IHS Chemical Week


ChemSpec USA 2011: Sustainability and Outreach Are Necessary to Thrive

3:19 PM MDT | May 4, 2011 | By REBECCA COONS

Industry leaders addressing Chemspec USA, held recently in Philadelphia, touted the competitive advantages to a business plan focused on sustainability and a sensible approach to regulations and government incentives. Jerome A. Peribere, executive v.p./Dow Chemical and CEO of Dow Advanced Materials told attendees that “broadly adopted and applied, the business of sustainability not only provides the best opportunity to create a more sustainable world for all of is, it also gives us the best opportunity to grow our businesses.” To this end, Dow is concentrated its efforts on the most urgent needs: climate change, clean energy and water, and safe and nutritious food. “We can’t meet those needs–and we can’t overcome these challenges–with yesterday’s approaches and yesterday’s solutions,” he added.

Products do not have to be new to be both sustainable and profitable. Dow has a large portfolio of materials for building insulation, an addressable market that is projected to grow from $27 billion in 2009 to $39 billion by 2014, Peribere says. At the same time, improving the energy efficiency of buildings and homes is considered among the most cost-effective and easily implemented methods for measurable, global carbon dioxide abatement. Advances in glue—the world’s first specialty chemical—can also drive sustainability and business gains. Dow’s structural adhesives are currently used to design and build cars that are lighter and more fuel-efficient. The technology is  mostly used by high-end European automakers, but Peribere expects its use to eventually spread throughout the auto industry.

Peribere closed by urging the industry not to think about sustainability as a “set of handcuffs or an add-on-program,” but rather an “unprecedented catalyst for innovation and growth.”

Joe Carleone, president and CEO of American Pacific Corporation (AMPAC) emphasized the importance of the U.S. manufacturing bases and called on the U.S. government and chemical industry to work together to bring about its revival. “If you lose manufacturing you lose R&D, and if you lose R&D you become a completely service economy” with inadequate job creation, he says.

Changes  to the current regulatory and business incentive structures should be a government priority, he says. Regulations are important, but need to be appropriate. “Good regulations make [AMPAC] a better company, but bad regulations hurt the economy,” he says. Chemical companies must advocate environmental and regulatory policies that are clear, concise, consistent, and wise, he adds.

Governments also need to attract business by minimizing risk for investors and creating better incentives, including lower corporate tax credits, permanent R&D tax credits, and an energy policy favorable to manufacturing.  With two government jobs for every manufacturing job, bureaucracy  is a major impediment to creating policies conducive to investors, Carleone says.

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