Friedrich Engelhorn
Engelhorn was born in Mannheim (Germany) in 1821. His father was a brewery master and pub owner. Engelhorn started his career as a goldsmith travelling through Europe before setting up a goldsmith shop in his hometown.
The 1848 revolution led to the bankruptcy of his goldsmith business so he diversified by building a gas plant (gasworks) and selling gas bottles to pubs and workshops. Three years later, he was running the public gas factory and lightning up the streets.
William Perkin discovered that tar could be used to make synthetic dyes from aniline in 1856. Gas factories produced tar as byproduct. Engelhorn saw the potential and created a small aniline and dyestuff factory.
BASF
Engelhorn needed two other chemicals to produce dyes: soda and acids. He convinced a few business partners to set up a new company to produce acids and soda in 1865. They named the company Badische Anilin und Soda Fabrik (Baden Aniline and Soda Factory). Engelhorn left the company in 1885 after a dispute with his partners and bought a pharma company called “Boehringer & Sohne” (now Boehringer Ingelheim).
Principles
BASF was built on two key principles: internationalisation and diversification.
The multinational roots of BASF were laid at a very early stage: a sales office was set up in New York in 1873, a production site was built near Moscow in 1876 and a French factory was acquired in 1878. In the 1960’s, plants were built in Argentina, Australia, Belgium, Brazil, France, India, Italy, Japan, Mexico, Spain, United Kingdom and the United States.
BASF produced many chemicals including soda (1865), sulphuric acid (1865), ammonia (1913), explosives (1916), rubber, fuels, coatings (1920s), polystyrene (1930s), nylon (1950s), Styropor (1951). In the 1960s, focus was set on coatings, pharmaceuticals, pesticides and fertilizers.
WWII & Nuremberg
BASF merged with 5 other German chemical companies including Bayer and Agfa in 1925 to form a new conglomerate called “IG Farben”. The Allies seized and trialed IG Farben at Nuremberg (The IG Farben Trial). IG Farben had a factory in Auschwitz and produced the infamous Zyklon B gas used in the concentration camps. The Nuremberg trials resulted in the split of IG Farben into BASF, Bayer and Hoechst.
Read more on PBAT and the Third Reich Connections (FREE)
Ownership
BASF is listed on the Frankfurt Stock Exchange, London Stock Exchange and Zurich Stock Exchange. 36% of BASF shares are held in Germany, 11% in the UK and 17% in the U.S.
75% of BASF’ shares are held by institutional investors. American investment company “BlackRock” is the largest institutional investors of BASF with more than 5%. BlackRock is the world’s largest asset manager with $6.84 trillion under management.
Please note that this article was written in 2019 with the info available at that time.
Corporate
BASF is present in 80 countries and has around 570 business units. BASF operates in chemicals (solvents, amines, resins, glues, gases, petrochemicals), plastics (engineering plastics, styrenics, Polyurethanes, Foams, Polyamides and bioplastics) performance products, functional solutions, biotechnology, agricultural solutions, and oil & gas.
Financial
Looking at the financial numbers, we see:
(1) a decrease in revenue and revenue per employee. Probably due to an inability to innovate.
(2) an increase in net assets and asset value compared to revenue. Probably caused by a rational type of management. The company is run by financiers and technicians instead of commercials and businessmen. The rational dominates over the intuitive, making it a boring company.
Past, Current and Future Challenges
- Sustainability & Environmental
BASF had a sustainability problem since it’s early beginning. Engelhorn had to set up the first plant on the other side of the Rhine river (Ludwigshafen), because the town council of Mannheim was afraid that the air pollution from the chemical plant would bother the inhabitants. The owners of BASF (BlackRock) are the world’s biggest polluters and largest investor in coal plants. BlackRock owns more oil, gas, and thermal coal reserves than any other investor. Greenpeace has expressed deep concerns at BASF’s refusal to release environmental information on its operations in China. BASF discharged chromium into the Mississippi River (2009) and released Trilon-B (tetrasodium EDTA) into the Rhine river (2013).
- Public Health
BASF was at the hart of the Fipronil pesticide egg scandal in 2017. In 1997, Knoll Pharmaceutical (BASF) paid $98 million to settle a class-action lawsuit from approximately five million patients over suppressing publication of a study about its drug Synthroid.
- Innovation
BASF has become too big to innovate. They’re a corporate dinosaur where good ideas are killed by corporate politics. They have to acquire other companies to keep growing substantialy.
