Sustainability

BASF’s Value-to-Society: Results 2013-2021 at Group level

Change in methodology

To understand the economic, environmental and social value BASF contributes to society along the value chain, we initially developed the Value to Society (VtS) approach in 2013 and have reported until 2020 the VtS results. To drive a standardization of impact valuation and thus allow comparability of impact assessments across companies, BASF was then a founding member of the Value Balancing Alliance (VBA) in 2019.

The change to the VBA methodology in 2020 implies that impacts reported in previous years are not directly comparable. Additionally, new indicators were included (child and forced labor). Ongoing piloting at VBA member companies will lead to further enhancements.

Comparison of results – VtS vs VBA

To make a comparison between the two methodologies possible, we show the results according to the VtS and the VBA approach for the years 2019 and 2020.

Two indicators – child labor and forced labor – were added with the VBA approach. The single economic indicator with the new approach now incorporates the previous indicators profit, depreciation and tax.

Apart from these indicator differences, the main change is the underlying macroeconomic model used for the calculation of both supply chain and customer industry effects. Upstream and downstream training data can now also be estimated, which was not included in the former approach.

For own operations, differences in the results are due to further slight changes: for the economic impact, a different methodology that accounts for the GDP contribution of R&D activities was used. For environmental indicators, the data collection was refined, i.e. a distinguishment was made between paved and unpaved land use as well as between emissions of different sizes of particulate matter (PM10 and PM2.5). We now used BASF’s GHG emission and water consumption account. For social indicators, incidences at contractors and leasing are now excluded as these form part of the supply chain.

2021 (VBA)

Comparison of results – 2021 vs 2020 (VBA)

To different extents, both positive and negative economic and social impacts increased. Changes for environmental impacts were smaller. Land use is the only indicator to decrease. The main reason for these changes might be the economic recovery after the pandemic shock.

Overall, economic impacts increased by 23%. For own operations, they increased by 13%, supply chain impacts increased by 32% due to an increase in spend and impacts in customer industries increased by 24% due to an increase in sales.

Environmental impacts increased slightly across all value chain levels. The main exception is land use in customer industries, which decreased by 20% due to shifts in the sales portfolio and improvements in the model. The GHG impact increased overall by 16%.

Both negative and positive social impacts increased overall. Labor compensation increased by 5% in own operations, in total by 19%. For human rights, the impact increased by 40% in the supply chain and decreased by 6% in customer industries.

Driven by an increase of the purchase volume by 33%, impacts along the supply chain increased for all impact indicators except air pollution which stayed constant.

Besides a decrease in land use of 6%, all other indicators, positive as negative, increased for own operations. Training almost tripled its impact between 2020 and 2021. The impact of GHG emissions remained constant.

The sales volume increased by 38%. Still, land use and human rights decreased in customer industries with 20% and 6%, whereas all other indicators have increased or remained constant. The most significant increase comes from training with 57% followed by labor compensation with 28% and the economic impacts of 24%.

2020 (VBA)

2019 (VBA)

Interactive year-on-year comparison 2013 - 2020 (VtS)

Find more information on the impact categories by clicking the arrows.

2020 (VtS)

2019 (VtS)

2018 (VtS)

2017 (VtS)

2016 (VtS)

2015 (VtS)

2014 (VtS)

2013 (VtS)