Innovation is a core element of Covestro’s strategy and is part of our identity. This is why our understanding of innovation is broadly defined: we do not rely on traditional research and development alone, but rather also on the great potential for creativity throughout the entire company. Promoting innovation at Covestro should be something that involves every individual employee.
In order to maintain and reinforce our position in the global arena, we work tirelessly at all levels to develop new products, improve established ones and optimize manufacturing and processing procedures. Application areas, business models and business processes are also subject to ongoing review. We draw on decades of experience and demonstrable success in these endeavors.
By managing innovation systematically throughout the Group, we ensure that our ongoing activities and our project pipeline always satisfy the needs of our customers, user industries and consumer markets. The Innovation Excellence department uses a wide variety of tools to achieve this. For example, we use a standardized method to assess every research and development project and incorporate the resulting findings into ongoing and future projects. The global, digital platform idea.lounge is available for discussing and processing ideas from all parts of the company. A new electronic platform for the operational suggestion system for managing and tracking improvement suggestions has been in development since 2018.
At “Innovation Celebrations,” we recognize employee projects from around the world that reflect our broad understanding of innovation. The awards serve to recognize innovative ideas for products and applications, production and production processes, business models and commercialization, internal business processes, as well as patents and intellectual property.
We seek to systematically align our research and development portfolio with the UN Sustainable Development Goals (SDGs) – in a manner consistent with our corporate vision. Our target for 2025 is to have 80% of project expenditures for research and development go toward areas that contribute to reaching these goals. The Group-wide evaluation process for existing and new innovation projects is currently being refined internally. One particular focus of our research activities is on the search for and development of solutions that help to address climate change.
In fiscal 2018, our research and development expenses amounted to €276 million after totaling €274 million in the previous year. As of December 31, 2018, Covestro had 1,123 employees1 working in research and development worldwide (previous year: 1,072), most of them at major innovation centers in Leverkusen (Germany), Pittsburgh (United States), and Shanghai (China). Its global presence allows Covestro to respond to regional market trends and customer requirements.
1 Employees calculated as full-time equivalents (FTE)
Use of digital technologies
Covestro is committed to pursuing digitalization along with the associated new opportunities for the entire chemical and plastic value chain. Covestro utilizes the opportunities arising from digitalization with a comprehensive strategic program and particularly the intelligent use of data, thus setting new standards in cooperation with customers. To achieve this goal, we anchor digital technologies and work activities in production, along the supply chain, in research and development, and at all points of contact with customers as well as for developing new business models. The focus is on the specific benefit for our customers.
At the same time, all of our employees benefit from the opportunities of digitalization. Covestro recognizes digitalization as a comprehensive ongoing development that includes various priorities and advances at different speeds. The company has already used data analysis for a number of years primarily for production processes and continually invests in employees and infrastructure to systematically promote digitalization – and therefore improve the efficiency of work and production processes using modern data processing and the intelligent interconnection of systems. This also includes supply chain management and mobile work arrangements.
In this connection, Covestro is ramping up the digitalization of research and development.
To remain innovative, Covestro not only closely cooperates with its customers around the world, it also collaborates with partners from academia and industry under the banner of open innovation, which is of great strategic importance for the company. Bilateral cooperations and collaboration in large, publicly funded consortiums characterize the partnerships with research facilities and universities as well as with companies along the value chain.
Covestro’s “Inclusive business” teams focus on improving the living conditions of people in underserved markets around the world. Their work in this area involves developing affordable solutions based on our innovative and sustainable products and technologies. These efforts focus particularly on food security and sustainable and affordable construction, e.g. for housing, schools and training centers, including water supply and sanitary facilities.
Our activities are aligned with the UN Sustainable Development Goals. Our guiding principle is to effect a positive change in the lives of ten million people and to contribute to social improvements by 2025. We would like to work with other organizations sharing similar values as part of a collaborative approach aimed at developing innovative solutions and business models.
Covestro maintains long-standing and strategic partnerships with various universities. This includes cooperating with outstanding partners throughout the world, such as RWTH Aachen University, Tongji University in Shanghai (China) and Carnegie Mellon University in Pittsburgh (United States).
On the industrial side, we are working more intensively with young start-ups and established partners that support us in our intensive efforts to develop alternative, nonfossil resources and biobased processes. A prerequisite for making biobased raw materials usable is their direct contribution to optimizing resources compared to traditional processes.
