Episode Transcript
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SPEAKER_00 (00:10):
Ladies and
gentlemen, we're number Demek
here, live at the Nemes Demekfor the Idea Gen Global
Leadership Summit.
I'm honored to have with metoday, Mr.
Dynam Kochik from Kovestro.
Dinnan, welcome.
Hi Morgan.
SPEAKER_01 (00:25):
Good George.
Good to see you.
Thank you.
SPEAKER_00 (00:29):
Well, Dan, you know,
it's an interesting time.
We're live here at the NemesDemek and the side of the lines
of the United Nations GeneralAssembly.
And Covestro is doing incrediblework across the planet and right
here in the United States ofAmerica.
I want to ask you, you'reoperating at the intersection of
(00:52):
material science and innovation.
What role do you see foradvanced materials in addressing
some of today's biggest globalchallenges?
Everything from climate changeto digital transformation.
Sure.
SPEAKER_01 (01:07):
Just a little bit
about Covestro.
Covestro is one of the world'sleading producers of materials
used in everyday items.
So think of polyurethane foams,which are used in mattresses and
chairs, your tennis shoes, forexample, polycarbonate in your
eyeglasses, for example.
And so we're a German company.
We have about 3,000 employeesacross the United States.
(01:29):
And we're constantly innovatingto meet the market demands for
the products that you and Iconsume every day.
So, you know, your computer, forexample, will have our plastics
in it.
And with all the new technologyand the rapid pace of the
changes that these differentrequirements for new products
are, we're constantly innovatingto meet our customers' demands.
(01:52):
And one of the big challenges,of course, is that our customers
expect sustainability to be partof our ethos as we're building
this into our products.
And so when you buy, forexample, an automobile, the
automaker wants to ensure thatthey can say with certainty that
this pro this vehicle is madewith materials that are
(02:13):
sustainably produced.
And so we're taking massiveleaps in that direction.
One of the big things that we'vepioneered in the United States
and are really innovating aroundare using different types of
feedstocks to make differenttypes of plastics.
So, in other words, thematerials that go into them
aren't aren't all going to befossil-based in the future.
(02:34):
And that's something that ourcustomers want.
And so I think for us as acompany, we see that as a real
opportunity to continue to grow,looking at different ways to
make our plastics and ourmaterials.
And also more broadly, just fromour own operations as a company,
committing to reducing ouremissions, making sure that our
(02:54):
overall footprint meets therequirements of both our
customers, also of ourshareholders in the United
States.
SPEAKER_00 (03:00):
Incredible.
I am very familiar, as you know,with Covestro and the work
you're doing.
And what is the what is thedistance that you would you
usually have a Covestro productfrom you?
Yeah, we always say you're neversix feet away from a Covestro
product.
Never six feet away from aCovestro product.
And what's what are some of theother types of uh products?
I know the headlamps invehicles.
SPEAKER_01 (03:20):
Yeah, pretty much
anything in the car you came to
today.
Right.
The US passports is one of theplastic used for that.
Identification cards fordriver's licenses, for example,
um pieces of your phone, forexample, some of the the on the
camera lens would be anotherexample of a product that that
we would supply into.
And so really everything youtouch, your laptop, uh the
(03:41):
screen, uh some of the filmsthat are used to make that.
So really a very diverse productrange.
I think we have over 10,000different product offerings in
the United States.
And so 10,000.
Yeah, in our product catalog.
So really an impressiveportfolio.
Um and again, uh something thatis interesting about the
chemical company is we're one ofthose companies that you may
(04:04):
touch our products every day andnot know it.
Um and so we don't have the sameend experience that you would
with your iPhone, for example.
But at the at the end of theday, all of our products make
those products possible.
We help to enable the newtechnologies.
And if we look toward thefuture, as automobiles are
transitioning to electricvehicles, the construction of
new data centers that needbetter insulating materials,
(04:26):
companies are looking to us toinnovate those materials for
them.
And so I'm a perfect example ofthat is the battery in an
electric vehicle.
Without using our types ofplastics, just not only for
that, but also the car itself,the weight becomes a
restriction.
And so there's a lot oftransition away from the
traditional materials used tomake that to new high-tech,
lighter weight polymers.
(04:48):
Um, think of solar panels asanother example, or wind blades
on uh turbines.
SPEAKER_00 (04:53):
Um, and so Cavestro
is leading the way.
Where are you headquartered herein the United States?
SPEAKER_01 (04:57):
So here in the
United States, or our North
America headquarters are inPittsburgh, Pennsylvania.
Globally, we're based inLeverkusen, Germany.
SPEAKER_00 (05:04):
Yeah.
And so, Dan, you've spent nearlya decade, gosh, working in
government affairs and policyanalysis in Washington, D.C.
What a fun, fun, fun job, isn'tit?
Never ends, you know.
And so, how is Cavestropositioning itself on key issues
like what you alluded tochemical safety, plastic waste
(05:26):
mitigation, and the circulareconomy policy that is being
discussed in D.C.
SPEAKER_01 (05:33):
Yeah, absolutely.
I mean, I think right now issuch an interesting time for
companies trying to evolve tothe different realities of a new
administration, which has verydifferent priorities.
You know, for us, I think top ofmind trade is really a huge, a
huge topic for us right now, andwe're trying to still understand
what some of those realities forus as a company are.
(05:55):
Um, I think also, though, youknow, that the ongoing changes
on some of the environmentalregulations we've been adopting
to make sure that we're not onlymeeting our standards here, but
also meeting our globalstandards.
So as a European-based company,we have very different a
different approach at the at theglobal level than a lot of our
(06:15):
peers here in the United Statesdo.
And so we do meet those globalstandards.
