E4 Biodiversity and Ecosystems

Strategy and Governance

E4-1

We are currently undergoing a transformation toward climate neutrality and observance of the planetary boundaries. To this end, we have set ourselves ambitious targets (see Targets and Target Achievement) that impact our business models and our strategy as well as how they interface with nature, biodiversity and ecosystems.

• We strive to use more and more renewable alternatives to fossil raw materials and energy.
• We aim to continuously reduce emissions in the natural world and improve our resource use on an ongoing basis.
• We manage our product portfolio with regard to the product-related contributions to greater sustainability (TripleS: Sustainable Solution Steering, see Sustainable steering of our product portfolio in the General Disclosures).

These three areas of transformation are also relevant to many of our stakeholders, such as investors, customers, legislators, suppliers, insurers and nongovernmental organizations. We actively seek out partnerships with relevant interest groups and organizations worldwide, for example in the Taskforce on Nature-related Financial Disclosures (TNFD), to expand our knowledge, to raise awareness about biodiversity and to drive necessary actions forward. In the event that our business activities negatively impact or could negatively impact affected communities, we involve them or their representatives in one of our stakeholder engagement formats (see S3 Contribution to the positive development of communities).

We generally consider the resilience of our business models at the level of our business units or operating divisions along the value chain (see Strategies to manage impacts, risks and opportunities in the Double Materiality Assessment chapter). The current resilience of our business models in relation to biodiversity and ecosystems was examined in 2024 in preparation for our double materiality assessment. In our Nature Advisory Council, we discussed aspects that were part of this assessment, such as our approach to renewable raw materials. Through the use of big data analysis, stakeholder viewpoints were also incorporated into our considerations. The assessment was conducted under the basic assumption of continuity concerning our current raw materials base. The examination focused on those business models connected with the impacts identified in this topic category: The use of industrial chemicals and the use of crop protection products. Overall, we assess our resilience level as high. As a chemical company, we still mainly use fossil raw materials. Our sourcing of renewable raw materials is diversified, leading to low dependence on biodiversity and ecosystem services. We regard the availability of water in sufficient quality and quantity as an important, but not material, dependency on ecosystem services. This dependency is documented as part of our opportunities and risk management and is addressed by means of our sustainable water management (see E3 Actions). We therefore regard our physical risks as low.

We actively pursue actions to reduce our dependency on fossil-based technologies and raw materials (see E5 Actions). This increases our dependency and impacts on biodiversity and ecosystems. The associated transitory and systemic risks have been considered and assessed as not material.

In respect of our business model in the field of agriculture, the long-term market demand for crop protection products and support in food production results in a high level of resilience. The transitory and systemic risks associated with this line of business have been considered and assessed as important but not material.

With a view to avoiding impacts on nature, we are guided by the risk mitigation hierarchy. If impacts cannot be minimized, we aim to reduce them, support the restoration of nature or contribute to the transformation of value chains toward better environmental outcomes.

Explanation of material impacts

Impact of land use on the sourcing of raw materials

Human use of land has impacts on biodiversity and the conservation of ecosystems. We pursue our ambitious climate targets (see E1 Global Targets) and seek to increasingly offer customers products that make a positive contribution to sustainability in the value chain (see  Sustainable steering of our product portfolio in the General Disclosures). This includes partially replacing fossil raw materials with renewable alternatives. This has a positive impact on the carbon footprint of the product concerned. At the same time, however, the cultivation of renewable raw materials must be considered from a sustainability point of view. If plants are grown in monocultures or if forests are cleared to enable cultivation, this has a negative impact on biodiversity and ecosystems. This may lead to land degradation. Therefore, our risk assessments when sourcing renewable raw materials take into account the protection of biodiversity and ecosystems, as well as social factors such as working conditions (see S2 Renewable raw materials) and food security. We carefully weigh advantages and disadvantages, for example with life cycle analyses. Moreover, we seek dialog with our stakeholders to identify conflicting goals. We also take into consideration recognized certification standards in our decisions, such as the Roundtable on Sustainable Palm Oil (RSPO). For our biomass balance portfolio (see E5 Sourcing and use of raw materials), we only source renewable raw materials that are certified in accordance with recognized standards, such as the International Sustainability and Carbon Certification (ISCC) or the REDcert scheme for sustainable biomass.

