BASF

Lobbying
BASF discloses a list of industry associations it selected for analysis. The company also discloses a clear and detailed framework for assessing alignment of its trade associations with its climate positions and an action plan to address misalignment which includes clear escalation steps.

Stakeholder engagement
BASF discloses an overview of the issues raised during its stakeholder engagement activities and the channels it uses to engage with its stakeholder groups.

Sustainability strategy and accountability
BASF discloses its process for identifying and prioritising its most relevant sustainability impacts as well as the outcome of this process, in relation to its sustainability strategy and reports consistently against all its targets. Furthermore, it provides evidence of linking performance criteria in senior executives’ remuneration policies to targets and objectives which cover nature, including biodiversity, and social issues.

Ecosystem conversion and restoration
BASF aims to achieve conversion-free supply chains and, to this end, it discloses certain activities. Additionally, it shares specific details and outcomes of ecosystem restoration projects taking place in areas impacted by its own operations or those of its suppliers.

GHG emissions
BASF has set time-bound targets to reduce its scope 1 and 2 emissions and reports progress against it. It also discloses a reduction in its scope 3 emission levels compared to the previous year.

Resource exploitation and circularity performance
BASF discloses its efforts to improve soil health or agrobiodiversity in its production or sourcing practices.

Solid and air pollution
BASF is reducing the production of hazardous substances and waste, discloses the proportion of hazardous waste treated to reduce pollution, the hazardous waste diverted from disposal, and the waste directed to disposal. Additionally, it reports regularly on air quality parameters of emissions of harmful air pollutants.

Water
BASF demonstrates reducing water withdrawal in its own operations, as well as water withdrawals in water-stressed areas. The company also engages with suppliers to reduce water withdrawal. Finally, BASF regularly reports on water pollution metrics, as well as a decrease in water pollution and its processes for managing and monitoring discharge water quality.

No leading practices were identified in the social inclusion and community impact area.

Act ethically
BASF has a transparent global tax strategy that strictly adheres to the tax laws and regulations of the countries in which it operates. Additionally, the company has a strong policy in place that explicitly prohibits bribery and corruption. It publicly commits to protecting personal data and enforces a supplier code of conduct that strictly prohibits any form of bribery and corruption.

To promote transparency and accountability, BASF provides a website and accessible phone numbers for all stakeholders to report concerns or complaints related to bribery and corruption, without fear of reprisals. The reporting channel is open to everyone, offering the option to remain anonymous or identify themselves.

Moreover, BASF discloses its approach to lobbying and political engagement through a policy statement. When engaging third-party agencies or partner staff to interact with political stakeholders on its behalf, the company’s policy governs the process and requires all agencies to commit in writing to abide by its ethical standards.

Provide and promote decent work
BASF has a publicly available policy statement in which it commits to respecting the health and safety of workers. Additionally, its policy statement emphasizes the importance of its business relationships in prioritizing the health and safety of their workers. By regularly monitoring their performance in this area, the company ensures accountability.

The company also provides transparency in terms of the age distribution of its direct operations workforce, as well as the birth year information for its board of executive directors and supervisory board.

Furthermore, as a signatory of WEPs since 2020, BASF publicly pledges its support for gender equality and women’s empowerment. It also sets a specific goal of increasing the representation of women in leadership positions to 30% by 2030, which it discloses to the public.

Respect human rights
BASF has made a publicly available policy statement in which it commits to respecting both the ILO core labour rights and human rights. To ensure transparency and accountability, the company provides accessible channels for all workers to voice their complaints or concerns. This can be done through a dedicated website and phone numbers. The company’s website explicitly states that these reporting channels are open to anyone and allows the complainant the option to remain anonymous or provide identification. The grievance mechanism is also accessible to all external stakeholders who may be negatively affected by the company.

Lobbying
BASF does not report on its advocacy practices on nature-related issues, nor whether these activities align with its sustainability strategy. Additionally, it has an opportunity to show leadership by integrating biodiversity in the criteria for its industry association review.

Sustainability strategy and accountability
While BASF discloses some sustainability objectives/targets including climate and social inclusion, it has an opportunity to establish group-wide targets for the most material parts of its value chain. Furthermore, the company states that the board of directors has expertise in sustainability. However, it could further disclose whether its highest governance body has expertise with respect to the company’s most material sustainability topics.

Ecosystem conversion and restoration
BASF does not have specific time-bound targets for achieving conversion-free supply chains, nor does it have a commitment to ensure zero conversion. Additionally, the company is not actively committed to restoring ecosystems.

