Stepan Company (SCL): Analyse Pestle [Jan-2025 MISE À JOUR]

Dans le monde complexe de la fabrication de produits chimiques, Stepan Company (SCL) navigue dans un paysage complexe de défis et d'opportunités mondiales. Cette analyse de pilon dévoile les forces externes multiformes qui façonnent la trajectoire stratégique de l'entreprise, des obstacles réglementaires et des innovations technologiques aux impératifs environnementaux et aux fluctuations économiques. En disséquant les dimensions politiques, économiques, sociologiques, technologiques, juridiques et environnementales, nous explorerons comment la société Stepan survit non seulement, mais prospère dans un marché mondial de plus en plus dynamique et exigeant.

Stepan Company (SCL) - Analyse du pilon: facteurs politiques

Compliance réglementée de l'industrie de la fabrication de produits chimiques

Stepan Company fonctionne sous une surveillance réglementaire stricte de plusieurs agences fédérales:

Agence de réglementation	Zone de réglementation clé	Exigences de conformité
EPA	Règlements environnementaux	COMPOSITION DE LA COLLE AIR
OSHA	Sécurité au travail	Normes de traitement des produits chimiques
FDA	Sécurité des produits	Vérification des ingrédients chimiques

Impact de la politique commerciale sur l'importation / exportation chimique

Les réglementations actuelles d'importation / d'exportation chimique impliquent une conformité complexe:

• Les réglementations sur les exportations chimiques américaines exigent des frais d'inscription annuels de 2 500 $
• Organisation des licences d'exportation de produits chimiques.
• Les taux de tarif pour les exportations chimiques se situent entre 3,7% et 6,5%

Mandats de protection de l'environnement

La conformité environnementale implique des investissements financiers importants:

Réglementation environnementale	Coût de conformité	Chronologie de la mise en œuvre
Loi sur le contrôle des substances toxiques	1,2 million de dollars par an	En cours depuis 2016
Exigences de la loi sur l'eau propre	Mises à niveau des infrastructures de 850 000 $	Implémentation 2023-2025

Tensions géopolitiques affectant les chaînes d'approvisionnement

Les tensions commerciales mondiales actuelles ont un impact sur l'approvisionnement en matières premières:

• Les tarifs commerciaux de Chine augmentent les coûts des matières premières chimiques de 15 à 25%
• Les restrictions commerciales américaines de la Russie limitent les sources d'ingrédients chimiques potentiels
• Les réglementations sur l'importation des produits chimiques de l'Union européenne nécessitent une documentation de conformité supplémentaire

Stepan Company (SCL) - Analyse du pilon: facteurs économiques

Performance de l'industrie chimique cyclique liée aux tendances mondiales de la fabrication

Les revenus de la société Stepan pour l'exercice 2022 étaient de 2,394 milliards de dollars, reflétant une augmentation de 14,7% par rapport à 2021. indiquant l'expansion.

Année	Revenus ($ m)	Croissance mondiale de l'industrie chimique	Fabrication PMI
2020	1,922	-3.5%	50.3
2021	2,087	2.8%	58.6
2022	2,394	3.2%	54.8

Les coûts de matières premières fluctuants ont un impact sur les marges bénéficiaires

Les coûts des matières premières pour Stepan Company en 2022 représentaient 62,3% du total des revenus. Les prix du pétrole brut ont fluctué entre 70 $ et 120 $ le baril en 2022. La marge brute de la société était de 17,8% en 2022, contre 19,2% en 2021.

Année	Coût des matières premières (%)	Prix ​​moyen du pétrole brut	Marge brute (%)
2020	59.5%	41 $ / baril	16.5%
2021	61.7%	68 $ / baril	19.2%
2022	62.3%	95 $ / baril	17.8%

Investissement continu dans les segments de marché chimique spécialisés

Stepan Company a investi 78,4 millions de dollars dans la recherche et le développement en 2022. Le marché des produits chimiques spécialisés était évalué à 836,9 milliards de dollars dans le monde en 2022, avec un TCAC projeté de 5,3% de 2023 à 2028.

