Solvay releases 2022 annual integrated report
In 2022, Solvay delivered record financial results and significant progress on sustainability goals, while supporting employees and communities in need.
Solvay today released its annual integrated report, which provides a comprehensive and integrated view of Solvay’s economic, environmental, and societal performance for 2022. It details the Group’s financial and extra-financial performance, governance, remuneration and risk management practices. It also includes a comprehensive update of climate risks analysis and a new section dedicated to the European taxonomy.
Key highlights of 2022
In 2022, Solvay delivered on and exceeded its commitments in a challenging environment marked by the energy crisis and inflation, logistics issues and the global urgency to tackle climate change. Key milestones included:
The Group achieved new financial records in 2022. Strong pricing more than offset cost inflation. Combined with higher volumes, this led to record EBITDA of €3.2 billion, increasing organically by 28.7% versus 2021. Higher profit and disciplined cash management led to record annual free cash flow of €1,094 million. Returns (ROCE) also reached a new record of 16.0%, versus 11.4% in 2021, and Solvay continued to strengthen its balance sheet, with the underlying leverage ratio down at 1.1x.
At the beginning of 2022, the Group announced its intention to separate Solvay into two strong, independent, publicly listed companies. One will focus on essential chemicals and the other on specialty chemicals, and both will be leaders in their respective areas. Solvay teams worked hard throughout 2022 to prepare for the split and the company is on track to complete it in December 2023.
In four years, Solvay has reduced Scope 1 and 2 greenhouse gas emissions by 19%, of which 15% was structural – almost twice the target set by the Paris Climate Agreement. In 2022, the company advanced toward carbon neutrality by adding 23 emissions reduction projects, bringing the worldwide total to 59. These address phasing out coal from energy production at four plants and significantly progressing renewable energy to power our operations. Solvay also introduced a target to reduce its Scope 3 emissions by 24% and its climate targets were validated by the Science Based Targets initiative (SBTi) in early 2023.
2022 was an exceptional year for investments with more than €1 billion invested to unleash growth and power the company’s energy transition – a 39% increase compared to 2021. Clean mobility is a key focus, with investments in new PVDF capacity for electric vehicle batteries in all regions. Solvay also increased capacity for sodium bicarbonate in Bulgaria, and invested in the vertical integration of natural vanillin. The company announced major investments to phase out coal at its soda ash plants, and implemented an innovative new technology to cut process emissions at its Green River site in the US.
To meet growing demand for sustainable and circular solutions in a range of markets and develop new business opportunities, Solvay launched a fourth growth platform, focused on renewable materials and biotechnology, in 2022. The platform covers the entire value chain and will help facilitate the development of safe and environmentally-friendly solutions, and enhance circularity in the company’s product offering.
In June 2022, Solvay unveiled its industry-leading plan to voluntarily phase out the use of fluorosurfactants globally by 2026. This will involve manufacturing nearly 100% of its fluoropolymers without fluorosurfactants at its Spinetta Marengo site in Italy. Since 2019, Solvay has quadrupled its investment in research and innovation to develop new non-fluorosurfactant technologies, successfully discontinuing the use of fluorosurfactants in the US in July 2021.
Upholding its founder’s legacy of protecting employee well-being, Solvay was one of the first companies to provide support for employees significantly impacted by high inflation in 2022. The Group distributed €25 million, including a €9.5 million bonus payment, among the Solvay employees proportionally most affected by inflation and working in countries that are not protected by national schemes, and the Global Performance Sharing budget for “non-executive” employees increased to €15 million.
Almost 28% of Solvay employees signed up to its Solvay Shares program, launched in 2022. These employees are now company shareholders, enhancing their sense of belonging and enabling them to share in the Group’s growth and performance. Participation rates were ahead of the benchmark for similar initiatives in other companies and reflect the high level of engagement recorded in the company’s global employee Pulse surveys.
In 2022, Solvay made significant progress in embedding diversity, equity and inclusion (DEI) into its company culture, launching a number of different initiatives. These included setting up a new senior leadership team to promote inclusive leadership, expanding its Employee Resource Groups (ERGs) and taking action to reduce the gender pay gap. Solvay also made DEI the focus of its annual Citizen Day, which involved more than 100 sites across the world, and included the DEI roadmap within the 15% Solvay One Planet part of the Short Term Incentive.
“Over the past four years, we have accelerated our journey to transform and simplify Solvay. Today, we have created the perfect conditions to ensure we are future-ready, combining a high-performing culture, talented people, compelling business results, a robust capital structure and ambitious growth and sustainability projects,” said Ilham Kadri, Solvay CEO. “We are now ready to reach new heights and are looking toward an exciting new future, celebrating our heritage, while passing on our legacy as we separate into two formidable new companies that will be leaders in their respective fields.”
In addition, the Solvay Solidarity Fund continued to support employees and local communities in need throughout 2022. Since its launch, the Fund has deployed more than €9.5 million to provide financial support to thousands of families. In 2022, donations were made to more than 50 projects in 14 different countries, reflecting a wide range of initiatives, which are detailed in the 2022 Solidarity Fund impact progress report. In early 2023, the Fund supported emergency efforts in Turkey and Syria with a €500,000 donation following the devastating earthquake there.
The 2022 report is available on Solvay.com where a downloadable version in the ESEF format, as specified by the European Commission in the Regulatory Technical Standard on ESEF (Regulation (EU) 2019/815), is also available. Solvay also publishes its 2022 report on payment to governments today. This document is available in the Financials section of Solvay's website.
Solvay is a science company whose technologies bring benefits to many aspects of daily life. With more than 22,000 employees in 61 countries, Solvay bonds people, ideas and elements to reinvent progress. The Group seeks to create sustainable shared value for all, notably through its Solvay One Planet roadmap crafted around three pillars: protecting the climate, preserving resources and fostering a better life. The Group’s innovative solutions contribute to safer, cleaner, and more sustainable products found in homes, food and consumer goods, planes, cars, batteries, smart devices, health care applications, water and air purification systems. Founded in 1863, Solvay today ranks among the world’s top three companies for the vast majority of its activities and delivered net sales of €13.4 billion in 2022. Solvay is listed on Euronext Brussels and Paris (SOLB). Learn more at www.solvay.com.