BASF Commits to Scope 3.1 Emission Reductions, Targets Net Zero by 2050

BASF Commits to Scope 3.1 Emission Reductions, Targets Net Zero by 2050

(IN BRIEF) BASF, a major player in the chemical industry, has announced new sustainability commitments, including targets for Scope 3.1 emissions. The company aims to reduce its specific Scope 3.1 emissions by 15% by 2030 compared to 2022 levels. This signifies a commitment to reducing emissions throughout its entire value chain. Additionally, BASF introduced a differentiated business steering approach to enhance competitiveness and profitability. They will emphasize key performance indicators such as EBITDA before special items and cash flows. The company also maintains a focus on cash generation across its businesses and has set ambitious EBITDA margins for each segment.

(PRESS RELEASE) LUDWIGSHAFEN, 7-Dec-2023 — /EuropaWire/ — BASF SE (ETR: BAS), the world’s largest chemical producer, has reaffirmed its commitment to sustainability and announced ambitious targets for Scope 3.1 emissions. During an investor and analyst update event held in Ludwigshafen, Dr. Martin Brudermüller, Chairman of the Board of Executive Directors of BASF SE, and Dr. Dirk Elvermann, Chief Financial Officer, presented the company’s progress in implementing its corporate strategy introduced in 2018.

“The company is now going another step and aims to further increase BASF’s competitiveness by adapting the steering of its individual businesses,” said Elvermann. “We are combining the benefits of a more differentiated approach to steering individual businesses with the advantages provided by the Verbund and our setup as an integrated company,” he added.

Scope 3.1 Emission Targets:

BASF has made a significant step towards achieving its net-zero emissions goal by setting targets for Scope 3.1 emissions. This commitment reflects BASF’s determination to reduce emissions across its entire value chain. By 2030, the company aims to reduce specific Scope 3.1 emissions by 15 percent compared to 2022 levels, equating to a reduction from 1.57 to 1.34 kilograms of CO2 per kilogram of raw materials purchased. BASF is dedicated to working closely with customers and suppliers to find cost-efficient and environmentally friendly solutions to achieve these targets.

New Business Steering Approach:

To further enhance its competitiveness and profitability, BASF is introducing a differentiated approach to steering its individual businesses. The company aims to optimize business models and processes, supported by adapted process structures, IT systems, and governance frameworks. This approach will enable businesses to better cater to specific customer industries while retaining the benefits of an integrated company.

Key Performance Indicators (KPIs) Changes:

Starting in January 2024, BASF will adjust its KPIs for steering the BASF Group. The company will emphasize EBITDA before special items and cash flows in the short and medium term. ROCE will remain a mid-term steering KPI to focus on asset profitability. At the segment level, new KPIs will be introduced, aligning closely with industry-specific goals.

Cash Generation Focus:

BASF will maintain a strong emphasis on cash generation across all its businesses. The company has set ambitious EBITDA before special items margins for its businesses, ranging from 15 percent to 30 percent, depending on the segment.

“We have defined a specific target because our focus is on improving the product carbon footprint of our sales products, which we calculate in kilograms of CO₂ per kilogram of BASF product sold,” Brudermüller said. “Our ambitions and efforts in the short and long term are clear: BASF will work with both customers and suppliers to find pragmatic solutions that are both cost-efficient and good for the environment. Our long-term ambition is also clear: We are committing to achieving net-zero Scope 3.1 emissions by 2050,” he added.

Further information on the Investor Update event can be found at: www.basf.com/investor-update

About BASF

At BASF, we create chemistry for a sustainable future. We combine economic success with environmental protection and social responsibility. More than 111,000 employees in the BASF Group contribute to the success of our customers in nearly all sectors and almost every country in the world. Our portfolio comprises six segments: Chemicals, Materials, Industrial Solutions, Surface Technologies, Nutrition & Care and Agricultural Solutions. BASF generated sales of €87.3 billion in 2022. BASF shares are traded on the stock exchange in Frankfurt (BAS) and as American Depositary Receipts (BASFY) in the United States. Further information at www.basf.com.

Media contact:

Jens Fey
Director, Corporate Media Relations
+49 621 60-99123

Dr. Stefanie Wettberg
Senior Vice President Investor Relations
+49 621 60-48002
+49 1520 930 7321

SOURCE: BASF SE