This report outlines IVL’s success in focusing on the sustainability and climate issues that matter most to our customers, employees, shareholders, and communities in 2022. This past year has reinforced the need for businesses to focus on climate change. IVL is moving quickly on several fronts, and we are leading our actions in line with our core value of being responsible.
Moreover, we created a purpose statement, ‘Reimagining chemistry together to create a better world’, which we believe defines how we view our role and maintains our focus on the positive impact that we have on our world.
Climate change threatens our ecosystems and our economies. The solution is decarbonization. Recognizing the urgency to act, Indorama Ventures is stepping up investing in our people and technology
Getting to Net Zero
Last year’s COP26 in Glasgow ends with global agreement to accelerate action on climate this decade. All countries agreed to revisit and strengthen their current emissions targets to 2030, known as Nationally Determined Contributions (NDCs), in 2022 to limit global warming to 1.5 degrees Celsius. There’s a lot of important and hard work ahead, and we are doing our part.
Our Chief Technology Officers, as part of the Decarbonization Committee, will head IVL’s decarbonization strategy. The strategy consists of six prongs to reduce the company’s global carbon footprint and support countries where we have operations. The committee will provide technical guidance to each segment and ensure plant-level decarbonization efforts achieve our net zero ambition.
We are on track to achieve our 2025 goals and set up more ambitious 2030 targets. The 2030 targets include a 30% reduction in Scope 1 & 2 combined greenhouse gas (GHG) () intensity, 15% reduction in energy intensity, 25% use of renewable electricity, 20% reduction in water intensity, 90% diversion of waste from landfill, recycle 1.5 million tons in PET bale input annually and sustainability capital expenditures of US$ 7 billion.
Sustainability is Front and Centre
In pursuit of business growth and profitability, we do things the right way – economically, socially, and environmentally. Health and safety are non-negotiable as we implement these three approaches in our global operations.
Our vision statement, ‘To be a world-class sustainable chemical company making great products for society’ is backed by decarbonization and broader sustainability strategies as key differentiators going forward. This sharper focus will enable us to respond to any future uncertainties and improve our position in the post-COVID era.
Focus on Sustainable and Green Finance
IVL continues to demonstrate leadership in sustainable finance through our Sustainability Performance Targets (SPTs), which allow us to issue innovative investment instruments that are linked to sustainability performance. The SPTs are part of our Sustainability-Linked Finance Framework which has been independently assessed.
IVL’s strong commitment to protecting the environment are reflected in our first issuance of THB 10 billion in Sustainability Linked Bonds (SLBs), which drew considerable interest from a range of institutional investors. This issuance continues our pioneering approach to green finance in Thailand. The SLB is linked to our environmental performance and serves as an important step in optimizing our capital structure, as well as incentivizing our company and stakeholders. It marks an important development in the Thai capital market as investors focus more on environmental metrics, specifically relating to climate change. In addition, in 2021 we were the first Thailand-based company to invest in HSBC’s Green Deposit to support a wide range of environmental, social and governance projects.
Stronger Performance, Greater Innovation
IVL’s operations continue to focus on long-term performance through sustainability. We are more effectively integrating our operations, both downstream in packaging and upstream in feedstocks and IOD, while diversifying our product range, notably in surfactants, through strategic acquisitions and operational enhancements.
Our naphthaletes unit, which was established last year at our integrated production facility in the U.S., makes us the world's largest PNDA producer, with the greatest level of purity to serve high-end polyester markets. Our strategic acquisition of Brazil-based Oxiteno continues our focus on value accreting investments, gaining a unique portfolio of high-value surfactants and significantly extending our existing IOD business. It will also strengthen our position in Mexico and Latin America, and in green chemical innovation.
We are strengthening our position as a global recycling leader. In 2021, we completed our acquisition of PET recycling assets from CarbonLite Holdings and its subsidiaries in Texas, as well as two PET recycling facilities in Poland. We also announced a new greenfield recycling facility in West Java in Indonesia which will recycle almost two billion plastic bottles annually in support of our commitment to clean oceans and closed-loop solutions.
We acquired the state-of-the-art assets of Ngoc Nghia, a market leader in PET, preforms and closures in Vietnam, where we can increase our presence in a high-growth market offering a full range of PET packaging solutions with enhanced operational excellence.
At the end of last year, we inaugurated our Global Business Service Centre in Kolkata, India, which will play an important role for our operating sites worldwide by consolidating large-scale processes and deploying cutting-edge technology to drive operating efficiencies and promote our sustainability and transformation journey.
Addressing Safety Incidents and Improving Employee Safety
Health and safety remain the primary focus at all our sites. While we strive to achieve a strong operational performance within safe work environments, unfortunately incidents do occur. In 2021, we suffered two work-related fatalities in Texas in the U.S. and in Egypt (a contractor) while another employee was permanently disabled. Mitigation and enforcement actions were undertaken immediately at both facilities to improve employee safety together with additional training. Two of our facilities experienced fires, and the proper reporting and response procedures were immediately followed in both instances. Detailed investigation of each and every incident has been carried out, mitigation actions have been undertaken and lessons learnt were shared across all IVL sites.
Regretfully, there were a total of 16 COVID-related employee deaths last year, up from seven in 2020.
Culture of Leadership and Success
We continue to support the UN’s initiatives to showcase our collective work as part of the international business community and to demonstrate our leadership in taking effective action. As a signatory of the UN Global Compact, we actively support its 10 principles and promote its core values. We are also playing a constructive role in achieving the U.N.’s Sustainable Development Goals (SDGs).
Despite the ongoing challenges from the pandemic, I am delighted to report that the dedication of IVL’s global team resulted in numerous accolades in 2021. This began with our inclusion in the Dow Jones Sustainability Indices (DJSI) in which we ranked in the 97th percentile among the five most sustainable companies. Furthermore, we improved the previous year’s top 2% placement ranking (Gold medal) with a top 1% ranking (Platinum medal). We also got several sustainability accolades as presented in the report.
A Future of New Value Creation
Building sustainability across all our businesses is a key focus as our colleagues work tirelessly towards making IVL a future ready organization. The past year has demonstrated IVL’s efforts in sustainability and promoting a more circular economy by increasing our presence in recycling and working more closely with stakeholders to invest in our people and the planet through innovation and product development.
In addition, I listed my own priorities. First, developing our people. Succession planning is critical to long-term success, and we must recruit, train, and promote outstanding leaders with the correct ‘growth mindset’. Second, we will include more bio-based feedstock into our goods. We aim to invest US$4.7 billion for bio-based feedstock consumption in our operation and set targets to achieve 16% against whole IVL target. Third, I will focus on our segment strategy - enabling each of our three segments to reach their full potential. Finally, I will emphasize digitalization as a vital component of change.