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Chemicals Management Is Good, but Not Considered a Sustainability Strategy, Report Finds

Sustainability is increasingly important on industry’s agenda, but chemicals management is often not directly linked to a company’s sustainability strategies, according to a study. Development of more sustainable chemical management is driven more by regulatory requirements, customer expectations or by companies’ business strategies. The study, commissioned by the European Chemicals Agency (ECHA), indicates that companies consider compliance with relevant regulations as a baseline, providing a “licence to operate” in their business fields, but they do not link this work directly to their sustainability strategies.

Good quality information in companies’ REACH registration dossiers was not considered a commercial asset. Dossier quality actually does not have a role in industry’s compliance programs, and the 19 companies participating in the study said they do not have specific goals (e.g. key performance indicators) or strategies to deal with dossier quality.

However, REACH is seen as contributing indirectly to profitability or as benefitting a company’s brand values in the long run. Companies striving for the sustainable use of chemicals particularly appreciate the predictability of regulatory action in order to stay “ahead of the game.” The study shows that the Candidate List of substances of very high concern is a major driver of innovation and substitution to less hazardous chemicals. In general, market demand for more sustainable products and production processes is increasing and is most apparent in consumer-facing businesses. Retailers play an important role in conveying trends in consumer demand.

 

‘Crucial but Indirect…’

The report also found that REACH and CLP regulations have a crucial though only indirect impact on a company’s sustainability and business strategies. The Candidate List in particular impacts market demand and is being used as a measure for investors to benchmark the sustainability performance of companies. Market and investor demands in turn have a direct impact on industry’s integrated corporate business strategies, including sustainability strategies.

The study encourages companies to include good chemicals management in their integrated corporate sustainability strategies by developing reporting tools and benchmarks.

Photo credit: Tarboat, Flickr Creative Commons

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