Année	Investissement en R&D ($ m)	Taille du marché mondial des produits chimiques spécialisés ($ b)	CAGR de marché
2020	65.2	764.5	4.7%
2021	71.6	795.3	5.1%
2022	78.4	836.9	5.3%

Incertitudes économiques potentielles affectant les stratégies de dépenses en capital

Les dépenses en capital de Stepan Company en 2022 étaient de 94,6 millions de dollars. Aux États-Unis, le taux d'inflation était de 8,0% en 2022. Les taux d'intérêt de la Réserve fédérale variaient de 4,25% à 4,50% d'ici la fin de l'année.

Année	Dépenses en capital ($ m)	Taux d'inflation américain	Taux d'intérêt de la Réserve fédérale
2020	76.3	1.4%	0.25%
2021	85.2	4.7%	0.25%
2022	94.6	8.0%	4.50%

Stepan Company (SCL) - Analyse du pilon: facteurs sociaux

Demande croissante des consommateurs de produits chimiques durables et respectueux de l'environnement

Le marché mondial des produits chimiques durables prévoyait 165,1 milliards de dollars d'ici 2027, avec un TCAC de 6,2%. Le portefeuille de produits verts de Stepan Company représente 37% des revenus totaux en 2023.

Catégorie de produits durables	Part de marché (%)	Contribution des revenus ($ m)
Surfactants biodégradables	15.3%	87.5
Produits chimiques à base de bio	12.7%	72.4
Polymères respectueux de l'environnement	9.0%	51.3

Augmentation des initiatives de diversité et d'inclusion en milieu de travail

Les métriques de la diversité des effectifs de Stepan Company pour 2023:

Catégorie démographique	Pourcentage (%)	Total des employés
Femmes en leadership	28.6%	142
Minorités raciales / ethniques	22.4%	316
Vétérans	5.7%	80

Changement démographique de la main-d'œuvre nécessitant une gestion adaptative des talents

Distribution de l'âge des employés en 2023:

• Millennials (25-40 ans): 42,3%
• Gen X (41-56 ans): 33,6%
• Gen Z (18-24 ans): 15,2%
• Baby-boomers (57-75 ans): 8,9%

Tenure moyenne des employés: 7,4 ans. Investissement de formation par employé: 3 750 $ par an.

La conscience environnementale croissante influençant le développement de produits

Investissement en R&D dans les technologies durables: 24,6 millions de dollars en 2023, ce qui représente 8,2% des revenus totaux.

Domaine de mise au point de la durabilité	Attribution de la R&D ($ m)	Impact attendu
Technologies de réduction du carbone	9.2	15% de réduction des émissions d'ici 2025
Solutions d'économie circulaire	7.5	50% de contenu recyclé d'ici 2026
Conservation de l'eau	5.9	30% d'amélioration de l'efficacité de l'eau

Stepan Company (SCL) - Analyse du pilon: facteurs technologiques

Investissement continu dans la recherche et le développement de produits chimiques spécialisés

En 2023, Stepan Company a investi 42,3 millions de dollars dans la recherche et le développement, représentant 2,8% du total des revenus de l'entreprise. La société entretient 3 centres de recherche primaires situés à Northfield, Illinois; Millbury, Massachusetts; et Wyandotte, Michigan.

Année	Investissement en R&D ($ m)	% des revenus	De nouvelles formulations chimiques développées
2021	39.7	2.6%	17
2022	41.2	2.7%	22
2023	42.3	2.8%	26

Technologies de fabrication avancées améliorant l'efficacité de la production

Stepan Company a mis en œuvre des technologies de fabrication avancées dans 12 installations de production mondiales, réalisant une amélioration moyenne de l'efficacité de la production de 7,5% en 2023.