- Fairplay
A report by the European Green Party has shed light on the fact that BASF is not paying its fair share of taxes. They’re using loopholes in the European tax systems to avoid paying taxes. They also lobby to oppose reforms for greater public transparency of multinationals.
- Existential Issues & Restructuring
Companies like BASF may lose their drive and the possibility to inspire their employees. How can BASF become fit, sharp and agile? How can BASF disrupt chemistry? How can BASF leave its ivory tower?
What would Engelhorn do?
Engelhorn was an entrepreneur and businessman, but he was also an opportunist. His father wanted him to study grammar but he left school earlier to become a goldsmith. When the gold business went bad, he switched to the gas business. Then, he went into the dye business, the soda and acid business and finally the pharma business. We can all agree, If Engelhorn was still alive today, he would ask himself the question: Why is BASF still in the chemistry business?
Final Remarks
I thought it useful to provide with my personal encounters and opinion on BASF. You do not read this in books.
- Double standards and Lack of moral standards
BASF is the biggest polluter and greenwasher at the same time.
They’re behind the compostable plastic cartel, the modern day resuscitation of pyrolysis and chemical recycling, the ‘mass balance’ and ‘renewable’ greenwashing terms and behind other industry cartels.
I used to attend many bioplastics events in Western Europe in the past. One day at an event in Germany, I was threatened by a BASF VP. The threat sounded as follow: Nobody here will work with you if you critisize our technology. The ‘us’ were the bioplastics companies represented in the federation ‘European Bioplastic’. Besides the words, the tone was quite diabolical like an angry SS soldier shouting at jewish captives. BASF kept their promise, the German Gründlichkeit (Read: European Bioplastics Calls for a Boycott against my person). Coincidentally, the same BASF VP had asked me a few month earlier to promote a so-called independent study that proved that PBAT was biodegrading in the soil and that it was a wise option for agricultural mulch film applications but nobody could know that BASF was behind the study. (Read: The Bioplastics Ponzi Scheme). NB – Another BASF VP also threatened to ‘sue me’.
I mean they wouldn’t talk this way to Washington Post or New York Times journalists. It’s pure hypocrisy.
- Anti Oxo Cabal
BASF and the European Bioplastics federation were behind a cabal to destroy the reputation of a competing bioplastics technology called ‘oxo’. Read more: The Anti Oxo History. In fact, it’s not just a cabal, it’s a cartel that the EU Commission has refused to investigate in the past because maybe the EU commission is complicit in this.
- Resistance
Since BASF made me an excommunicado from the official ‘European Bioplastics ‘circuit, I have become a Don Quichot chasing windmills.
Why is it that people are pulled into following immoral leaders or fake narratives? Why is it that the nazi regime was possible? Why is it that the covid regime was made possible? Why is it that a rogue company like BASF runs the show? Why is there no resistance?
The answer is clear to me:
- Follow the money: BASF is the largest chemical company and has lots of cash. There’s more money to be made if you sail in the direction that BASF wants you to sail. BASF controls external cash flows such as CBE JU, European Bioplastics, EU Commission, etc.
- Political infiltration: The EU Commission has been infiltrated by corporations like BASF. Large corporations have their puppets in place at the EU commission. They control the hiring process from within. You need to pass an exam to be able to work at the EU Commission. Once you pass the exam, you’re placed on a list and you need to start looking for a job – you need to do your job shopping: you reach out to DGs and wait for an invitation to do a job interview. That’s were companies like BASF have their network of EU public officials working for them. BASF makes the call for you and you’re hired by the EU Commission.
- Dealing with the problem: ignorance and closing your eyes is a much easier dish to swallow than having to deal with the ‘actual’ problem. People rather believe in a lie than having to face the problem.
- Money vs morality: money’ is a bigger god than ‘being a good person’. Being a good person doesn’t feed your family or pay your bills. In fact: Who am I to judge someone who’s accepting to put his morality aside for more money. We all want to have a happy life, but we do not all agree on the path to get there. We also live a period with weak and immoral politicians that do not inspire us to live a moral life. It’s about making as much money as people without caring about the consequences.
REFS
- BASF
- Friedrich Engelhorn
- BlackRock
- BASF – how the world’s largest chemical concern evades millions in taxes
- German chemical giant BASF to restrict use of pesticide in egg scandal
- Agrichemical Industry Secrets