Product Stewardship

Product stewardship at Evonik includes compliance with all legal regulations, such as the European chemicals regulation REACH or the Globally Harmonized System (GHS) for the classification and labeling of chemicals. In addition to the legal regulations, we have been committed to the voluntary international Responsible Care® Initiative and the Global Charter of the International Chemical Association (ICCA) for many years. Evonik defines both in a product stewardship group standard. This includes implementation and control mechanisms to verify compliance. In addition, we have defined the cornerstones of our product stewardship in a product policy. In addition, in the 2023 reporting year, Evonik began working on a policy paper on product stewardship. 

Responsible use of chemicals We look at our products along the value chain, from raw material procurement to delivery to our industrial customers. This approach encompasses the topic of product stewardship and is not to be understood as a complete life-cycle assessment. In view of the global trade in chemical products and chemicals, it is important to promote broad communication on their safe handling and use. We face up to this responsibility with a comprehensive, worldwide range of information. This includes information portals, safety data sheets – also for non-hazardous products – in over 35 languages, technical data sheets and extensive information on our website. In addition, we have set up an e-mail mailbox for inquiries. 

Our specialist departments support our customers at all stages of the product life cycle. This ranges from the selection of raw materials to the handling of possible toxicological, ecotoxicological and physico-chemical hazards to the resulting risks, taking into account the exposure. Furthermore, we advise on regulatory requirements for planned uses, including transport and disposal. If necessary, we train our customers in the use of our products. As part of the survey, no violations in the labelling of products were detected in 2023.

IMPLEMENTATION OF THE REACH REGULATION AND DOSSIER QUALITY
REACH requires the registration of all substances that are manufactured, imported into or placed on the market in the EU in quantities of more than 1 tonne per year. Evonik supports the goals for the protection of health and the environment in the handling of chemicals. In order to implement the complex requirements of REACH, we are in close dialogue with our suppliers, customers, trade associations and authorities. 

In addition to the substance registrations that are still required, the focus is on dossier and substance assessments as well as restriction and authorisation. Evonik is currently not affected by its own approvals. In order to determine at an early stage whether our substances may be in focus, we compare officially published substance lists with our portfolio in order to take appropriate measures. To this end, we are in close contact with our customers. Inspections also extend to the raw materials we purchase. For substances of very high concern, such as those that are on the candidate list of the REACH Regulation, we discuss the next steps with the suppliers or look for alternatives if necessary. For all inquiries from our customers and suppliers concerning REACH, we have set up an e-mail mailbox for prompt and comprehensive answers. 

Another focus of our REACH activities is the dossier updates of substances that have already been registered, closely aligned with the Cefic Action Plan, which Evonik has signed as part of a voluntary commitment. The review of the Evonik dossiers with the aim of further improving quality will take place gradually until the end of 2026. We provide annual updates on progress in this report and to Cefic. Since the start of the Action Plan in mid-2019, we have revised more than 420 dossiers. 

GLOBAL PRODUCT STRATEGY (GPS)

The International Council of Chemical Associations (ICCA) initiated the Global Product Strategy (GPS) campaign to contribute to the globally safe and appropriate management of chemicals. Evonik explicitly supports this initiative.

THE GLOBALLY HARMONIZED SYSTEM (GHS) 
The GHS is a global system established by the United Nations for the classification of chemicals and their uniform labeling on packaging and in safety data sheets. The status of GHS implementation continues to vary around the world. That's why we at Evonik have a database in which information about progress, changes, and requirements in the countries is collected and communicated internally. Evonik complies with GHS/CLP requirements worldwide. 

OUR CHEMICALS MANAGEMENT SYSTEMS 
We evaluate all the substances we place on the market (>1 tonne/year). We also take into account particularly hazardous substances in smaller quantities. This enables a well-founded risk assessment. If necessary, certain usage patterns are restricted or, in extreme cases, even bans on the use of individual products are pronounced. 