Since 2023, our Care Chemicals division has been publishing a comprehensive Responsible Sourcing Report, which has replaced the previously published Palm Progress Report. This report provides an annual summary of our activities and progress in the pursuit of greater sustainability and transparency in the palm value chain and in the value chains of other renewable raw materials.

Through the sourcing of raw materials that have been mined or otherwise extracted, we exert a significant influence on the degradation of land and on the condition of ecosystems. Mining can result in soil erosion, a loss of biodiversity and the pollution of water sources. The BASF procurement requirement ensures that environmental and social criteria are taken into account during procurement. We expect our raw material suppliers to meet environmental and social requirements (see Sourcing of renewable raw materials). By fostering the circular economy, we are able to reduce demand for newly mined raw materials. BASF is involved in various projects to improve sustainability in the supply chain, such as in connection with the recycling of lithium-ion batteries. The company’s Verbund concept enables the efficient use of raw materials by using a plant’s by-products as feedstocks in other processes, thereby saving raw materials and energy.

Land use by BASF sites

The operation of our sites represents land use. Our sites comprise production plants, research and office buildings and agricultural testing grounds, among other things. We utilize a total surface area of approximately 43,000 hectares, of which around 23%¹ is sealed.

In order to assess the impact of our sites on biodiversity and ecosystems more closely, we have focused on our production sites, as pure office locations are less relevant by comparison. Only about a quarter of our around 1,000 sites worldwide are production plants.

Using the WWF Biodiversity Risk Filter (BRF²), an internationally recognized and science-based platform, we analyzed our production sites on the basis of 33 indicators included in the filter to identify impacts and dependencies in the area of physical risks and in respect of reputationally harmful topics. Our further considerations centered on the potential physical impacts. The BRF analysis indicated that BASF’s greatest dependency lies in the topic category Water, both in terms of the availability and the quality of water for our production sites. For one group of sites, a potential impact was identified due to tropical cyclones. Ranked third was the risk of extreme heat. BASF already addresses these three dependencies as part of its site management.

The BRF analysis pointed to pollution as the greatest potential impact of BASF caused by our sites. However, this figure was considerably lower than the BRF estimate for the chemical sector overall. We discuss the proximity of our sites to protected areas further under Metrics.

For of the management of our production facilities and their plants, we aim to act as a good neighbor and are striving to conserving biodiversity and ecosystems and to minimizing negative impacts on the environment. We generally keep our product-related emissions to air, water and soil as low as possible at these sites, avoid and reduce waste and manage remediation sites responsibly.

For more information on how we prevent pollution, see E2 Pollution Prevention; for more information on how we handle water, see E3 Water.

Identification and selection of material sites

ESRS 2 SBM-3

The material BASF sites for biodiversity and ecosystems were identified based on the results of the double materiality assessment and using the methodological framework for the drivers of biodiversity loss,³ as adapted for BASF, as well as the insights gained from the BRF analysis on impacts and dependencies.

To determine our material sites, we began by defining sites with active production operations as relevant for the topic category and then evaluated these sites using a set of indicators. As land use has been defined as a material impact, one indicator was the size of a site compared with all other sites.

We assigned further indicators to the sites using our environmental database if they allowed statements to be made on the drivers of biodiversity loss that are relevant to BASF. These were emissions making a contribution to eutrophication⁴ and acidification (pollution), greenhouse gas emissions (contribution to climate change) and water supply (potential overuse of natural resources). The sites with the highest entry values for each indicator were then further considered. The most important dependency for our material sites is the quality and quantity of water available. Here too, the sites were compared with each other and those with the highest values determined. Finally, the sites exhibiting at least four markers (>50% of indicators considered) were identified.

This method enables us to identify the material sites with a high degree of alignment with the drivers of biodiversity loss. The limitation of this method lies in the fact that, by definition, it only uses comparisons between our sites and thus relative contributions. We will continuously review whether threshold values for indicators can be applied in the future that go beyond BASF.

The following table shows a list of material sites based on this analysis:

The following table shows how these sites are embedded within local ecosystems.

Crop protection products and their impact on biodiversity and land

The agricultural sector, especially the intensive cultivation of large areas of land, including the use of crop protection products, competes with the conservation of natural habitats with a high level of biodiversity. Farms play an important role in this regard: They not only need to focus on their productivity and yields, but also meet societal and consumer expectations and protect the environment. Additional measures to promote biodiversity in the agricultural sector can have positive effects and help to reduce negative impacts. BASF has been active in this area for many years and founded the BASF Farm Network, which brings together farmers, environmental organizations, universities and companies. Its mission is to demonstrate the coexistence of farming and nature by means of practical experiments. The network supports programs that reconcile agricultural production with the protection of soil and the environment. It helps farmers to increase biodiversity on their fields and to use water and soil sustainably.

