ZURICH — Holcim’s $30 billion New York spinoff of its North American business has come under fire from an environmental group that said the major cement maker was doing too little to tackle climate change.
The Swiss-based company has failed to cut direct emissions from its plants or spend enough to reduce materials or energy waste, said Industrious Labs, a U.S.-based environmental nonprofit.
Holcim on Thursday announced an investment in a U.S. low-carbon cement startup – its latest move to shrink its environmental footprint.
It rejected the claims of Industrious Labs and said it is committed to sustainability, having won an award for industrial decarbonisation this year after spending 402 million Swiss francs ($474.17 million) on green projects in 2023.
Industrious Labs, which is part of a campaign called Concrete Change to reduce the sector’s environmental impact, gave Holcim a grade of “D” – the second-lowest rating – for its sustainability performance.
It said the spinoff, due to take place in the first half of 2025, hides mounting costs and a failure to adapt to growing demand for cleaner cement.
“Markets are brutal and don’t reward incumbents which are slow to respond to customer demand,” Nachy Kanfer, a partner at Industrious Labs, told Reuters. “We see multiple net zero cement projects under way, and Holcim is being left behind.”
Industrious Labs, which holds no stake in Holcim, said it is not providing investment advice, but Kanfer said Holcim will have to invest heavily to catch up with rivals or risk missing out on a market shift to lower-carbon cement.
“We are not hoping for a lower valuation, but a premium valuation where Holcim makes a clear and specific commitment and spends capital on improving sustainability,” Kanfer said.
The cement industry is responsible for about 7% of global CO2 emissions, according to the Global Cement and Concrete Association.
Holcim said it generates 90% of its cement sales in North America from its low-carbon range, and that it is working on three projects in the region to capture more than 5 million tons of CO2 per year.
“Holcim is transitioning to alternative fuels, with three plants already operating with close to 100% fossil-fuel free thermal energy,” a Holcim spokesperson said.
“The planned listing of Holcim’s North American business in the U.S. is on track to be completed in the first half of 2025, with the aim of unlocking a new era of value creation for all stakeholders,” he added.
($1 = 0.8478 Swiss franc)
(Reporting by John Revill in Zurich; Editing by Barbara Lewis and Matthew Lewis)
