Top 3 Companies Valuing ESG In The Paints And Coatings Industry
The Sherwin-Williams Company
In recent years, ESG, sustainability, and innovation have caught the attention of the paint and coatings industry. It’s important to move away from the notion that this sector just deals with making houses pop with vibrant colours. In fact, the paint and coatings industry has been essential in providing coatings for various initiatives: offshore wind power plants, improving the durability of items, transportation, and the hygienic production of food, to name a few.
Furthermore, it plays a vital role in minimising environmental footprints. It can prolong the life of various products and boost recyclability. For this reason, it’s worth paying attention to the challenges that this industry faces.
After all, the industry also sees its fair share of greenwashing, on top of finding environmentally sustainable ingredients, reducing waste, and other industry challenges.
This is a selection of companies that, through our research, seem not to be overtly greenwashing, and are in fact making significant contributions to the development of ESG practices in the sector. They’ve created good ESG strategies and are making a big difference.
The Sherwin-Williams Company
Sherwin-Williams’ environmental profile has set the stage for ESG values with its strategy. The company is looking to push itself to adopt ESG values as part of the solution to the goals and problems before it. In their 2021 sustainability report, they outline that by 2030 they will:
Cut Scope 1 and 2 greenhouse gas emissions by 30% each.
Increase renewable energy sources to 50%.
Increase energy efficiency by 20%.
Reduce waste disposal by 25%.
The company knows that making these shifts may, on the one hand, result in a loss of customers, yet will result in increased demands for their products and services too.
While the goals themselves could be more ambitious, especially when Sherwin-Williams has an average ESG score across the three major indices, it’s refreshing to know the company is admitting that the changes could result in a loss of revenue for them and that they’re okay with that. The company has accepted that, in order to truly embrace ESG, there has to be a change in business practices.
It’s something every company right now is facing. The problem is that many choose to find ways to profit and meet halfway rather than fully commit to a change and accept a possible loss of revenue in the short- to mid-term. Sherwin-Williams is “kind of a big deal” because it has chosen to be transparent in this regard.
AkzoNobel, based in the Netherlands, has committed itself to be carbon neutral by 2050. While a lot of other companies have pledged to do this in other industries and within the same time frame, it’s important to note how quickly AkzoNobel has devoted itself to the ESG cause.
To start, the company states their environmental ambitions clearly on their website:
50% fewer carbon emissions in their value chain.
Over 50% of revenue from sustainable solutions.
100% circular waste in their operations and upheld through reduce, reuse, and renew.
Over 100,000 members of local communities were empowered with new skills.
These ambitions cover the standard pledges we’ve heard before about reducing waste and cutting emissions. However, the company is looking to do more for people by teaching them valuable skills.
Not only that, but given the waste they have openly admitted, they are looking to provide some new and creative solutions. It was reported in 2021 that 77% of their waste had already avoided landfills. It’s highly likely that they’ll be able to reach that target of 100% before 2030. Especially when they’ve developed products like wood coatings that boost manufacturing efficiency and energy savings to the point where they gain 30% more output.
PPG Industries, Inc.
Another company taking a different approach to ESG is PPG Industries. While it’s important to focus on the environmental aspects of each industry, the current global focus can create a bias toward solving that issue and nothing else. When it comes to ESG, there is more to it than demonstrating your environmental credentials. ESG is about giving power to the people by embracing diversity and inclusion, putting your people first to drive your brand, culture, and operations.
PPG fully embraces this by working to further a culture of diversity, equity, and inclusion. Their ESG report highlights how they’re making an effort to bring women into leadership roles as well as include under-represented ethnic and racial groups across their business.
PPG has also put USD 74 million USD into boosting racial equity by providing educational pathways for people of colour and black communities. An additional USD 13 million was put forth to educate communities about sustainability globally.
Each Has Their Own Brand Of ESG
The interesting part about this industry is how these companies look at ESG. To them, this is an extension of their brand. It’s something to inject their own company values into and distinguish themselves with. Even though each company is doing the same thing in terms of service, each one is distinguishable by what they’re focusing on, and that has become a distinctive element of their respective brand propositions.
PPG is investing in more equality than others in the industry. AkzoNobel is creating new products and passing down valuable skills. Sherwin-Williams is taking a bolder and more transparent step toward making a difference. Regardless of which ones and others you find appealing, these stances are something to keep in mind a we see more organisations start to embrace a culture of transparency as both part of their brand, and of a pragmatic approach to longer-term risk management and structured, sustainable growth.
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