And I think for us it really is,like I said, trying to ensure
that we're always puttingpeople, uh, people and pro uh
ahead of profit as a company.
And so for us, our constantinnovation model is to
continually improve and build tomeet those demands that are new
(06:38):
realities.
SPEAKER_00 (06:39):
And fair global
competition and all the things
that come along with that, whichuh is not always simple, uh, but
something that that isimportant, right?
unknown (06:47):
Absolutely.
SPEAKER_00 (06:48):
And so you have some
challenges and some
opportunities, right?
And so in aligning yourpriorities, uh, whether it's
federal legislation,specifically in tax trade, and
transportation, what are some ofthe the sort of tactics that
you're utilizing to make surethat you stay at the fore of
making sure that you knowCavestro is profitable and
(07:13):
helping to change the world?
SPEAKER_01 (07:14):
Yeah, I think really
the top of mind is, you know,
and it all starts from within.
Our team is really growing usingnew tools, um, new data sources,
really being able to get aheadof and understand these
sometimes very complicatedregulatory proposals, uh, but
also working very closely withour outside council and
consultants and making sure thatwe're um constantly evolving to
(07:38):
meet these very interesting andintricate, as you know, uh
rulemaking actions andlegislative priorities.
SPEAKER_00 (07:45):
Yeah.
Yeah.
So from your experience inengaging with these policymakers
in Washington, what do you seeas a message that resonates the
most when advocating for more,let's say, innovation in
chemical uh related matters?
SPEAKER_01 (08:05):
Yeah, I think we we
need an enabling environment, as
we say, right?
We need to not only have thepolicy environment that that
allows for uh the United Statesto remain competitive as a
chemical producer.
I mean, we're, you know, when wemake an investment as a company,
we're looking at the long term.
It's not a five-year quickturnaround on a on the return on
(08:27):
a new facility, for example.
If we're looking at thelong-term, decades-long type of
investment.
And so we have to convince ourshareholders and stakeholders
internally that the US is theplace to do business if we're
interested in continuing to growhere.
Um and so we really need thosepolicies, both both at the
federal and at the state andlocal level, um, that ensure
(08:48):
that companies are incented tomake the right uh investments
here in the US.
But also I think making surethat that the energy, I mean,
energy is top of mind for us.
Um, you know, energy costs are ahuge portion of what goes into
our into our calculus of whatour pro what we can reliably
sell our products for.
And so we have to continue toensure that energy policies
(09:11):
support our company, um, youknow, and constantly
understanding the regulations.
Like I said, that's more the thechallenge is keeping up and
making sure that we're able toadopt and adapt to the new
realities that come up reallyevery day.
SPEAKER_00 (09:26):
And as a as a new
this your administration, I know
has um focused on deregulation.
Yeah, and uh one for ten or so.
Um so that's maybe helpful insome ways to um to make sure we
introduce a piece of um uh uh aregulation that um you're
getting rid of some other onesso that you're balancing out how
(09:46):
much regulation because thatregulatory burden I I know is
challenging.
It's extremely challenging.
And like you said, understandingit, what does it mean?
Like what's this new regulationand the time it takes and the
you know the impact it has on acompany?
SPEAKER_01 (09:58):
So and with that,
just the the constant need for
certainty.
I mean, I think for us, we'relike I said, you know, we we
kind of from differentadministration or from uh shifts
in the political headwinds, ourpriorities very much change, but
our our core mission stays thesame.
That we need to continue toproduce products that meet our
(10:18):
standards and our customers'standards.
And so we have to rely on ourown um ability to continue to uh
to make those products, but alsorely on our outside um, the
outside environment to helpinfluence how we make those
decisions.
SPEAKER_00 (10:34):
Well look, I'm
familiar with Covestrooms, you
know, and a huge fan uh ofeverything you're doing, both in
the United States and around theworld.
And it in it literally, youwouldn't be able, you're not
sitting more than six feet froma Covestro product, the the
laminate on tables here, thewalls, the rugs, you know, just
about everything, right?
Yeah, really everything.
So looking ahead, what is it,Dan, that excites you about
(10:57):
Covestro's future?
There's so much, I know.
There's a lot.
There's a lot.
And what message would you liketo leave behind here with our
global audience live at NASDAQand across the world about what
leadership uh in these timesmeans?
Yeah, of course.
SPEAKER_01 (11:13):
I mean, I think for
us, we're really looking forward
to being continuing to be theinnovator for a lot of the
products that will enable thefuture.
So, as I mentioned, electricvehicles, for example, new
different types of technologiesthat rely on high-tech,
sustainable materials that arealso able to meet the
performance standards.
And so that really lookingforward is a great opening for
(11:36):
us.
We're we're able to continue toinnovate and meet those demands.
Um, I think we have a reallyhealthy future of being a leader
in that area.
Um, and I think, you know, uhjust more broadly, I think um as
a company, we we continue tosee, like you mentioned, a lot
of these changes in customerdemands.
But at the end of the day, um,our products are, like you said,
(12:00):
in everything, and we need tocontinue to make these products
to help to meet those demands.
And so I I I see that as reallypromising for us for our future.
And um, I think one one lastthing to add is just the current
state of manufacturing in theUnited States.
There's a lot of hopeful newinvestment that can be made.
I think we see a lot ofopportunities and we're and
(12:23):
we're working to uh really lookinto ways to grow our footprint
here because there's a greatgreat workforce.
AI is leading the future here.
Um, you know, we have energyaccess.
Um, and so really uh lookingthat's an exciting future look
for the company and for industrybroadly.
SPEAKER_00 (12:42):
Well, Dan Kochik,
you are leading the way, global
leader, Covestro, number one.
Thank you.
Let's go.
Thank you.