Our innovation project aimed at manufacturing biobased aniline is one example of this. We are now able to manufacture the important basic chemical aniline on the pilot plant scale from biomass, rather than using the traditional method benzene, a raw material based on crude oil. This innovative procedure is the result of a cooperation between University of Stuttgart, the CAT Catalytic Center at RWTH Aachen University and Bayer AG. Covestro has thus succeeded in positioning itself as an innovative and sustainable company and as an ideal partner for future research and development projects.
In addition to making alternative biobased raw materials usable in order to improve resource efficiency and expanding the CO2 technology platform to close the carbon cycles, electrochemical processes represent an area of activity for visionary, circular economy solutions aimed at the energy-efficient manufacturing of basic chemicals. In pursuit of this goal, Covestro collaborated with RWTH Aachen University and the Jülich Research Center to establish the industrial electrochemical competence center ELECTRA.
Alliance Management, a central unit at Covestro, provides support throughout the Group in planning and implementing cooperations and networks and for positioning the issues of innovation and sustainability at the state, federal and European policy levels.
Resource-efficient circular economy solutions
Many process and product innovations that we develop with and for our customers strengthen the circular economy by achieving greater resource efficiency by means of longevity and energy efficiency. Another goal of this is to responsibly reuse or recycle the materials utilized throughout the value chain. In doing so, we aim to uphold the quality and must ensure the safety of the products and avoid waste and emissions to the greatest extent technically possible.
Covestro works in cross-industry consortiums on methods aimed at making it possible to use CO2 and waste flows of other industrial sectors as future raw materials for its products. In order to live up to the growing significance of circular business models and the need for more efficient use of resources, a central coordinating office with global responsibility for circular economy was established at Covestro. In addition, a venture management team was established in 2018 in the Polyurethanes segment to work with the coordinating office on reviewing potential cooperative projects along the entire value chain and assessing future business potential and technology options pertaining to the integration of waste-based raw materials.
In 2018, we also promoted the exchange of scientific findings and supported and helped organize the conference “Circular Economy” hosted at the Leverkusen site by the German Chemical Society (Gesellschaft Deutscher Chemiker, GDCh). Furthermore, the event serves as a signal of the close collaboration between the chemical industry and science for the purpose of promoting circular and sustainable solutions.
Our products consist primarily of chemical compounds that are based on carbon. We want to use carbon as intelligently as possible. Increasing carbon productivity means creating more value using fewer carbon-based fossil resources. We work with a group of international organizations in the Carbon Productivity Consortium to develop a generally recognized method for assessing carbon productivity and to make it a tool for change. Meetings were held in 2018 with other leading businesses and organizations, e.g. during the Covestro-Tongji Sustainable Development Forum in Shanghai (China).
Innovation in the individual segments
In the Polyurethanes (PUR) segment, we are working continually on improving the technology, costs and sustainability associated with polyurethane manufacturing. Using digital work techniques, we aim to address customer needs even more specifically during the development process. The research focuses on insulating properties and lightweight application developments as well as on efforts to improve flame-retardant properties, reduce emissions and manufacture cost-effective, sustainable precursors.
Covestro plays a decisive role in the industrial development of temperature-independent viscoelastic foams. The strategic, global partnership with the Haier Group, the world’s largest manufacturer of large electric household appliances, underscores our innovative strength in improving energy-saving microcell foams. Together with other industrial partners, we are working on new processing technologies that can be used to manufacture lightweight composite materials. These include the innovative process called pultrusion, which we are further developing in cooperation with KraussMaffei Technologies GmbH and profine GmbH.
In addition, Covestro is conducting systematic research in the PUR segment to determine how CO2 can be used intelligently. In the search for alternatives to petrochemical resources, we have succeeded in using CO2 as a raw material for the synthesis of polyols on an industrial scale. Covestro has developed a new type of polyol for use as a component in flexible polyurethane foam that is manufactured to contain as much as 20% CO2. This polyol is produced on an industrial scale in a facility at the Dormagen site in Germany, making use of a CO2 waste gas flow from an adjacent facility. Products launched on the market already under the brand name cardyonTM include mattresses from RECTICEL NV/SA and, the most recent example, a sports flooring from Polytex Sportbeläge Produktions GmbH.