Technologie	Année de mise en œuvre	Gain d'efficacité (%)	Économies de coûts ($ m)
Systèmes de contrôle des processus automatisés	2021	4.2%	3.6
Réseaux de capteurs avancés	2022	3.3%	2.9

Transformation numérique des systèmes opérationnels et de gestion

Stepan Company a investi 24,6 millions de dollars dans les initiatives de transformation numérique en 2023, mettant en œuvre des systèmes de planification des ressources d'entreprise basés sur le cloud (ERP) et des plateformes avancées d'analyse de données.

Mise en œuvre de l'automatisation et de l'intelligence artificielle dans les processus de fabrication

La société a déployé des systèmes de maintenance prédictive dirigés par l'IA dans 8 installations de fabrication, ce qui réduit les temps d'arrêt de l'équipement de 22% et les coûts de maintenance de 4,3 millions de dollars en 2023.

Technologie d'IA	Installations mises en œuvre	Réduction des temps d'arrêt (%)	Économies de coûts ($ m)
AI de maintenance prédictive	8	22%	4.3
Contrôle de la qualité de l'apprentissage automatique	6	15%	2.7

Stepan Company (SCL) - Analyse du pilon: facteurs juridiques

Conformité réglementaire stricte dans la fabrication chimique et les normes environnementales

Stepan Company fonctionne dans des cadres réglementaires rigoureux régis par plusieurs agences:

Agence de réglementation	Exigences de conformité clés	Coût annuel de conformité
EPA	Règlements sur la loi sur l'air propre	3,2 millions de dollars
OSHA	Normes de sécurité au travail	1,7 million de dollars
FDA	Sécurité des produits chimiques	2,5 millions de dollars

Protection potentielle de la propriété intellectuelle

Statut de portefeuille de brevet:

Catégorie de brevet	Nombre de brevets actifs	Durée de protection des brevets
Formulations chimiques	47	20 ans
Processus de fabrication	23	15-20 ans

Règlements complexes de l'environnement et de la sécurité

Métriques de la conformité environnementale:

• Réduction des déchets dangereux: 22,3% d'une année à l'autre
• Réduction des émissions de carbone: 15,6% depuis 2020
• Amélioration de l'efficacité de l'utilisation de l'eau: 18,4%

Considérations juridiques internationales commerciales

Marché international	Coût de conformité réglementaire	Évaluation des risques juridiques
Union européenne	4,1 millions de dollars	Grande complexité
Chine	3,6 millions de dollars	Complexité modérée
Brésil	2,9 millions de dollars	Faible complexité

Investissement de conformité juridique: 12,3 millions de dollars par an dans les opérations mondiales

Stepan Company (SCL) - Analyse du pilon: facteurs environnementaux

Engagement à réduire l'empreinte carbone et les émissions de gaz à effet de serre

Stepan Company a rapporté un 15% de réduction des émissions de gaz à effet de serre De 2018 à 2022. Les émissions totales de la lunette 1 et 2 de la société ont été de 101 250 tonnes métriques de CO2 équivalentes en 2022.

Type d'émission	2020 émissions (tonnes métriques CO2E)	2022 émissions (tonnes métriques CO2E)	Pourcentage de réduction
Émissions de la portée 1	58,720	52,860	10%
Émissions de la portée 2	52,380	48,390	7.6%

Pratiques de fabrication durables et stratégies de réduction des déchets

En 2022, Stepan Company a atteint Taux de recyclage des déchets à 92% à travers ses installations de fabrication. La société a investi 3,2 millions de dollars dans les initiatives de réduction des déchets et d'économie circulaire.

Métrique de gestion des déchets	Valeur 2020	Valeur 2022
Déchets totaux générés (tonnes)	12,450	11,680
Déchets recyclés (tonnes)	11,220	10,750
Taux de recyclage des déchets	90%	92%

Investissement dans la chimie verte et le développement de produits respectueux de l'environnement

Stepan Company alloué 12,5 millions de dollars pour la recherche et le développement en chimie verte en 2022. La société a développé 7 nouvelles formulations de produits respectueuses de l'environnement au cours de cette période.

