What changed in this filing

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Item 1. Business

2022-02-16 compared with 2021-02-17 · 82 added, 31 removed, 109 unchanged (51% of the section changed)

6 unchanged sentences

Our Oilfield Services business supplies drilling, completion and production chemicals which make exploration and production more effective, cost-efficient and environmentally friendly.

Our Octane Additives business previously manufactured a fuel additive for use in automotive gasoline until it ceased trading on June 30, 2020.

Segment Information

15 unchanged sentences

We have also devoted substantial resources towards the development of new and improved products that may be used to improve combustion efficiency.

Our customers in this segment include national oil companies, multinational oil companies and fuel retailers.

Our customers in this segment include national and multinational oil companies and fuel retailers.

Performance Chemicals

Our Performance Chemicals segment provides effective technology-based solutions for our customers’ processes or products focused in the personal care, home care, agrochemical and metal extraction markets.

This segment has grown through acquisitions, and the development and marketing of innovative products.

This segment has grown through acquisitions, together with the development and marketing of innovative products.

The focus for our Performance Chemicals segment is to develop high performance products from its technology base in a number of targeted markets.

4 unchanged sentences

pandemic adversely impacted customer demand in 2020.

We expect increased customer activity to return as the global demand for fuel increases and oil prices return to the pre-pandemic

Our customers in this segment include multinational public and independent companies operating currently principally in the Americas.

Octane Additives

The Octane Additives segment has ceased trading and is no longer a reporting segment from July 1, 2020.

Previously our Octane Additives segment produced tetra ethyl lead (“TEL”) for use in automotive gasoline and provided services in respect of environmental remediation to manage the cleanup of redundant TEL facilities as refineries completed the transition to unleaded gasoline.

The expected activities to clean up redundant TEL facilities have been provided for in the second quarter of 2020.

Legacy costs related to these operations are now being recorded as operating expenses within corporate costs.

We expect increased customer activity to return as the global demand for fuel increases.

Our customers in this segment include multinational public and independent companies currently operating principally in the Americas.

Our strategy is to develop new and improved products and technologies to continue to strengthen and increase our market positions within our Fuel Specialties, Performance Chemicals and Oilfield Services segments.

6 unchanged sentences

Working Capital

The nature of our customers’ businesses generally requires us to hold appropriate amounts of inventory in order to be able to respond quickly to customers’ needs.

The nature of our customers’ businesses generally requires us to hold appropriate amounts of inventory in order to respond quickly to customers’ needs.

We therefore require corresponding amounts of working capital for normal operations.

16 unchanged sentences

Intellectual Property

Our intellectual property, including trademarks, patents and licenses, forms a significant part of the Company’s competitive advantage, particularly in the Fuel Specialties, Oilfield Services and Performance Chemicals segments.

Our intellectual property, including trademarks, patents and licenses, forms a significant part of the Company’s competitive advantage for all our segments.

The Company does not, however, consider its business as a whole to be dependent on any one trademark, patent or license.

11 unchanged sentences

We consider our competitive edge to be our proven technical development capacity, independence from major oil companies and strong long-term customer relationships.

We believe we remain the world’s only producer of TEL for use in aviation gasoline, which we market as our AvTel product line.

We believe we remain the world’s only producer of tetra ethyl lead (“TEL”) for use in aviation gasoline, which we market as our AvGas product line.

Performance Chemicals:

5 unchanged sentences

Our competitive strength is our proven technology, broad regional coverage and strong customer relationships.

Octane Additives:

Production and sales of TEL for use in automotive gasoline have ceased and therefore Octane Additives is no longer a reporting segment from July 1, 2020.

Research, Development, Testing and Technical Support

4 unchanged sentences

We believe that our proven technical capabilities provide us with a significant competitive advantage.

Our Performance Chemicals business has launched significant new mild surfactants

based on isethionate and taurate chemistry which are well aligned with developing customer needs.

Our Performance Chemicals business has launched significant new mild surfactants based on isethionate and taurate chemistry, which are well aligned with developing customer needs.

In addition, the business has developed further formulations in emollients, silicones and surfactants for the personal care, homecare, agrochemical and metal extraction markets.

4 unchanged sentences

Management believes that the Company is in material compliance with applicable environmental laws and has made the necessary provisions for the continued costs of compliance with environmental laws.

Our principal site giving rise to environmental remediation liabilities is our Ellesmere Port manufacturing site in the United Kingdom.

