PFAS - Assessing and addressing the business risk within a changing regulatory and ESG landscape - PROP311909
Status: Proposal
Date Announced: March, 2024
Summary
PFAS (Perfluoroalkyl and polyfluoroalkyl substances) is the umbrella term for a class of thousands of chemicals and polymers that are widely used as surfactants, lubricants, surface treatments, coatings, seals and liners. The industrial use of PFAS is mainly due to their chemical and thermal stability. This durability however also means PFAS are persistent when they are present in the environment and some show signs of bioaccumulation potential.
PFAS are increasingly being detected as pollutants and have been observed to contaminate groundwater, surface water and soil. Some are linked to negative effects on human health and have been restricted under the Stockholm convention on persistent organic pollutants1.
In March 2023, a formal proposal under Annex XV of the EU’s REACH regulations to restrict PFAS was submitted. The definition adopted for this proposal includes most chemicals and polymers and so is unprecedented in both its scale and scope. A decision on the proposal is expected in 2025/6.
The US has adopted a risk based approach with a “polluter pays” position2. Litigation has led to payouts from PFAS manufacturers in excess of $11bn with a growing focus on users of PFAS3. Environmental groups are targeting Environmental and Societial Governance (ESG) commitments of corporate investors with the stated aim of reducing the adverse impacts of hazardous chemicals4.
There is need to understand the key elements that describe the regulatory, ESG and supply side landscape to assess the changing business risk profile and develop the relevant mitigation strategies.
Project Concept
PFAS (Perfluoroalkyl and polyfluoroalkyl substances) are diverse group of chemicals and polymers. Since their discovery in the 1930s they have become an integral part of industrial and consumer products across the globe. They are an active component in adhesives, lubricants, surfactants, additives in coatings and erosion inhibitors. Polymeric PFAS are used as coatings, surface treatments and as seals and gaskets. It is estimated that there are over 10,000 different PFAS types and the overall market for PFAS products is approximately £25bn. Industrial estimates suggest that whilst the potential number of PFAS types is large, the number of commercially mature products is much smaller, probably less than 500.
Concerns over adverse effects on human health led to a voluntary withdrawl of two historically significant types of PFAS in the early 2000s, PFOA (perfluorooctanoic acid) and PFOS (perfluorooctane sulfonic acid). Alternatives and replacements for these chemicals are subject to some scrutiny with regards to their health and environmental effects. However, the number of chemicals that have been screened is small compared to the number available.
An increasing number of environmental studies are identifying PFAS in water sources. Limits for PFAS contamination in drinking water have considerably reduced as more data on health impacts are identified.
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