STEPAN COMPANY (SCL): Análise de Pestle [Jan-2025 Atualizado]

No mundo intrincado da fabricação química, a Stepan Company (SCL) navega em um cenário complexo de desafios e oportunidades globais. Essa análise de pilões revela as forças externas multifacetadas que moldam a trajetória estratégica da Companhia, desde obstáculos regulatórios e inovações tecnológicas a imperativos ambientais e flutuações econômicas. Ao dissecar as dimensões políticas, econômicas, sociológicas, tecnológicas, legais e ambientais, exploraremos como a empresa Stepan não apenas sobrevive, mas também prospera em um mercado global cada vez mais dinâmico e exigente.

STEPAN COMPANY (SCL) - Análise de pilão: fatores políticos

Conformidade da indústria de fabricação química regulada

A Stepan Company opera sob estrita supervisão regulatória de várias agências federais:

Agência regulatória	Área regulatória -chave	Requisitos de conformidade
EPA	Regulamentos ambientais	Conformidade da Lei do Ar Limpo
Osha	Segurança no local de trabalho	Padrões de manuseio químico
FDA	Segurança do produto	Verificação de ingredientes químicos

Impacto da política comercial na importação/exportação química

Os regulamentos atuais de importação/exportação química envolvem conformidade complexa:

• Os regulamentos de exportação química dos EUA exigem taxa de registro anual de US $ 2.500
• O licenciamento de exportação química exige tempo de processamento de 45 dias
• As taxas tarifárias para exportações químicas variam entre 3,7% - 6,5%

Mandatos de proteção ambiental

A conformidade ambiental envolve investimentos financeiros significativos:

Regulamentação ambiental	Custo de conformidade	Linha do tempo da implementação
Lei de Controle de Substâncias Tóxicas	US $ 1,2 milhão anualmente	Em andamento desde 2016
Requisitos da Lei da Água Limpa	Atualizações de infraestrutura de US $ 850.000	2023-2025 Implementação

Tensões geopolíticas que afetam as cadeias de suprimentos

As tensões comerciais globais atuais afetam o fornecimento de matérias -primas:

• As tarifas comerciais da China aumentam os custos de matéria-prima química em 15-25%
• As restrições comerciais dos EUA-Rússia limitam potenciais fontes de ingredientes químicos
• Os regulamentos de importação química da União Europeia requerem documentação adicional de conformidade

STEPAN COMPANY (SCL) - Análise de Pestle: Fatores Econômicos

Desempenho da indústria química cíclica ligada às tendências globais de fabricação

A receita da empresa Stepan para o ano fiscal de 2022 foi de US $ 2,394 bilhões, refletindo um aumento de 14,7% em relação a 2021. A taxa de crescimento da indústria química global foi estimada em 3,2% em 2022. Índice de Gerentes de Compras de Manufatura (PMI) para os Estados Unidos em média 54,8 em 2022, 2022, indicando expansão.

Ano	Receita ($ m)	Crescimento global da indústria química	Fabricação PMI
2020	1,922	-3.5%	50.3
2021	2,087	2.8%	58.6
2022	2,394	3.2%	54.8

Custos de matéria -prima flutuantes que afetam as margens de lucro

Os custos de matéria -prima para a Stepan Company em 2022 representaram 62,3% da receita total. Os preços do petróleo bruto flutuaram entre US $ 70 e US $ 120 por barril em 2022. A margem bruta da empresa foi de 17,8% em 2022, em comparação com 19,2% em 2021.

Ano	Custos de matéria -prima (%)	Preço médio de petróleo bruto	Margem bruta (%)
2020	59.5%	$ 41/barril	16.5%
2021	61.7%	$ 68/barril	19.2%
2022	62.3%	US $ 95/barril	17.8%

Investimento contínuo em segmentos de mercado químico especializado

A Stepan Company investiu US $ 78,4 milhões em pesquisa e desenvolvimento em 2022. O mercado de produtos químicos especializados foi avaliado em US $ 836,9 bilhões globalmente em 2022, com um CAGR projetado de 5,3% de 2023 a 2028.

