Sept 18, 2025 | Case Study | 6 minute read
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How Dow is supporting superior everyday products through value chain decarbonization
This collaboration demonstrates how companies within complex value chains, such as Dow and its customers, can harness the power of working together to create new solutions to reduce emissions.
Dow and P&G agreement demonstrates how industry can collaborate on value chain decarbonization
Dow and P&G have finalized a landmark commercial agreement to transact reduced greenhouse gas (GHG) emissions materials important to P&G’s formulated end-products.
The new agreement with Dow strategically supports P&G’s broader ambition to achieve net zero GHG emissions across its supply chain and operations—from raw materials to retail delivery—by 2040.
What are Scope 3 emissions?
Scope 3 emissions include indirect GHG emissions related to an organization's upstream and downstream value chain activities1. Examples include the purchased raw materials used to create products.
The current transaction aims to reduce several million metric tons of GHG emissions over the next decade.
Through this transaction, P&G is able to reduce the Scope 3 emissions tied to raw materials used in its products and supplied by Dow. A critical enabler in this agreement is Dow’s ongoing efforts to significantly lower GHG emissions from its own manufacturing operations.
Business value in lowering GHG emissions
The business case for GHG emissions reduction is compelling. It not only contributes to the Scope 3 emission reduction but also offers tangible market opportunities, competitive advantages, innovation and long-term growth.
Market opportunities
Consumers are becoming more environmentally conscious, and many consider sustainability in their buying decisions. By lowering GHG emissions and participating in value chain decarbonization earlier, businesses can attract more consumers, differentiate themselves from competitors, and help create supply chain security. By connecting consumer value with upstream investment, partnering companies can accelerate the pace of emissions reductions.
Competitive advantage as early movers
Based on the study “Scaling Products for a Net Zero World” realized by the World Economic Forum in partnership with the Boston Consulting Group, a significant supply-demand imbalance is expected for low-carbon products, with downstream companies facing scarcity risks as they pursue decarbonization. Strong signals of intent and long-term partnerships will be key to bridge this gap. Delayed action may result in missed opportunities and higher costs.2
Innovation and long-term growth
Sustainability and innovation are no longer separate topics. Companies that focus on GHG reduction often develop new technologies and processes that can lead to new offerings and benefits to delight consumers. By investing in sustainable practices, businesses can help to future-proof themselves in the shift towards a low-carbon economy.
The role of carbon accounting
Unlocking investment in hard-to-abate sectors, such as the chemical sector, will require carbon accounting mechanisms that address systematic barriers to generating value for low-carbon products. Traceable and auditable market-based carbon accounting mechanisms are essential to developing credible and scalable solutions.
Dow and its partners support the development of science-based Carbon Accounting Standards3. This collaboration contributes to the broader adoption of market-based mechanisms across the industry, creating pathways for companies to engage in credible emissions reduction initiatives.
Central to this approach is the use of a Carbon Footprint Ledger—a methodology based in mass balance principles—that enables the delivery of high-value products with a low-carbon footprint to customers. To ensure the integrity and transparency of these reductions, the Carbon Footprint Ledger methodology is independently assured and certified in alignment with the relevant Greenhouse Gas Protocol and ISO requirements4.
By partnering in this transformative way, Dow and P&G are collaborating to address GHG reduction and accountability across global value chains. Both companies continue to evaluate opportunities to further reduce GHG emissions through ongoing and future joint efforts with each other and with additional partners.
About the article
This case study was developed by a cross-discipline team representing materials and market expertise across Dow in collaboration with our customer, P&G. To explore more of our decarbonization and climate mitigation initiatives, visit our Purpose in Action page.