Corporate Report 2023: Letter from the Management Board | About This Report | Sustainability Management | Corporate Bodies and Management | Report of the Supervisory Board | Now - for the Future | Group Management Report | Products | Safety and Health | Environment | People | Social Commitment | Consolidated Financial Statements (condensed version) | Multi-Year Overview | Global Compact: Communication on Progress (COP) | ALTANA worldwide | List of Shareholdings | Overview | Contact
Innovation
As a specialty chemicals company, innovations are an important factor for ALTANA, enabling us to offer our customers new, competitive solutions and at the same time to meet current requirements regarding performance profile, costs, environmental protection, and sustainability. Thanks to close cooperation with our customers, we are able to identify global technology trends at an early stage and to be immediately involved in new development fields. This enables us to develop tailored solutions quickly and reliably. We build on existing competencies, on the one hand, and gain access to new ones on the other, in order to continuously adapt our product portfolio to market and customer needs. There is also great potential to combine our competencies across the divisions to establish innovative solutions on the market more quickly and efficiently. To this end, our research and development teams have access to the latest analytical methods in our chemical laboratories and application technology test laboratories. Numerous awards from our customers underscore our success as an innovative solutions provider.
In addition to the activities in the business divisions, selected innovations are initiated and coordinated at the ALTANA level, aimed at tapping new business fields and absorbing technology and market trends. The basis for these innovations are the strong competencies of the divisions along the entire value chain as well as the synergies that arise between the divisions. For the design of new innovation areas, we use three different but thematically complementary approaches: the ALTANA Institute, our technology platforms, and corporate venturing.
With the help of the ALTANA Institute, external networks and close cooperation with universities and research institutes around the world are used to harness outside impetus. Here, we cooperate in basic research on topics that form the foundation of further applicationoriented internal research and development activities. In addition to the technology transfers of completed projects to the business divisions, a further project was launched at the University of Illinois in the U.S. this year, intensifying the existing research cooperation. In addition, a strategic research cooperation was established with the Friedrich Schiller University in Jena. In this context the position of a research group leader was filled, who will conduct basic academic research in areas relevant to ALTANA.
ALTANA’s investments in the realm of technology platforms increased compared to the previous year. This demonstrates the constant expansion of this area, based on targeted customer cooperation.
The “Printed Electronics” innovation platform that was integrated into the ELANTAS division was able to further increase sales by means of additional new business and to fill the project pipeline further. Due to last year’s investment in the technology startup Saralon GmbH, ELANTAS now also sells products resulting from this cooperation.
As part of the “Cubic Ink” technology platform, the product portfolios for both inkjet and VAT polymerization were standardized and completed. Development projects were finalized for both products with a view to entering series commercialization in 2024.
The “Heliosonic” laser transfer technology platform reached a milestone with the first sale of a print head. The concentration of activities on functional printing led to projects with customers in rapidly growing markets. Apart from the first print head sale, income was also generated from the initial ink sales. Furthermore, the construction of an additional printing machine, which covers a significantly larger printing width, was finalized.
Thanks to the close cooperation between the central departments Corporate Innovation and Corporate Venturing, ALTANA can continuously examine technology and market potential and enter new attractive markets by means of targeted investments in innovative technology companies. In this context, ALTANA further expanded its cooperation, for example, with the company TAU ACT GmbH, Berlin.
The basis for our innovative strength is an open and dynamic corporate culture that gives the 1,265 employees in our worldwide research and development centers freedom for creative and entrepreneurial action. The equipment in our development centers enables our employees to turn their ideas into market ready solutions. Our research and development expenses increased by € 3.6 million to € 196.5 million compared to the previous year (€ 192.9 million). The increase in the proportion of sales accounted for by research and development expenses to 7.2 % (previous year: 6.4 %) is mainly due to the demand driven decline in sales. In general, our expenditures are related to the achievement of important milestones, the implementation of individual customer requirements in future innovative products, and the long-term orientation of our innovation activities.
Employees
At the end of 2023, the companies of the ALTANA Group employed 7,939 people worldwide (previous year: 6,957). The increase of 982 employees, or 14 %, compared to the previous year was almost exclusively due to the acquisition of the Von Roll Group in September 2023, in which we took over 982 employees.
In the BYK division, the number of employees increased by 11 to 2,515 in 2023 (previous year: 2,504). The acquisition of the business of the U.S. company Imaginant Inc. in August 2023 augmented staff numbers by 32. The strongest increase was recorded in production, particularly at BYK Gardner in the U.S., into which Imaginant’s business was integrated.