Improper use of crop protection products may have a negative impact on human health and the environment. We are therefore focusing our smart stewardship activities on education and continuously improving our solutions for farmers. Alongside aspects such as efficacy and productivity, this includes safe use by our customers and impact on the environment. We consider the entire life cycle of our products – from research and development to their proper use and disposal.

Crop protection products and seeds are highly regulated at national and international level, which leads to strict requirements for registering and re-registering active ingredients and crop systems. Regulatory approval is only granted after comprehensive evaluation has shown that our products are safe for humans, animals and the environment when used according to label instructions.

Industrial chemicals and their impact on biodiversity

Emissions of industrial chemicals can have direct and indirect impacts on biodiversity and ecosystems. Direct impacts occur where chemicals directly affect organisms or habitats. Indirect impacts may occur when chemicals enter the environment and build up within the food chain and/or environment or adversely affect habitats. These impacts differ depending on which chemical has entered the environment and in what concentration, and over what period. It is important to consider the potential impacts and to take suitable measures to minimize the environmental impacts.

We work continuously to reduce the environmental impacts of our products and processes. At the same time, we continue to steer our product portfolio toward sustainability in accordance with our TripleS methodology (see Sustainable steering of our product portfolio in the chapter General Disclosures). As part of TripleS, we also evaluate all relevant BASF products in terms of their impacts on biodiversity. We identify products that pose challenges in the area of sustainability; where these challenges are substantial, we develop action plans in order to optimize products or replace them with alternative solutions.

We see product safety as an integral part of all business processes, as an important element of our risk management and as an essential pillar of our commitment to Responsible Care^®. We continuously work on ensuring that our products pose no risk to people or the environment when they are used responsibly and in the manner intended. A thorough safety and risk assessment enables us to serve markets with safe and more sustainable products that meet regulatory requirements while still responding to trends.

More sustainable intensification of farming as a positive impact

The more sustainable intensification of farming through the use of modern crop protection products offers various benefits. It increases the productivity of farms by maximizing their yield per hectare and minimizing losses due to pests and diseases. It also helps to safeguard food supply by facilitating higher and more stable yields. The more efficient use of resources such as water and fertilizer improves the sustainability of agricultural production, which helps to protect the environment in the long term.

BASF’s specific areas of action include the development of seeds and traits that are more resilient to climate change and enable higher yields, as well as biological and chemical crop protection solutions and digital technologies that help farmers to manage their fields more efficiently.

BASF’s Agricultural Solutions division has set itself ambitious sustainability targets, including a reduction in CO₂ emissions per metric ton of crop yield and an expansion of digital technologies to more than 400 million hectares of agricultural land. These measures are part of a broader strategy that aims to increase agricultural productivity and sustainability while simultaneously conserving natural resources.

Description of material risks

Regulatory requirements for chemicals

The chemical industry is facing substantial risks due to changes to and reforms of regulatory requirements or approval conditions, including in relation to the areas of environmental protection, biodiversity and ecosystems. More stringent regulations may limit the approval, use or marketing of certain chemicals. BASF plans to respond to regulatory changes with a combination of proactive and reactive measures. These include continuous monitoring, analysis of the regulatory framework and steering of our product portfolio using the TripleS method. We also invest in research and development in order to continuously develop chemicals with improved toxicological and ecotoxicological properties and thus meet the new requirements. Moreover, BASF is committed to working closely with stakeholders and regulatory bodies to ensure that company practices comply with the latest standards.

Governance approach

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Our governance in relation to the topic category Biodiversity and Ecosystems is based on three internationally recognized reference points:

• The five drivers of biodiversity loss as defined by IPBES (see Drivers of biodiversity)
• The Kunming Montreal Global Biodiversity Framework (GBF) and its target of reducing biodiversity loss and reversing the trend by 2030
• The United Nations’ Sustainable Development Goals (SDGs), including Zero hunger (SDG 2) and Life on land (SDG 15)

Governance in respect of the drivers Climate Change, Pollution and Water is described in the respective standards and therefore not elaborated upon here (Climate Change, Pollution Prevention and Water).