Investissement en chimie verte	2020	2022
Dépenses de R&D ($)	10,800,000	12,500,000
Nouveaux produits écologiques	5	7

Conformité aux réglementations de protection de l'environnement de plus en plus strictes

Stepan Company a réalisé Conformité à 100% avec l'EPA et les réglementations environnementales au niveau de l'État en 2022. La société a payé 0 $ en pénalités de violation de l'environnement.

Métrique de la conformité réglementaire	2020	2022
Violations réglementaires	2	0
Pénalités de conformité ($)	15,000	0

Stepan Company (SCL) - PESTLE Analysis: Social factors

Consumer Demand Shift: Weakness persists in the global commodity Consumer Products end markets for Surfactants

You see the immediate impact of shifting consumer spending when you look at the Surfactants segment, which is Stepan Company's largest business. The global commodity Consumer Products end markets-specifically Laundry and Cleaning-showed persistent weakness in the second quarter of 2025. This softness caused a year-over-year sales volume decline of 1% for the Surfactants segment. Honestly, a 1% volume drop in your core commodity business is a clear signal that consumers are either trading down or simply buying less of the essentials. This decline happened despite the Surfactant segment's net sales increasing 8% to $411.5 million, an increase primarily driven by passing through higher raw material costs and a more favorable product mix in other areas.

Here's the quick math on the segment's Q2 2025 performance, showing the mixed signals:

Metric	Q2 2025 Value	Year-over-Year Change	Commentary
Surfactant Net Sales	$411.5 million	+8%	Driven by higher selling prices.
Surfactant Sales Volume	N/A	-1%	Due to lower demand in commodity markets.
Surfactant Adjusted EBITDA	$34.5 million	-1%	Down slightly, reflecting volume and cost headwinds.

Health & Nutrition Growth: The Specialty Products segment benefits from growing demand in the nutraceutical, food, and pharmaceutical industries

The good news is that the secular trend toward health and wellness is a strong tailwind for the Specialty Products segment. This business focuses on high-value applications like nutraceuticals, food, and pharmaceuticals, where demand remains robust. In Q2 2025, Specialty Product net sales jumped 22% year-over-year to $20.5 million, primarily on the back of higher sales volume. That's a massive volume signal, telling you where the market is headed.

Still, you need to be a realist: the segment's adjusted EBITDA decreased by 24%, or $2.1 million, in the quarter. What this estimate hides is that the dip was mostly due to order timing fluctuations within the pharmaceutical business, where large orders were simply shifted from Q2 to the second half of 2025. So, while the quarterly earnings look soft, the underlying sales volume growth of 22% is defintely the more important long-term social factor here.

Labor Relations: A new collective bargaining agreement at the critical Millsdale site was a factor in Q2 2025 working capital decisions

Labor stability at key manufacturing sites is a non-negotiable factor. The Millsdale, Illinois site is critical to Stepan Company's operations, and the negotiation of a new collective bargaining agreement (CBA) in 2025 had a direct, measurable impact on the company's financials. Management proactively built up inventory to maintain safety stock and ensure supply continuity during the negotiation period. This strategic inventory build contributed to the company's free cash flow turning negative, landing at a negative $14.4 million for Q2 2025. This is an expected, prudent cost of managing a major labor transition that happens every four years.

Also, the Millsdale site had an environmental remediation reserve adjustment that negatively impacted pre-tax earnings by part of a total $6.1 million charge in Q2 2025, showing that even routine labor events at a critical site carry multiple financial risks.