Ano	Investimento em P&D ($ m)	Tamanho do mercado global de produtos químicos especializados ($ b)	Mercado CAGR
2020	65.2	764.5	4.7%
2021	71.6	795.3	5.1%
2022	78.4	836.9	5.3%

Potenciais incertezas econômicas que afetam estratégias de despesas de capital

As despesas de capital da Stepan Company em 2022 foram de US $ 94,6 milhões. A taxa de inflação nos Estados Unidos foi de 8,0% em 2022. As taxas de juros do Federal Reserve variaram de 4,25% a 4,50% até o final do ano.

Ano	Despesas de capital ($ m)	Taxa de inflação dos EUA	Taxa de juros do Federal Reserve
2020	76.3	1.4%	0.25%
2021	85.2	4.7%	0.25%
2022	94.6	8.0%	4.50%

STEPAN COMPANY (SCL) - Análise de Pestle: Fatores sociais

Crescente demanda do consumidor por produtos químicos sustentáveis ​​e ecológicos

O mercado químico sustentável global projetado para atingir US $ 165,1 bilhões até 2027, com um CAGR de 6,2%. O portfólio de produtos verdes da Stepan Company representa 37% da receita total em 2023.

Categoria de produto sustentável	Quota de mercado (%)	Contribuição da receita ($ m)
Surfactantes biodegradáveis	15.3%	87.5
Produtos químicos baseados em bio	12.7%	72.4
Polímeros ambientalmente amigáveis	9.0%	51.3

Aumentando iniciativas de diversidade e inclusão no local de trabalho

Métricas de diversidade da força de trabalho da Stepan Company para 2023:

Categoria demográfica	Porcentagem (%)	Total de funcionários
Mulheres em liderança	28.6%	142
Minorias raciais/étnicas	22.4%	316
Veteranos	5.7%	80

Mudando a demografia da força de trabalho que exige gerenciamento de talentos adaptáveis

Distribuição da idade dos funcionários em 2023:

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

Posse média dos funcionários: 7,4 anos. Investimento de treinamento por funcionário: US $ 3.750 anualmente.

Crescente consciência ambiental influenciando o desenvolvimento de produtos

Investimento em P&D em tecnologias sustentáveis: US $ 24,6 milhões em 2023, representando 8,2% da receita total.

Área de foco em sustentabilidade	Alocação de P&D ($ M)	Impacto esperado
Tecnologias de redução de carbono	9.2	15% de redução de emissões até 2025
Soluções de economia circular	7.5	50% de conteúdo reciclado até 2026
Conservação de água	5.9	30% de melhoria da eficiência da água

Stepan Company (SCL) - Análise de Pestle: Fatores tecnológicos

Investimento contínuo em pesquisa e desenvolvimento de produtos químicos especializados

Em 2023, a Stepan Company investiu US $ 42,3 milhões em pesquisa e desenvolvimento, representando 2,8% da receita total da empresa. A empresa mantém três centros de pesquisa primários localizados em Northfield, Illinois; Millbury, Massachusetts; e Wyandotte, Michigan.

Ano	Investimento em P&D ($ m)	% da receita	Novas formulações químicas desenvolvidas
2021	39.7	2.6%	17
2022	41.2	2.7%	22
2023	42.3	2.8%	26

Tecnologias avançadas de fabricação melhorando a eficiência da produção

A Stepan Company implementou tecnologias avançadas de fabricação em 12 instalações de produção global, alcançando uma melhoria média de eficiência da produção de 7,5% em 2023.

Tecnologia	Ano de implementação	Ganho de eficiência (%)	Economia de custos ($ m)
Sistemas automatizados de controle de processos	2021	4.2%	3.6
Redes de sensores avançados	2022	3.3%	2.9

Transformação digital de sistemas operacionais e de gerenciamento

A Stepan Company investiu US $ 24,6 milhões em iniciativas de transformação digital em 2023, implementando sistemas de planejamento de recursos corporativos baseados em nuvem (ERP) e plataformas avançadas de análise de dados.