We have implemented a variety of governance approaches with a view to minimizing our impacts on biodiversity in the area of land use. For explanations of the policies to which we make repeated reference, see the General Disclosures chapter of our Sustainability Statement. This chapter includes explanations regarding application, accountability, impacts in the value chain, global applicability, accessibility to stakeholders and engagement thereof. Examples include our position on the responsible sourcing of renewable raw materials, the BASF position on forest protection and our global environmental protection standards. The Corporate Environmental Protection, Health, Safety & Quality unit in the Corporate Center conducts regular audits to monitor compliance with internal environmental protection requirements. We will continuously further develop our governance, including with regard to protecting biodiversity in the areas around our sites. As the double materiality assessment did not identify any material dependencies, opportunities or physical/transitory risks in this topic category, our policies do not refer to it.

Sourcing of renewable raw materials

We have laid down our expectations of our suppliers with regard to environmental, labor and social standards in the supply chain as well as our commitment to preserving biodiversity in the Supplier Code of Conduct. We expanded our procurement requirement in 2024: With our principles for the responsible sourcing of renewable raw materials, we are, among other things, committed to stopping or reversing biodiversity loss within our sphere of influence. The new principles are firmly embedded in our strategic and procurement processes, the aim being to put the BASF raw materials portfolio on a sustainable footing. We endeavor to ensure compliance with these guidelines using a multistage control process (see S2 Strategy and Governance).

Palm oil, palm kernel oil and their derivatives are some of our most important renewable raw materials. We mainly use these to produce ingredients for the cosmetics, detergent, cleaner and food industries. There is a risk that forest areas are cleared to create farmland for the production of palm and palm kernel oil. For this reason, we use the internet platform palmoil.io, provided by the technology company MapHubs, to regularly monitor deforestation activities and other possible breaches of regulations at our suppliers’ sites. Based on our Supplier Code of Conduct, we have defined our expectations of suppliers in the palm-based value chain in a supplementary global procurement policy (BASF Palm Sourcing Policy). These address, among other things, certification standards, traceability, environmental aspects connected with the observance of workers’ rights and the rights of Indigenous peoples, as well as the inclusion of smallholder structures. Third-party certification in accordance with standards such as those of the Roundtable on Sustainable Palm Oil (RSPO) enables us to take biodiversity-related criteria into account when sourcing raw materials. The monitoring of deforestation activities and the achievement of our targets when sourcing certified raw materials help us to monitor compliance with the policy.

When using biological resources, we adhere to the provisions of the international Nagoya Protocol. This supplementary agreement to the U.N.’s Convention on Biological Diversity regulates access to genetic resources and benefit sharing. It sets out obligations (for example, compensation payments) for the users of genetic resources such as plant-based raw materials. We use internal control mechanisms such as Responsible Care audits to monitor compliance with these standards.

Our global position on forest protection sets out our commitment to preserving biodiversity in areas of High Conservation Value such as High Carbon Stock forest areas and peatlands in the procurement of renewable raw materials. We have also set out our expectations on this topic in the global Supplier Code of Conduct, which is part of our purchasing conditions (see S2 Strategy and Governance). The unit-specific risk management systems of our business units are supported and monitored during implementation according to minimum standards set by the Corporate Center units. The Corporate Audit unit, as the third instance involved, monitors the effectiveness and compliance with risk management. Moreover, forest protection in accordance with this position is addressed when making investment decisions. We will adapt this position in 2025, incorporating the EU Deforestation Regulation (EUDR). In 2024, BASF once again participated in the “Forests” evaluation, provided by nonprofit organization CDP and achieved a grade of A-, thereby once again attaining leadership status. The assessment is conducted based on detailed insights into the palm value chain and activities that impact ecosystems and natural habitats.

BASF sites and production plants

We are deeply committed to environmental protection and sustainability at our sites. The aim is to minimize the impact of production on people and the environment and to continuously improve. We do not have dedicated policies for the protection of biodiversity in proximity to our sites, but instead use our comprehensive Responsible Care Management System. Alongside global requirements and health and safety standards (for more information, see E2 Strategy and governance and S1 Occupational safety and health), this also covers environmental protection. We have defined our global standards for emissions to air and water in Group-wide requirements, the implementation and compliance of which is the responsibility of the sites and Group companies. Among other things, these stipulate that water protection concepts must be implemented at all production sites in order to prevent unforeseen emissions and the pollution of surface or ground water. The Corporate Center unit Environmental Protection, Health, Safety & Quality conducts regular audits to monitor compliance with internal requirements that are part of the Responsible Care Management System.

