Addressing Four Key Sustainability Endpoints

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 billion or 38 percent of total revenue in 2018.

Improving our customer's products	Improving our customers' processes	Enabling our customers to meet stricter environmental standards	Enabling our customers to reformulate their products to meet consumer demand
~$0.1B 2018 Revenue	~$0.5B 2018 Revenue	~$0.3B 2018 Revenue	~$0.1B 2018 Revenue
High-performance plastic resins made with Grace's CONSISTA® polypropylene catalysts, because of their inherent strength, require less polymer per article, reducing the weight of automobile parts, thereby improving vehicle fuel efficiency and reducing emissions. PHONOSORB® adsorbents made with 3A zeolite synthetic molecular sieves prevent moisture accumulation in multi-pane glass windows and allow window manufacturers to meet the EU's quality requirements for reducing energy usage for heating and cooling. PERKASIL® precipitated silicas are used to produce low rolling resistant tires to improve vehicle fuel efficiency. In addition, they improve tear strength, abrasion resistance, and aging resistance of tires, lengthening tire life.	Grace's silica-based DARACLAR® 9000HP reduces water use and solid waste and eliminates the use of diatomaceous earth in the beer brewing process without impacting product quality. It has allowed brewers to increase capacity while reducing the environmental footprint of the brewing process. Grace's broad portfolio of fluid catalytic cracking (FCC) catalysts includes the series of ACHIEVE® catalysts, each designed to maximize the efficiency of the FCC unit above the industry average. Optimizing refinery operations reduces both energy and raw material use per unit of output. ACHIEVE® catalysts also enable the production of high-octane fuel without aromatics. Makers of biodiesel, an alternative to petroleum-based diesel fuel, use Grace's TriSyl® silica to maximize the efficiency of the biomass conversion process from pre-treatment of base oil to final polishing of the fuel.	Refineries around the world are committed to reducing sulfur oxides (SOx) and nitrogen oxides (NOx) emissions from the fluid cracking catalyst unit. Grace's DESOX®, DENOX® and CP®P additives allow refiners to meet even the toughest air emission standards. For example, a refinery in Greece reduced NOx emissions by 65 percent with no negative impact on unit performance or yields using a combination of Grace's CP®P and DENOX® technologies. ART Hydroprocessing, Grace's joint venture with Chevron, is at the forefront of refining technologies to enable shippers to reduce sulfur emissions in compliance with the 2020 International Marine Organization standards. Among many examples, ART's ICR® 1000 catalysts enable production of fuels meeting the world's toughest environmental standards while processing difficult feeds without sacrificing run lengths or yields. Grace's LUDOX® colloidal silicas are key ingredients in emission control devices that enable vehicle manufacturers to meet the strictest vehicle emissions standards. SYLOBEAD®, a molecular sieve from Grace, is used in the dehydration of ethanol, an essential step in the production of ethanol-based fuels.	High-performance plastic resins made with Grace's CONSISTA® polypropylene catalysts produce less residuals, no peroxide byproducts, and use no phthalates. SHIELDEX® silica enables customers to create non-toxic anti-corrosive pigments without the addition of heavy metals, eliminating the need to add lead, chromate, or zinc phosphates.

Improving our customer's products

Improving our customers' processes

Enabling our customers to meet stricter environmental standards

Enabling our customers to reformulate their products to meet consumer demand

~$0.1B 2018 Revenue

~$0.5B 2018 Revenue

~$0.3B 2018 Revenue

~$0.1B 2018 Revenue

High-performance plastic resins made with Grace's CONSISTA® polypropylene catalysts, because of their inherent strength, require less polymer per article, reducing the weight of automobile parts, thereby improving vehicle fuel efficiency and reducing emissions.

PHONOSORB® adsorbents made with 3A zeolite synthetic molecular sieves prevent moisture accumulation in multi-pane glass windows and allow window manufacturers to meet the EU's quality requirements for reducing energy usage for heating and cooling.

PERKASIL® precipitated silicas are used to produce low rolling resistant tires to improve vehicle fuel efficiency. In addition, they improve tear strength, abrasion resistance, and aging resistance of tires, lengthening tire life.

Grace's silica-based DARACLAR® 9000HP reduces water use and solid waste and eliminates the use of diatomaceous earth in the beer brewing process without impacting product quality. It has allowed brewers to increase capacity while reducing the environmental footprint of the brewing process.

Grace's broad portfolio of fluid catalytic cracking (FCC) catalysts includes the series of ACHIEVE® catalysts, each designed to maximize the efficiency of the FCC unit above the industry average. Optimizing refinery operations reduces both energy and raw material use per unit of output. ACHIEVE® catalysts also enable the production of high-octane fuel without aromatics.

Makers of biodiesel, an alternative to petroleum-based diesel fuel, use Grace's TriSyl® silica to maximize the efficiency of the biomass conversion process from pre-treatment of base oil to final polishing of the fuel.

Refineries around the world are committed to reducing sulfur oxides (SOx) and nitrogen oxides (NOx) emissions from the fluid cracking catalyst unit. Grace's DESOX®, DENOX® and CP®P additives allow refiners to meet even the toughest air emission standards. For example, a refinery in Greece reduced NOx emissions by 65 percent with no negative impact on unit performance or yields using a combination of Grace's CP®P and DENOX® technologies.

ART Hydroprocessing, Grace's joint venture with Chevron, is at the forefront of refining technologies to enable shippers to reduce sulfur emissions in compliance with the 2020 International Marine Organization standards. Among many examples, ART's ICR® 1000 catalysts enable production of fuels meeting the world's toughest environmental standards while processing difficult feeds without sacrificing run lengths or yields.

Grace's LUDOX® colloidal silicas are key ingredients in emission control devices that enable vehicle manufacturers to meet the strictest vehicle emissions standards.

SYLOBEAD®, a molecular sieve from Grace, is used in the dehydration of ethanol, an essential step in the production of ethanol-based fuels.

High-performance plastic resins made with Grace's CONSISTA® polypropylene catalysts produce less residuals, no peroxide byproducts, and use no phthalates.

SHIELDEX® silica enables customers to create non-toxic anti-corrosive pigments without the addition of heavy metals, eliminating the need to add lead, chromate, or zinc phosphates.

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.