The non-profit organization CDP, formerly known as the Carbon Disclosure Project, has rated BASF as one of the world’s leading companies in the areas of climate protection, forest protection and sustainable water management. The group received an "A" score in the climate and forest protection categories and an "A-" in the water security category, which means it achieved leadership status in all three areas analyzed by CDP.
"This renewed recognition by CDP confirms our consistent commitment and the effectiveness of our sustainability strategy. BASF will continue to develop innovative solutions for its customers and pursue an ambitious agenda to contribute to a sustainable future," said Dr. Christoph Jaekel, Head of Corporate Sustainability at BASF.
Assessment in the area of climate protection
In the climate category BASF received an "A" score, which means not only leadership status but also inclusion on CDP’s A list. The company has been participating in CDP’s climate protection data reporting program since 2004. As part of this assessment, CDP analyzes, among other aspects, the transparency of emissions reporting, the approach to risks and opportunities related to climate change, the climate strategy and measures to reduce CO2 emissions.
BASF has set the goal of reducing CO2 emissions (Scope 1 and 2) by 25% by 2030 compared with 2018 while continuing to grow production. This target addresses emissions related to product manufacturing and energy generation and covers around 96% of Scope 1 emissions and 99% of Scope 2 emissions. The reduction strategy is based on the decarbonization pathways outlined by the International Energy Agency (IEA) in the study "Net Zero by 2050", in line with limiting global warming to 1.5°C.
The group also plans to reduce emissions associated with suppliers’ goods and services. In particular, BASF aims to reduce specific emissions in Scope 3.1 by 15% by 2030 compared with 2022 across its entire portfolio. The long-term objective is to achieve net-zero emissions (Scope 1, 2 and 3.1) by 2050.
Sustainable water management
In the area of water security BASF again received an "A-" score, as in the previous year. According to CDP guidelines, companies that manufacture products containing hazardous substances cannot receive an "A" rating in this category. In its assessment CDP considers the transparency of reporting on water management activities and the way risks such as water scarcity are mitigated.
CDP also analyzes the extent to which the product development of evaluated companies can support sustainable water management by their customers. BASF is implementing sustainable water management at all its Verbund sites and at production locations in water-stressed areas by 2030. In 2024, the level of target achievement was 65%.
Actions for forest protection
For the first time BASF received an "A" score for its efforts to protect forests. This result is based on a detailed analysis of the palm oil value chain and activities affecting ecosystems and habitats. Palm kernel oil and its primary derivatives are among the most important renewable raw materials used by the group.
The top rating was driven, among other factors, by a high level of transparency in disclosing raw materials and supply chains relevant to deforestation, extensive public engagement and activities and initiatives such as smallholder projects in the palm oil supply chain.
Importance of CDP ratings for the market
CDP represents more than 640 investors with approximately 130 trillion US dollars in assets under management. Each year over 31,500 companies are called upon to report in one or more assessment categories. Around 300 companies with a combined purchasing power of 6.4 trillion US dollars require their suppliers to participate in CDP reporting.
The data collected by CDP is included in analyses conducted by leading rating agencies. Scores are awarded annually on a scale from "A" to "D-", while companies that provide no information or submit insufficient data receive an "F" rating. This structured classification system makes CDP ratings an important reference point for financial market participants and stakeholders assessing the climate and environmental strategies of companies.