BASF sets stringent standards for the exploration and development of new sites and, among other things, incorporates requirements for environmentally friendly development and the inclusion and protection of nature and ecosystems in accordance with our Responsible Care Management System.

Impacts in the downstream value chain

Through our commitment to the objectives set forth by the Responsible Care^® initiative of the International Council of Chemical Associations (ICCA) and our own global environmental protection standards, we undertake to continuously minimize negative impacts of our products on health, safety and the environment and to optimize our products on an ongoing basis. For more information, see the chapters E2 Pollution Prevention and E3 Water.

Before our products are launched on the market, they undergo various tests and assessments – depending on legal requirements and their application profile. These tests enable us to identify potential hazard characteristics as well as health and environmental risks at an early stage. Based on these results, we derive precautionary and protective measures and develop recommendations for safe handling (see E2 Actions in the value chain).

In the area of crop protection, we further follow international standards, such as the International Code of Conduct on Pesticide Management and the Principles of Integrated Pest Management. We evaluate our products and solutions in crop protection and seeds throughout the entire research, development and registration process for potential risks and impacts to the ecosystems in which they are used.

Actions

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We take actions in a variety of areas to ease the pressure on biodiversity and ecosystems or to impact them positively. We consider these to be key measures:

• The steering of our product portfolio toward more sustainability through TripleS
• Our measures concerning the sourcing of certified palm-based raw materials

Further measures outlined in the following chapter often represent locally organized activities, projects and initiatives. They have not been assigned to any centrally managed action plan.

Measures in the topic categories Climate Change and Pollution are described in the chapters E1 Climate Change and E2 Pollution Prevention. Our actions concerning the protection of water as a resource are also discussed separately (see E3 Water).

Sourcing of renewable raw materials

We are involved in a various initiatives in our upstream value chain to manage the sourcing of renewable raw materials in a way that protects local biodiversity. Take palm-based raw materials, for example: For the first time in 2023, our Care Chemicals division published a comprehensive Responsible Sourcing Report, which replaces the previously published Palm Progress Report. The third edition of this report will be published at the beginning of 2025. Here, we report annually on our measures and progress toward more sustainability and transparency in the palm value chain as well as further renewable raw materials value chains. We have been a member of the Roundtable on Sustainable Palm Oil (RSPO) for 20 years now and contribute to further national and international initiatives, such as the German Forum for Sustainable Palm Oil (FONAP) and the organization High Carbon Stock Approach (HCSA).

We source most of our palm-based raw materials from Malaysia and Indonesia. As a study conducted for the European Commission shows, smallholders account for around one-third of the total volumes produced there. Through our involvement in local initiatives, we aim to expand our supplier base for RSPO-certified palm products while simultaneously bolstering smallholder structures and sustainable production methods that help to protect local biodiversity. Since 2023, we have been working in partnership with a leading natural cosmetics manufacturer and the Indonesian nonprofit organization Kaleka to support smallholders in Central Kalimantan. The aim is to promote regenerative agricultural methods as well as to help establish favorable political framework conditions and regulations. We are also involved in a local project in Sumatra through the Forum for Sustainable Palm Oil.

Building on our involvement in these two initiatives, we joined forces with the nongovernmental organization Solidaridad in 2023 to promote sustainable palm oil and improve the living conditions of smallholders in Indonesia and Malaysia. In 2024, the program focused on developing viable and resilient production systems and on supporting integrative market access systems. Farmers are assisted in preparing for compliance with international standards and the certification of agricultural methods. The project seeks to train farmers in both countries with a view to fostering their continued involvement in the sector. In 2024, we entered into a further strategic partnership with the nonprofit organization Solidaridad and the organization Fedepalma, which represents the interests of many palm oil farmers and mills. The main objective of the project is to promote more sustainable palm oil production in Colombia in the long term by implementing improved and more sustainable growing practices among local producers.

We have developed a grievance mechanism for our palm value chain that reflects our commitment to the No Deforestation, No Peat and No Exploitation (NDPE) policy and that encompasses both direct partners and third-party suppliers. In the event of violations, we take action up to and including contract termination. In our decisions, we also take into account results from the grievance mechanism of the Roundtable on Sustainable Palm Oil (RSPO).

