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Organization Name

BASF SE

Case Story Title

Sustainable Management Structure

Case Story Date

2002/12/03

Issues Addressed

  • Principle 1 - Businesses should support and respect the protection of internationally proclaimed human rights
  • Principle 2 - Make sure that they are not complicit in human rights abuses
  • Principle 3 - Businesses should uphold freedom of association & effective recognition of the right to collective bargaining
  • Principle 4 - The elimination of all forms of forced and compulsory labour
  • Principle 5 - The effective abolition of child labour
  • Principle 6 - Eliminate discrimination in respect of employment and occupation
  • Principle 7 - Businesses should support a precautionary approach to environmental challenges
  • Principle 8 - Undertake initiatives to promote greater environmental responsibility
  • Principle 9 - Encourage the development and diffusion of environmentally friendly technologies

Case Story Category

Partnership Project

Countries of Impact

Case Description

In June 2001, BASF was one of the first companies in the world to implement a new management structure aimed at facilitating and promoting the integration of sustainable ideas and activities in the company?s goals and strategies. The structure is headed by the Sustainability Council. The Council is supported by an International Steering Committee whose members reflect the range and diversity of the BASF Group and the significance of the topic as well as by the Sustainability Center, the central coordinating body.

The Sustainability Council is chaired by Board member and Industrial Relations Director Eggert Voscherau. It ensures that BASF Group policy is in accordance with the principles of sustainability. The key task of the Sustainability Council ? whose high-level members include seven division presidents in addition to Voscherau ? is to establish tools and structures for the sustainable development of the company. The International Steering Committee consists 10 ten vice-presidents who were selected to reflect the various regions and diversity of the BASF Group. The Committee plans and oversees the implementation of the Council?s decisions. The integration of the three key areas of sustainability and the worldwide harmonization of all measures play a central role for them.

Along with coordinating the in-house project-teams and the different bodies of BASF?s sustainability management structure, the Sustainability Center functions internally and externally as a competence group. It is in contact with external stakeholders, such as NGOs and coordinates responses to rating agencies with respect to BASF?s triple bottom line reporting on sustainability.Multifaceted sustainability activities have been initiated on the basis of the new management structure. For example, Group-wide sustainability reporting has been implemented in the form of BASF?s Annual Report, Social Responsibility Report and Environment, Safety, Health Report. The Social Responsibility Report provides information about the company?s relations with employees, business partners, communities and other stakeholders, and is intended to foster stakeholder dialogue.

Moreover, the new management structure promotes the development and implementation of tools to measure the level and progress of sustainability. The eco-efficiency analysis is one of the company?s core activities in this area. This is an instrument applied at the operational level to evaluate which business activities advance the goal of achieving sustainable development. It consists of an environmental impact assessment, an economic analysis and eco-efficiency comparisons. For example, in an eco-efficiency analysis of indigo ? the dye that makes blue jeans blue ? BASF?s product was compared with newly developed BASF products and with competing products. BASF wanted to know how much product the customer needs to use to dye, for example, 1,000 pairs of jeans. How much energy is needed to do this? What emissions and waste result? And how long does the fabric hold its color? Questions like these help to determine which product best meets customers? needs and which offers the most eco-efficient solution. On the initiative of the sustainability management a project team is now developing indicators to include the social dimension of sustainability so that the eco-efficiency analysis will become a holistic measuring tool.

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