Strategy
SABIC’s strategy addresses transformational changes occurring in the chemical industry as well as those driven by Saudi Vision 2030.
CONTEXT
The chemical industry is one of the world's oldest established industries. It has been extremely resilient, driven by its ability to deliver solutions through progress in technology and innovation. Currently, chemicals are used in about 96% of all manufactured products.
The global chemical industry is going through a historical period of transformation, driven by accelerating megatrends such as evolving globalization, a heightened focus on sustainability, the unfolding energy transition, advancing digitalization, and changing demographics. Saudi Arabia is similarly in a period of transformation initiated by Saudi Vision 2030; and here, the chemical industry has a critical role to play in helping achieve Saudi Vision’s objectives of economic growth and diversification. These global and national changes highlight the increasing importance of the chemical industry across the value chain.
OUR PURPOSE, VISION, AND STRATEGY
SABIC’s vision is to be the preferred world leader in chemicals. To realize this vision, SABIC must address the transformational changes that are occurring in the chemical industry as well as those being driven by Saudi Vision 2030. We intend to do this by driving performance in collaboration with our customers, ensuring long-term dependability and building valuable relationships with an unrelenting focus on people, the planet, and prosperity while enabling Saudi Vision 2030.
Our strategy is built around leveraging and enhancing our competitive advantages around competitive feedstock, asset positions and integration, global product and market leadership, technology and innovation, global partnerships, collaboration with Saudi Aramco, business excellence, human capital, global brand, and digitalization. These competitive advantages help us create sustainable value while fulfilling our purpose and vision.
This is fully reflected in our business model, which leverages our key competitive advantages to create a lasting impact for our stakeholders.
Read more about our competitive advantages.
OUR STRATEGIC FOCUS AREAS
Our key strategic focus areas are to transform SABIC to earn the right to grow, realize targeted value creation and portfolio positions, and grow to win while addressing relevant risks. We will continue to support Saudi Vision 2030 through our role as national chemicals champion, helping to promote manufacturing localization and sustainability with a focus on the circular carbon economy.
We have changed our operating model in the last decade to ensure we have the required focus and agility to deliver value for our stakeholders. We emphasize value creation from existing businesses and drive profitable growth through focused portfolio roles and priorities. This includes realizing synergies with Saudi Aramco, meeting our carbon neutrality and circularity ambitions and targets, and, thereby, delivering returns for our shareholders. The Hadeed share purchase agreement with the Public Investment Fund (PIF) was the latest action to realize this portfolio position focus.
We continue to actively manage and take action to address key strategic risks through a robust risk management process and governance.
OUR BUSINESS STRATEGY
Our segment structure consists of three segments: Petrochemicals (including Chemicals and Polymers), Specialties and Agri Nutrients. These segments participate across the chemical value chain, delivering products, applications, and solutions to our end-use industries.
PETROCHEMICALS
CHEMICALS
SABIC has globally leading positions in olefins, glycol, and oxygenates. The leading positions are a direct result of our decades-long growth and building of value-creation positions. We aim to enhance value and grow the chemicals business by
- profitably growing through competitive feedstock, assets and platforms, selective integration, competitive technology, winning partnerships, and synergizing with Saudi Aramco
- delivering on our carbon neutrality and circularity ambitions and targets
- enhancing operational excellence of existing and growth businesses while ensuring safety and reliability
- sustaining and enhancing our global leadership positions in chemical products across key markets.
We continue to assess multiple growth options that address the competitive advantages mentioned above. Our recent announcement of our final investment decision for the SABIC Fujian Petrochemical Complex (Sino-Saudi Gulei Ethylene Complex Project) in China shows how we are executing our value creation strategy while strengthening our commitment to China. In Saudi Arabia, we are studying the establishment of a complex to convert oil and liquids into chemicals (L2C) in Ras Al-Khair in Saudi Arabia in cooperation with the Saudi Ministry of Energy and Saudi Aramco. This is to achieve our desired goal of maximizing the benefits of the hydrocarbon resources for the company's shareholders, strengthening SABIC’s global position, developing its human capabilities, preserving its technical know-how, supporting its customers locally and globally, and contributing to achieving the goals of Saudi Vision 2030.
POLYMERS
SABIC has leading global positions in key polymers, particularly in polyolefins and engineering thermoplastics products and markets. Our key end-use markets are growing and are very resilient with increasing requirements for sustainable products and services. SABIC is positioned to address growth and sustainability requirements and realize ambitions to be the global polyolefin leader through
- strengthening our portfolio, technology, and market-leading positions globally
- accelerating leadership in circularity
- enhancing commercial, supply chain, and operational excellence.
SPECIALTIES
Our Specialties business focuses on the high-performance plastics segment. It is a global leader in this business with close customer relationships and partnerships with multiple OEMs. Its main competitive advantages are uniqueness around customer intimacy; leading innovation and technology capabilities; and an innovative portfolio of products, applications and, services. These advantages secure sustainable value creation for all stakeholders. They also help the business to be the most reliable supplier in fast-growing and disruptive markets and be the “first to be specified” innovation leader. We continue to expand and strengthen these aspects of our business. Specialties also leverages its global leadership and competitive advantages to help enable Saudi Vision 2030 and the National Industrialization Strategy (NIS).
AGRI-NUTRIENTS
SABIC Agri-Nutrients Company was launched on January 1, 2022, after all related investments and assets were consolidated. Since then, the company has continued to make progress in positioning itself for future opportunities driven by energy transition while capitalizing on the favorable supply-demand outlook of the global nitrogen industry. The company aims to enhance its leadership in global fertilizers markets, position itself in the evolving low-carbon ammonia space, and realize its role as national chemicals champion in Saudi Arabia, enabling Saudi Vision 2030. To achieve this, Agri-Nutrients is leveraging its competitive assets and feedstock platforms, operational excellence, global leadership, and technology and innovation capabilities, while selectively extending its position along the value chain.
FUTURE PROJECTS
Read more about our future projects around growth, sustainability, and strategic portfolio optimization.
Read more about how we build competitive and sustainable assets.
Disclaimer: This abridged interactive version of the SABIC Integrated Annual Report 2023 is based on the original PDF report published on this website. In case of any discrepancy, the original PDF report will prevail.