"The companies that will lead the next decade are not the ones with the best sustainability reports. They are the ones that have built decarbonization into their operational DNA — into the daily decisions that no sustainability team is in the room for," believes Sanjay Kshirsagar, Chief Operating Officer, Prince Pharma. As Scope 3 emissions become a strategic business priority, organizations are realizing that meaningful carbon reduction is driven not by reporting frameworks, but by the decisions made across procurement, logistics, product design, and supplier networks.
What practical and scalable interventions are helping organisations decarbonise their extended value chains beyond manufacturing operations?
Having led supply chain and operations across Henkel, Givaudan, Galaxy Surfactants, and Brenntag, I can say with certainty that the most effective Scope 3 interventions are never the ones that start in the sustainability department. They start on the operations floor — in procurement decisions, in logistics contracts, in the way you design a product's bill of materials. That is where the real carbon sits, and that is where it can be meaningfully reduced.
At Henkel, I saw firsthand how embedding carbon KPIs into supplier scorecards — not as aspirational targets but as contractual performance metrics — transformed the quality of upstream data and, over time, supplier behaviour. When decarbonisation becomes a condition of commercial relationship, the conversation changes entirely. At Givaudan, the challenge was different: fragrance and flavour ingredient sourcing spans hundreds of natural raw materials across dozens of origin countries, and achieving traceability — let alone carbon measurement — required years of systematic supplier development and joint investment in origin-level data infrastructure.
The most scalable Scope 3 interventions are the ones built into operational systems — procurement, logistics, product design — not the ones bolted on as reporting exercises.
At Galaxy Surfactants, reformulating toward bio-based fatty alcohols and sugar-derived surfactants was not a marketing decision — it was an operational one, driven by the realisation that the carbon intensity of our feedstock was our single largest Scope 3 lever. And at Brenntag, I experienced the distributor's unique position: the ability to aggregate freight, consolidate shipments, and shift modal choices across thousands of customers simultaneously — delivering Scope 3 reductions at a network scale that no individual manufacturer could replicate. Across all four companies, the pattern was consistent: scalable decarbonisation is built on operational integration, not sustainability overlays.
Which parts of the chemical ecosystem present the greatest decarbonisation challenge, and how can the industry address them collaboratively?
In my experience across these four very different businesses, the hardest part of the chemical ecosystem to decarbonise is not the part you control — it is the part two or three tiers upstream that you can barely see. At Galaxy Surfactants, our palm-derived feedstock supply chain stretched from Indonesian and Malaysian plantations through crushing facilities, refineries, and traders before reaching our manufacturing gate. The carbon embedded in that journey — land use change, fertiliser inputs, processing energy — dwarfed anything we could address in our own operations. And the traceability infrastructure simply did not exist at the granularity we needed.
At Givaudan, the complexity is botanical: natural ingredients sourced from smallholder farmers across Africa, Asia, and Latin America, where carbon measurement is practically impossible through conventional means and where the social and environmental dimensions are deeply intertwined. These are not problems any single company can solve through procurement policy alone. At Brenntag, I saw the logistics dimension: the chemical distribution network is inherently fragmented, with last-mile delivery requirements — driven by hazardous goods regulations, customer-specific scheduling, and product compatibility constraints — that make clean consolidation enormously difficult.
The hardest emissions to address are always in the tier you cannot see. That is why industry collaboration is not optional — it is the only viable architecture for upstream decarbonisation.
The answer, I believe, is collaborative infrastructure — shared audit frameworks like Together for Sustainability, where Henkel was a founding participant, that eliminate duplication and pool the cost of supplier engagement. For logistics, sector-wide investment in green freight corridors and intermodal solutions is essential. No individual company will fund that infrastructure alone. The chemical industry's greatest opportunity is to treat pre-competitive collaboration as a structural strategy, not an occasional gesture.
One of the most instructive experiences of my Brenntag-connected work was seeing how a distributor's network-level decisions — which most people think of as purely operational and commercial — are in fact one of the most powerful Scope 3 levers in the entire chemical value chain. By applying load optimisation algorithms across EMEA distribution routes and identifying 14 high-volume corridors where road freight could be shifted to rail, the network delivered an estimated 18,000 tonnes CO2e reduction in a single year — without any change in product formulation, supplier selection, or customer service levels. The lesson: in distribution, the carbon lever is the network itself.