The number of staff members in the ECKART division decreased by 63 to 1,711 in the course of 2023 (previous year: 1,774). The changes mainly affected production and research and development at the Hartenstein site.
ELANTAS’ workforce grew by 1,018 to 2,101 (previous year: 1,083). The proportion of employees gained through the acquisition of the Von Roll Group totaled 982. The increase in the number of employees was spread across all functional areas, with the main focus being on production with 725 employees.
In the ACTEGA division, the number of employees rose by 7 to 1,354 (previous year: 1,347) over the course of the year. The growth was in the areas of production and sales.
In the Group’s holding companies, the headcount rose by 9 to 258 in the past fiscal year (previous year: 249). Part of the increase (three people) was due to the implementation of a new service company in Shanghai, which offers Group-wide services for China. The employees were previously employed in the ECKART division.
The functional structure of the workforce changed slightly in the 2023 financial year due to the acquisition of the Von Roll Group. With 54 % or 4,270 people (previous year: 3,568), the proportion of employees in production increased, including 725 people due to the acquisition of the Von Roll Group. The number of people employed in research and development rose by 23 to 1,265 employees in 2023 (previous year: 1,242), 47 of whom came from the acquisition of the Von Roll Group. In marketing and sales, the headcount rose by a total of 101 to 1,267 in 2023 (previous year: 1,166). Here, 105 employees were taken over from the Von Roll Group. Administration comprised 1,138 employees in the reporting year (previous year: 981); the increase of 157 people is also mainly due to the acquisition of the Von Roll Group (105 people).
There were only minor shifts in the regional structure in 2023 compared to the previous year. With 5,091 people (previous year: 4,506), the European Group companies continued to account for by far the largest share of the workforce. 3,847 employees (previous year: 3,641) were employed in Germany at the end of the year, most of them at the largest production and development sites of the ECKART and BYK divisions, in Hartenstein and Wesel respectively. The inclusion of the Von Roll companies augmented the number of employees in Switzerland by 213. The workforce in the Americas rose by 264 to 1,809 at the end of 2023 (previous year: 1,545). The increase was primarily attributable to the Von Roll Group’s North American and Brazilian companies. The number of employees working for the Asian Group companies grew from 906 in the previous year to 1,039 in 2023, with the headcount in China and India increasing the most due to the new Von Roll companies.
At the end of the 2023 fiscal year, 2,022 women and 5,917 men worked for ALTANA. 91 % of all employees had an unlimited contract and 9 % a limited contract on the balance sheet date. Excluding the new colleagues from the Von Roll Group, 75 % of the female employees worked fulltime and 25% parttime at the end of 2023. Among male employees, the share of fulltime employees was 98 %. Apart from its own employees, 69 people from employment agencies worked for the ALTANA Group on December 31, 2023.
The 2023 reporting year was marked by the further consolidation of the programs, processes, and regulations established in HR in recent years. The systems and measures introduced worldwide in the last few years were continuously improved and advanced to meet the everchanging requirements of today’s working world and the new generations. In the wake of the coronavirus pandemic, it is evident that placing an even greater emphasis on corporate culture and employee retention is imperative to guarantee long term success.
With the Onboarding @ALTANA program, the company engages with new employees even before their first day of work. Aside from an initial welcome message, the program incorporates various digital training units automatically assigned to employees via SAP SuccessFactors. The primary emphasis is on familiarizing individuals with the entire ALTANA Group, encompassing all four divisions, to gain insights into ALTANA’s business model beyond the confines of the company itself. The program also covers areas such as compliance, health and safety at work, information security, and data protection. Employees are introduced to the ALTANA TalentCycle and its associated competency model through concise videos and illustrative case studies. This training is compulsory for all new employees and is accessible in a total of nine languages. Moreover, there is a separate module for disciplinary managers designed to provide an initial understanding of the managerial role at ALTANA. In the reporting year, a total of 649 individuals completed the Onboarding @ALTANA program.
The Onboarding @ALTANA program has achieved a silver accolade from the Brandon Hall Group as part of its prestigious “Awards of Excellence.” The Brandon Hall Group an international research and analysis company, conducts the Excellence Awards in Human Capital Management biannually.
To welcome our new colleagues from the Von Roll Group to ALTANA, the pertinent onboarding program training package was provided in a digital format shortly after the completion of the acquisition.
Beyond the onboarding of new team members, retaining and advancing the growth of longstanding employees stands as a pivotal cornerstone. In 2022, a global digital learning library was introduced to a select group of companies. Owing to the overwhelmingly positive feedback and robust utilization by employees in all functional areas, the decision was made to extend this offer to the entire ALTANA workforce starting in the 2023 reporting year. All ALTANA Group employees now have complimentary access to digital learning content via SuccessFactors, accessible during working hours. They can choose to complete the content as a comprehensive training course with confirmation or focus on individual sections of the training.