Furthermore, Covestro is working to expand the technology platform for the future production of molecules and products using CO2. In order to better close the raw materials cycle, we are collaborating with industrial partners to research how foams can be recycled in various application areas and which technologies are visionary from a holistic perspective. We joined a partner in 2018 to commission a European waste study that analyzed the polyurethane waste flows and that can be used as a reference for future recycling scenarios.
New digital products such as our digital service platform also offer innovative solutions for customers. This platform has a forecast tool to identify the best online polyurethane recipes and processing conditions for a specific production environment.
A digital chemical reactor has also demonstrated initial success. Covestro developed software for this product to precisely calculate the changes in temperature and molecular composition, in other words, the progression of the chemical reaction.
In the Polycarbonates segment, we are developing products including new polycarbonate-based material solutions and customized products tailored to meet increasingly complex customer requirements in the mobility, health and electronics/LED technologies areas. The key here is to lower the weight of the components and final products, improve their energy efficiency and safety, and realize completely new design possibilities.
The trend toward modern and integrated light elements – made possible by LED technology – is a theme that can be traced through all industries, but particularly in the field of mobility. Due to their transparency and thermal stability, polycarbonates are the ideal material for realizing innovative solutions.
In the automotive sector, the growing number of driving assistance systems, sensors and camera systems can be seamlessly integrated with our sensor-transparent materials of the MakrolonTM brand. We also support the new requirements for electric drive systems by developing new flame-retardant products, e.g. for ultra-light honeycomb crash absorption structures for protecting batteries, vehicles and passengers.
In 2018, we provided consistent support in the lighting market for the growing trend toward LED technology. Our newly developed products combine outstanding optical properties with exceptional longevity. In this way, Covestro supports the trend toward maintenance-free, efficient LED lighting.
Our innovations in the field of health applications are also worth noting. We designed a new clear-transparent material that meets the exacting requirements for manufacturing diagnostic ampoules, thus improving occupational safety for medical technology staff when conducting time-sensitive blood analyses. In addition, our newly developed carbon-fiber reinforced MakrolonTM allows us to manufacture disposable surgery implements more efficiently.
For the electronics industry, our new product portfolio meets customers’ stringent standards concerning optical and high-gloss display properties. Due to the new materials, it is now possible to realize larger displays with three-dimensional design. We have also made consistent advancements in the field of high-performance materials. At the Markt Bibart site we commenced operations in the commercial production of our Continuous Fiber-Reinforced Thermoplastic (CFRTP) composites, thus combining the stiffness and strength of carbon-fiber or fiberglass with the flexibility and efficient processability of thermoplastics. This makes applications lighter, increasingly stable and even more aesthetic and creates entirely new design possibilities in key areas such as IT, mobility and consumer products.
Coatings, Adhesives, Specialties
The Coatings, Adhesives, Specialties segment serves a number of specialized industries. Together with these customers and partners, we introduced significant innovations in 2018. A process and product innovation allowing even lower residual monomer content in our DesmodurTM and BayhydurTM types had the biggest impact on our product portfolio in 2018. These are setting the new market standard in regard to work safety and industrial hygiene.
In 2018, we began launching a number of new products featuring biobased raw materials. Alternatives to petrochemical raw materials help to conserve resources and improve the carbon balance and are particularly successful wherever further product performance enhancement is required.
In addition to our standard products, our specialty areas are particularly strong drivers of innovation. The area of thermoplastic special elastomers is capitalizing on customized solutions for the electronics industry, such as cell phone cases. The Elastomers unit developed new polyurethane casting systems for the substitution of rubber products in mining. It also supplies suitable processing machinery and, in 2018, introduced a new generation of machinery that is intended to increase precision, productivity and efficiency for our customers. In the Specialty Films unit, significant investments were made in new capacities as a result of successful projects with the automotive, medical technology and security card industries.
We are pursuing new digital paths with regard to customer interaction. Based on the results of our research, we developed a digital tool to help customers make the right selection from our products and to provide the appropriate recipe for products. They can individually enter the desired properties themselves. In the area of processing machinery for elastomers, we introduced a digital interface to allow the maintenance of machinery while online, the management of innovative processing methods and the implementation of quality checks.
In the additive manufacturing (3D printing) area, we were able to implement critical, strategic steps using digital technologies. In the field of shoe technology, we worked with partners from the industry to establish new system solutions. As a result, efficient 3D printing processes replaced time-consuming work steps, and industry-standard materials were substituted by Covestro plastics.