How is Scope 3 performance influencing procurement decisions, customer relationships, and long-term competitiveness?
I have watched this shift happen in real time across my career, and I can tell you the change in the last five years has been dramatic. When I was working within Henkel's supply chain ecosystem in the mid-2010s, sustainability was a procurement consideration — important, but rarely decisive. Today, it is a threshold question. I have sat in commercial review meetings where a supplier's inability to provide verified product-level carbon data was treated with the same seriousness as a quality non-conformance. That would have been unimaginable a decade ago.
At Givaudan, we experienced this from the supplier side: FMCG customers were increasingly requiring Environmental Product Declarations for fragrance ingredients, and the companies that could provide them — backed by ISO 14044-compliant LCAs — were gaining commercial advantage that had nothing to do with price. At Galaxy Surfactants, the investment in product-level carbon footprinting for our surfactant lines was driven almost entirely by customer pull: personal care brands under CSRD obligations needed primary supplier data, not spend-based estimates, and were actively differentiating between suppliers on that basis.
Carbon data is becoming the new quality certificate. Suppliers who cannot provide it will lose preferred status regardless of their price competitiveness — I have seen this happen.
At Brenntag, I saw the commercial opportunity this creates for a distributor: customers willing to pay a green premium can be actively matched with certified bio-based or lower-carbon chemical alternatives, converting sustainability performance into a revenue differentiation strategy. The dynamic is now clear across all four companies I have been associated with: Scope 3 leadership protects margin, secures long-term contracts, and opens market segments that are closed to those who cannot demonstrate verifiable progress.
How can chemical companies improve data transparency, emissions traceability, and sustainability alignment across fragmented supplier networks?
This is the question I am asked most often, and the honest answer is that there is no shortcut. Data transparency across a fragmented chemical supplier network is an organisational capability that takes years to build — it cannot be purchased off the shelf or delegated to a software platform. I learned this progressively across my career, and each company taught me a different dimension of the challenge.
At Henkel, the critical insight was the difference between spend-based emission estimates and primary supplier data. Spend-based estimates are operationally convenient but strategically useless — they tell you approximately where your carbon sits but give you no basis for targeted reduction. The shift to primary data requires systematic supplier engagement, tiered requirements that match the materiality of each supplier relationship, and investment in the internal capability to verify and use the data once it arrives. The Together for Sustainability framework was invaluable here: by sharing audit infrastructure with peer companies, Henkel could extend meaningful engagement further into its supply base than any proprietary programme could have reached cost-effectively.
At Givaudan, the data challenge was about origin traceability — knowing not just that a natural ingredient came from a certified supplier, but which farm, which harvest, and under what conditions. This required blockchain-enabled provenance tracking for key ingredient streams, co-developed with smallholder cooperatives who needed technical and financial support to participate. At Galaxy Surfactants, the equivalent was RSPO chain-of-custody documentation for palm-derived feedstocks, providing immutable records that satisfied both procurement and certification requirements. At Brenntag, the opportunity was different: as a data aggregator sitting between thousands of producers and customers, building a carbon data intermediary function alongside the product distribution function is one of the most scalable contributions the distribution sector can make to industry-wide transparency.
Supplier data transparency is not a technology problem — it is a relationship and capability problem. The technology is the easy part.
Which emerging innovations or ecosystem partnerships can create the biggest long-term impact on indirect emissions reduction?
Having worked across the ingredient, distribution, and formulated product sides of the chemical value chain, my conviction is that the biggest long-term lever is feedstock circularity — fundamentally redesigning what the industry uses as its raw material base, rather than optimising processes built on inherently carbon-intensive petrochemical inputs. Everything else — energy efficiency, logistics optimisation, packaging redesign — matters, but it is marginal compared to changing the molecular origin of what we make.
