Sustainability and innovation at Vopak

Vopak has been active for more than 400 years now. At this moment in storing and handling bulk liquid chemicals, gases, and oil products. Over the centuries, the company has constantly innovated and adapted to new market developments.

Vopak: constant innovation

We may well be an old company, but we’ve grown so old because we’ve always been an innovator. Otherwise, we’d no longer exist", says Willem van der Zon, Vopaks global environmental advisor. Together with his colleagues Khalid Saled (energy coördinator) and Jermain Carter (senior global tax manager) Willem talked to PwC’s tax specialists Roger Quaedvlieg and Rinske Weustenenk about how Vopak shapes sustainability and innovation – and what role tax investment facilities and government subsidies play in this.

Khalid Saleh (Vopak), Rinske Weustenenk (PwC), Jermain Carter (Vopak) and Roger Quaedvlieg (PwC). Due to circumstances, Willem van der Zon was unable to attend the photo shoot.

Vopak’s sustainability policy

Willem van der Zon says that Vopak’s sustainability policy goes further than just the climate question. “We operate worldwide and we have rules that apply in all countries. All our terminals undergo a health, safety, and environment check every three years to ensure that our rules and policies, including those relating to sustainability, are being complied with. For a long time, Vopak was one of the few companies in the industry to publish a sustainability report. We’ve been doing that for over ten years now. At first, our focus was mainly on the Global Reporting Initiative standards, but they weren’t specifically tailored to us. Together with internal and external stakeholders, we’ve since formulated twelve issues that we consider to be important. As of last year, we’ve also included four of the UN’s seventeen Sustainable Development Goals (the “SDGs”) – issues where we can make a difference.”

Sustainable development goals

Vopak pays special attention to SDGs 7, 8, 9, and 12. Willem van der Zon explains: “Because of our purely facilitatory role of storage and transshipment, the relative quantities of energy we consume and CO₂ we emit are already very low. In line with SDG 7, ‘Affordable and Clean Energy’, we’ve given our own energy requirements a clear focus on clean energy. This leads to even lower CO₂ emissions than we already had. Nevertheless, we are continuing to examine the effects of climate change on our operations. In coastal areas, our storage facilities are at sea level, so if the sea level rises, they’ll be susceptible to flooding.”

Vopak’s emissions, such as fugitive emissions from storage tanks, fall under SDG 12, “Responsible Consumption and Production”. “In that area,” says Khalid Saleh, “we are constantly working on innovations aimed at reducing such emissions. That’s also in line with SDG 9, ‘Industry, Innovation and Infrastructure’. For example, we are using floating roofs and seals to seal our storage tanks. In line with SDG 8, ‘Decent Work and Economic Growth’, we pay our employees the living wage in all the countries where we operate. We’ve also included that requirement for our contractors and subcontractors.”

Khalid Saleh - energy coordinator at Vopak

Active cooperation within the chain

As part of its environment and sustainability policy, Vopak actively seeks cooperation with authorities and governments within various networks and industry associations. “I’m a member of the Ministry of Social Affairs and Employment’s Central Board of Experts,” says Mr Van der Zon, “representing the VNO-NCW employers’ organisation. I also participate in the GSN, a remediators’ network made up of public and private land managers such as Netherlands Railways and the Dutch Ministry of Defence. Vopak is also an active member of VOTOB, an association of independent tank storage companies that represent the sector vis‑à‑vis government and that are working on a shared sustainability and safety policy. And we also take part in the Hydrogen Platform, in which government and companies cooperate. So even though we aren’t a producer of hydrogen ourselves, we can still make a contribution as part of the chain. Our cooperation in drawing up the Hydrogen – Industry as Catalyst report by the World Energy Council Netherlands (WEC), to which PwC is affiliated, also fits in with the active role we want to play in relevant organisations and platforms.”

Innovation high on the agenda

Innovation has a high place on Vopak’s agenda. “As a company,” Mr Van der Zon explains, “we always try to be on the solution side. We consciously look for ways to apply emerging technologies in our operations and for how we can facilitate new developments. We may well be an old company, but we’ve grown so old because we’ve always been an innovator. Otherwise, we’d no longer exist.”

For the past four years, Vopak has had an Innovation Lab, where employees focus entirely on innovation. Khalid Saleh explains the approach: “Vopak aims to give people with good ideas the scope they need to develop them. As the energy coordinator, I work closely with the innovation team. Vopak also explicitly involves the younger generation of employees in its innovation agenda. ‘Young Vopak’ organises information meetings, for example, to discuss innovative projects, but also the energy transition and the mechanisms that the government makes available for sustainable investment. That way, we ensure dialogue with our employees and we learn from one another.”

“What you mustn’t forget,” adds Jermain Carter, “is the increasing importance of supplier and customer data. Our innovations increasingly involve a strong data component, but we also have drones that inspect tanks and robots that clean them. We try in that way to tackle the IT and OT issues in an integrated manner as far as possible. So it’s not just a matter of data or robots but more a combination of the two."

“What you mustn’t forget, is the increasing importance of supplier and customer data. Our innovations increasingly involve a strong data component, but we also have drones that inspect tanks and robots that clean them."

Jermain CarterSenior global tax manager Vopak

Rinske Weustenenk, tax specialist PwC

Financial support from government

Together with PwC’s tax specialists Roger Quaedvlieg and Rinske Weustenenk, Khalid Saleh and Jermain Carter keep constant track of developments in the Netherlands’ investment portfolio and at the application of government subsidies and tax incentives to promote sustainable development. “Investment facilities,” says Mr Saleh, “act as an incentive for companies to invest in renewable energy, energy-saving measures, or emission reductions. But I want to emphasise that it’s an incentive effect, because the facilities aren’t (yet) a dealmaker. I’m involved with energy projects across the board in the Netherlands. That means such things as energy recovery systems, residual heat, heat roundabouts, solar panels, and the replacement of halogen lighting by LEDs at our terminals. The energy costs for LEDs are lower, of course, but maintenance is also cheaper than with halogen. All in all, the total cost of ownership is lower. Replacing halogen by LEDs has now really become feasible thanks to the government incentives."

Successful projects are eye-openers

“Successful projects ensure that the impact of sustainable investments is also allowed for elsewhere within the organisation – definitely if you make clear what environmental improvement or energy reduction you can achieve and, despite a slightly higher level of investment, that you’ll achieve a net increase in return due to lower operating costs and using a subsidy, for example. In that way, colleagues within Vopak – not just in the Netherlands but worldwide – are inspiring one another to develop and implement projects from that perspective. And within the industry, too, we’re learning from one another and taking over methods from one another.”

Saleh and Carter describe the cooperation: “Together with PwC, we create awareness and the right mind-set. PwC brings its experience and specialist knowledge to bear in order to increase the success rate of a subsidy application, for example.” Roger Quaedvlieg agrees: “The government usually only provides financial support for projects that make use of innovative technologies, and little or no support for using technologies that have already been available on the market for a considerable time. So if the government grants a subsidy to Vopak, it’s sign that the company has shown that it’s innovative and that it’s willing to make advances in the area of sustainability.”

Roger Quaedvlieg, tax specialist PwC