There are also environmental remediation liabilities on a much smaller scale in respect of our other manufacturing sites in the U.S.

At Ellesmere Port there is a continuing asset retirement program related to certain manufacturing units that have been closed.

We recognize environmental remediation liabilities when they are probable and costs can be reasonably estimated, and asset retirement obligations when there is a legal obligation and costs can be reasonably estimated.

This involves anticipating the program of work and the associated future expected costs, and so involves the exercise of judgment by management.

We regularly review the future expected costs of remediation and the current estimate is reflected in Note 13 of the Notes to the Consolidated Financial Statements.

Our principal site giving rise to asset retirement obligations is our Ellesmere Port manufacturing site in the United Kingdom.

There are also asset retirement obligations and environmental remediation liabilities on a much smaller scale in respect of other manufacturing sites.

We regularly review the future expected costs of remediation and

the current estimate is reflected in Note 13 of the Notes to the Consolidated Financial Statements.

The European Union (“E.U.”) legislation known as the Registration, Evaluation and Authorization of Chemical Substances Regulations (“REACH”) requires most of the substances in the Company’s products to be registered with the European Chemicals Agency.

6 unchanged sentences

These registration based regulatory regimes will result in increasing test expenses and registration fees to ensure Innospec products remain compliant with the appropriate regulations and can continue to be sold in these markets.

Environmental, Social & Governance (“ESG”) and Corporate Social Responsibility Reporting

As part of our commitment to being open and transparent about our performance, our latest Responsible Business Report, which is our 2020 Report, was independently assured to assess its adherence to the globally recognized AA1000 Assurance Standard.

The Responsible Business Report, along with further information on our sustainability program and performance is available online in the “Corporate Social Responsibility” section of the Company’s website at https://innospecsustainability.com.

Such information does not constitute part of, and is not incorporated by reference into this Annual Report on Form 10-K.

Employees and Human Capital Management

4 unchanged sentences

We aim to create an environment where our employees are encouraged to make positive contributions and fulfill their potential.

The Board is also actively involved in reviewing and approving executive compensation, selections and succession plans so that we have leadership in place with the requisite skills

and experience to deliver results the right way.

The CEO periodically provides the Board with an assessment of senior executives that have potential as successor for the CEO position, as well as perspectives on potential candidates for other senior management positions.

Core Values & Culture

Responsible Growth through Innovation and Customer Service:

Financial stability and growth are essential to maintain our goal of making a positive contribution towards a more sustainable future.

Generating economic benefits for our employees, stockholders, and local communities, while encouraging ongoing innovation in our product portfolio alongside excellent customer service which will allow our business to be competitive and sustainable.

Caring for People:

We strive to create a safe and caring culture where our employees are supported and encouraged to make positive contributions.

Our continued success depends on keeping people safe, promoting a healthy lifestyle, protecting human rights, improving education, training and maintaining good relations with our neighbors.

& Protecting the Environment:

We aim to use resources as efficiently as practicable and minimize the impact of our operations on the environment.

We look to supply safe, sustainable products, designed to meet the needs of society now and in the future while minimizing their environmental impact.

Leading by Example:

We understand that honest, ethical and transparent conduct is vital to our success and reputation.

Every employee plays an essential part in complying with local and national laws, rules and regulations.

We uphold a high standard of corporate and business integrity across all of our activities.

Employee Engagement

Attracting Talent:

We believe our hardworking team of employees is our greatest asset.

We employ approximately 1900 people across 24 countries and we believe that the skills, commitment and enthusiasm of our employees helps us to deliver long-term growth for investors.

Across our sites, we provide local support and opportunities for the next generation of talent in our industry by offering a range of placements, internships, work experience and apprenticeships.

We strive to attract and retain the best talent in a changing and competitive working environment.

As an organization, we are committed to making Innospec a great company to work for and we invest, as appropriate, in the development of our employees to meet this ambition.

Our employees are offered both internal and external training, where appropriate, to support their continued development and to meet the needs of our business.

Where relevant, we support our employees’ ongoing professional training and development to encourage their progression within our business.

Pay and benefits:

We offer what we believe are competitive reward and recognition programs, based on both business-wide and individual performance.

Our packages have been designed to attract and retain the best employees, reward achievement and encourage our teams to deliver superior performance for our customers and our company.

In addition to our company-wide performance incentive plans, we encourage our employees to share in the long-term success of our company with incentive programs, such as our Global Sharesave Plan.

