Interview on sustainability: “An unclear regulatory framework is one of the biggest challenges”

How do you assess the coatings industry in comparison to other sectors regarding sustainability?

Dr. Felix Lauterbach: In recent years, the coatings industry has made significant progress toward sustainability, particularly through the increased use of water-based systems and low emission technologies. Compared with other sectors, however, the industry operates in a field of tension: on the one hand, there are strong regulatory requirements, while on the other, price pressure remains high. At the same time, expectations along the entire value chain are rising, especially regarding CO₂ reduction, circularity, and the use of renewable raw materials.

Customers are also increasingly prioritizing CO₂ reduction as an important sustainability criterion, which is clearly visible in close market engagement. Overall, the coatings industry today shows strong momentum in sustainable innovations but still faces the challenge of making these technologies cost efficiently available across all application areas.

Where do you see the greatest challenges and opportunities to make the industry more sustainable?

Lauterbach: An unclear regulatory framework is one of the biggest challenges, as it complicates investment security and long-term planning. In addition, there is a need for common standards – such as those developed under Together for Sustainability (TfS – to make sustainability comparable internationally. Transparency along the value chain is equally critical: only when data on CO₂ footprints and raw material origin are reliably available can manufacturers make well informed decisions.

Another central challenge is the availability of sustainable raw materials in sufficient quantity and quality, particularly in the area of bio based and recycled feedstocks. Here, expanding infrastructure and improving the cost structure of alternative feedstocks play a major role.

A major opportunity lies in scaling technologies such as mass balance and chemical recycling, which already lead to measurable CO₂ reductions. Innovations in formulation technologies – such as enabling low biocide or biocide free products, already successfully implemented in internal and external projects – are equally important. Overall, the industry has significant opportunities to differentiate itself through sustainable solutions.

Where do you see the strongest demand for sustainability, and how does this shape BASF’s regional strategies?

Lauterbach: The strongest impulses clearly come from the market: many customers, especially in Europe, but increasingly also in Asia and North America, expect solutions that enable CO₂ reduction and support circularity. In Europe, highly ambitious sustainability goals dominate, while demand for circular solutions is increasing significantly in Asia. North American customers place great value on robust, traceable CO₂ data.

These market requirements directly shape our regional orientation, for example through the global expansion of mass balanced products and the adaptation of our portfolio and production focus. This allows us to address the specific expectations of each region while maintaining a globally consistent sustainability strategy.

Event tip

The Sustainable Coatings Conference, which takes please November 3 and 4 in Amsterdam, Netherlands, will provide practical insights into low‑carbon technologies, circular economy approaches, bio‑based and water‑based systems, and robust assessment methods such as LCA and mass balance. Learn how the industry is responding to regulatory pressure, customer expectations, and material constraints – and how sustainability can become a measurable business advantage rather than a compliance burden.

How do you measure the success of your sustainability initiatives—primarily by CO₂ reduction, or are other metrics important as well?

Lauterbach: We follow a holistic approach built on several key pillars: CO₂ reduction, the share of sustainable raw materials (renewable or recycled), the use of green energy, and regulatory compliance. In addition, we assess how effectively different measures translate into measurable impact, for example, where mass balance solutions, renewable energy, or alternative feedstocks enable a reduced product carbon footprint under the applicable calculation methodology. Beyond carbon, toxicological improvements and formulation innovations, such as low biocidal or biocide free systems, are equally important. Our goal is a KPI set that equally reflects ecological, economic, and regulatory dimensions.

Mass balance has a partly controversial reputation in the industry. What criticisms do you hear most frequently?

Lauterbach: A common criticism relates to misunderstandings: many customers assume that each component is physically replaced, although the principle is based on attribution at the beginning of the value chain. In addition, some market participants wish for a fully segregated supply chain – yet in integrated and complex value chains this is neither technically nor economically feasible and contradicts the customer expectation for a scalable, cost-efficient transformation.

Further discussions revolve around whether mass balance creates sufficient investment incentives for renewable raw materials or whether more immediately traceable product solutions should be preferred. Differences between certification systems also cause confusion, as they vary significantly in logic and complexity.

What would you say are the practical advantages that mass balance offers the industry?

Lauterbach: The greatest advantage of mass balance is that alternative raw materials can be integrated into existing production networks through certified attribution, without the need to build new plants or establish separate processes. This enables faster and more scalable adoption of sustainable products and always represents a true “drop-in solution.” It reduces both costs and development or market-entry timelines.

Depending on the feedstock and production setup, mass balance can also support measurable reductions in product carbon footprints, while maintaining high supply reliability and consistent product quality. Customers benefit from certified documentation and global availability across BASF sites. For many applications, mass balance is therefore a pragmatic and reliable pathway to broad-scale sustainable transformation.

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