Your expert for questions
Dr Daniel Haag
Director, PwC Strategy&
Tel: +49 711 3422 6886
The fight for sustainability in industrial production has been going on since the industrial revolution. However, against the background of global warming, the topic of sustainable production is currently receiving more focus than ever – because industry is particularly resource-intensive and energy-intensive. When energy and heat consumption are included in the calculation, industry is responsible for around 40 percent of global carbon dioxide emissions. A large proportion is related to basic materials such as steel, aluminium, plastic and cement. Estimates expect global consumption of these materials to be two or even four times higher by the year 2050.
“With global value chains and high levels of resource-intensity, industrial production has a major responsibility for the environment – and is also an important lever in efforts to achieve a more sustainable and environmentally compatible production in the future.”
Industrial production is currently going through a transformation. This opens up a wide range of opportunities for sustainable solutions:
Many manufacturing companies have set sustainability targets, and offer sustainable products and solutions. However, these are often comfortably within the boundaries of what is possible. There are many reasons for this.
Typical challenges include:
Many companies are being driven by regulatory requirements and are not exploiting the full potential of sustainability. We are supporting our clients in tapping into particularly attractive opportunities in the following areas:
A clear strategy that is derived from the material topics for the company and its stakeholders is the basis for anchoring sustainability into all processes and areas of a company. This creates the right conditions for minimising sustainability risks, such as those within the supply chain or broader value chain. It also helps companies to earn and build trust among customers and employees, while cutting costs and creating a clear differentiation against competitors. This puts companies in a strong position to tap into sustainability-related market opportunities.
The industrial sector faces expectations to decarbonise its use of electricity, heat and cooling. Leading companies are setting “Science-Based Targets” that are proven to be derived from the overarching climate targets – and that are also audited and binding. Some companies are setting “Net Zero” targets, while others are even leading the way to climate positivity. By improving efficiency, leveraging synergies, embracing electrification and using green gases, it is possible to produce more sustainable goods with a reduced carbon footprint.
Manufacturers must take a very close look at their global value chain in terms of social and environmental considerations. For companies in the chemicals and metals industries, for example, around 60 percent of climate emissions are generated outside of their own production sites. For machinery & equipment producers, this figure stands at almost 90 percent. The supply chain also accounts for the majority of air pollution, water consumption and land use.
A large proportion of environmental impacts are generated when customers use products, particularly when this involves machines and equipment with a long service life. For this reason, sustainability must already be taken into consideration during product development, and the suitability for a circular economic model should be planned into every stage in the entire product life cycle. Through measures such as targeted reuse of components or entire machines, it is possible to reduce the environmental footprint – while also cutting costs.
Companies must comply with increasingly demanding requirements for transparency about their ESG footprint, as well as rules for sustainability reporting (e.g. value chain laws, EU taxonomy, CSR guidelines). Transparency and consistent sustainability reporting that reflects business-relevant factors create the foundation of a targeted sustainability strategy.
Our Sustainability Team will join you on every step of your journey to sustainable industrial production.
Our work is guided by three fundamental beliefs:
Let’s work together to transform your company into a driving force for sustainability in industrial production.
The chemical industry plays a central role in global efforts to tackle the biggest challenges facing society and environment – such as climate change. This industry is now striving to move away from a reactive and compliance-driven approach, and to focus on value creation instead.