Dow Chemical 2013 Annual Report Download - page 85

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interruptions of normal business work operations that could materially and adversely affect the Company’s results of
operations, liquidity and financial condition.
Dow implemented the Community Awareness and Emergency Responses ("CAER") initiative at its manufacturing sites around
the world and the communities near those sites. The CAER initiative includes open communication, integrated planning and
community drills between industry and surrounding communities. The CAER initiative continues to be a critical part of Dow's
global implementation of Responsible Care®.
Dow played a key role in the development and implementation of the American Chemistry Council’s Responsible Care®
Security Code, which requires that all aspects of security – including facility, transportation and cyberspace – be assessed and
gaps addressed. Through the Company’s global implementation of the Security Code, Dow has permanently heightened the
level of security – not just in the United States, but worldwide. Dow employs several hundred employees and contractors in its
Emergency Services and Security department worldwide.
Through the implementation of the Security Code, including voluntary security enhancements and upgrades made since 2002,
Dow is well-positioned to comply with the new U.S. chemical facility regulations and other regulatory security frameworks. In
addition, Dow was the first chemical company to receive coverage under the Support Anti-terrorism by Fostering Effective
Technologies Act (“SAFETY Act”) from the DHS in 2007 for the Company’s MTSA regulated sites, and the first to receive
coverage under the SAFETY Act in 2008 for the Company’s Rail Transportation Security Services. This unprecedented
certification helps validate Dow’s efforts and provides additional liability coverage in the event of a terrorist attack.
Dow continues to work collaboratively across the supply chain on Responsible Care®, Supply Chain Design, Emergency
Preparedness, Shipment Visibility and transportation of hazardous materials. Dow is cooperating with public and private
entities to lead the implementation of advanced tank car design, and track and trace technologies. Further, Dow’s Distribution
Risk Review process that has been in place for decades was expanded to address potential threats in all modes of transportation
across the Company’s supply chain. To reduce vulnerabilities, Dow maintains security measures that meet or exceed regulatory
and industry security standards in all areas in which the Company operates.
Dow continually works to strengthen partnerships with local responders, law enforcement and security agencies, and to
enhance confidence in the integrity of the Company’s security and risk management program, as well as strengthen its
preparedness and response capabilities. Dow also works closely with its supply chain partners and strives to educate
lawmakers, regulators and communities about the Company’s resolve and actions to date that mitigate security and crisis
threats.
Climate Change
Climate change matters for Dow are likely to be driven by changes in regulations, public policy and physical climate
parameters.
Regulatory Matters
Regulatory matters include cap and trade schemes; increased greenhouse gas (“GHG”) limits; and taxes on GHG emissions,
fuel and energy. The potential implications of each of these matters are all very similar, including increased cost of purchased
energy, additional capital costs for installation or modification of GHG emitting equipment, and additional costs associated
directly with GHG emissions (such as cap and trade systems or carbon taxes), which are primarily related to energy use. It is
difficult to estimate the potential impact of these regulatory matters on energy prices.
Reducing Dow's overall energy usage and GHG emissions through new and unfolding projects will decrease the potential
impact of these regulatory matters. Dow also has a dedicated commercial group to handle energy contracts and purchases,
including managing emissions trading. The Company has not experienced any material impact related to regulated GHG
emissions. The Company continues to evaluate and monitor this area for future developments.
Physical Climate Parameters
Many scientific academies throughout the world have concluded that it is very likely that human activities are contributing to
global warming. At this point, it is difficult to predict and assess the probability and opportunity of a global warming trend on
Dow specifically. Preparedness plans are developed that detail actions needed in the event of severe weather. These measures
have historically been in place and these activities and associated costs are driven by normal operational preparedness. Dow
continues to study the long-term implications of changing climate parameters on water availability, plant siting issues, and
impacts and opportunities for products.