An important message from our Chairman and Chief Executive Officer
As a science and technology company, we eagerly take on the responsibility for finding answers to the most pressing challenges of our time.
Chairman and Chief Executive Officer
This year Dow marks its 125th anniversary. While we celebrate our rich heritage, we are also imagining how we can build a better, more sustainable and equitable future. As a science and technology company, we eagerly take on the responsibility for finding answers to the most pressing challenges of our time. This is central to our purpose as a company. It is central to our growth strategy. And it is central to driving best-in-class performance and accountability.
Throughout this report, you will see how we are using our Environmental, Social and Governance (ESG) approach as a catalyst for innovation and collaboration to create new products, new business models and new ways to build value for our customers, our people, our communities and our stockholders. It is clear to us that sustainable innovation and profitable growth are not mutually exclusive, but rather mutually dependent. It is also clear that our intentional focus on collaboration and inclusion helps us better navigate challenges and grow our impact to deliver positive change for the world.
We have crafted a portfolio that is well-positioned to meet the increasing needs of our customers and consumers who are demanding more circular and sustainable products around the world. We have a clear, science-based, disciplined and affordable path to carbon neutrality, even while we continue to grow our capacity and improve transparency and accountability on all our sustainability efforts. To advance our efforts, we are continuing to build a strong and inclusive culture, which is evidenced by our recognition as the only materials science company to earn a place on the Great Place to Work and Fortune 100 Best Companies to Work For list. At the same time, we know that best-in-class governance means continuous improvement, and we are committed to challenging ourselves and raising the bar by further enhancing diversity at all levels throughout the company.
Here are some of the important ways we advanced our ESG agenda in 2021:
We are executing on our plan to decarbonize our business and grow value. To reach our 2030 and 2050 carbon emissions targets we have a plan to replace end-of-life assets with new, more carbon-efficient technologies. In 2021, for example, we announced plans to build the world’s first net-zero carbon emissions, integrated ethylene cracker and derivatives site in Fort Saskatchewan, Alberta. In addition, we outlined a detailed roadmap to reduce current CO2 emissions from our operations in Terneuzen, the Netherlands, by more than 40% by 2030. We are one of the top 20 global corporations using renewable, clean energy, and we expanded our access to renewable energy to more than 900 megawatts. We also continue to invest in next-generation, carbon-efficient technologies such as e-cracking, fluidized catalytic dehydrogenation (FCDh) technology and ethane dehydrogenation (EDH).
We are accelerating our sustainability investments to enable design for recyclability and more circular plastics through mechanical and advanced recycling. To advance our 2030 targets to Stop the Waste and Close the Loop, our team is working across our value chains to enable packaging design with recyclability in mind. We also have our own product line of recycled-content resins under the brand name REVOLOOP™. Today, 85% of our products sold into packaging applications are reusable or recyclable. As we continue down our path to enable more recyclability and keep plastic waste out of the environment, we are scaling supply partnerships with companies such as Mura Technology and Fuenix to produce circular feedstocks from advanced recycling processes. In fact, we are committed to delivering circular polymers from advanced recycling by the end of 2022. We also are investing in collaborative actions to minimize and manage plastic waste through partnerships such as the Alliance to End Plastic Waste.
We continue to take deliberate actions to drive inclusion, diversity and equity throughout our organization and beyond. We believe diverse teams make more innovative and better-performing teams. That is why we are institutionalizing inclusion in everything we do – from hiring to who has a seat at the decision-making table. We are creating a culture that embraces and values differences. In 2021, we introduced new global paid time-off policies that will provide employees with equal opportunity for parental leave, to take care of their families, and to volunteer and engage in Employee Resource Group (ERG) activities. Our ERG participation is redefining best-in-class performance, with nearly 100% of People Leaders and more than 50% of global employees participating. We also continue to advance supply chain diversity. Since launching four years ago, our Supply Chain Diversity Program has led to more than $1.74 billion in spend with small and diverse suppliers and delivered over $15 million in EBIT to our bottom line.
We are mobilizing alliances of diverse stakeholders to create meaningful social change across our communities. In 2021, we increased our commitment to $13 million for Dow ACTs, a framework designed to address systemic racism and inequality. We joined OneTen, a coalition of businesses that have pledged to upskill, hire and advance 1 million Black individuals in the United States over the next decade. We also continued engagement with historically Black colleges and universities (HBCUs) to reinforce the STEM and Ph.D. pipelines. Through the Future of STEM Scholars Initiative (FOSSI), we are underwriting the education of 10 students per year who are pursuing STEM degrees at HBCUs to help increase the number of underrepresented professionals in the chemical industry. And because we believe sustainable business creates positive social change, we invested $2 million in seed grants for projects in 12 countries, including infrastructure projects that help keep plastic waste out of the environment and back into the circular economy.
We are improving governance, transparency and accountability across Dow. We have raised the bar in our ESG reporting and disclosures through improved carbon emissions and circularity reporting and improved climate risk disclosures and greenhouse gas intensity metrics. And we are working with the World Economic Forum’s International Business Council to help develop consistent international frameworks for reporting and accounting standards for ESG matters. We continued to actively deepen and diversify our Board, electing three new directors in 2021 and 2022. Also, we modified our Annual Performance Award and Executive Compensation Program metrics to include ESG components – holding every member of Team Dow accountable for the same metrics that we report to all our stakeholders.
A sustainable world is one of intersections – between the environment and society, science and innovation, collaboration and action. Because the challenges facing our local and global communities are increasingly complex and interconnected, they demand a collaborative and integrated approach. They also require game-changing ideas fueled by science.
Within this report, you’ll see how Dow is working with our stakeholders to deliver on a broad range of ESG priorities through our purpose-driven strategies and processes. I’m proud of the many ways that Team Dow is making real progress in helping society meet its most urgent needs. While we know there is still much work to do, we are passionately committed – as we have been for well over a century – to imagine a better world. A more equitable world. A more resilient world. A more sustainable world. And a company that will thrive for the next 125 years as it helps build that new future.
Chairman and Chief Executive Officer