OUR COMMITMENT
  • To empower members to confidently understand and navigate a continuously changing and complex global environment.

Contributor Perspectives

REACH and the Move Toward Green Chemistry

Mar 1, 2007 | 20:55 GMT
By Kathleen Morson The U.S. Commerce Department held the first of several regional "REACH Roadshows" for U.S. businesses in Charlotte, N.C., on Feb. 27. The aim of the seminars is to educate companies on how to comply with REACH — Registration, Evaluation and Authorization of Chemicals — the European Union's sweeping new chemicals regulation that takes effect June 1. Global companies, not just U.S. manufacturers, are preparing to meet the requirements of REACH, a groundbreaking directive that will spur significant global change in the chemical industry. This major shift is toward "green chemistry," which essentially means developing chemicals that have the least impact on the environment and human health. Green chemistry provides a new guiding framework, which some companies already are working to achieve and certain universities are beginning to teach. The implementation of REACH, however, ensures that green chemistry is here to stay. Here Comes REACH The REACH regulation represents a shift from the Western regulatory world's reliance on risk assessment to something more precaution-based. Significantly, it shifts the regulatory burden from government agencies to the producers themselves to demonstrate that their chemicals are safe. REACH was approved by the European Commission in December 2006 after three years of parliamentary debate, mostly focused on the costs and impact to small businesses (various analyses have estimated registration costs alone will surpass $2 billion). REACH harmonizes a patchwork of EU chemicals-related regulations, some of which discriminated between "old" and "new" chemicals — those manufactured before or after 1981 — and others of which only applied to specific chemicals used in certain products. The regulation requires importers and manufacturers of chemicals in Europe of quantities over one metric ton to register their chemicals with the new European Chemicals Agency, to be located in Helsinki, Finland. It also requires chemical companies to provide the agency with testing data and lists of the uses of their chemicals for evaluation and approval. Some components of this stage will effectively remove certain chemicals from the market before any formal bans are in place. Under the authorization stage of REACH, the agency is in charge of authorizing which chemicals can be used in what applications. Chemicals that are suspected to be carcinogenic, mutagenic or toxic, as well as those that are persistent in the environment and bioaccummulative will be the toughest to get authorized. In these cases, the company has to prove humans will not be directly exposed to the chemical through normal use of the product, or agree to use an available safer alternative. Beginning in 2009, the agency will put these chemicals on a "candidate" list (with EU member states' approval) and note which ones have less-harmful alternatives. Those on the list that have suitable alternatives will be marked for phase-out, while those that do not yet have alternatives can still be used under certain regulatory stipulations. This candidate list will be reassessed at regular intervals to determine whether new chemicals need to be added and whether there are new alternatives to those already on the list. Product manufacturers selling in and to Europe must ensure that their upstream suppliers — commodity chemicals companies — are in compliance with REACH and that the chemical substances in their products have been authorized for use. The regulation, although it was devised in Europe, will affect goods sold outside Europe because most companies that sell goods internationally will not create separate product lines for Europe and the rest of the world. In real terms, REACH will work like this: The manufacturer of a children's toy that discovers one or more of its chemicals is on this list probably will not wait for a forced phase-out or a potentially more serious product liability suit stemming from the use of a chemical that could harm its buyers. The company, then, will deselect those listed chemicals that have alternatives, while pushing chemical companies to create new alternatives for those that lack them and for those that might be added to the list next. In other words, downstream users of chemicals will push the burden back up the supply chain for the chemical companies to deal with. Enter Green Chemistry Using green chemistry practices, scientists working in chemical production labs would constantly reassess their products to weigh their potential to cause harm to human health or the environment. This is important because it represents a shift in current practices, under which a chemical is assessed based on its risk — the probability of an adverse effect caused by exposure to it under specific circumstances. Instead, green chemists focus on the chemical's toxicity — its inherent ability to cause adverse effects. A low-risk chemical, for example, might be very toxic but still require a large dose to induce harm. Green chemists take a broadly precautionary approach and reject the toxicology idea that "the dose makes the poison." The green chemistry ethic also can be applied by consumer products companies and retailers in their corporate chemicals-use policies. Scientists Paul Anastas and John Warner outlined 12 broad principles of green chemistry in the book "Green Chemistry: Theory and Practice." These principles include promoting practices such as prevention of waste, creating less-hazardous chemical syntheses, designing safer chemicals, using renewable ingredients and designing for innocuous degradation into the environment, among others. Green chemistry advocates say it is necessary to consider the entire life cycle of a product or process in order to determine its full cost, both in a financial sense and in terms of its effects on human health and the environment. The green chemistry concept has been used by sustainability and