As industries across the globe embrace a more sustainable future, Simon-Kucher’s Profitable Green Growth in Chemicals and Materials in North America Report sheds light on how the chemicals and materials industry is navigating this critical transition. The report highlights the progress companies have made, the obstacles they face, and the opportunities waiting to be seized in the growing green economy.
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Historically, transitioning to greener practices has been a tough sell for the chemicals and materials sector, often hindered by high costs and slow-moving demand. However, change is happening, and North America’s chemicals and materials industry is beginning to step up to the plate. Today, 58% of companies in the sector have set clear sustainability targets, and 9% are addressing ambitious Scope 3 emissions goals—indirect emissions stemming from their supply chains and product life cycles. While momentum is building, the path forward remains challenging and complex.
Here’s a closer look at the drivers, obstacles, and opportunities for this crucial industry as it works to deliver on its green goals.
1. Market Demand Drives Sustainability
For the chemicals and materials industry, sustainability isn’t just an ideal—it’s increasingly a competitive necessity. Customer demand and the drive to capture market share are the top motivators, reflecting a growing preference for environmentally responsible solutions. Cost savings is the third biggest driver, showing that sustainable practices aren’t just good for the planet—they also make business sense, offering ways to reduce operational costs over time.
Industry leaders see sustainability as a path to growth, better risk management, and a competitive edge. Companies are realizing that by committing to environmental responsibility, they can attract new business, reassure investors, and navigate regulatory pressures more effectively.
2. Challenges in Meeting Sustainability Goals
While sustainability is an important goal, reaching it is not easy. Just 45% of companies report being on track or ahead of their sustainability targets. Many face high costs for green solutions, the need for substantial investments, and challenges in finding the right partners. Without industry-wide standards, only 12% of companies report a high level of standardization, leaving most to navigate this journey without clear benchmarks or best practices.
These hurdles make it harder for companies to stick to their sustainability agendas, even when the commitment is strong. The high cost of green solutions limits options and creates financial pressure, while the lack of standardized practices forces each company to find its own way.
3. Revenue Opportunities in Green Markets
For those who overcome these challenges, green markets hold serious revenue potential. In North America, 28% of chemicals and materials companies already earn half or more of their revenue from green products, outpacing the national average of 20% across industries. This strong performance gives early adopters a competitive advantage and highlights the benefits of moving quickly.
Shifting to green products is no longer a “nice-to-have”—it’s essential for companies wanting to stay competitive. Those that have made the shift are well-positioned to thrive as regulations increase and customer demands grow. Meanwhile, companies that hesitate risk being left behind by others who are already moving forward.
A Path Forward for the Chemicals and Materials Sector
Sustainability presents both a challenge and an opportunity. Success will come to those companies that confront the challenges head-on, investing in green innovations, forming the right partnerships, and making sustainability work for their bottom line. As demand for green solutions grows, companies that prioritize sustainability will find themselves in a position to lead—and grow—in a transforming market.
For North America’s chemicals and materials companies, now is the time to build on progress, tackle challenges, and capitalize on the growing green economy.
To explore how your organization can advance its sustainability journey, contact us below.
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