We are also driving the market transformation toward certified, sustainably sourced oleochemicals for another renewable raw material: coconut oil. We use coconut oil to manufacture ingredients for products such as detergents, cleaning agents and cosmetics. We have, for example, certified our production sites in Cassina Rizzardi, Italy, and Zona Franca, Spain, under the Rainforest Alliance Mass Balance Coconut scheme. As a result, BASF offers certified sustainable ingredients for personal care products on the basis of coconut oil.

• More information on our voluntary palm commitment and our palm grievance mechanism

BASF sites and production plants

We continuously optimize the production processes at our sites. This includes initiatives to improve energy efficiency (see E1 Operational Excellence), reduce emissions to air and water (see E2 Actions and E3 Actions) and avoid waste (see E5 Waste Management). We primarily rely on proactive measures and methods to protect biodiversity and only to a lesser degree on compensation measures. These are sometimes necessary, such as on account of conditions imposed by financial institutions and official bodies.

When it comes to investment decisions on the construction of new sites or the expansion of existing ones, the potential impacts on forests and other biodiversity criteria are systematically considered. In this regard, a decision may also be taken to institute compensatory measures, such as investments in local afforestation programs.

Continuous monitoring and documentation of emissions to air and water as well as the implementation of measures for improvement are an integral part of our environmental management. This is regularly audited by the Corporate Environmental Protection, Health, Safety & Quality unit in the Corporate Center. Our measures connected with reducing pollution are discussed under E2 Actions.

Impacts in our downstream value chain

In our new corporate strategy, we focus on enabling our customers’ efforts toward a green transformation with suitable BASF products. Today, we already use alternative raw materials and biomass in selected value chains in order to add sustainability attributes to our products. To increase transparency surrounding our product-specific greenhouse gas emissions and to implement our carbon reduction measures where they add the greatest value, we use a digital solution to calculate the carbon footprint of approx. 40,000 products on an ongoing basis (see E1 Product Carbon Footprints).

By virtue of our TripleS sustainability evaluation method (see Sustainable steering of our product portfolio in the chapter General Disclosures), we continuously steer the BASF product portfolio toward more climate protection, resource efficiency and circularity. Using this method, we systematically evaluate products in terms of their sustainability performance. Here, the aspect of biodiversity is also taken into account. As part of the TripleS evaluation, we identify products with high sustainability potential and products that do not fulfill the sustainability criteria. The latter products are systematically phased out of the portfolio or replaced by more environmentally friendly alternatives. Through our TripleS target, we annually review the effectiveness of these measures in the area of biodiversity and ecosystems.

Our Agricultural Solutions division offers farmers various solutions to promote biodiversity in agriculture while simultaneously enabling productive and efficient food production. These include, for example, various e-learning modules on biodiversity and agriculture. The interactive training sessions are available to interested farmers free of charge. We measure participation in our training and development programs annually. In the 2024 business year, we reached 199,427 people with the programs.

Global Targets

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Many of our sustainability-related corporate targets (for additional information, see Targets and Target Achievement) contribute to the protection of nature. These include our climate protection targets to reduce our greenhouse gas emissions (see E1 Global Targets), our targets in the area of resource use and circular economy (see E5 Global Targets) and our sustainable water management target (see E3 Global Target).

BASF has not set an explicit target for the topic category of Biodiversity and Ecosystems. We are reviewing whether we can derive a separate target for the topic category of Biodiversity and Ecosystems, either from various approaches or as an overarching ambition.

At regular meetings with external stakeholder representatives as part of our strategic stakeholder engagement, as well as in conversations with investors, we discuss the sustainability topics of material importance to BASF. Through this, the expectations of our stakeholders are continuously taken into account when setting potential targets.

In relation to our impact in connection with the sourcing of renewable raw materials, we set ourselves the target in 2015 of purchasing 100% certified palm oil and palm kernel oil starting 2020. We regard this target as a key indicator of whether our measures in the upstream value chain are successful. In recent years, we have met this target. Due to insufficient availability of RSPO-certified palm kernel oil, we were unfortunately unable to meet this target in 2024, posting a figure of 98.1% (2023: 100%). In 2024, we were able to trace approx. 97% of our total volume of our global palm footprint⁵ back to the oil mill (2023: 96%).

