Engineered Materials Industry Trends – Sustainability Initiatives Driving Innovation

Sustainability continues to be a driving force behind innovation, with diversified industrials M&A increasingly becoming a vehicle to fast-track access to low-impact product solutions and technologies, according to a new industrials industry report released by the Engineered Materials investment banking team from Brown Gibbons Lang & Company (BGL).

The report details how industrials industry participants are innovating with sustainability a driving force behind increased investments in R&D and new product development. Examples include:

• Stahl devotes substantial resources to innovation. Forty-eight percent of the company's R&D projects had an ESG focus in 2023-up from 31% in 2022). The company is invested in replacing fossil-based raw materials in its products, having spent much of its recent innovation activity towards this effort.
• According to H.B. Fuller's 2023 Sustainability Report, nearly 60% of the company's new product development projects are focused on increasing the sustainability of its customers' end products. And 23% of 2023 revenue came from new solutions introduced in the past five years.
• PPG Industries reported 44% of sales came from sustainably advantaged products in 2023, which is well on the way toward achieving the 2030 goal of 50%. Recent successes include the introduction of low-carbon, biobased paints; low-VOC paint films; and sustainable packaging.

"Sustainability drives every single R&D project we have today and that has been started in the last two years," indicated Yohann Trang, the new global market director for construction materials at Arkema. "We provide and we will provide in the future even more sustainable solutions, whether it is bio-based, lower carbon footprint, mass balance, products that are better

performing with lower dosage, or giving better durability, every aspect is explored today within the group.

The full industrials industry report is available for free download and examines innovative approaches that manufacturers are taking to sustainability, including:

• How manufacturers of engineered materials are responding to growing customer and end-user demand for more sustainable products
• The types of megatrends that are seeing increased sustainability relevance for makers of advanced materials and growing government stimulus
• Notable M&A transactions that signal growing participation by corporate buyers and investors in sustainable product solutions
  

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