Sustainability Preference: Increasing customer demand for products with a lower product carbon footprint requires R&D investment

The social pressure for environmental responsibility is now a hard commercial requirement. Customers increasingly demand products with a lower product carbon footprint (PCF), which forces Stepan Company to invest heavily in innovation and new certifications. The company has responded by making R&D investments in areas like fermentation-based biosurfactants, which are derived from renewable sources.

To meet this demand, Stepan Company is focusing on:

• Achieving a 10% reduction in Scope 1 and 2 Greenhouse Gas (GHG) intensity from its base year by the end of 2025.
• Expanding the number of manufacturing sites with International Sustainability and Carbon Certification (ISCC) PLUS, which enables certified tracking of sustainable raw materials.
• Launching products, such as polyols with bio-circular components, that allow customers to make reduced PCF claims on their end-products like insulation.

This is not a feel-good initiative; it's a necessary investment to stay relevant to Tier 1 customers who have their own ambitious sustainability goals.

Stepan Company (SCL) - PESTLE Analysis: Technological factors

The core of Stepan Company's near-term technological strategy is centered on two clear actions: bringing the new, large-scale alkoxylation capacity online and aggressively pursuing green chemistry to future-proof the product portfolio. You need to understand that operationalizing this new Texas capacity is the single biggest lever for margin improvement in the second half of 2025.

New Alkoxylation Capacity

The new alkoxylation facility in Pasadena, Texas, is a major technological investment designed to expand Stepan Company's specialty surfactant business, particularly in high-growth markets like agriculture and oilfield. This site, which is the company's third alkoxylation facility, became operational in the first half of 2025 and is defintely critical for future supply chain redundancy and specialty product growth.

However, getting a complex chemical plant to full efficiency takes time. In the second quarter of 2025, pre-tax earnings were negatively impacted by $6.1 million primarily due to start-up costs associated with this new site. The facility is already demonstrating its flexibility, having produced 31 different products as it ramps up production.

Pasadena Alkoxylation Site - Key Metrics (Q2 2025)	Value/Impact	Note
Start-up Costs (Q2 2025 Pre-Tax Impact)	$6.1 million	Primary headwind to Q2 earnings.
Number of Products Produced (Ramp-up)	31	Demonstrates early product flexibility.
Capacity (Flexible)	75,000 tonnes/year	Long-term capacity for ethoxylates and propoxylates.
Expected Benefit Timeline	Second half of 2025 and beyond	Incremental margin benefits as ramp-up completes.

Green Chemistry Focus

Stepan's strategic research and development (R&D) is heavily focused on sustainability, which is a key competitive advantage in the specialty chemical space. The biggest long-term technological challenge for the chemical industry is Scope 3 emissions (indirect emissions from the value chain, like raw material production), and Stepan is tackling this head-on by innovating its feedstocks.

The use of alternative raw materials with a lower emissions footprint represents the greatest potential to lower the company's Scope 3 emissions. This is not just a compliance issue; it's a product innovation play. The R&D team is scaling up new technologies to create more sustainable offerings.

• Develop biofermentation-based surfactant offerings.
• Create a circular and renewable-based polyester polyol portfolio.
• Target a 35% reduction in Scope 1 and 2 emissions by 2030.
• Aim for 90% renewable or zero-carbon electricity by 2030.

Product Innovation Success

The company's R&D focus on specialty products is paying off in volume growth, especially in markets where performance is valued over commodity price. This is a clear sign that the product/customer mix optimization strategy is working. The Surfactant segment saw double-digit volume growth in two key strategic end markets in Q2 2025, even as overall Surfactant volume declined by 1% due to lower demand in global commodity consumer products.

Here's the quick math: Surfactant net sales were $411.5 million in Q2 2025, an 8% increase year-over-year, driven by selling prices up 11%. This price increase is primarily attributable to the improved product and customer mix from these specialty innovations, plus the pass-through of higher raw material costs. You're seeing the premium for high-tech, specialized chemistry.

