Note 5: Climate change

Our Carbon Policy and cradle-to-gate carbon footprint intensity targets have been in place since 2009. In our 2020 sustainability strategy, carbon footprint takes an even more important role – not only for its measure of impact on climate change, but also because we are using it as a proxy for how efficiently we are using raw materials and energy in our products (see Value chain page).

Carbon footprint cradle-to-grave

Our target is to reduce our cradle-to-grave carbon footprint by 25-30 percent per ton of sales between 2012 and 2020. The cradle-to-grave footprint adds the impact from our customer applications and end-of-life of our products to the cradle-to-gate measure we have used since 2009. We also include the impact from VOC emissions in our improvement ambitions. We will achieve this through innovative products/solutions, technology and energy management and by creating more value from fewer resources.

AkzoNobel carbon footprint million tons of CO2(e)

Cradle-to-grave carbon footprint in million tons of CO2(e) (bar chart)

The carbon footprint of the six main greenhouse gases is measured from cradle-to-grave based on the international Greenhouse Gas (GHG) Protocol and Lifecycle Assessment ISO 14040-44. See Assessment method on the website. 2012 data has been restated to reflect changes in value chain models and include the impact from VOC emissions.

This year indicates a total footprint of around 27 million tons of CO2(e) and a reduction of CO2(e) per ton of sold product of two percent since 2012. The cradle-to-grave assessment indicates that around 40 percent is from raw materials extraction and processing (Scope 3 upstream), 15 percent from our own direct and indirect emissions from energy consumption (Scope 1 and 2), and 45 percent from the use and end-of-life phase (Scope 3 downstream).

Cradle-to-grave carbon footprint in million tons of CO2(e)

Product related carbon footprint based on 376 key value chains. Impact from VOC emissions included - about 3 million tons CO2(e). Raw materials and packaging category includes other Scope 3 upstream activities, e.g. RM transport, energy related activities. Excludes non-product categories, e.g. employee travel, capital goods, investments.

The reduction derives mainly from reformulations and higher sales of lower impact paints and from power consumption with lower carbon footprint impact in some facilities. Other changes in product mix and higher production volumes in facilities with a less favorable energy mix have limited the impact of these improvements.

Cradle-to-grave footprint per Business Area in million tons CO2(e)

 

 

 

 

 

 

 

2012

 

2013

Decorative Paints

 

5.0

 

4.2

Performance Coatings

 

13.0

 

12.9

Specialty Chemicals

 

9.5

 

9.4

Scope 3 emissions

We have assessed all Scope 3 categories according to the GHG Protocol Scope 3 standard. The results are summarized in the table on this page. Impact from VOC emissions is included: about three million tons CO2(e), mainly in downstream use and end-of-life treatment of sold products. 2012 data is restated on the same basis.

All Scope 3 categories million tons CO2(e)

 

 

 

 

 

 

 

2012

 

2013

*

Included in cradle-to-grave product footprint.

Purchase goods and services*

 

10

 

10

Capital goods

 

0.7

 

0.8

Fuel and energy-related activities*

 

0.4

 

0.3

Upstream transportation*

 

0.1

 

0.1

Waste generated in operations*

 

0.2

 

0.1

Business travel

 

0.2

 

0.2

Employee commuting

 

0.1

 

0.1

Upstream leased assets

 

<0.01

 

<0.01

Downstream transportation*

 

0.2

 

0.2

Processing and use of sold products*

 

8

 

8

End of life treatments of sold products*

 

3

 

3

Downstream leased assets

 

<0.01

 

<0.01

Franchises

 

<0.02

 

<0.02

Investments

 

0.4

 

0.4

Total

 

23

 

23

Management

Through the value chain focus in our strategy, company targets and product development, we aim to use raw materials produced in energy and material efficient processes to produce products which are energy and material efficient for our customers. For our own operations, we continue to focus on improving energy efficiency and managing the fuel mix of our energy intensive businesses.

Our businesses have developed quantified carbon management plans which identify specific improvement opportunities and programs. These include:

  • Material strategies for key raw material groups (e.g. solvents and resins) (see Supply chain)
  • Joint activities with suppliers to reduce the footprint of key raw materials (see Supply chain)
  • Renewable raw materials (see Supply chain)
  • Energy strategy including renewable energy (see Environment)
  • Site programs to improve yields, reduce waste and improve energy efficiency (see Environment)
  • Reformulations using lower footprint raw materials (see Products and solutions)
  • New curing developments to reduce energy use during product application (see Products and solutions)

These plans are summarized at a company level to manage and follow up carbon reduction targets. We have also developed additional common metrics, for example, percentage of renewable raw materials, percentage of renewable electricity/heat, to monitor progress on important development activities.

Energy risk management

Energy pricing is seen as the most significant climate change risk for AkzoNobel. This is not only related to the competitiveness of our energy-intensive businesses, but also to the impact energy pricing has for all our businesses, along the entire value chain, for our suppliers and for our customers.

Regional differences in energy pricing related to existing and future national and regional regulations and subsidies creates a non-level playing field for energy on a global level. Shale gas is influencing not only the energy market, but also the markets of some major raw materials. The move to renewable energy varies across regions and jurisdictions. We are monitoring this with the new renewable electricity indicator, as it is an important driver for footprint reduction (see Environment: Renewable energy). We are managing these risks by monitoring price developments, forecasting around energy supply and spreading production in different regions.

Renewable raw materials

Renewable raw materials are an important component of our sustainability strategy, since a considerable share of AkzoNobel’s carbon footprint is embodied in the raw materials we buy. We have successfully progressed the implementation of the renewable chemicals and white biotech strategy by setting up novel supply chain partnerships (see Supply chain: Renewable raw materials).

External engagement

In addition to activities to reduce energy use and greenhouse gas emissions in our value chain, we participate in different business initiatives, such as the WBCSD Chemicals Sector project Reaching Full Potential, which sets guidelines for reporting of avoided emissions. Our carbon management and performance is reported through the Carbon Disclosure Project.

More information on our assessment method for carbon footprint can be found in the Reporting principles section.