Opportunities and Risks
The content of this section is not part of the statutory audit of the annual financial statements but has undergone a separate limited assurance by our auditor.
The content of this section is voluntary, unaudited information, which was critically read by the auditor.
The goal of BASF’s risk management is to identify and evaluate opportunities and risks as early as possible and to take appropriate measures to seize opportunities and limit risks. The aim is to prevent any threat to BASF’s continued existence and to create value through improved managerial decisions. We understand opportunities and risks to be any event that can positively or negatively impact the achievement of our short-, medium- or long-term goals.1
Where quantifiable, we measure and manage opportunities and risks in terms of probability of occurrence and economic impact should they materialize. We use statistical methods to aggregate opportunities and risks into risk categories. In addition, we use a qualitative evaluation scale for opportunities and risks to assess both business and sustainability-related aspects that cannot be quantified. This approach provides an integrated overall view that enables us to assess economic and sustainability-related opportunities and risks at Group level based on the greatest economic impact or qualitative evaluation and probability, and to implement effective risk management measures.
Overall assessment
For 2026, we expect slightly weaker global economic growth than in 2025, as well as slightly weaker growth on the chemicals market. Overall macroeconomic uncertainty will remain high.
A further escalation of current geopolitical conflicts could lead to disruptions in global supply chains and to greater constraints on the supply of energy, industrial raw materials and intermediates. The war in Ukraine and the situation in the Middle East continue to pose significant risks to market development and the supply of raw materials. Owing to the continued high uncertainty related to increased U.S. tariffs and potential countermeasures by trading partners, the effects on volumes, prices and competitive dynamics – and the associated opportunities and risks – are currently difficult to assess.
Additional opportunities may arise particularly from stronger economic growth if the macroeconomic development proves better than assumed. Moreover, significant opportunities and risks to our earnings arise from volatile margins. Our assessment of opportunities and risks stemming from margin and currency volatilities is based on forward-looking market-related assumptions.
According to our assessment, there continue to be no significant individual risks that pose a threat to the continued existence of BASF SE or the BASF Group. The same applies to the sum of all risks (for more information, see (Consolidated) Sustainability Statement).
Ultimately, residual risks (net risks) remain in all business activities that cannot be eliminated, even by comprehensive risk management.
Possible variations related to: |
Outlook |
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Business environment and sector |
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Market growth |
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Margins |
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Competition |
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Regulation/policy |
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Company-specific opportunities and risks |
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Procurement |
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Supply chain |
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Personnel |
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Information technology |
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Tax and customs duties |
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Financial |
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Exchange rate volatility |
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Other financial opportunities and risks |
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1 At the beginning of the one-year assessment period, the targets correspond to the forecasts.
Here you can find a comprehensive overview of the abbreviations and definitions used in the ESRS.