Charlie Tan is Chief Executive Officer at the Global Impact Coalition (GIC), a spin-off from the World Economic Forum founded by some of the world’s largest petrochemical companies. It focuses on the development of Net-Zero business models and unlocking the technologies and finance that will enable them.
Prior to creating this in-house at the WEF, Tan spent the last decade building successful start-ups within the energy space, most notably a waste oil collection and aggregation business that raised significant capital and helped increased global traceability and transparency of waste streams in developing economies. He started his career as an oil trader for one of the world’s largest hedge funds. Tan graduated from Imperial College London and earned a CFA Certificate in Investment Management. He recently spoke to The Innovator about why industry collaboration is key to achieving sustainability goals.
Q: Tell us about the Global Impact Coalition
CT: GIC is dedicated to catalyzing change in the chemical industry. It was created due to the pressing need to confront the climate impact of the sector, which currently accounts for around 6% of global emissions. The aim is to drive tangible projects and R&D partnerships to expedite the transition to Net-Zero carbon emission and foster cross-industry innovation. The CEOs asked themselves ‘as we go on this journey towards Net Zero do we need to go it alone or can we go together? It turns out, we can, and must, go together.’
Due to some great success and proof points over the last few years in November 2023 the Global Impact Coalition (then called the Low Carbon Emitting Technologies initiative) left the WEF and started life as an independent Swiss-based entity with the continued mission of fostering collective industry action to co-create and co-develop innovative business models and technologies that help to drive Net Zero goals.
Q: Who are the founding members?
CT: The GIC was founded by some of the world’s leading chemical companies, including BASF, SABIC, Covestro, Clariant, LyondellBasell, Mitsubishi Chemical, and Solvay (now Syensqo).
The industry has reacted very positively to the GIC since inception, and we are looking to capitalize on this by forming strong partnerships and expanding global memberships. We have welcomed new members such as Sabanci, a Turkish industrial conglomerate, and Siemens Energy, a global technology provider. However, we are only just scratching the surface. The GIC will look very different in the coming months.
Currently, one of our core partners is Boston Consulting Group, who have dedicated a highly specialized team to assist with joint ideation sessions and business model evaluations. Essentially, their role is helping with the question ‘now that we have these companies in the room together, how do we actually create and develop new ideas and business cases that can be presented to CEOs?’
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Q: What are chemical industry’s pain points and what can these companies achieve together that they can’t achieve alone?
CT: Some of our key industry pain points include decarbonization of processes, reduction of high global warming potential emissions, energy transition enablement, circularity of polymers, utilization of alternative carbon sources, and chemical safety and pollution. These present opportunities for collaboration. Working together means companies can benefit from each other’s areas of expertise to co-develop (and de-risk) new projects where the technology itself may not be the innovative part but rather the integration of these technologies from a value chain perspective.
That said, we must be realistic in this joint effort. New business models are not easy to develop. If they were they would have been developed already. We must be sustainable as an industry, but projects and joint endeavours still need to be justified commercially. Understanding and identifying this early on means we are already moving in the right direction.
Q: What sort of projects is GIC working on?
CT: We have had some great success points to date. An example is our R&D Hub for Plastic Waste Processing, that was officially created and spun off around nine months ago and is now hosted by the TNO research institute in the Netherlands.
The R&D Hub was set up and co-funded by coalition member companies BASF, SABIC, LyondellBasell, Mitsubishi Chemical, Solvay (now Syensqo), Covestro, and Dow. Some of the specific technologies that are a focus area for the R&D Hub are sensing for sorting, polymer/inorganic separation at mm/um-scale, and enhanced solvolysis for composite recycling.
Currently less than 10% of the 400 million tons of plastic produced annually is being recycled, so ensuring constant innovation in new technologies for waste processing is crucial. That is why this R&D Hub is so pivotal in driving the charge in new technologies for waste processing with a lower CO2 footprint and greater levels of plastic waste recycling.
The electrically heated steam cracker is another good project example. It involves coalition member companies BASF and SABIC, and engineering firm Linde. By using electricity from renewable sources instead of natural gas, this new technology has the potential to reduce CO2 emissions of one of the most energy intensive production processes in the chemical industry by at least 90% compared to technologies used today.
Q: What has worked and what hasn’t worked?
CT: When the group first came together with the support of the WEF, initiating collaboration among competitors within the chemical industry posed some challenges. However today, we’ve achieved a great level of trust among our member companies that continues to grow and develop. One thing I learned from my time at the WEF, is that it is invaluable to offer safe spaces for meaningful conversation, with the goal of turning conversations into tangible action.
Keeping our CEO Advisory Board updated and onboard with the GIC developments is also crucial and has worked well to date. At the end of the day, this is about leading from the top to ensure things can get done and have true impact.
It is imperative that early on interested parties are clear about what are they bringing to the project and what are they expecting to take out. I feel we now have strong frameworks in place for this which also helps to set the tone on expectations from all stakeholders.
Q: Systemic change requires public/private collaborations. Is GIC working with the public sector?
CT: While our immediate focus (for now) lies within the private sector, we actively engage with the public sector, particularly in discussions around financing specific proof of concept projects. Industry associations such as CEFIC are doing a great job advocating for the regulatory support needed for industry transformation. The latest Antwerp Declaration for a European Industrial Deal is an example of that. I have no doubt that in the near future we will look to CEFIC and others to cooperate together.
Q: What advice do you have for other industries that are considering forming industry groups to become greener?
CT: My time at the WEF afforded me a bird’s eye view on many initiatives within shipping, steel, oil & gas, and so on. My personal take away is that industry CEOs and executives are crucial to ensuring company buy-in at all levels, as at the end of the day the leg work to derive tangible value from these initiatives often falls on working teams. It is very much a cultural and mindset shift that is needed from the top down, where people are encouraged and incentivized to think both on behalf of their company but also the broader industry when it comes to achieving sustainability through collaboration. As the saying goes, to go fast, go alone, but to go far, go together.
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