For the evaluation of our substances, we use the Chemicals Management System (CMS) developed in-house by Evonik. The system allows us to evaluate our fabrics on a global scale. The CMS content has been harmonised with the requirements of the International Chemical Association (ICCA) and the requirements of REACH. As part of CMS, we have already recorded and evaluated all substances that have entered our portfolio as a result of acquisitions in the period from 2017 to 2020. We intend to record and evaluate substances that were added to our portfolio from 2021 to 2023 as a result of acquisitions by the end of 2026. 

As an extension of the CMS, our Chemicals Management SystemsPLUS refers to products that contain more than 0.1 percent substances of very high concern. Our goal is to reduce or replace them wherever possible. The prerequisite for this is an in-depth examination in order to derive suitable measures for a further reduction of possible negative effects on people and the environment. As part of CMSPLUS, we have already recorded and evaluated all products that have been added to our portfolio as a result of acquisitions in the period from 2017 to 2020. We intend to record and evaluate products that were added to our portfolio from 2021 to 2023 as a result of acquisitions by the end of 2026.

GREEN DEAL 
With the Green Deal, the European Commission has presented a roadmap on how the EU is to become climate-neutral by 2050. One element of the zero pollution target is the EU Chemicals Strategy for Sustainability (CSS), which will have a far-reaching impact on the chemical industry and its value chain. Evonik supports the goals of the Green Deal and actively advocates at association and commission level to ensure that the planned changes are made with a sense of proportion, that planning is guaranteed, and that REACH remains the central regulatory instrument for chemicals. In addition, we participate in consultations. 

Evonik considers the following tightenings envisaged as part of the REACH revision to be particularly critical: the generic risk approach, polymer registration, the comprehensive data requirements for the identification of substances with endocrine disrupting properties and persistence, and the "Mixture Allocation Factor" (MAF) assessment factor for mixtures.

The generic risk approach is intended to disregard the exposure required for a scientifically sound assessment. It is planned to issue restrictions or bans solely on the basis of certain hazard characteristics, which will be continuously expanded. This approach is not only to be used more intensively in the consumer sector, but also to be extended to the commercial sector. 

The EU Commission is tasked with reviewing and implementing the requirements for polymer registration under REACH. The regulatory process currently being discussed is likely to be multi-stage in the future. Accordingly, a notification phase would initially be planned to cover all polymers on the EU market. In a second step, the polymers would be grouped, including downstream data generation. This would be followed by the registration of the polymers that are actually subject to registration. It is estimated that up to 70 per cent of the polymers on the EU market would be subject to a registration requirement with corresponding data requirements. From an industry point of view, costs and effort must remain within reasonable limits. 

The Chemicals Strategy for Sustainability foresees enhanced data requirements on endocrine disruptors, as well as restrictions and, where appropriate, bans on consumer applications. Endocrine disruptors can be both natural and chemical substances that disrupt or alter the regulation of the endocrine system, resulting in lasting damaging effects. The evaluation factor for mixtures involves the introduction of an additional safety factor for the evaluation of possible additive and synergy effects. The European Commission is calling for a generic factor for all applications. Together with the chemical industry, Evonik is committed to ensuring that MAF is used in a more targeted manner. Currently, the application of a MIF of five for substances >1000 tonnes per year) is being discussed. This could mean that uses that were previously considered safe will have to be re-examined and adapted. The planned amendments to the CLP Ordinance also contain critical points. For example, endocrine disruptors such as PBT/vPvB and PMT/vPvM have been introduced as new hazard classes. PBTs are substances with persistent, bioaccumulative and toxic properties. PMT substances have persistent, mobile and toxic properties. The introduction took place within the scope of the EU (CLP) without prior consultation at UN level (GHS). The aim of the EU Chemicals Strategy is to define substances that meet these criteria as Substances of Very High Concern (SVHC) and to regulate them as such under the CLP Regulation. For Evonik and the chemical industry, it is necessary that the guidelines currently being developed provide comprehensive assistance with classification and labeling.  

The proposed Ecodesign for Sustainable Products Regulation (ESPR) sets performance and information requirements for almost all product categories. These include, but are not limited to, durability, recycling and resource efficiency. From Evonik's point of view, the planned information requirements for the Digital Product Passport go beyond what is necessary, as product information relating to the protection of know-how must be disclosed. In addition, there is a risk that certain Substances of Concern (SoC) will be regulated in parallel with the REACH Regulation. In principle, Evonik welcomes this approach, as it is an important component for safe products in a circular economy. 

