- September 19, 2008 - Lanxess, Huntsman, Ashland and Dow, among others, face market diminution and increased costs of production according to a new report by Innovest, a New York-based investment research firm. Innovest has issued a new report detailing potential corporate impacts of the European Union regulation on chemicals, known as REACH wherein 11 companies out of 73 analyzed face specific risks. The report reviews exposure to potential regulatory action in Europe, management readiness, and strategic profit opportunities that may arise from the directive.

"As expected, chemicals used in the manufacture of plastics and conventional crop protection chemicals are likely to be phased out, and there are a few affected market segments that were a surprise" says Noran Eid, Senior Analyst at Innovest. "However, we compared company strategy to develop alternative products. This is important intelligence for investors seeking early insights into competitive advantage resulting from REACH."

To estimate financial exposure to regulatory impacts of REACH on "substances of very high concern," Innovest utilized a database developed by the International Chemical Secretariat that identifies nearly 300 chemicals that meet specific criteria under REACH. Innovest’s analysis indicates that for 11 of the 73 companies, the potential exposure could be greater than 2% of annual sales, if all substances on the ChemSec "SIN List" are subject to authorization. Additionally, the report identifies specific product segments that may face value deterioration due to higher costs. Some plastics manufacturers could see an estimated ~1.5% to 3% impact on value.

Innovest Strategic Value Advisors (www.innovestgroup.com) is an international investment research and advisory firm specializing in analyzing "non-traditional" drivers of risk and shareholder value, including companies’ performance on environmental, social and strategic governance issues. Innovest’s principal outside investor is ABP (Netherlands), currently the second largest pension fund in the world, and one of the most highly regarded by investment professionals. Innovest clients currently have combined managed assets of over US $7 trillion.

Innovest Strategic Value Advisors, Inc.

Innovest Strategic Value Advisors, Inc.

Innovest Strategic Value Advisors is an internationally recognized investment research and advisory firm specializing in analyzing companies’ performance on environmental, social, and strategic governance issues, with a particular focus on their impact on competitiveness, profitability, and share price performance. Innovest currently has offices in New York City, Toronto, San Francisco, London, Paris, Sydney, and Tokyo.

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