Novel Incorporation of Environmental Social Governance Ratings for Premarket and Established Chemical Process Technologies

For sustainable and innovative premarket manufacturing technologies, there is only limited data available from the typically small companies that operate them. This limitation does not allow for the application of conventional environmental social governance (ESG) rating methodologies in such cases. This puts emerging technologies at a disadvantage to investors and shareholders given that ESG reporting is an eminent financial growth instrument. To compensate for this gap, a novel ESG evaluation technique is proposed and designed to assess both traditional (TRL 7–9) and emerging chemical process technologies (TRL 4–6). This approach challenges present economic arguments against adopting new technologies with future, yet uncertain, prospects for economical gain. Historically, ESG methodologies have focused on evaluating organizations, including companies. We propose an alternative approach, evaluating technologies and their applications in an entrepreneurial context. This study developed principles to modify criteria from the established commercial ESG framework of Morgan Stanley Capital Investment (MSCI). These principles were applied to relevant environmental and social criteria derived from MSCI’s primary ESG grading methodology. The ESG Industry Materiality Map and the Global Industry Classification Standard reveal that critical issues within the governance pillar are not deemed highly significant for the chemical and materials sectors, while pivotal issues under the environmental and social pillars are prioritized in ESG evaluations. A case study exemplified and demonstrated the proposed approach in the context of ammonia manufacturing in Australia. It compared traditional centralized ammonia production using steam methane reforming and Haber–Bosch (HB) conversion with the alternative regional, premarket production using high-temperature plasma (HTP) and green, electric mini-Haber–Bosch processes (e-mini-HB). The premarket technology is superior in environmental rating and inferior in social rating, which can be used to provide commercial advice to emerging HTP/e-mini-HB companies. As the environmental score has a higher MSCI-ESG weight factor, a superior overall ESG rating is determined for the premarket HTP/e-mini-HB technology.