As part of a strategic review of our product portfolio, we identified the products that address four key sustainability drivers.
- Products designed for use-phase efficiency, a concept defined by the Sustainability Accounting Standards Board (SASB) as products that "through their use—can be shown to improve energy efficiency, eliminate or lower greenhouse gas (GHG) emissions, reduce raw materials consumption, increase product longevity, and/or reduce water consumption," either through:
- Improved products – by increasing the efficiency of a product during its use phase
- Improved processes – by increasing the efficiency of the manufacturing process used to make a products
- Stricter Environmental Standards – products that directly enable customers to meet environmental regulatory/legal requirements applicable to their products or manufacturing processes.
- Reduced Consumption/Sustainable – products that enable customers to reformulate their products to avoid or reduce to de minimis levels substances of concern to their customers.
Together, the products in our portfolio that address these sustainability endpoints accounted for approximately $1.1 billion or 44 percent of total revenue in 2019.
Improving our customer's products
| ~$0.1B
| - High-performing
PP catalysts for lightweighting
auto parts to improve fuel economy - Custom
single-site PE catalysts for downgauging packaging to reduce plastics
requirements - Silicas
for tires to reduce rolling resistance and improve fuel economy - Zeolites
for dual pane windows to reduce energy use
|
Improving our customers' processes1
| ~$0.5B2
| - Advanced
FCC catalysts to reduce raw material and energy requirements - Advanced
silica gel for filtration to reduce water use and waste
|
Enabling our customers to meet stricter environmental standards
| ~$0.4B
| - Hydroprocessing
catalysts to meet cleaner fuels standards (e.g.,
IMO 2020)
- Additives
to reduce SOx
and NOx emissions from refinery operations - Colloidal
silicas for vehicle emission control devices
|
Enabling our customers to reformulate their products to meet consumer demand
| ~$0.1B
| - Non-phthalate
PP catalysts for safer packaging and household items - Silicas
for anti-corrosive coatings that are heavy-metal free - Silicas
for high performance paints with low-VOCs
|
1. Represents
revenues aligned to SASB Chemicals Sustainability Accounting Standards
definition of products designed for use-phase resource efficiency, including
improving energy efficiency, eliminating/lowering emissions, reducing raw
materials consumption, increasing product longevity, and/or reducing water
consumption.
2. Figure
includes unconsolidated ART joint venture
PRODUCT DEVELOPMENT
Grace is investing heavily into products with at least one of these sustainability drivers. Over 300 employees conduct research at a dozen research and development centers globally. Roughly two-thirds of Grace research projects are focused on products that will deliver one of our sustainability drivers. Over two-thirds of revenues expected from the commercialization of those projects have at least one of the above sustainability drivers, and many have strong sustainability value propositions.
With the oversight of the Grace Research Council, and guided by our PrISM process, we expect growth in many of these areas to outpace the growth in other product lines, and to prioritize our R&D resources accordingly. We are engaged in ongoing conversations with our customers to ensure we understand their sustainability needs and how they define value. The conversations occur at all levels of the business from front-line sales teams up through our business presidents and the Grace Leadership Team.
