Solvay Board Issues Open Letter Regarding Soda Ash Operations in Rosignano
Brussels, 10 February 2022
The Solvay Board of Directors is issuing today the following open letter to all stakeholders regarding its Soda Ash operations in Rosignano, Italy.
To Our Stakeholders,
Over the last 16 months, a hedge fund that owns one share of Solvay – Bluebell Capital Partners – has promoted a campaign based on misleading information about our operations in Rosignano. As a 160-year-old company, we are keenly aware of our societal responsibilities and the vital role chemistry plays for the ESG journey on which we have embarked. The Solvay Board and management team value input and ESG engagement from all shareholders. However, over the course of Solvay’s engagement with Bluebell, we have become increasingly concerned that they may not be interested in a science and fact-based discussion.
Solvay is committed to responsible operations guided by our Solvay One Planet roadmap, which strives to promote the sustainability of our product portfolio, our facilities, and the well-being of our employees and communities in which we operate. This same commitment is true in Rosignano, Italy, where Solvay has been producing soda ash for over a century.
Solvay’s process to produce soda ash in Rosignano is safe and controlled, uses natural materials and complies with EU and Italian regulations, including corresponding effluent discharge methods and emission limits. The Company has provided Bluebell with extensive information about the Rosignano facility, backed by documentation including periodic monitoring reports from regulators and independent scientific and academic institutions, which is available on the Company’s website, and a summary of which is provided as an addendum to this letter.
It is difficult to imagine how Bluebell, a fund with no known expertise in environmental science or chemistry and no track record of sustainability investing, would understand Solvay’s soda ash operations better than environmental regulators and independent scientists who have been overseeing and monitoring the Rosignano site for decades, in compliance with stringent EU and Italian requirements.
Despite Solvay’s responsiveness and diligence in pointing to facts and scientific data from official sources, including providing detailed answers to a list of 52 questions, Bluebell submitted to our May 11, 2021 annual general meeting (subsequently posted on our website for the benefit of all stakeholders), Bluebell has continued to repeat and disseminate its same misleading narrative. Indeed, Bluebell has sent numerous letters to nearly 200 stakeholders, including shareholders, customers, regulators, EU, UN and Italian officials and professional affiliates, in what appears to be a campaign aimed at harming Solvay’s Soda Ash business.
In late January 2022, the IPPC1 permit for the Rosignano site was renewed, following a lengthy review of our operations conducted by independent experts and government agencies (the permit renewal process was prompted by the adoption in 2017 of new EU requirements applicable to Inovyn, a company unrelated to Solvay, and our Peroxides production unit, whose facilities share the same industrial campus and are therefore covered by the same permit). Since the permit renewal, Bluebell has taken the extreme step of making unfounded insinuations of misconduct involving the Italian Ministry of Ecological Transition, which have been passed onto the press and have been promptly denied by the Ministry. This latest attack has made it clear to Solvay’s Board that Bluebell does not appear to be interested in genuine ESG engagement.
Our Board considers the oversight of matters related to ESG to be a critical part of our responsibility to all stakeholders. Under the leadership of Solvay’s CEO, Ilham Kadri, we have taken important steps forward to accelerate the Company’s progress. Through the Company’s robust ESG roadmap, One Planet, Solvay is driving progress toward 10 ambitious targets across three key pillars – climate, resources and better life, including plans to phase out coal, cut emissions and transition towards green energy to reach carbon neutrality by 2050, with all businesses other than soda ash to achieve carbon neutrality by 2040.
As part of its ongoing sustainability efforts, Solvay has made significant investments in Rosignano, which have resulted in freshwater consumption being reduced by more than 20% in the past decade and using recycled water from the municipal wastewater treatment facility. The site has also successfully cut its emissions by 40% in the past two years thanks to the building of a high-efficiency cogeneration power facility as well as another plant to capture, purify and liquefy CO2 which is reused in its production process. Our responsible commitment to the sustainable development of the Rosignano facility has recently received the support of the local authorities2 and the employee unions, who noted in a statement that the permit renewal “represents the right and concrete recognition of the site and the efforts made in recent years to constantly improve its sustainability in the area of health, safety and the environment.”3
Our Board of Directors and management team will continue to take actions that we believe are in the best interest of our shareholders and all stakeholders, whom we thank for their support as we continue to accelerate our journey to enhance value, responsibly.