At Galaxy Surfactants, I saw this most clearly. The transition from petrochemical-derived surfactants to sugar-based glucosides and plant-derived betaines was not just an environmental improvement — it was a strategic repositioning of the product portfolio toward a raw material base that is renewable, increasingly traceable, and aligned with where downstream customer demand is heading. The Renewable Carbon Index framework gave the business a structured way to measure and communicate this transition, which made it real in commercial conversations rather than just a sustainability claim.
At Henkel, the investment in chemical recycling partnerships — integrating pyrolysis-derived feedstocks into adhesive and packaging material development — opened a genuinely new raw material pathway that could not exist without ecosystem collaboration between brand owners, recyclers, and chemical producers. At Givaudan, partnerships with agricultural research institutions to develop lower-input cultivation methods for natural ingredients are reducing the land-use and fertiliser-related carbon embedded in our natural raw material base. And at Brenntag, the curation of a bio-based and recycled-content chemical alternatives portfolio is performing the essential market infrastructure function: making green chemistry commercially accessible to formulation customers who cannot source it independently.
Feedstock circularity is the real prize. Optimising a petrochemical supply chain is a holding strategy — rebuilding it around renewable and recycled carbon is the transformation.
The introduction of the Renewable Carbon Index as a portfolio management tool at Galaxy Surfactants was, in my view, one of the most practically useful sustainability innovations I encountered across my career. Rather than relying on high-level sustainability commitments, the RCI gave operations and commercial teams a product-level metric — the share of renewable carbon in each formulation — that could be tracked, targeted, and communicated. By 2024, approximately 68% of Galaxy's surfactant portfolio by volume was derived from renewable carbon sources. More importantly, the RCI became a live commercial tool: customers could request RCI scores for specific products during formulation discussions, enabling them to make ingredient choices that moved their own product sustainability metrics. Measurement made the strategy real.
How are digital technologies helping chemical companies improve emissions visibility, operational efficiency, and sustainability decision-making?
I have been both a beneficiary and a sceptic of digital technology in supply chain sustainability, and my honest view is this: the technology is powerful when it is connected to operational reality, and largely performative when it is not. I have seen both in my career. The companies that are genuinely advancing their Scope 3 capabilities through digital tools are the ones that started by cleaning up their operational data — master data quality, consistent unit definitions, reliable transactional systems — before layering sustainability analytics on top.
At Henkel, the integration of sustainability data into the enterprise resource planning environment was transformative precisely because it made carbon a live operational variable rather than an annual accounting exercise. When a procurement manager can see the carbon consequence of a sourcing decision at the point of making it — not six months later in an ESG report — the decision-making changes. That is the real value of digital integration: not visibility for reporting purposes, but visibility for operational decision-making. At Brenntag, the application of predictive analytics to freight optimisation — using order pattern data to identify consolidation opportunities before shipments are booked — delivered carbon and cost reductions simultaneously, which is the kind of aligned outcome that sustains organisational commitment to decarbonisation over time.
Digital tools give you visibility. But visibility only creates value if it changes decisions. Building that connection between data and operational action is the hard part — and most organisations have not done it yet.
At Givaudan, digital twins of key manufacturing processes allowed our teams to simulate the emissions impact of process parameter changes before physical trials, compressing the timeline for green chemistry implementation significantly. At Galaxy Surfactants, AI-assisted demand forecasting reduced overproduction in specialty ingredient lines, lowering both inventory waste and the energy intensity of batch manufacturing. Across all four companies, the pattern is consistent: digital technology delivers sustainability value when it is integrated into the operational workflow, not when it exists as a parallel reporting infrastructure.
What policy support, financing mechanisms, or industry collaborations are essential to make Scope 3 transition efforts commercially scalable?
After two decades in supply chain and operations leadership across chemical, consumer goods, and distribution businesses, my view on policy is pragmatic: the private sector will move faster and further with clear, consistent policy signals than it ever will through voluntary commitment alone. I have seen ambitious corporate sustainability strategies stall because the policy environment was too uncertain to justify the capital allocation — and I have seen modest corporate commitments accelerate rapidly when regulatory requirements created commercial urgency.
