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Preface from the Management Board
2023 was another challenging year for the CHT Group. The transformation of our markets, our competition and the associated changes in our customers’ needs are shaping our environment and causing upheaval within the entire chemical industry. Geopolitical conflicts are doing the rest. The resulting uncertainties lead to continued rising inflation, high interest rates and a weak global economy. These factors have posed a major challenge for us in 2023. In Europe in particular, we and our customers are facing high energy prices, weak economic growth and increasing regulation.
We are accepting these challenges and have taken effective measures to maintain our competitiveness. We want to continue to grow profitably and become climate-neutral by 2045.
As a global business enterprise, we supply products and solutions to a large number of customers in a wide range of industries worldwide. Our primary goal is to support our customers’ sustainability performance with our products and solutions. However, this also depends on the cooperation of all partners involved in the supply chain, as only by working together can we overcome the current global challenges posed by a growing world population, climate change and the increasing complexity of supply chains. We take responsibility for our actions, our company and society.
Sustainability is a fundamental component of our corporate strategy as a foundation-managed company. To achieve our goals, we align our actions unreservedly with the three dimensions of sustainability – people, planet, performance – i.e. social, environmental and business performance.
Our development shows that we are following the right path with Strategy 2025, which is aligned with the United Nations’ Sustainable Development Goals (SDGs). With the “Green Deal”, the EU Commission is pursuing ambitious climate targets which we are actively involved in implementing by setting ourselves the goal of becoming climate-neutral as CHT Group by 2045. To underpin this ambitious plan, we signed the Science Based Targets initiative (SBTi) at the end of 2021 to meet the targets of the Paris Climate Agreement and committed to the 1.5 °C target. At the beginning of 2024, SBTi approved the CHT Group’s climate reduction targets of – 42 % in Scope 1+2 and – 25 % in Scope 3 by 2030.
What challenges do we see as the CHT Group?
The transition to a sustainable and climate-neutral society is the greatest challenge of the coming decades. Many of our products and technologies contribute to the success of this transition. We are therefore working at full speed to develop products and process solutions that reduce our customers’ CO2 footprint, while at the same time making worldwide efforts to reduce the carbon footprint of our own production value chain.
The further intensification of resource scarcity on a global level calls for responsible handling of raw materials. In addition, the chemical industry remains very energy-intensive and dependent on fossil raw materials. Therefore, the transition of our energy consumption towards non-fossil energy sources is crucial.
To successfully continue this transition, we will need further profitable growth in our businesses and a business-friendly environment. In line with our strategy, we are increasingly producing locally for local markets and thus also reducing the CO2 footprint caused by transportation. This is why we opened a new production facility in Honduras in 2022 and another in Bangladesh in 2023. Both countries produce heavily for the textile industry. In order to be able to supply the innovative growth areas in North America even better with innovative silicone products, the site in Cassopolis will be upgraded with state-of-the-art production technology. Production in the new facilities will start in 2024.
By 2025 we will achieve 80 % of our sales from products classified as sustainable. These products support our customers in traditional industries such as textiles and paper to make the transformation towards lower pollutant and resource-saving manufacturing. Furthermore, they also ensure the reduction of water and energy consumption in the corresponding industries. Moreover, our additives are used in future technologies such as e-mobility, fuel cells and high-tech construction materials.
In 2023, we introduced a new supplier management system in the Group. Our adapted supplier management system includes a Supplier Code of Conduct adjusted to the German Supply Chain Due Diligence Act. The measures range from a risk analysis based on the Chemie3 industry standard for the chemical industry to a supplier questionnaire for self-assessment. In addition, sustainability roundtable meetings have been arranged with important suppliers from the areas of raw materials and logistics. These meetings serve to agree joint measures for sustainability and climate protection.
In 2024, we are expanding our activities in the area of human rights and participating in the UN Global Compact Human Rights Accelerator Program and have started an internal analysis of the payment of living wages at CHT.
In the Sustainability Report 2023, we present the CHT Group’s contribution to sustainable and responsible action and give you an overview of how we are tackling the many challenges described.
Eva Baumann | CEO
Prof. Dr. Klaus Müller | CFO