environmental health advocates to push consumer products companies and retailers to change the way they use chemicals. In practice, this means the companies establish mechanisms to routinely evaluate the chemicals used in their products and look for newer, possibly safer ones to use as substitutes. Until fall 2006, however, green chemistry was thought to be an impractical and costly practice — certainly not one considered friendly to most businesses. Then Wal-Mart stepped in. Green Chemistry Wins a Large Supporter In October 2006, Wal-Mart introduced a sweeping chemicals policy designed to spur the development of alternatives to potentially harmful chemicals in products it sells. Although Wal-Mart likely made the move in anticipation of REACH, several U.S. state chemicals initiatives and pressure from shareholder activists, the move nonetheless framed green chemistry as a workable business strategy. If Wal-Mart says green chemistry is doable, it likely is — or Wal-Mart will make it so. Wal-Mart announced its desire to phase out 17 chemicals (and specifically named the first three: the pesticides propoxur and permethrin and cleaning product ingredients known as nonylphenol ethoxylates). More important, Wal-Mart announced it would follow four principles that would guide the retailer's chemicals policies. These principles are similar to Anastas and Warner's 12 green chemistry principles, and in certain instances are even more robust. Wal-Mart can phase out the 17 chemicals because, at the end of the day, it is not the company's responsibility to do the work — the burden is on Wal-Mart's suppliers. Some suppliers, including SC Johnson & Son, have embraced similar chemicals policies for some time, making their transition to what Wal-Mart requires much easier. And others are certain to follow suit. Wal-Mart suppliers, which are not in the chemical business but in the consumer products business, are not necessarily tied to specific chemicals, and they likely will alter their formulas in exchange for continued access to the shelves of the world's largest retailer. The prices of goods at Wal-Mart, though, are likely to stay about the same because the retail giant has a habit of ensuring thriftiness among its suppliers. REACH and Green Chemistry Although a chemical's placement on the REACH candidate list does not mean it automatically will be banned or phased out (this decision is up to the chemicals agency in Helsinki), consumer product companies and retailers are likely to push for their suppliers to offer alternatives to the chemicals on the list. Those downstream customers that fail to act, then, will risk facing a brand attack campaign focusing on the how the European Union is questioning the safety of chemicals in their product. It is no wonder, then, that some businesses and governments have called the list a "blacklist" because it will have the effect of black-balling these chemicals, at least in the public's mind. The initial list of candidate chemicals will be publicized in June 2009 and reviewed every five years. Although the list has not been finalized, it could include some versions of the plastic additives known as phthalates (some of which already are banned for use in certain children's products in Europe) that are found in polyvinyl chloride shower curtains, for example. Certain brominated flame retardants used in clothing, upholstery and electronics (some of which already have been restricted under various EU directives) also are likely to be on the list, as are the chemicals Wal-Mart has marked to phase out. Meanwhile, smart chemical companies will try to guess which chemicals will be on the first list and begin (if they have not already) researching alternatives. They also will work with their downstream customers to determine the demand for certain alternatives — SC Johnson, Dell, Herman Miller, Nokia, Volvo Car Corp. and Motorola already have adopted green-chemistry-like chemicals policies and are pressuring their suppliers to offer alternatives. Teaching Green The green chemistry ethic already is practiced by certain companies. Cargill Dow is making inroads into bio-based plastics, while Merck & Co. and other pharmaceutical companies are looking into ways to minimize waste in the lab as well as their company's impact on native species. Ink and solvent manufacturer NuPro Technologies Inc. is developing ways to reduce the toxicity of solvents used in the printing process. However, with both a de facto (Wal-Mart) and de jure (REACH) push for green chemistry, it appears green chemistry likely will eventually become standard practice. The five-year mechanism to shift the demand continually for certain chemicals will require that chemical companies be nimble — constantly looking ahead for safer alternatives. Smaller chemical companies that produce only a handful of chemicals could find that their bread-and-butter-chemicals are losing demand from downstream customers due to their fears that the chemicals they buy will end up harming someone. Consequently, the large and diverse chemical companies, those with higher research and development budgets, should be able to weather the REACH storm well. Major universities, including Massachusetts Institute of Technology, Georgia Institute of Technology and Texas A&M University, now offer at least several environment-focused courses in their chemistry departments. University of Massachusetts (the institutional home of John Warner) is the first to offer a doctorate degree in green chemistry. The chemistry majors of tomorrow are learning how to minimize the impact of chemicals on the environment and human health. They likely will be recruited by the larger chemical companies, which increasingly realize they need these young chemists' expertise and insight to navigate a changing regulatory and de facto public policy world in chemistry. The tables have turned on what is considered modern chemistry. The major push started by Wal-Mart's policy change and built upon by the REACH directive signals that a move toward green chemistry is on its way.

Copyright © Stratfor, an operating unit of RANE Network Inc.

OUR COMMITMENT