Sasol Limited Integrated Report 2021 - Book - Page 15
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Delivering our strategy over horizons
RESET
TRANSITION
REINVENT
We know where we are going
and how to get there
Up to 2025
2025 to 2030
2030 to 2050
Resetting Sasol
Transitioning Sasol
Reinventing Sasol
For more than 70 years we have built
the capabilities and competencies
to deliver sustainable value in our
businesses. Our new operating model,
led by an investor-facing Corporate Centre
together with our Energy and Chemicals
customer-facing Business Units, enhances
customer-centricity, providing each
business with significant autonomy to
deliver on its strategy. This provides us
with agility, enabling us to be adaptable
to our customers’ rapidly evolving needs,
while contributing to the energy transition
and expanding the circular economy.
Laying foundation for
longer-term sustainability
Ramping-up sustainability investments
and leverage current assets to scale-up
sustainable opportunities
Deliver on ambition of Net Zero emissions
by 2050, growing value through the
repurposing of existing assets and the
participation in new value pools
We will be establishing our third Business
Unit that will lead the development of
our FT sustainable solutions business.
To succeed in this new venture, we are
nurturing an entrepreneurial culture and
mindset to experiment and learn outside of
the constraints of our existing businesses.
IR
• LCCP ramp-up
• Sasol 2.0
• Strengthen balance sheet and re-commence
dividends
• Create leadership in priority energy and chemical
customer segments
• Incubate and scale new FT-based sustainability
businesses
• Shift chemicals portfolio to higher-margin
specialty chemicals
• Continue to decarbonise assets
(options across gas, green H2)
• Continue circular chemicals solutions
opportunities
• Intensify rollout of FT-based sustainability
businesses
• Intensify chemicals portfolio shift to
higher-margin specialty chemicals
• Bring FT-based sustainability businesses
to maturity
• Develop circular chemicals solutions
(customer-led innovation)
• Shift to gas as a transition feedstock and
procure renewable energy
• Continue scale-up of FT-based sustainability
businesses
• Continue chemicals portfolio shift to
higher-margin specialty chemicals
Targets*
Scope 1 and 2 emissions reductions
Scope 3 reduction
Coal intake reduction
63,9 mtpa to ~44,7 mtpa
35,6 mtpa to ~28,5 mtpa
40 mtpa to ~31 mtpa
It is a path that is not without risk and
uncertainty and effectively managing
these will be critical. This includes but
is not limited to:
• effectively managing transitional risk
and ensuring a just transition;*
• ensuring access to low-carbon feedstock;
• technologies becoming uncompetitive;
and
• access to markets.
We will have to proactively manage all
risks and ensure that we track and monitor
emerging ones.
or more detail refer to pages 4 and 10 – 12.
F
CCR
Cash fixed cost saving
Gross margin uplift
Capital range
Working capital optimised
15 – 20%
5 – 10%
~R20 – R25 bn per annum
14%
Targets are included in performance agreements across the organisation linked to Key Performance Indicators (KPIs) for
short-term incentives (STIs) and long-term incentives (LTIs)
*
We will achieve Net Zero emissions
while preserving and creating value for
our employees, our local communities
and other stakeholders. Reducing our
emissions contribute and sets our path
to sustainability.
IR
Cash flow targets*
or more detail refer to pages 4 and 10 – 12.
F
We are embedding
sustainability with a clear
path to Net Zero
or more detail refer to our Climate Change Report,
F
and specifically page 2 and 26 on just transition,
available on our website, www.sasol.com
* A framework that has been developed by the trade union
movement to encompass a range of social interventions
needed to secure workers’ jobs and livelihoods when
economies are shifting to sustainable production,
including management of climate change, protecting
biodiversity and ending war, among other challenges.
Decarbonisation targets for 2030. Financial targets for 2025.
We know what it will take
By delivering our Sasol 2.0 transformation programme by 2025 and ramping-up LCCP
it will enable the deleveraging of the balance sheet which allows for the resumption of
dividends, decarbonisation of our assets and to establish new sustainable businesses
of green hydrogen, SAF and FT solutions and to grow our chemicals portfolio.
Our capital allocation principles are to firstly, prioritise the strengthening of our
balance sheet, reducing net debt to EBITDA to below 1,5 times and reintroducing
the dividend, while decarbonising our assets. Our second phase of strategy execution,
capital will be allocated to smaller value-accretive organic and merger and acquisition
growth opportunities. In the third phase capital will be allocated for larger growth
opportunities competing with special dividends or share buy backs.
IR
For more detail refer to page 44 for capital allocation principles.
The role of the Board
Contributing to the UN SDGs and the Decade of Action
In refining our strategy, the Sasol Board played the key guiding role. During the year, in addition to its four quarterly meetings, the Board held
six special meetings and, one dedicated session to guide and robustly debate Sasol’s strategic direction within a highly volatile macroeconomic
environment operating context.
Our updated absolute medium-term GHG emission reduction target to 2030, the associated
roadmap and our ambition to be Net Zero by 2050 supports our contribution to our
prioritised SDGs. We are confident about our energy transition which is further detailed in
the Climate Change Report. Furthermore we are tracking our delivery to all SDGs, aspiring to
improve our ESG ratings on a year-on-year basis with the ultimate aim of being included in
the Dow Jones Sustainability Index. Delivering on our targets and commitments up to 2030
will be critical to resetting and transitioning Sasol. In so doing we will not only make Sasol
more robust but this will also contribute to the Decade of Action.
Our Directors reconsidered the Group’s 2030 emission reductions targets as well as our ambition for Net Zero emissions by 2050. In doing
so, we updated our 2030 roadmap to achieving the target taking into account the impact on society and business continuity. In August 2021,
the Board endorsed our updated strategy which is aligned with the energy transition.
Our strategy aims to deliver Future Sasol, growing shared value, sustainable returns to all stakeholders while accelerating our transition to
Net Zero. The delivery of our strategy will be measured through the inclusion of relevant KPIs for achieving STIs and LTIs.
IR
For more detail refer to pages 31 – 35.
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CCR
SR
Sasol Integrated Report 2021
For more detail refer to our Climate Change Report and Sustainability Report available
on our website, www.sasol.com
FUTURE
SASOL