In view of volatile market dynamics, we are adjusting our palm-specific targets. We will continue to source 100% certified sustainable palm oil and palm kernel oil to the extent that this is commercially available and possible. We are adjusting our aim of sourcing derivatives of palm oil and palm kernel oil as 100% certified products from 2025 (2024: 10.2%). Due to the lack of availability on the market, we are now aiming to achieve this target by 2030. RSPO certification will remain a preferred standard. If we consider alternative standards or systems, they must demonstrate an equally stringent focus on environmental protection, labor standards and human rights. In addition, we will strictly adhere to our responsible sourcing principles. Achieving our targets remains dependent on the availability of raw materials and economic feasibility.

As part of our “Winning Ways” strategy, we have set ourselves a new target in the area of circular economy. We strive to almost double the sales revenue generated by so-called Loop Solutions to €10 billion by 2030, compared with the base year of 2023. We define Loop Solutions as products that make a positive contribution to the circular economy in line with the TripleS methodology. These are products that are based wholly or partially on renewable or recycled feedstocks, that support the recycling process, or that increase durability of materials or prolong their functional life (see E5 Global Targets). As such, we aim to contribute to the more efficient use of resources and counteract climate change. This can also ease the pressure on ecosystems, as the use of recycled raw materials reduces demand for newly extracted raw materials. If fewer fossil raw materials are extracted or renewable raw materials harvested, this reduces the negative impacts on humans and the environment.

As part of our Responsible Care Management System, for example, we review the effectiveness of our measures in terms of combating these impacts. We analyze our impacts in the downstream value chain by means of the TripleS method. We have set ourselves the target of considerably increasing sales that we generate through products that make a positive contribution to sustainability. We group these products together as Sustainable-Future Solutions. By 2030, more than 50% of BASF’s sales relevant to TripleS are to be attributable to Sustainable-Future Solutions. We are making good progress toward achieving this target (see Sustainable steering of our product portfolio in the chapter General Disclosures). Sustainable-Future Solutions also include products whose attributes have a positive impact on biodiversity and ecosystems, such as through the use of renewable or recycled raw materials. One example of this is surfactants made from certified, sustainable palm (kernel) oil, which are used in detergents, cleaning agents and dishwashing detergents.

We do not rely on compensation measures to reach the aforementioned targets. With our selected measures and targets, we focus on avoiding or reducing negative impacts pursuant to the mitigation hierarchy. In terms of the impacts of our sites or our production activities, we have not set ourselves any dedicated targets on biodiversity and ecosystems.

Metrics

ESRS 2 SBM-3, ESRS 2 IRO-1, E4-5

All BASF production sites in proximity to nature reserves must document potential direct negative impacts on biodiversity-sensitive areas. No such impact was reported by any site for 2024.

Since 2013, we have been analyzing production sites in terms of their proximity to nature reserves, including with the help of the Integrated Biodiversity Assessment Tool (IBAT). The sites have documented their results in our environmental database since 2021. In 2024, our assessment was expanded and now includes nature reserves pursuant to the classification of the International Union for Conservation of Nature (IUCN) I, II and III as well as Ramsar, UNESCO Natural World Heritage Sites, Natura 2000 and Key Biodiversity Areas (KBAs).

The sites document whether there are biodiversity-sensitive areas in their vicinity and whether they have had a negative impact on them. If such an instance occurs, we identify the cause of the negative impact. This could, for example, be a product leak, a habitat destruction due to construction work or the feeding in of untreated wastewater. Once we have concluded our investigation, we review the measures planned or already implemented in order to reduce or mitigate any impacts on nature.

In 2024, nearly 15% of our production sites⁶ bordered a nature reserve or biodiversity-sensitive area; of which no sites reported negative impacts on nature reserves.

Using the STAR (Species, Threat, Abatement and Restoration) tool, we also calculated the STAR values for our production sites based on the IUCN Red List of Threatened Species. This analysis covered the sites themselves and a radius of ten kilometers. The results indicate that some of our production sites are located in areas with high or very high STAR values. These values indicate, for instance, that these areas are home to a large number of threatened species. We took a closer look at the drivers of biodiversity loss at these sites. Drivers included tourism, fishing, invasive species and the occurrence of diseases unrelated to chemical production.

• More information on our commitment to biodiversity
• More information on our position on forest protection