Impacts of Brexit on the Chemicals Industry

Corporate Finance & Restructuring | Economic Consulting

October 30, 2017

FTI Consulting is an independent global business advisory firm dedicated to helping organisations manage change, mitigate risk and resolve disputes.

With dedicated teams in key political and commercial capitals, FTI Consulting is well placed to help you navigate your Brexit challenges and manage commercial risk. Our Brexit Leadership team outlines the key issues facing the Chemicals industry and what companies should be focusing on amidst the political uncertainty.

The Chemicals industry provides input for many other business sectors:

Complex Supply Chains

  • A finished product crosses the channel several times
  • Any trade disruption can lead to a hold-up in the flow of goods
  • Tariffs could even lead to a halt in trade
  • Diverse number of consumer and industry products potentially affected

Paris Agreement

  • Chemical industry is an ‘Energy Intensive Industry’Increased momentum towards clean energy following COP21
  • EU decarbonisation targets of 60% by 2050
  • Higher energy costs have competitiveness implications

Reputational Issues

  • Negative media coverage
  • Consumer trust issues
  • Increased NGO scrutiny and links to diseases
  • Politicization of scientific findings around approval process
  • Personal choice between convenience and efficiency vs nostalgia and NGO-led fear

Heavier Regulatory Burden

  • Potential re-opening of REACH
  • Energy ‘Winter Package’ and ETS revision
  • Moving away from scientific principles in new regulation, e.g. Endocrine Disruptors
  • Ongoing debate of risk vs hazard-based legislation in EU

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Key Contact

Hans Hack

Senior Managing Director