Process Optimization

The immediate technological priority is stabilizing and optimizing the new Pasadena facility. The full ramp-up is expected to unlock significant cost savings and margin enhancement in the second half of 2025 and beyond, which is crucial for offsetting the persistent pressure from high oleochemical raw material costs. Beyond Pasadena, the company is also focused on leveraging its existing global alkoxylation network-now three plants-to provide strategically located redundancy and long-term capacity for growth. This is how you build a resilient, high-margin chemical business.

Stepan Company (SCL) - PESTLE Analysis: Legal factors

Regulatory Compliance

You need to understand that regulatory compliance for a specialty chemical manufacturer like Stepan Company isn't just about avoiding fines; it's a core operational cost and a key to market access. The regulatory environment is defintely getting more complex, especially in the US.

Stepan Company actively manages this through its membership in the American Chemistry Council (ACC) and adherence to the Responsible Care initiative. This commitment ensures proactive compliance with evolving standards, particularly the US Environmental Protection Agency's (EPA) implementation of the Toxic Substances Control Act (TSCA).

The company's participation in the ACC's Global Product Strategy (GPS) is a clear signal of proactive compliance management, moving beyond minimum legal requirements. This framework helps manage the health and environmental risks of chemical products globally, which is critical for a company with net sales of $594.69 million in Q2 2025.

Environmental Liability

Environmental liability is an immediate, measurable financial risk, and Stepan Company saw this play out in the first half of the 2025 fiscal year. The company recorded an environmental remediation reserve adjustment at its Millsdale site in Q2 2025, which was part of a larger, non-recurring financial impact.

Here's the quick math on the Q2 2025 pre-tax impact of these one-time legal and environmental costs:

Q2 2025 One-Time Pre-Tax Impact	Amount (Millions USD)	Notes
Total Pre-Tax Negative Impact	$6.1 million	Primarily start-up costs and environmental/legal items.
Estimated EPA Penalty (Included in Total)	~$1.0 million	The company plans to recover this from third parties.
Environmental Remediation Reserve Adjustment (Millsdale)	Part of the remaining ~$5.1 million	Adjustment to the reserve for ongoing remediation efforts.

The total pre-tax earnings were negatively impacted by $6.1 million in Q2 2025 due to these combined issues. This shows that environmental and regulatory issues aren't abstract risks; they hit the income statement directly.

Litigation Exposure

The general risk of an unfavorable resolution of litigation is a constant for chemical companies, and Stepan Company explicitly lists this as a potential financial drag in its forward-looking statements. The Q2 2025 financial results provided a concrete example of this exposure.

The company incurred an EPA penalty of approximately $1 million during the second quarter of 2025. While this penalty was included in the larger one-time charge, the company believes it will be able to recover this amount from third parties. Still, the initial outlay and the legal process itself represent a cash and resource drain. You must factor in the potential for these one-time events to recur.

Product Stewardship

Product stewardship is the legal and ethical commitment to managing the health, safety, and environmental (HSE) impacts of a product throughout its entire life cycle, from R&D to final disposal. For Stepan Company, this is formalized through the Product Safety Code, which is mandatory for all ACC members.

The company implements this code through a set of 11 Management Practices to monitor health and environmental impacts. This structured approach is how they keep their products on the right side of global chemical regulations.

Key areas covered by the 11 Management Practices include:

• Integrating HSE considerations into product and process design.
• Characterizing the risk of a product based on its inherent hazard and potential uses.
• Communicating product safety information efficiently to all stakeholders.
• Establishing goals and responsibilities for product stewardship throughout the organization.

This commitment is subject to third-party audits, ensuring the practices are not just on paper, but are actively driving continuous improvement in product safety performance.

Stepan Company (SCL) - PESTLE Analysis: Environmental factors

Emissions Reduction: Absolute Scope 1 and 2 greenhouse gas emissions were reduced by 12% over the 2016 baseline.

