Strategy and Governance
Sustainability strategy
WACKER supports the transition to climate neutrality (net zero) in two respects: Firstly, WACKER products allow greenhouse gas (GHG) emissions to be reduced and its customers to conserve resources. What is more, climate-friendly technologies such as photovoltaics would not be possible without WACKER products like polysilicon. Secondly, WACKER is clearly committed to the Paris Agreement and has developed a transition plan to mitigate the climate impacts of its actions.
SustainaBalance® is WACKER’s holistic sustainability strategy to achieve its medium- and long-term sustainability targets. We promote the balance between ecological, social and economic factors based on three pillars: Value Up, Footprint Down, Collaboration Beyond. This is how WACKER is addressing current issues relating to climate change mitigation, energy efficiency and renewable energy.
Under Value Up, WACKER addresses the positive impacts and opportunities that arise from climate change. We actively support the transition to climate neutrality by systematically improving the sustainability of our products. Further details can be found in ESRS 2 – General Disclosures.
Under Footprint Down, WACKER addresses the impacts and risks related to its direct greenhouse gas emissions (Scope 1) and indirect emissions from the consumption of purchased energy (Scope 2). This includes identifying the material emission sources as well as the corresponding actions to cut emissions, such as projects to increase energy and process efficiency as well as bring about process transformation.
The Collaboration Beyond pillar focuses on upstream and downstream greenhouse gas emissions. WACKER is committed to improving sustainability along the entire value chain by working closely with its suppliers and customers. WACKER is part of the Together for Sustainability initiative (see ESRS 2 – General Disclosures) to set standards together with other companies in the chemical industry, e.g. to calculate carbon footprints. Our exchanges with customers enable us to identify new requirements early on and/or develop plans to reduce the climate impacts of our products together with our customers.
A program with clearly defined responsibilities implements our sustainability strategy operationally.
Transition plan for climate change mitigation
We have set ourselves the target of achieving net zero by 2045. By 2030, we are aiming to have cut our absolute GHG emissions (Scopes 1 and 2) throughout the Group to half of our 2020 figure and to have lowered our absolute GHG emissions from purchased feedstocks and fuel- and energy-related activities (Scope 3, categories 1 and 3) by 25 percent compared with 2020.
The targets to cut greenhouse gases are science-based ones, meaning they are consistent with the 1.5 degrees Celsius target set out in the Paris Agreement. Not only the targets for 2030 but also our aim of achieving net zero by 2045 have been validated by the independent Science Based Targets initiative (SBTi).
We have defined the key levers for reducing direct and indirect greenhouse gas emissions under Scopes 1 and 2, and indirect emissions along the value chain (Scope 3), on the basis of the relevant sources of emissions as part of our transition plan. This includes cutting greenhouse gas emissions in our silicon-production lines, the transition to climate-friendly processes, and the purchase of renewable energy (Scopes 1 and 2), as well as the acquisition of low GHG feedstocks and primary energy resources (Scope 3).
Material Scope 1 and Scope 2 actions
- Green silicon production
In the production of metallurgical-grade silicon, energy with coal, usually in the form of bituminous coal, is used to reduce quartz to silicon. The fossil coal used emits CO2 in the process. Using biogenic reducing agents instead of bituminous coal emits bio-based CO2 instead of fossil-based CO2 and, as a result, cuts Scope 1 emissions. Going forward, moreover, the intention is for the CO2 being emitted to be captured and recycled (Carbon Capture and Utilization, CCU) or stored in suitable geological layers (Carbon Capture and Sequestration, CCS). - Transforming our production processes
Our production processes generally result in greenhouse gases through the use of thermal energy (steam), through CO2 as a process emission, or through the use of refrigerants. We are working on making our steam fossil-free going forward (e.g. using high-temperature heat pumps), using any CO2 generated as a byproduct as feedstock, and replacing climate-relevant refrigerants with natural ones. - Procuring renewable energy
At WACKER, over 70 percent of the energy that we use for our processes is already electricity-based. Procuring renewable energy therefore enables our Scope 2 emissions to be reduced significantly. Over the past few years, the majority of WACKER sites have been powered by renewable electricity. The coming years will see us change more sites over to green electricity. At some WACKER sites, moreover, we intend to source our purchased thermal energy from renewable sources over the next few years.
Material Scope 3 actions
- Purchasing feedstocks and primary energy resources with low-GHG production practices
As a company in the chemical industry, WACKER purchases a variety of chemical feedstocks, particularly petrochemically-manufactured and silicon-based feedstocks. These are increasingly purchased from sources with low-GHG production practices and, as a result, reduce Scope 3 emissions (category 1). - Purchase of renewable energy
In most cases, electricity and thermal energy from renewable sources produce lower GHG emissions along the upstream value chain compared with fossil-based energy. By increasingly purchasing renewable energy, WACKER is reducing its GHG emissions in the upstream energy chain (Scope 3, category 3). - Changing over to a renewable feedstock basis
Chemical feedstocks today are primarily based on crude oil and natural gas. In the long term, WACKER is planning to procure renewable feedstocks, i.e. ones that have been produced on the basis of CO2, biomass or recycled materials. This allows end-of-life emissions in particular to be greatly reduced.
Capital expenditures under the transition plan
In 2022, WACKER introduced a dedicated budget to enable sustainability projects to be executed quickly. In the year under review, around €6.7 million of this budget was invested in the form of pure capital expenditures (CapEx) in projects with a positive impact on achieving our climate and environmental targets.
The changeover to renewable feedstocks means that we will increase our sales of taxonomy-aligned products, too. In line with higher sales, the operating expenses and capital expenditures for these activities will increase as well (see “EU Taxonomy Regulation”).
WACKER has no plants or products in which greenhouse gas emissions are tied permanently. Carbon- or oil-based activities do not apply to WACKER and natural gas-based activities and their capital expenditures are not material.
As a company operating in the chemical sector, Wacker Chemie AG is subject to the EU’s Paris-aligned Benchmarks.
Management
The four members of WACKER’s Executive Board, led by the president and CEO, are responsible for managing the Group’s sustainability strategy, which is an integral part of the WACKER Group strategy. Strategic dependencies, impacts, risks and opportunities related to climate change are identified, monitored, and presented to both the Supervisory and Executive Boards for a decision as part of a materiality assessment. The planning of capital expenditures related to the transition plan is part of the Group’s investment planning.
The transition plan is monitored and coordinated five times a year as part of our Sustainability Council’s activities. The Sustainability Council measures the progress made in reaching the Group’s climate targets and checks the status of specific and planned actions (for details, please refer to “Goals” and “Actions”).
Furthermore, progress in attaining Group targets is presented at least once a year to the entire Executive Board and the Supervisory Board for approval.