In addition to offering digital and flexible training opportunities, our program aimed at strengthening specialist careers has undergone expansion. Following the completion of the expert program by 24 pilot participants in Germany and the U.S. in 2022, the initiative was extended to China in the year under review. As of now, 71 employees have either successfully completed the program or are currently enrolled. The objective of this program is to foster and nurture talent at ALTANA independently of disciplinary management.
Another significant focus in the reporting year was the overhaul of posting regulations, including the introduction of a new posting directive. This guideline establishes a framework for globally standardized conditions and processes governing international assignments. The updated policy enhances transparency in processes and responsibilities while providing greater flexibility for the international exchange of employees. Moving forward, ALTANA assignments will be categorized into three groups: short term assignments (up to six months), long term assignments (up to 36 months), and relocation abroad with the intention of permanent residence in that country. This categorization enables responsible parties to address employee needs specifically and adhere to country-specific regulations, such as those pertaining to immigration, tax, social security, and labor law.
The reporting year also marked the implementation of the first remuneration determination process through SAP SuccessFactors. Pilot companies were chosen for this initiative in 2022 and actively participated in the process in 2023. By using SAP SuccessFactors, the process became transparent and digitalized with a reduced workload for local managers, as the system now manages documentation. In the reporting year, the process was applied to the top management group and selected companies in the BYK division and ALTANA AG, with plans for implementation at other ALTANA companies in 2024.
Environment and Safety
Environmentally compatible management and occupational safety are key components of ALTANA’s corporate strategy. The ALTANA Group measures progress in the area of environmental protection using specific key figures, such as the consumption of natural gas and electricity as energy sources and the resulting greenhouse gas emissions, and in the area of safety with the help of accident figures. Ideally, our aim is to reduce the number of accidents to zero.
In terms of environmental protection, our goal is to continuously reduce energy consumption at all of our sites and in all areas and to promote the use of energy from renewable sources. By purchasing green electricity worldwide since 2020, we have achieved a first milestone on the road to independence from fossil fuels. In addition, the sites invest every year in energy transformation measures, as described in the “Environment” chapter of this report.
In August 2023, the BYK division acquired the business of the U.S. company Imaginant. At the end of September 2023, the ELANTAS division secured a majority stake in the Swiss Von Roll Group. As of the end of 2023, the integration processes necessary for determining sustainability-related information for these two acquisitions had not reached completion. Consequently, the corporate report does not encompass safety and environmental key figures from the aforementioned acquisitions.
Safety is a top priority at ALTANA. ALTANA ensures continuous improvement in the safety of its employees by means of various technical and organizational measures tailored to the production conditions at the sites and to the laws and regulations that apply there. To achieve a uniform safety culture, ALTANA also relies on targeted employee training programs. All of our worldwide sites have established their own safety organization, which is responsible, among other things, for complying with all local occupational safety regulations, for training and education measures, and for recording and evaluating accidents. Throughout the Group, the Work Accident Indicator (WAI) serves as the central key performance indicator for recording and evaluating the development of occupational safety at all sites on the basis of reported accidents with lost work days. Three key figures are defined for better comparability: WAI 1 refers to the number of reported occupational accidents with lost work time of one day or more per million working hours. WAI 2 comprises the number of reported occupational accidents with lost work time of more than three days per million working hours. And WAI 3 represents the number of lost work days due to reported occupational accidents per million working hours.
ALTANA determines the working hours on the basis of the actual hours worked. If such recording is not possible, a qualified estimate of the average hours worked is made. Accidents are recorded directly on site and reported to a defined group of persons within 48 hours. On a quarterly basis, the reported accidents with lost work days are evaluated in a global IT system. Subsequently, the evaluations are made available to all responsible persons, such as the Management Board, division presidents, managing directors, and experts from the area of Environment, Health and Safety (EH&S). On the basis of this data, ALTANA’s Management Board, together with the EH&S department, sets target values for the three WAIs for each year, which apply equally to all companies of the ALTANA Group.