The most valuable policy intervention, in my experience, is carbon pricing that is credible, long-term, and covers Scope 3 emissions in a meaningful way. When carbon has a reliable price, investment decisions change — renewable feedstocks become commercially competitive, green logistics infrastructure gets funded, and circular economy business models become viable at scale. The EU Carbon Border Adjustment Mechanism is a step in this direction, but its current scope is narrow, and the administrative burden for chemical companies with complex, multi-origin supply chains is significant. Harmonised international standards — particularly for product-level carbon disclosure — would remove the market fragmentation that currently disadvantages bio-based and recycled-content producers competing against subsidised petrochemical alternatives.
On financing, I was closely connected to Henkel's sustainability-linked bond programme, which tied borrowing costs to verified Scope 3 reduction milestones. This structure worked precisely because the KPIs were operational — not communications targets — and the verification was independent. That credibility attracted institutional investors at a scale and cost that conventional financing could not match. For mid-sized companies like Galaxy Surfactants operating in emerging markets, blended finance mechanisms that de-risk green chemistry investment are equally important. And for the industry collectively, pre-competitive collaboration — through TfS, the Alliance to End Plastic Waste, and similar coalitions — provides the shared infrastructure that makes systematic supply chain transformation possible without every company bearing the full cost independently.
Voluntary commitment accelerates what regulation makes inevitable. The companies investing in Scope 3 capability now are building the competitive position that the next regulatory cycle will reward.
My exposure to Henkel's sustainability-linked bond structure gave me a clear view of how financial architecture can accelerate operational decarbonisation. The EUR 1 billion framework, which tied the bond coupon to three verified sustainability KPIs including a Scope 3 reduction target, worked because the milestones were operational and independently verified — not aspirational commitments. The bond was oversubscribed 3.2 times at issuance, reflecting strong institutional investor appetite for credible, KPI-linked instruments. The practical effect inside the organisation was significant: Scope 3 reduction targets that might previously have been treated as sustainability ambitions became financial obligations, with treasury and operations aligned around the same metrics. If I were advising a mid-sized chemical or pharmaceutical company today, establishing a sustainability-linked financing structure would be one of my first operational recommendations — not for the capital cost benefit, but for the organisational alignment it creates.
What will define a truly future-ready chemical supply chain, and how can the industry move from isolated initiatives toward integrated transformation?
I have spent the better part of my career building and transforming supply chains in businesses where the stakes — product quality, regulatory compliance, customer relationships — were always high. What I have learned, and what I now bring to my role at Prince Pharma, is that truly future-ready supply chains share a common characteristic: sustainability is not a programme that runs alongside operations. It is embedded in the operational system itself — in how procurement decisions are made, how logistics is contracted, how manufacturing processes are designed, and how supplier relationships are structured and measured.
Across Henkel, Givaudan, Galaxy Surfactants, and Brenntag, I observed different stages of this journey. Henkel, with its 2030 climate-positive commitment and deep TfS engagement, is perhaps furthest along the path of making sustainability a systemic operational capability rather than a strategic overlay. Givaudan's investment in origin traceability and smallholder partnership programmes reflects an understanding that the future-ready supply chain must be resilient and equitable as well as low-carbon — because natural resource scarcity and social instability in origin communities are as existential a risk as carbon regulation. Galaxy Surfactants' portfolio transformation toward renewable carbon demonstrates that a mid-sized specialty chemical company can reorient its entire product logic without sacrificing commercial performance. And Brenntag's evolution from product distributor to sustainability infrastructure platform shows how the distribution layer of the chemical value chain can become an active driver of ecosystem-wide decarbonisation rather than a passive intermediary.
The shift from isolated initiatives to ecosystem-wide transformation requires three things. First, shared data infrastructure — carbon transparency across supply chain tiers, enabled by common standards like the PACT Pathfinder Framework, so that every node in the value chain can build on reliable upstream data rather than estimates. Second, collaborative commercial models that distribute the cost and benefit of decarbonisation fairly — because if the financial burden falls entirely on suppliers while the commercial benefit accrues to brands, the system will not sustain. And third, operational leadership that is willing to make Scope 3 a first-class performance metric — measured, managed, and rewarded with the same rigour as cost and customer service. That is the standard I try to apply in my current role, and it is the standard I believe the industry must collectively adopt to make the sustainability transition both genuine and durable.
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