Material Impacts, Risks and Opportunities
The following is a description of WACKER’s material impacts on people and the environment as well as the resulting risks for WACKER in relation to its business model, value chain, strategy and decision-making. No material opportunities were identified.
Material impacts
Use of petrochemical raw materials
The chemical industry predominantly uses fossil raw materials, particularly those based on crude oil and natural gas, to manufacture its products. Their use might adversely impact ecosystems and the climate.
WACKER, too, uses fossil raw materials to make specialty chemicals. These raw materials are recovered through irreversible interference with the respective ecosystems. Fossil carbon can be released in the form of greenhouse gas emissions both during the transport of chemical products and at the end of their lives, which in turn adversely impacts the environment. This also applies to companies in our value chain.
The use of renewable raw materials based on biomass, CO2 and recycling is becoming more and more important in our sustainability strategy to reduce the negative impacts of recovering fossil raw materials, including their greenhouse gas emissions (see ESRS E1 – Climate Change). The limited availability of renewable raw materials means they can only be used long term, which is why they have not been a key part of our business model to date.
Waste generation
In addition to the manufacturing of the actual products, chemical production methods involve waste as well. Improper handling of this waste can adversely impact people’s health and damage ecosystems.
Alongside the large number of specialty products that WACKER makes at its production sites all over the world, waste is produced there too. If not handled properly, this waste can potentially impact ecosystems and the health of employees and service providers. This also applies to companies in our value chain.
Avoiding and/or reducing waste is of the utmost priority in our waste strategy. We dispose of unavoidable waste safely and appropriately or reuse it as a raw material to keep the adverse impacts on people and ecosystems as low as possible.
Material risks
Availability, cost and acceptance of petrochemical and critical raw materials
An increase in regulatory requirements relating to the procurement of raw materials can lead to significant cost increases in our production and it is primarily our European sites that are affected. This also applies to other companies along our value chain.
We especially consider the availability of fossil raw materials at reasonable costs to be a risk that may have medium to high impacts on WACKER’s earnings in the medium term. Renewable raw materials are much more expensive than fossil raw materials and the difference in cost cannot currently be offset unless low availability is increased, e.g. by regulating quotas. The quantity of renewable raw materials used compared with fossil raw materials is still low at present.
Please also see the Risk Report for details of the impacts and actions as well as our risk analysis in relation to our strategy.