GHG emissions
BASF should set time-bound targets to reduce its scope 3 emissions and all of its scope 1, 2 and 3 emissions should align with a 1.5-degree trajectory.

Impact and dependencies assessment
BASF uses various methods like Eco-Efficiency Analysis and IBAT to measure its sustainability performance, assess biodiversity risks, and implement local protective measures. Despite these initiatives, it doesn’t fully disclose the results of biodiversity impact assessments for all its business units. While the company aligns its biodiversity efforts with supply chain impacts and has policies like the Palm Commitment, it hasn’t disclosed assessments of its impacts on nature, including biodiversity, in its upstream value chain. Furthermore, the company has not provided any details on its dependencies on nature either within its own operations or in its upstream business relationships.

Invasive species
BASF has not identified any activities that could lead to the introduction of invasive alien species in its own operations.

Key areas and species
While BASF has been involved in conservation efforts in the Atlantic Rainforest and collaborated with the Brazilian Espaço ECO Foundation to identify over 200 animal and plant species in the Suvinil Reserve, it still has an opportunity to disclose species existing in or adjacent to its other locations. Additionally, although it discloses certain production sites’ proximity to Ramsar sites and IUCN protected areas, and provides information about the Suvinil reserve, it hasn’t named all such sites. The company could further disclose the locations of its suppliers near biodiversity hotspots, species populations adjacent to supplier locations, and the conservation status of species at its own sites.

Resource exploitation and circularity performance
BASF provides a general overview of its inputs and energy supply, but there is room for improvement by offering more in-depth information about the various materials utilized. As the company aims to double its circular economy solutions sales by 2030, it would be beneficial to include more quantitative data on its group-wide circularity performance. Additionally, the company could improve its transparency by setting a target to enhance soil health in its production or sourcing practices and sharing updates on its progress.

Solid and air pollution
BASF should commit to avoid developing or marketing new chemicals or products with SVHC (substance of very high concern) properties. It has an opportunity to disclose quantitative evidence regarding plastic use reduction and use of sustainable packaging, including the amount of plastic waste generated and proportions directed from or to disposal. The company could also disclose time-bound targets to reduce air pollutants across the most material parts of its value chain.

Water
BASF has an opportunity to disclose relevant information on rights to water in its operations or supply chains.

Indigenous Peoples’ and land rights
BASF does not show if it is committed to respecting Indigenous Peoples’ rights or land rights of local communities.

Safe, clean, healthy and sustainable environment
BASF has an opportunity to commit to respecting local communities’ right to a safe, clean, healthy and sustainable environment, and to zero tolerance for acts of violence, threats, intimidation or judicial harassment committed against land and environmental rights defenders. Moreover, it should track its actual or potential negative impacts on the health of local communities.

Act ethically
BASF has the option to provide a clear description of how it identifies bribery and corruption risks and impacts in specific locations or activities within its own operations. Additionally, it currently publishes a report on its lobbying contributions in the United States and is willing to disclose data on lobby expenditures upon request from national or regional transparency registries. However, it is uncertain whether the company engages in lobbying activities exclusively in these specified regions or countries. Therefore, there is an opportunity for the company to either disclose its lobbying expenditures in all locations where it carries out lobbying activities or specify that it only does so in certain countries or regions.

Provide and promote decent work
BASF has an opportunity to disclose a time-bound target for paying all workers a living wage. Additionally, it could explain how it determines a living wage in the regions where it operates. While the company expects its suppliers to comply with local laws regarding minimum wages, it should also describe how it supports the payment of a living wage through its business relationships.

The company’s board currently consists of 6 members, with only 1 being female. This means that the percentage of women on the board is currently 16.66%. In order to promote gender diversity, the company has a chance to increase this percentage further.

Furthermore, BASF could also disclose the ratio of basic salary and remuneration between women and men in its total direct operations workforce, broken down by employee category and significant locations of operation.

Respect human rights
While BASF expects its business relationships to respect the right not to be the subject of forced labour, child labour, and discrimination, it has an opportunity to reference all the ILO fundamental rights at work, including freedom of association and collective bargaining, in all contexts and locations.

Although BASF mentions conducting due diligence, it should explicitly state that it also conducts human rights due diligence that involves identifying potential risks and impacts in its own operations and supply chain. The company also has an opportunity to improve its disclosure by providing the results of its human rights risk assessment. In addition, the company could disclose the existence of a global system designed to address, prevent, or mitigate these salient human rights issues.