LafargeHolcim raises its target for reducing carbon emissions

LafargeHolcim raises its target for reducing carbon emissions

Reuters  | Sep 21, 2020 00:35

LafargeHolcim raises its target for reducing carbon emissions

By John Revill

ZURICH (Reuters) - LafargeHolcim (S:LHN) has committed to further reducing its carbon emissions by 2030, the world's largest cement maker said on Monday, as investors and customers increasingly demand companies curb their environmental impact.

The Swiss company wants to reduce the amount of CO2 produced for every tonne of cement it makes by 21% as part of the global goal to limit temperature change to 1.5 degrees Celsius.

It wants to reduce the CO2 created for every tonne of cement to 475 kg per tonne, down from its previous target of 520 kg. Last year the figure was 561 kg - equivalent to around 120 million tonnes of C02.

Investors are pushing companies to lower their emissions, with insurers and pensions funds taking environmental impact into account when making their investment decisions.

LafargeHolcim's shares have lost 11.2% over the past 12 months, underperforming the Stoxx construction and materials index which is 0.4% lower (SXOP)

"Investor concerns regarding carbon emissions are holding back LafargeHolcim shares quite significantly," said Bernd Pomrehn, an analyst at Bank Vontobel.

"For sure the level of carbon emission is becoming an increasingly important topic for investors," Magali Anderson, chief sustainability officer at LafargeHolcim, told Reuters.

LafargeHolcim said it would increase the use of low carbon and carbon neutral cements it makes. It will reuse 100 million tonnes of waste to heat its kilns and also increase the amount of recycled materials in cements.

The goals will be monitored by Science Based Targets Initiative, a collaboration among green investment adviser CDP, the United Nations Global Compact, World Resources Institute and the World Wide Fund for Nature.

LafargeHolcim was taking the initiative to help protect the environment, but there were also good business reasons to do it, Anderson said.

© Reuters. The logo of LafargeHolcim, the world's largest cement maker, is seen in Zurich

Using alternative fuels instead of traditional fossil fuels was cheaper, while customer demand for low-carbon cement was rising, she said.

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