Here are some examples of environmental regulations affecting chemical supply chains:
1. EU Corporate Sustainability Reporting Directive (CSRD) and ESG Sustainability Reporting Standards (ESRS): These directives aim to enhance the transparency, accountability, and comparability of sustainability information disclosed by companies. They require companies to assess and report on their environmental impact, labor and human rights practices, ethical behavior, and sustainable procurement performance.
2. EU Corporate Sustainability Due Diligence Directive (CSDDD): This directive emphasizes responsible business conduct concerning environmental, labor, and human rights issues and was approved by the European Parliament in June 2023.
3. U.S. Securities and Exchange Commission (SEC) Regulations: The SEC is considering new regulations that would require companies to include certain climate-related disclosures in their initial and annual financial reports.
4. EU "Fit for 55" Initiative: This initiative aims to reduce emissions, including carbon, by at least 55% by 2030. Additionally, the EU already imposes a fee on carbon emissions associated with goods produced in the EU, managed through the Emissions Trading System. The latest regulationโthe Carbon Border Adjustment Mechanism (CBAM)โreflects this existing fee by taxing carbon emissions in goods imported into the EU. The CBAM regulation initially targets six key industries, including steel, aluminum, cement, fertilizers, hydrogen, and electricity. By 2030, all goods covered by the Emissions Trading System are expected to be subject to CBAM, with some chemicals and plastics likely to be covered before that.
5. Canadian Government Report on PFAS: The Canadian government has released a report outlining the status of PFAS in Canada and the next steps for controlling or restricting their entry into the Canadian market.
6. U.S. Chemical Regulations: In 2024, U.S. chemical regulations will be very active. In the first quarter, the fees for the Toxic Substances Control Act (TSCA) notices were announced. The fees for Premanufacture Notices (PMNs) will increase from $19,020 to $37,000. Additionally, new Persistent, Bioaccumulative, and Toxic (PBT) rules may be released in this quarter. By the end of the year, we may see new Significant New Use Rules (SNURs).
7. New Zealand Environmental Protection Authority (New Zealand EPA): The New Zealand Environmental Protection Authority has confirmed which international regulatory agencies can be used as sources of information for some hazardous chemical assessments. These regulatory agencies are from Australia, Canada, the European Union, the United Kingdom, and the United States, all of which regulate hazardous chemicals in a manner similar to New Zealand's system.
8. Chemical Regulations in China: Industrial chemicals in China are primarily regulated by the following regulations:
ย ย - State Council Order No. 591 - Regulations on the Safety Management of Hazardous Chemicals;
ย ย - MEP Order No. 12 - Measures for Environmental Management Registration of New Chemical Substances;
ย ย - Administration of Work Safety Order No. 53 - Measures for the Registration Management of Hazardous Chemicals;
ย ย - MEP Order No. 22 - Measures for Environmental Management Registration of Hazardous Chemicals (which was abolished in July 2016).
These environmental regulations have a profound impact on chemical supply chains, requiring companies to not only comply with local environmental regulations but also consider the environmental impact and sustainability of their supply chains on a global scale.
