Severe weather events resulting from climate change and long-term climate trends could affect our operations and supply chain.
To address climate risks, we maintain systematic business continuity planning and crisis management processes. Through these processes, we coordinate the efforts of our local emergency management teams at each location with our regional and global crisis management leadership.
Global, regional and local plans consider the risk of natural disaster, infectious disease, supply chain interruptions, employee safety, asset protection, customer impacts and other business continuity requirements. We implemented these plans in 2020 to manage the global pandemic from its earliest days at our facility in Wuhan, China, as well as the hurricanes that impacted our facility in Lake Charles, Louisiana.
Each year, the local emergency management team at each of our facilities around the world must review and update its emergency response plan to reflect current conditions and changes in risk. Each site also performs a tabletop or actual emergency response exercise, and our global leadership monitors conformance with these requirements through our internal corporate auditing processes. In addition, our regional and global crisis management teams conduct similar tabletop exercises or actual crisis response exercises annually.
Beyond physical risks, we also evaluate the impact of climate change risks on regulatory, legal, technology, market and reputational issues.
In 2020, we conducted a pilot climate change scenario analysis for our Specialty Coatings and Materials business using the Task Force for Climate-Related Financial Disclosure (TCFD) framework. We evaluated six transitional risks and four physical risks to identify significant impacts and opportunities related to climate change, with the business incorporating the results into its annual strategic planning process.
This pilot served as a prototype for the implementation of the TCFD framework for each of our other businesses. The framework is now incorporated into our standard annual business strategy review process and will address the impact of climate change upon each business. The TCFD process also will enable us to identify opportunities in each market we serve as we strive to achieve our sales targets for sustainably advantaged products.
In addition to risks, climate change presents us with opportunities through the development of sustainably advantaged products.
We conduct assessments of our portfolio in addition to ongoing assessments of new product development initiatives for attributes that positively address both climate change and the achievement of the United Nations Sustainable Development Goals. These sustainable attributes also benefit our supply chain, operations, customers’ sustainability and product end-of-life impact. See the Product Stewardship and Product Overview sections for additional information.
Through our Government Affairs department and membership with trade associations and coalitions, we engage directly and indirectly with policy makers at the local, state and national levels on issues related to climate change. Two key focus areas are energy efficiency and clean energy generation.
We are a strong supporter of energy efficiency, innovation and sustainability. As such, we are supportive of bipartisan energy-efficiency legislation.
We also support legislation on clean energy generation that provides manufacturers with access to a range of energy resources. We support an “all-of-the-above” approach to energy generation, which includes clean energy generation methods such as wind and solar. We do believe that clean energy generation must occur in a measured way, without significant price fluctuations and without harming our production, suppliers and business customers.
As a producer of advanced coatings that go into clean energy generation, we closely follow the advanced energy manufacturing industry. We frequently support the advocacy efforts of wind, solar and other clean energy stakeholders.