In addition, the EU Commission is working on tightening the Industrial Emissions Directive (IED). This calls for the introduction of an environmental management system that includes a so-called chemical management system, including a risk assessment for the environment and health, as well as a substitution analysis. The environmental management system is to become an operator obligation and is not congruent with existing environmental management systems such as ISO 14001 or ISO 50001. In addition, limit values will be tightened and performance values such as energy and resource efficiency will have to be complied with. 

Safe and Sustainable by Design (SSbD) is a new concept that aims to assess the safety and sustainability of products as early as the innovation phase. SSbD is in the test phase until the end of 2024 and is being monitored and supported both at the association level and at Evonik in close interdisciplinary exchange between product stewardship, innovation, and sustainability. It is initially planned as a guideline rather than a law and is expected to have an impact on our product portfolio. 

As part of the implementation of the EU taxonomy, Evonik still sees a need for discussion regarding the criteria for Do No Significant Harm (DNSH) with regard to the environmental goal of "pollution prevention and control". Here, the regulatory improvements in the year under review only specified some of the ambiguous wording. In addition, 2023 saw the adoption of the first delegated act of the EU Taxonomy, which lists the criteria for a significant contribution to the environmental objective of 'pollution prevention and control' for selected economic activities. The economic activities for this environmental goal comprise only a small part of our portfolio (1 percent of our sales in 2023). The application of our products for the prevention and reduction of environmental pollution - for example in emission reduction, remediation of contaminated sites or as an alternative to hazardous substances - is largely ignored. 

The EU Commission plans to replace the Packaging and Packaging Waste Directive with a regulation. Evonik sees the danger that certain substances will be regulated in addition to the REACH regulation. We are following further developments both internally and at association level. 

The EU's Corporate Sustainability Reporting Directive (CSRD) aims to put sustainability reporting on a par with financial reporting. These include uniform EU standards for sustainability information, the so-called European Sustainability Reporting Standards (ESRS). In the future, Evonik will have to prepare corresponding sustainability reports on the basis of the CSRD and thus disclose information on the ESRS. The requirements related to product stewardship are contained in the ESRS E2 standard "Pollution". 

As part of our sustainability analysis of the businesses, aspects of product stewardship along the value chain are also examined. In the year under review, we recorded and evaluated product stewardship signals in various categories of our business sustainability analysis. Signal categories 1 and 2 refer specifically to critical substances and regulations. In signal category 3, sustainability ambitions of the value chain are also recorded for the topic of product stewardship and chemical safety before they become part of the regulatory framework. PARCs with negative valuations – so-called "transitioners" or "challenged" sales – make up only a small part of our portfolio. We want to keep the share of sales with "challenged" products below five percent in the long term (chapter "Strategy and Growth", p.22). This is done both by continuously replacing dangerous products and by working on alternative solutions.

REACH-LIKE REGULATIONS IN THE REGIONS 
Various countries and regions have either already introduced or are in the process of implementing chemical regulations that are broadly in line with EU REACH requirements. This applies, for example, to South Korea, Turkey, Taiwan and the Eurasian Union. Other countries – such as the US – have also raised their standards significantly. Evonik actively monitors the global development of regulations and ensures their implementation in the respective regions. In South Korea, coordination is underway within the Substance Information Exchange Forums (CICO) and consortia for the next volume band. In Turkey, substances are continuously registered. In addition, Evonik is monitoring the development of further emerging regulations in order to prepare accordingly. This includes, for example, the entry into force of the new Chemicals Regulation in the Eurasian Union. According to the current status, the regulation is to come into force in Russia on September 1, 2024, and in the other countries of the Eurasian Union two years later. A REACH-like chemicals regulation is being planned for India. In order to be able to accompany further developments, Evonik has advocated for the Indian Chemical Council (ICC) to establish a new working group "Product Stewardship Advocacy Committee". Evonik has taken over the leadership of this working group.