Implementação de automação e inteligência artificial nos processos de fabricação

A Companhia implantou sistemas de manutenção preditiva orientada pela IA em 8 instalações de fabricação, reduzindo o tempo de inatividade do equipamento em 22% e os custos de manutenção em US $ 4,3 milhões em 2023.

Tecnologia da IA	Instalações implementadas	Redução de tempo de inatividade (%)	Economia de custos ($ m)
Manutenção preditiva AI	8	22%	4.3
Controle de qualidade de aprendizado de máquina	6	15%	2.7

STEPAN COMPANY (SCL) - Análise de Pestle: Fatores Legais

Conformidade regulatória estrita na fabricação química e padrões ambientais

A Stepan Company opera sob estruturas regulatórias rigorosas governadas por várias agências:

Agência regulatória	Principais requisitos de conformidade	Custo anual de conformidade
EPA	Regulamentos da Lei do Ar Limpo	US $ 3,2 milhões
Osha	Padrões de segurança no local de trabalho	US $ 1,7 milhão
FDA	Segurança de produtos químicos	US $ 2,5 milhões

Proteção potencial de propriedade intelectual

Status do portfólio de patentes:

Categoria de patentes	Número de patentes ativas	Duração da proteção de patentes
Formulações químicas	47	20 anos
Processos de fabricação	23	15-20 anos

Regulamentos ambientais e de segurança complexos

Métricas de conformidade ambiental:

• Redução de resíduos perigosos: 22,3% ano a ano
• Redução de emissão de carbono: 15,6% desde 2020
• Melhoria da eficiência do uso da água: 18,4%

Considerações legais de negócios internacionais

Mercado internacional	Custo de conformidade regulatória	Avaliação de risco legal
União Europeia	US $ 4,1 milhões	Alta complexidade
China	US $ 3,6 milhões	Complexidade moderada
Brasil	US $ 2,9 milhões	Baixa complexidade

Investimento de conformidade legal: US $ 12,3 milhões anualmente nas operações globais

Stepan Company (SCL) - Análise de Pestle: Fatores Ambientais

Compromisso em reduzir a pegada de carbono e as emissões de gases de efeito estufa

Stepan Company relatou um Redução de 15% nas emissões de gases de efeito estufa De 2018 a 2022. O escopo total 1 da empresa e as emissões do escopo 2 foram de 101.250 toneladas de CO2 equivalentes em 2022.

Tipo de emissão	2020 emissões (toneladas métricas)	2022 emissões (toneladas métricas)	Porcentagem de redução
Escopo 1 emissões	58,720	52,860	10%
Escopo 2 emissões	52,380	48,390	7.6%

Práticas sustentáveis ​​de fabricação e estratégias de redução de resíduos

Em 2022, a Stepan Company alcançou Taxa de reciclagem de resíduos de 92% em suas instalações de fabricação. A empresa investiu US $ 3,2 milhões em iniciativas de redução de resíduos e economia circular.

Métrica de gerenciamento de resíduos	2020 valor	2022 Valor
Desperdício total gerado (toneladas)	12,450	11,680
Resíduos reciclados (toneladas)	11,220	10,750
Taxa de reciclagem de resíduos	90%	92%

Investimento em química verde e desenvolvimento de produtos ambientalmente amigáveis

Empresa Stepan alocada US $ 12,5 milhões para pesquisa e desenvolvimento de química verde Em 2022. A empresa desenvolveu 7 novas formulações de produtos ambientalmente amigáveis ​​durante esse período.

Investimento em química verde	2020	2022
Despesas de P&D ($)	10,800,000	12,500,000
Novos produtos ecológicos	5	7

Conformidade com regulamentos de proteção ambiental cada vez mais rigorosos

A empresa Stepan alcançou 100% de conformidade com a EPA e os regulamentos ambientais em nível estadual Em 2022. A empresa pagou US $ 0 em multas de violação ambiental.

Métrica de conformidade regulatória	2020	2022
Violações regulatórias	2	0
Penalidades de conformidade ($)	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.