Why better regulation and partnerships are essential to achieve carbon neutrality

While many companies have publicly committed to achieving carbon neutrality, it’s no secret that most still have a long way to go to achieve this goal.

A Boston Consulting Group (BCG) study showed that fewer than 20% of the world’s top 1,000 companies had science-based targets aligned with a 1.5°C pathway and almost 40% have no net zero commitment at all.

For hard-to-abate sectors, such as the chemical industry, the climb can be even steeper. However, such sectors are, importantly, key to achieving shared goals. While good strides are being made towards carbon neutrality, we also support the broader transition to net zero. Indeed, without the chemical industries, there would be no electric vehicle (EV) batteries, no green hydrogen, no connectivity and no sustainable future.

It is thus critical to create the best environment for companies to succeed in on the road to carbon neutrality and net zero. There are many actions we can take to accelerate our progress.

Importantly, governments must take the lead in creating flexible, innovation-friendly regulatory environments. Similarly, the private sector must commit to transparent, actionable roadmaps to achieve carbon neutrality.

First, we need to rethink how regulation is designed. Current regulatory frameworks in Europe, for example, while well-intentioned, are often inflexible, siloed, and not equipped to foster innovation in clean energy.

To accelerate the transition to sustainable and inclusive growth, governments should provide the right infrastructure for companies to successfully launch clean energy projects instead of creating rigid processes that create barriers.

A maxim remains true: “While the US stimulates, the EU regulates.” Shifting global competitive market dynamics should be a true wake-up call for Europe. Compared to the US and Asia, the EU still has a lot of work to do. With the Clean Industrial Deal package aimed at restoring EU competitiveness, there is a massive opportunity to ensure corresponding chemical management policy does not undermine the economic viability of EV battery mega-plants or semiconductor manufacturing.

Achieving net zero emissions requires unprecedented public-private collaboration. This is essential for hard-to-abate sectors. Targeted support is crucial, including through subsidies, tax incentives or direct investment in research and development. We must ensure that these industries, which are essential to the global economy, can transition sustainably without risking jobs or creating instability.

Public-private partnerships (PPPs) can drive the necessary investments in clean energy innovation and infrastructure development. PPPs facilitate the sharing of best practices and technologies by fostering greater collaboration along the supply chain. This can lead to faster and more impactful decarbonization. Consider that industries committed to similar targets can work together to make an even bigger impact seeing as they’re pursuing the same goals.

To truly reach carbon neutrality and net zero we must reinvent the supply chain. Procurement must be about building a sustainable future alongside supplier networks.

One of the most exciting partnerships is Together for Sustainability (TfS), which is a chemical industry-led initiative dedicated to building sustainable chemical supply chains – of which Syensqo is a founding member.

TfS assesses the sustainability performance of chemical companies and their suppliers, offering guidance to make improvements. Collaborations like TfS enable data exchange on products along their life cycles and the development of by-products. By working together, we can take advantage of opportunities like sharing resources to create by-products.

Syensqo is, furthermore, part of the World Business Council for Sustainable Development. This council of 230 members are making significant progress on dealing with scope 3 emissions and assessing carbon pricing (notably for hard-to-abate industries).

Many opportunities for customer and supplier partnerships exist as well. Syensqo, L’Oréal, Henkel, Procter & Gamble, Hichem and NGO TechnoServe have been working together on the Sustainable Guar Initiative (SGI), a program that aims to improve the standard of living for Guar farmers in Rajasthan, India. This is done through developing better agricultural practices, the empowerment of women and sustainable natural resources management initiatives. Today, over 12,500 farmers have enrolled – of which 28% are women. The initiative has more than doubled guar yields and increased farmer revenues by 25% since its launch in 2015.

It is also important to bring unique talents together to show the world what’s possible. That’s exactly what Climate Impulse is doing by preparing to fly non-stop around the world, with zero emissions, in a green hydrogen-powered plane.

Syensqo is proud to partner with Climate Impulse, the University Mohammed VI Polytechnique (UM6P) and OCP Group in this adventure as the provider of lightweight materials for the construction of the plane. Through partnerships like these, we are bringing great minds together to innovate, making the impossible possible.

The path to carbon neutrality and net-zero emissions is not just a regulatory or technological challenge; it is a collaborative endeavour that requires a fundamental shift in how we approach sustainability. We must rethink and simplify regulation, and foster public-private deals and collaboration amongst industry players to de-risk and accelerate the development of mega-projects.

This is how we’ll support end-users and achieve competitiveness in our chemical industry, while working toward a net-zero future.