Risks and Opportunities

Ashland maintains a board-level committee that monitors public issues having an impact on the company and oversees Ashland’s Environmental, Health, Safety, and Product Compliance (EHS&PC) compliance practices. The vice president of EHS&PR presents trends, issues and concerns which affect or could affect the Company's EHS&PC practices, including the Company's overall environmental compliance, remediation and sustainability efforts related to operations, products and services.

Ashland uses a company-wide process to assess risks in all areas relating to sustainability, including climate change, water resources, waste generation, environmental impact and social concerns. This process covers all types of risks and opportunities, including regulatory, financial and reputational. At the board level, this process is carried out by the Environmental, Health, Safety, and Product Compliance Committee, which serves as as the governance body for EHS, product compliance and sustainability. The board committee meets at least quarterly. The EHS function provides company-wide support throughout the year to all Ashland businesses as they assess these risks to their operations.

Ashland has publicly reported about these risks and opportunities to the Carbon Disclosure Project every year since 2006. These statements were also incorporated in the Ashland annual report on Form 10-K for the 2014 fiscal year and all the following years.

Physical risks have the potential to affect Ashland sites in areas prone to sea-level rise or extreme weather events, much as they do the general public and other businesses. However, the company anticipates only minor damage to its sites, and most are expected to be able to return to operation after restoration of utilities. This was our experience in 2012 with Superstorm Sandy and again in 2017 as well as other significant weather events. Resource shortages resulting from these physical risks are also expected to have a similar affect on Ashland as they will on other businesses.

The main regulatory risks to the company involve regulatory controls, such as cap-and-trade, permitting, and emission-reporting regulations that unfavorably affect Ashland and all of industry. While these regulatory burdens do not affect most of Ashland’s facilities directly, due to their low GHG emission rates, Ashland operates several facilities that are subject to GHG emissions reporting or permitting requirements. Ashland also expects to be indirectly affected by the impact on suppliers and customers. In 2018, Ashland discontinued the direct use of coal at all our manufacturing locations, with the decommissioning of the coal fired boiler at our Jiangmen China plant.  

Ashland participates in several markets that have developed as a result of climate change. Ashland’s products have been used for years to create lightweight composites for the automotive industry, which improve fuel efficiency, and for the production of wind turbine blades. Other Ashland products have been used in the development of composite building and construction materials, which can replace traditional concrete and steel construction, provide longer structure life, reduce maintenance requirements and improve energy efficiency. Ashland has also been producing products made from bio-renewable resources for several years and continues to increase those capacities. In addition to currently manufactured products, Ashland is constantly evaluating adjacent market opportunities that develop as alternative technologies expand and evolve.