 figures to include these  changes and also included a facility which was acquired but not reported last year – so we have an indication of the improvement per ton achieved during the year. The results of the cradle-to-gate assessments show a reduction of around 3 percent from about 853 kg/ton to approximately 827 kg/ton.

Cradle-to-gate carbon footprint in million tons of CO2

Cradle to gate carbon footprint in million tons of CO2 (bar chart)

The carbon footprint of the six main greenhouse gases is measured from cradle-to-gate based on the international Greenhouse Gas (GHG) Protocol and Lifecycle Assessment ISO 14040-44. See Assessment method.
The cradle-to-gate assessment excludes Chemicals Pakistan and National Starch. They measure Scope 1 and 2 emissions which is included in the Performance Summary data. 2009 cradle-to-gate data has been restated to reflect changes in portfolio and raw material data.

Ambitions

  • Reduce our cradle-to-gate (scope 1, 2 and 3 upstream) carbon footprint per ton of product by 10 percent by 2015 (2009 baseline)
  • Reduce cradle-to-gate carbon footprint per ton of product by 20 to 25 percent by 2020 (2009 baseline)
  • Control absolute scope 1 and 2 greenhouse gas emissions below 2008 levels
  • Our existing objective to increase eco-premium solutions to 30 percent of revenue will track the provision of carbon-efficient solutions to customers, reducing our downstream footprint.

These improvements will be achieved though a mix of innovation, energy efficiency and fuel mix improvements.

Assessment method

The assessment uses boundaries in line with financial reporting and definitions in line with the Greenhouse Gas Protocol. It is carried out using recognized tools and staff experienced in lifecycle assessment. Businesses identify and assess the cradle-to-gate carbon footprint of key value chains in order to understand the high greenhouse gas emission areas where improvements will deliver financial and environmental benefits.

Scope 3 (upstream) includes GHG emissions from the extraction, production and transport of raw materials. We have developed a central raw materials database to provide consistency/transparency of data use. This database includes mainly “default” or proxy data which has been selected as the most representative/current data from recognized data sources, as well as specific supplier data. The absolute data and year on year comparision provide indicative assessments.

Scope 1 includes direct GHG emissions from our production and owned transport. Emissions from our sites are assessed from measured fuel use and process emissions; transport is assessed from fuel use and/or estimated distance traveled.

Scope 2 includes the indirect GHG emissions from purchased electricity and heat. Energy use is collected from site measurements, with emissions assessed using supplier or country grid factors and fuel mix.

The individual business footprint was calculated by extrapolating from measured key value chains, or from assessing the total raw material footprint from purchased materials, and total production and transport energy use.

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