Circular Economy BASF Report 2021 Management’s Report – Circular Economy 142 By the end of the 2021 business year, we had evaluated 98.7% of In addition, we want to increasingly use alternative raw materials in The data helps us to target our CO reduction measures to those 2 1 the relevant portfolio (2020: 98.4%). This refers to the BASF Group’s the manufacturing of our products. These include bio-based raw areas where our customers can later achieve the greatest value sales from products in its strategic portfolio to third parties in the materials such as bionaphtha and biogas, and renewable raw added from lower carbon emissions in the value chain. business year concerned. By the end of 2021, sustainability materials such as RSPO-certified palm oil, which we have been ana lyses and assessments had been conducted for more than using for many years as a substitute for fossil resources. To expand To determine the carbon footprint of our purchased raw materials 56,000 specific product applications (2020: >57,000), accounting our supply base for alternative raw materials and at the same time, (upstream Scope 3 emissions), we have until now worked with for €71 billion in sales (2020: €54.1 billion). contribute to the circular economy, we are also developing new, industry averages and values from external databases. To obtain a waste-based sources of raw materials. To achieve this, we develop more accurate data base and reduce emissions in the supply chain, In 2021, we generated sales of €24.1 billion with Accelerator innovative technologies, usually in cooperation with partners, for we launched our Supplier CO Management Program in 2021. The 2 products (2020: €16.7 billion) – already reaching our target for 2025. example for the chemical recycling of plastic waste or disposed aim of the program is to, in a first step, determine the carbon foot- Accelerator products account for 33.9% of the assessed relevant mattresses made of polyurethane. We aim to process 250,000 met- prints of raw materials as accurately as possible. We support our portfolio. Sales of Accelerator products rose by 44.3% compared ric tons of recycled and waste-based raw materials in our production suppliers here by sharing our knowledge of valuation and calculation with the previous year. This is primarily attributable to the positive plants annually from 2025. methods, for example. In the second step, we then want to work development of Accelerator sales in the Surface Technologies with our suppliers to identify levers and targets to continuously and Chemicals segments. Performer products account for 54.9%, One of the steps we have taken to achieve our goals is establishing reduce greenhouse gas emissions along the supply chain. Transitioner products for 11.1% and Challenged products for 0.1% a company-wide Circular Economy Program. As part of this pro- For more information on our corporate carbon footprint and Supplier CO2 Management Program, of the solutions assessed. gram, BASF teams are currently developing new approaches to the see page 130 onward three main action areas in more than 35 initiatives: alternative raw New market requirements arise as a result of the continuous develop- material pathways, innovative material cycles and new business ment of new product solutions in the industry or changing regulatory models for the circular economy – which also include digital and frameworks. This has an effect on the comparative assessment, service-based concepts. which is why we regularly reassess our product portfolio. For more information on the circular economy, see page 44 For more information on Sustainable Solution Steering, see basf.com/en/sustainable-solution-steering For more information on raw materials, see page 112 onward Product Carbon Footprint Circular economy Circularity is a particular focus in the continued development of our In line with increasingly ambitious climate protection targets, CO 2 product portfolio. This enables us to help our customers achieve transparency is becoming more and more important for us and our their sustainability goals while improving the resource and carbon customers. We have published a comprehensive corporate carbon footprint of our products. footprint along our value chain every year since 2008. In addition, we already calculated carbon footprints for individual products in the By 2030, we aim to generate sales of €17 billion with solutions for past. To further increase transparency, we developed a digital solu- the circular economy. These include products based on renewable tion to determine product-specific greenhouse gas emissions in or recycled raw materials that close material cycles (“close the loop”) 2020 and have since calculated the carbon footprints of around or increase the resource efficiency or life of materials (“extend the 45,000 sales products. These Product Carbon Footprints include all loop”). greenhouse gas emissions from raw material extraction to the finished BASF product leaving the factory gates (“cradle-to-gate”). 1 The definition of the relevant portfolio and further information can be found in the Sustainable Solution Steering manual at basf.com/en/sustainable-solution-steering