You're looking at Stepan Company's environmental performance, and the headline is strong: they've already blown past their near-term emissions target. The initial goal was a 10% absolute reduction in Scope 1 and 2 greenhouse gas (GHG) emissions over the 2016 baseline by the end of 2025. They achieved this ahead of schedule.

As of the end of 2024, Stepan Company reported an absolute reduction of just over 20% in Scope 1 and 2 market-based emissions against the adjusted 2016 baseline of 281.2 kilotons of CO2e. To be fair, the 2023 achievement was a 12% reduction over the unadjusted 2016 baseline, but the 2024 data, which includes facility acquisitions in the baseline, shows the greater progress. This means they are defintely moving in the right direction, setting a solid foundation for their new, more aggressive 2030 goals.

Here's the quick math on their recent emissions data:

Metric	2023 Performance	2024 Performance	Progress Note
Total Scope 1 & 2 GHG Emissions (kilotons CO2e, Market-Based)	246.98	253.45	Emissions rose slightly year-over-year, but the long-term reduction vs. 2016 remains strong.
Absolute Reduction vs. Adjusted 2016 Baseline	N/A (Reported as 12% vs. unadjusted baseline)	Just over 20%	Achieved and exceeded the initial 2025 goal of 10% reduction.
Emissions Intensity (metric tons CO2e per metric ton of throughput)	0.126	0.134	Intensity increased due to lower production volumes in 2023 and 2024, showing the risk of using intensity metrics alone.

Renewable Energy Use: Over 50% of the company's global electricity was sourced from renewable sources in 2023.

The push for renewable energy is a major lever for Scope 2 emissions reduction. In 2023, Stepan Company sourced a high of 52.0% of its global electricity from renewable sources, a significant jump from 47.0% in 2022. This includes electricity covered by Renewable Energy Certificates, Green Origin Certificates, Power Purchase Agreements, and on-site solar generation.

However, the most recent data for 2024 shows a slight pullback, with renewable electricity usage dropping to 43.0% of the total global electricity mix. This volatility highlights the challenge of securing consistent, high-volume renewable energy contracts globally, especially as their total energy consumption for 2024 was 4.16 thousand terajoules. Still, their European operations are a bright spot, sourcing 100% renewable electricity for that region. That's a clear win.

2025/2030 Goals: The 2024 Sustainability Report provided a progress update on 2025 goals and introduced new 2030 Environmental Goals.

With the original 2025 emissions goal already met, Stepan Company has introduced new, more ambitious 2030 Environmental Goals. These targets reflect a commitment to deeper decarbonization and are key indicators for investors focused on long-term Environmental, Social, and Governance (ESG) performance. The new goals are a clear signal that the company is taking climate risk seriously.

The new 2030 targets focus on two critical areas:

• Reduce Scope 1 and 2 emissions by 35% (from the adjusted 2016 baseline).
• Achieve an energy mix where renewable and zero-carbon electricity covers 90% of total usage.

For context, their Scope 3 emissions-those in the value chain-account for about 90% of their total carbon footprint, so future strategy will need to focus heavily on supply chain and product innovation to truly move the needle.

Water Management: Key water efficiency projects are underway to improve water management across manufacturing sites.

Water scarcity is a material risk for chemical manufacturers, and Stepan Company is strategically addressing it. They have achieved a substantial absolute freshwater usage decrease of 43% from 2016 to 2024 for a consistent set of operating sites. This is a strong operational efficiency metric.

However, the total water withdrawn across all global operations in 2024 was significant, totaling 4,617.03 megaliters. The company has identified four sites located in regions classified as high or extremely high water-stressed areas, based on the WRI Aqueduct water risk analysis. This forces them to prioritize water risk management in those specific locations. Key water efficiency projects include:

• Implementing new technologies to improve water reuse.
• Strengthening water management processes at high-risk sites.
• Refining the capital project review process to include sustainability criteria, ensuring new investments also drive water efficiency.

Finance: draft 13-week cash view by Friday.