For 2023, ALTANA again set ambitious target ranges for all three accident indicators (WAI 1: 0 to 2.3; WAI 2: 0 to 1.5; and WAI 3: 0 to 27.0), once again emphasizing how important the continuous improvement of occupational safety is for the company. However, the year presented a challenging economic environment, characterized by geopolitical conflicts and cyclical declines in demand in the three major economic regions of Europe, the U.S., and China. Against the backdrop of these general conditions, the number of behavior-based accidents rose. Although we succeeded in keeping the number of reported occupational accidents at our sites at a low level, we were unable to achieve our ambitious targets at Group level in 2023, as was the case in 2022. Globally, 31 accidents with lost days were reported at ALTANA, two more than in the previous year. Based on hours worked, the WAI values are as follows: WAI 1: 2.8 (previous year: 2.5); WAI 2: 1.7 (previous year: 2.0); and WAI 3: 31.8 (previous year: 23.1).
ALTANA has also been addressing the issue of energy efficiency and the associated greenhouse gas emissions for several years. In addition to absolute values, energy consumption is set in relation to the quantity of finished goods that are produced. ALTANA establishes annual reduction targets for energy consumption in relation to the quantity of finished goods produced. The recording and calculation of emissions relates, as Scope 1, to direct greenhouse gas emissions from emission sources owned or controlled by the Group. These include, for example, the combustion of primary energy sources in the course of heat generation and fuel consumption in the company’s own vehicle fleet at some sites. Scope 2 includes indirect greenhouse gas emissions from the performance-related purchase of electricity. They are recorded and calculated in accordance with the standard “A Corporate Accounting and Reporting Standard – Revised Edition” of the Greenhouse Gas Protocol initiative. The data are reported in the document “Facts and Figures on Sustainability 2023.” The energy consumption of all production sites included in the scope of consolidation is recorded and evaluated in a global reporting system. The CO2 equivalents for Scope 2 are calculated based on conversion factors (g CO2 / kWh) defined by the International Energy Agency (IEA) in line with the currently published values (2021) for the location-based method and with the aid of emission factors of the electricity supplier or an individual electricity product for the market-based method. For Scope 1, we use the current conversion factors from the Intergovernmental Panel on Climate Change (IPCC).
The companies generally verify consumption by means of bills. If this is not possible for the last two months of the reporting year, the companies first make a qualified estimate of the values. As a result, in the following year – as soon as all bills are available – the prior year figure may still be adjusted retrospectively. In 2023, ALTANA had a total energy consumption of 611,843 MWh (previous year: 680,948 MWh). The main energy sources were natural gas (336,427 MWh) and electricity (241,196 MWh). ALTANA set a target value of 1.16 MWh / t for the specific energy parameter – based on one metric ton of finished goods – for 2023 and slightly exceeded it in the reporting period at 1.18 MWh / t, but improved it slightly compared to the previous year (1.20 MWh / t). This resulted in a total of 77,769 tons of CO2 equivalents. Of these, 76,393 tons of CO2 equivalents fall under Scope 1.
For the purchased electricity of 241,196 MWh, the same number of Guarantees of Origin was acquired in accordance with recognized quality standards (for example, CoO for Europe, GREENE for the U.S., and IREC for China) and through a German PPA (Power Purchase Agreement). This is electricity that is generated from renewable energies and whose origin is made transparent by means of a Guarantee of Origin. ALTANA plans to finalize the decommissioning of these Guarantees of Origin for 2023 in April 2024. According to the “location-based” method, 85,500 tons of CO2 equivalents are calculated for this elec tricity procurement, but as described above, we cause zero CO2 emissions according to the “market-based” method due to the measures taken by ALTANA. The purchase of steam, district heating, and compressed air causes 1,377 tons of CO2 equivalents in Scope 2 greenhouse gas emissions based on the “location-based” method and the “market-based” method.
Apart from focusing on reducing emissions within its own value chain, ALTANA also invests in certified climate protection projects. When selecting projects, we make sure that they are certified according to internationally recognized standards such as the Verified Carbon Standard (VCS) and, moreover, contribute to selected Sustainable Development Goals of the United Nations. In addition, we review the portfolio built up in this way internally at annual intervals and check whether it continues to meet our requirements. For the reporting period, ALTANA offset 44,600 tons of CO2 equivalents through certificates from the “Kinnaur Hydropower Plant” project on the Satluj River in the Himachal Pradesh region of India (Verra Register VCU serial number 9355-83999139-84032489-VCS-VCU-997-VER-IN-1-1742- 01012018-31122018-0). The amount corresponds to around 58 % of the greenhouse gas emissions generated in Scope 1 in the reporting year.
This voluntary contribution to slowing climate change is not offset against the emissions generated. However, the approach corresponds to the best practice ecommendations of SBTi (Science Based Target Initiative) for support measures on the road to decarbonization. ALTANA has set itself the goal of voluntarily offsetting as many CO2 equivalents as the company generates in Scope 1, Scope 2, and selected categories of Scope 3 (categories 4, 6, and 8) starting in 2025.