This plan gives employees the opportunity to participate in a savings plan linked to an option to buy shares in Innospec at a discount and, therefore, benefit from any growth in the share price over the savings period.

We also provide a range of other benefits in line with the market practice in each location we operate in, including insurance and pension arrangements.

Performance Management Framework:

We conduct an annual performance management process across the organization.

Together with their line managers, employees agree upon annual objectives, and, at the end of the year, review with their line manager their performance against those objectives and their overall performance.

The results of each annual performance review affect performance bonus amounts, pay reviews and career advancement decisions.

Senior Leadership Communications and Transparency:

We actively seek opportunities for regular engagement and communication by our CEO and other senior executives with our broader employee population.

Communications are through a variety of means including written communications, webcasts and conference calls.

For example, we hold a CEO Call at least once a year, during which the CEO and CFO discuss current issues and developments in the business, including a Q&A session answering questions raised by employees.

The CEO Call is accessible to all employees across the Company.

In addition to the CEO Calls, each financial quarter, following the quarterly financial results announcement, the CEO and CFO provide a written review of the financial results to all employees.

Diversity and Inclusion

Innospec aims to attract and retain the best people by ensuring that employment decisions are based on merit, performance and contribution to the Company.

Innospec aims to attract and retain the best people by ensuring that employment decisions are based on merit, performance, ability and contribution to the Company.

As part of our Global HR Policy, our diversity and equal opportunities policy ensures that current and prospective employees receive equal opportunities irrespective of gender, sexual orientation, race, color, ethnic or national origin, marital status, age, disability, religion or belief.

Health and Safety

We prioritize the safety of employees, communities and everyone involved in the manufacture, use or disposal of our products.

We set high standards for process and occupational safety, which is managed by our network of Safety, Health and Environment (“SHE”) professionals throughout the business.

SHE is a top priority for Innospec with our three core objectives being that:

We don’t annoy our neighbors

We leave only the gentlest footprints on our environment

The Company periodically reviews the Corporate SHE structure and organization so that we have the optimum resources and correct approach.

We strive to embed SHE in our culture by having leadership that comes from executive management.

Our Responsible Care Executive Committee (known as RESPECT) comprises members of the senior leadership team and is led by the CEO.

RESPECT is responsible for setting the group’s SHE and Sustainability policies and objectives across the global business.

It also monitors ongoing performance in these areas throughout the year.

Through this structure, we have established a strong culture of safety within our organization.

The RESPECT committee reports to the Board and conducts a major review of objectives and performance annually alongside quarterly interim reviews.

Training is an essential part of our health and safety strategy.

To minimize the risk of accident or injury, we give our employees the information they need, delivered effectively and at the appropriate time.

Our ongoing training programs demonstrate our commitment to targeting zero accidents, making sure that safety is always front of mind and that we continually raise standards.

Every year, employees across our sites take part in a variety of site-specific training courses to enable them to be competent and safe in their roles.

Available Information

Our corporate web site is www.innospec.com

We make available, free of charge, on or through this web site our annual, quarterly and current reports, and any amendments to those reports, as soon as reasonably practicable after electronically filing such material with, or furnishing it to, the U.S.

Our corporate website is www.innospec.com.

We make available, free of charge, on or through this website our annual, quarterly and current reports, and any amendments to those reports, as soon as reasonably practicable after electronically filing such material with, or furnishing it to, the U.S.

Securities and Exchange Commission (“SEC”).

In addition, the SEC maintains an internet site at www.sec.gov

that contains reports, proxy and information statements, and other information that we file electronically with the SEC and state the address of that site.

The Company routinely posts important information for investors on its web site (under Investors).

The Company uses this web site as a means of disclosing material, non-public

In addition, the SEC maintains an internet site at www.sec.gov that contains reports, proxy and information statements, and other information that we file electronically with the SEC.

The Company routinely posts important information for investors on its website (under Investors).

The Company uses this website as a means of disclosing material, non-public

information and for complying with its disclosure obligations under SEC Regulation FD (“Fair Disclosure”).

Accordingly, investors should monitor the Investors portion of the Company’s web site, in addition to following the Company’s press releases, SEC filings, public conference calls, presentations and webcasts.

Accordingly, investors should monitor the Investors portion of the Company’s website, in addition to following the Company’s press releases, SEC filings, public conference calls, presentations and webcasts.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business