Targets and Target Achievement 2022
For us, business success tomorrow means creating value for the environment, society and business. That is why we pursue ambitious targets along our entire value chain. We report transparently on target achievement so that our stakeholders can track our progress.
Our objective is profitable growth: We want to grow sales volumes faster than global chemical production, further increase our profitability, achieve a return on capital employed (ROCE) considerably above the cost of capital percentage and increase the dividend per share every year based on a strong free cash flow.
In addition to these financial targets, we have set ourselves broad sustainability targets. We want to significantly reduce our CO2 emissions in the coming years and align our product portfolio even more strongly with climate protection and the circular economy. To achieve this, we are updating the methodology used to assess our product portfolio against defined sustainability criteria and will apply it for the first time in 2023 (see Our Sustainability Concept). We are also working to strengthen sustainability in our supply chains and use resources responsibly. We want to further improve safety in production. Furthermore, we aim to promote diversity within the company and create a working environment in which our employees feel that they can thrive and perform at their best.
The objective of these targets is to steer our business into a more sustainable future, and at the same time, contribute to the United Nations’ Sustainable Development Goals (SDGs). We are focusing here on issues that we as a company can influence – especially SDG 2 (Zero hunger), SDG 5 (Gender equality), SDG 6 (Clean water and sanitation), SDG 7 (Affordable and clean energy), SDG 8 (Decent work and economic growth), SDG 12 (Responsible consumption and production) and SDG 13 (Climate action).
Good to know
Most important KPIs
BASF has set itself ambitious targets along the value chain. Two of these indicators are particularly important:
- Return on capital employed (ROCE)
- Absolute CO2 emissions
As our most important key performance indicators (KPIs), these two metrics are the main indicators used to steer the BASF Group. We also use ROCE for employee incentivization throughout the Group. The achievement of climate protection targets also influences the compensation of members of the Board of Executive Directors and senior executives.
Status of Target Achievement
Achieve a return on capital employed (ROCE) considerably above the cost of capital percentage every year5,6
Grow sales volumes faster than global chemical production every year6
Increase EBITDA before special items 3% to 5% per year6
Increase the dividend per share every year based on a strong free cash flow1,6
Effective climate protection
Reduce our absolute CO2 emissions2 by 25% by 2030 (baseline: 2018)5,6
Cover 90% of our relevant spend with sustainability evaluations by 20257
Have 80% of our suppliers improve their sustainability performance upon re-evaluation7
Resource efficiency and safe production
Reduce worldwide process safety incidents per 200,000 working hours to ≤0.1 by 20253,7
Reduce the worldwide lost-time injury rate per 200,000 working hours to ≤0.1 by 20253,7
Introduce sustainable water management at our production sites in water stress areas and at our Verbund sites by 20307
Employee engagement and diversity
1 Dividend proposed by the Board of Executive Directors
2 Scope 1 and Scope 2 (excluding the sale of energy to third parties, including offsetting) The target includes greenhouse gases according to the Greenhouse Gas Protocol, which are converted into CO2 equivalents (CO2e). The baseline year is 2018.
3 We will update the safety targets and report according to a new system in 2023.
4 We regularly calculate the employee engagement level. The most recent survey was conducted in 2022.
5 Most important key performance indicator
6 Reasonable assurance
7 Limited assurance