Interview with Frank Jenner | Ernst and Young

Five areas will be addressed at ACHEMA: fossil-free production, circular economy, industrial water, sustainable chemistry and bio-based economy. As the leading platform for the process industry, the intention is to strive to expand the scope beyond "just" innovative solutions already on display.
That is one of the reasons why the EY innovation stage will bring together startups, institutions in science, technology, business, education and finance as well as political and regulatory protagonists for what’s expected to be something of a revealing interdisciplinary discourse.
On the Monday of the event, Frank Jenner will publish an EY DigiChem study, updating a similar one from 2020, which gave some strong indicators of how much digitisation in the chemical industry has been accelerating. So much so that 90 per cent of those questioned told researchers that they expected "evolutionary, revolutionary or even disruptive" changes. The survey, carried out in co-operation with an independent market research institute, went on to highlight the fact that many medium-sized and larger chemical companies are already using digital technologies to radically change their existing processes and structures.
Many executives felt that digital technologies were having an increasing impact on their company's strategic and operational positioning. In particular, it would affect innovation and development (56%), the customer interface (56%), the processes and efficiency along the value chain (55%), logistics and sales (62%), sales and order management (59%) and customer service (58%).
And 51 per cent said that the biggest benefit of their digitisation projects so far had been cost savings, followed by faster turnaround times (47%) and better customer centricity (43%).
Many also found that their company was able to adapt relatively easily to the Covid lockdowns, thanks to the digital progress that had already been made. As a result, most were able to switch to remote working and customer service in a very short time, and digitise processes that were previously analog.
Ahead of its publication, I spoke biefly to Mr Jenner about the work his company have been doing in the interim.

ACHEMA Inspire: The Green Innovation Zone will be multi-faceted and cover many disciplines. Can you summarise what green innovation means to you?

• __Frank Jenner: I have recently centered on “hydrogen”. H₂ as a fluid to transport energy but also as a feedstock. I am a strong believer that H₂ will help us in saving the climate in the long run.

ACHEMA Inspire: Have there been any recent initiatives that have impressed you or made an impact on your thinking?

• __Frank Jenner: H₂ again! But also other things like the circular economy which is still in its infancy. When I see that only eight per cent of material is circular worldwide, and also only nine per cent of the plastic value chain is circular and even only 15 per cent of the plastic waste collected in Europe is circular this clearly demonstrates our needs going forward.
  As far as EY are concerned, we have just joined the Alliance to End Plastic Waste as a supporter to contribute stronger than ever in this initiative.

ACHEMA Inspire: You talk generally about change being ‘on the horizon’ in terms of chemical value chains. How close are we to effecting meaningful change?

• __Frank Jenner: Well, I would certainly say that a mega change in this decade and beyond is going to be the electrification of ALL assets in a plant. Starting from the steamcraker to all downstream units, each piece of equipment needs to be electrified. This is the biggest chemical process engineering challenge since the sixties and a big, big challenge and change and I appreciate and admire the efforts of the chemical industry here.
  But the change being on the horizon was meant more in terms of the digital transformation the chemical industry is undergoing. This has been tested and implemented successfully in the past seven years especially in the back-office functions but it needs to be further driven in the production environment and the logistics and distribution functions: i.e. the entire Supply Chain. There is still much more to gain. And with the circular economy on its way, the digital transformation is set to receive another big push from this angle as well.

ACHEMA Inspire: There is no doubt that the process industry is fully committed to the UN’s Sustainable Development Goals. What in your opinion is most needed in terms of help in achieving those.

• __Frank Jenner: As I said earlier, it is a big challenge for the industry to electrify their assets and change their feedstocks away from Nafta and Gas for a CO₂ emission-free future. This is what the industry is pushing for globally and I can see the efforts everywhere among our clients.
  There is a big commitment being given here. However, the regulator needs to see and respect these efforts and realise that it cannot be done overnight. The efforts are huge! On the other hand, the chemical industry is also a big partner on the solution side for all other manufacturing industry players, having new product innovations in place to reduce CO₂ emissions for their customers. I would say that no other industry can work on their own set-up so strongly and provide new products, services and solutions to reduce CO₂ emissions in the product life cycle and value chains of their customers, including proper material recycling capabilities in the long run.

ACHEMA Inspire: You mentioned that EY has recently joined the Alliance to End Plastic Waste. How will your involvement bring the greatest benefit?

• __Frank Jenner: We will support the alliance right now in a project to define and align their KPI metrics performance system for the external reporting of all their global initiatives. This is essential to progress further and gain even more momentum in the market. Further, we will provide help and support in bringing different stakeholders together to form new projects and programs which require substantial financial contributions from their project partners. The alliance wants to kickstart initiatives and start funding to a certain degree, but the majority needs to come from companies themselves as well as governments and other NGOs as well.

ACHEMA Inspire: Finally, how would you describe the way digital transformation is helping to reshape operations in the chemicals industry?

• __Frank Jenner: As mentioned, the back office support functions are in a good way compared to other industries at the moment. The chemical industry came late to the game in 2015 but since then they have gone fast forward and gained momentum. However, within the production and logistics areas, more effort will be needed going forward to also support electrification and decarbonization and foster the circular economy. Digitalisation will be the door-opener and the realisation lever in all of those areas.

Editor's Note: The Sustainable Development Goals were adopted by the UN in 2015 as a universal call to action to end poverty, protect the planet, and promote prosperity by 2030. There are 17 of them, all integrated on the understanding that action in one area will affect the outcomes in others, that development must also balance the social, economic and environmental sustainability.
Among them are also commitments to promote clean water and sanitisation, responsible consumption and of course production and affordable clean energy. Its impact has so far been positive on just a corporate level. In 2017, Ethical Corporation Magazine, based in London, published its Responsible Business Trends report which showed that 60 per cent of respondents were integrating the SDGs into their business strategy, a rise from the 47 per cent of a year earlier.
But according to a more recent study by GRI, the Amsterdam-based non-profit Global Reporting Initiative, four in five companies now include a commitment in their sustainability reports to the SDGs, even though fewer than half have set measurable targets for how their actions contribute towards fulfilling them.