Sincerely,
The Solvay Board of Directors
1Integrated Pollution Prevention and Control
2The statement of the Rosignano mayor is available here.
3The statement of the union representatives is available here.
Solvay’s Soda Ash Operations in Rosignano
A Safe and Controlled Process Using Natural Materials
The process to produce soda ash in Rosignano, Italy is safe and controlled, uses natural materials and is in full compliance with EU and Italian regulations. Both Solvay and the regulators monitor every step of the process, as do independent institutions, confirming that the effluent composition complies with Italian emission limits and the offshore water quality near the facility is safe and similar to the rest of the Tuscan coast.
The facility’s compliance with applicable regulations was recently reaffirmed by the renewal of the Company’s IPPC permit by Italian authorities for the Rosignano facility in January 2022. The full review process was first initiated by the Ministry of Ecological Transition in November 2018, due to amendments to the EU BAT-BREF4 enacted in late 2017 (which applied to Inovyn, a company unrelated to Solvay, and our Peroxides production unit, whose nearby facilities share the same industrial campus and are therefore covered by the same permit). The new permit is based on an extensive review of the Rosignano operations conducted by an independent committee of experts, whose conclusive report contains detailed prescriptions to be complied with by the plant, and a thorough monitoring and compliance report by ISPRA5.
4Best Available Technique Reference Document
5Italian National Institute for Environmental Protection and Research
Solvay’s Soda Ash Process Uses Natural, Inert Materials
The production of soda ash involves the use of natural materials – limestone, salt brine and water – and the Rosignano facility uses limestone and salt from nearby quarries. No heavy metals are used or added in the soda ash process. Limestone is a widespread natural material and can be found in the cliffs along the coast in Italy. This natural, local limestone is brought into the facility and, following the production cycle, this same natural, residual local limestone, mixed with gypsum, sand clay and seawater is released into the sea. It is safe and inert. Like many types of rock or stone, it contains traces of naturally-occurring heavy metals, which are imprisoned in a solid state in the limestone and are not harmful for living organisms.
The Effluent Release Method is Fully Compliant with EU Best Available Techniques (BAT) and is the Preferred Solution
There are several acceptable techniques to dispose of inert materials remaining from soda ash operations, as outlined in the applicable EU BAT-BREF. Those methods are:
- Settling ponds (considered to be BAT for a land-locked facility) or
- Direct release into the sea (considered to be BAT for a facility near the sea) through pipes or an open channel
Each of the techniques was considered solely based on the facility’s specific geographical characteristics and alignment with BAT-BREF, not cost. Following discussions with local, regional and national authorities, and supported by independent scientific bodies, a release to the sea through an open channel was confirmed to be the preferred solution for Rosignano, given that:
- Underwater currents ensure that the non-toxic limestone does not accumulate (as required by BAT) but rather spreads evenly on the seabed; and
- The limestone that flows back onto the shore and the beach plays an important role in stabilizing the shore against erosion.
The renewed IPPC permit acknowledges these facts, confirming that the direct release into the sea through an open channel is the best available technique according to BAT-BREF.
Solvay’s new permit in Rosignano also confirms that the maximum amount of suspended solids that may be released into the sea is 250,000 tons per year (as previously authorized) and falls in the range defined by the BAT-BREF (actual discharge is approximately 220,000 tons). However, as part of the Company’s efforts to continually optimize the efficiency and sustainability of its operations, Solvay has committed to study possible new technical solutions to reduce the quantity of suspended solids produced or discharged by the facility and to report its findings to the authorities. This commitment is included in the new IPPC permit.
About Solvay
Solvay is a science company whose technologies bring benefits to many aspects of daily life. With more than 23,000 employees in 64 countries, Solvay bonds people, ideas and elements to reinvent progress. The Group seeks to create sustainable shared value for all, notably through its Solvay One Planet roadmap crafted around three pillars: protecting the climate, preserving resources and fostering a better life. The Group’s innovative solutions contribute to safer, cleaner, and more sustainable products found in homes, food and consumer goods, planes, cars, batteries, smart devices, health care applications, water and air purification systems. Founded in 1863, Solvay today ranks among the world’s top three companies for the vast majority of its activities and delivered net sales of €9 billion in 2020. Solvay is listed on Euronext Brussels and Paris (SOLB). Learn more at www.solvay.com.
