From left to right: Karen Yin, president of AkzoNobel China; Zhou Tao, China region president of DSM-Firmenich; Chen Pu, chief Asia officer of Syensqo; Shen Kelei, executive VP, and president for China unit, Marelli. [Photo provided to chinadaily.com.cn]
Editor's Note: This year marks a critical milestone as China concludes its 14th Five-Year Plan. To help in assessing the success of the process, we have asked multinational executives to share with our readers their insights about their business achievements in the past few years and further expectations in the years to come.
Q1 What's your view on this year's two sessions? Do you expect any specific policy measures for further deepening reforms and expanding high-standard opening-up? What more should China do to create a more enabling business environment for foreign investors?
YIN: We are confident in the continued development of the Chinese market, which continues to be one of AkzoNobel's most important strategic markets thanks to the country's reform and opening-up policies. We have witnessed significant opportunities emerging from China's economic development and we are excited about the prospects it holds for our business. We are working closely with some of China's top companies, which we believe will further strengthen our presence in the Chinese market and drive our business growth. We are optimistic that China's ongoing reforms will continue to create a more enabling business environment for foreign investors. This will not only benefit AkzoNobel, but also contribute to the overall development of the paints and coatings industry in China.
ZHOU: We are delighted to see the Chinese government's commitment and efforts in improving the business environment, including the continuous introduction of policies that support multinational and foreign investors, as well as the strengthening of intellectual property protections. We have forged a decade-long commitment to the Chinese mainland market through our innovative, science-backed solutions tailored to Chinese consumers' evolving needs. Our growth in China is deeply intertwined with the nation's development priorities. China's 2025 economic roadmap, prioritizing domestic consumption growth, innovation-driven modernization and institutional openness, presents expansive opportunities for dsm-firmenich in the nutrition, health and beauty sectors. These strategic priorities align with evolving consumer demands and supportive policies, positioning us to capitalize on long-term growth and innovation in these high-potential markets.
CHEN: Syensqo's history of operating in the Chinese mainland dates back more than 40 years. The company has benefited from the opening-up policies and economic growth of the country. With China remaining a growth engine of the world economy in 2025, we expect the two sessions will solidify the commitment to high-level opening-up of the country, endorse sustainable growth and intellectual property protection in order to create a more enabling business environment for foreign companies and foster deepening reforms of the country. We look forward to contributing to the development of China through local partnerships, collaborative innovations and more sustainable development.
SHEN: We highly commend the Chinese government's efforts in optimizing the business environment, particularly regarding transparency, intellectual property protections and fair competition. These initiatives have significantly bolstered confidence among foreign enterprises, providing Marelli and similar companies with a stable and predictable operating environment in China. Throughout our extensive operations in China, Marelli has consistently benefited from strong support from local governments, greatly facilitating our business growth. Specifically, we hope for streamlined regulatory processes, enhanced intellectual property protections and the introduction of additional incentives to encourage innovation in ESG (environmental, social and governance) practices and sustainable manufacturing. We wish to see enhanced policy support in the field of automotive intelligence technology, which will drive deep collaboration among industrial ecosystems.
Q2 "New quality productive forces" is widely seen as key to helping China achieve industrial upgrade and "high-quality development". How can your company help cultivate such forces in China?
YIN: We actively support China's industrial upgrade and high-quality development, and collaborate closely with our customers, suppliers and key stakeholders in driving this high-quality development. Our suppliers in China have started working with us to reduce carbon emissions, benefiting the entire supply chain. We are one of the first coatings companies to provide powder coating solutions for the EV industry in China. Our decorative paint solutions have been leading bio-based solutions to create a healthier living space. Therefore, Akzo Nobel has a lot to offer new quality productive forces with our leading technology.
ZHOU: Sustainable development is integral to new quality productive forces. As a leading, innovation-focused consumer company in nutrition, health and beauty, sustainability lies at the heart of our development and business activities. From fragrances and food to micronutrients, we address the latest consumer needs and desires in a sustainable way. We are determined to keep increasing our positive impact and raising our standards in helping to tackle climate change and protect nature. Aligned with China's dual carbon goals, sustainability remains central to our strategy. In 2024, dsm-firmenich China achieved a 65 percent renewable electricity utilization rate. Earlier this year, our Chifeng plant secured a 25-year renewable energy agreement to accelerate green transition. As of now, six operational sites have signed five-year (2024-28) 100 percent renewable electricity purchase agreements.
CHEN: Syensqo's strategy is centered on creating advanced, sustainable solutions that help drive growth. The company's pursuit of sustainable development through innovation is highly in line with the new quality productive forces. Syensqo is investing 4 percent of its turnover in research and innovation. Many of the innovations in biotechnology and chemistry are offering fundamental solutions to develop materials that are lighter in weight, lower in carbon emissions and thus enable many critical sectors. We have set a target of 18 percent of sales from products that enable circularity by 2030 and are already at 16 percent. Achieving carbon neutrality and net zero requires a fundamental shift in supply chain management, focusing on sustainability. Now 100 percent of Syensqo's sites in China use renewable purchased energy and share best practices and technological advancements with our partners and suppliers in China, leading to faster and more impactful decarbonization.
SHEN: Our efforts are driven by substantial investments in innovation-focused automotive technologies, particularly in intelligence, software-defined vehicle and sustainable practices. Innovation is central to Marelli's strategy and permeates our operations. We collaborate with customers and suppliers from the earliest design phases, leveraging cutting-edge digital tools such as digital twins and aligned strategic roadmaps, to foster joint innovation and deliver tangible business value. Our emphasis on design-led innovation allows us to provide personalized, and intuitive vehicle experiences, powered by advanced, flexible and cloud-connected technologies. With our "China for China; China for Global" strategy, Marelli consistently leverages local innovation capabilities to generate globally competitive automotive solutions, significantly contributing to the growth of China's high quality productive forces. Meanwhile, we have leveraged local strengths to extend these innovative productive forces to global markets.
Q3 DeepSeek has been a buzzword and surprised the world starting this year. AI technology has been deeply integrated with various industries around the world. What opportunities do you foresee for your business from AI technology? What's your view on China's ability to sustain innovation in breakthrough technologies in the coming years?
YIN: China's ability to drive innovation in breakthrough technologies is undeniable, and China is already one of the top players in AI worldwide. At AkzoNobel, innovation is part of our DNA in everyday work. Our China Startup Challenge attracted 210 proposals, leading to collaborations with four startups focused on AI-driven supply chains, recyclable packaging and digital transformation. We are already piloting AI solutions with local partners to enhance our supply chain efficiency. China's dynamic innovation ecosystem inspires us to explore groundbreaking technologies. AI, for example, holds immense potential for our business — ranging from optimizing smart manufacturing to developing sustainable products faster.
ZHOU: At dsm-firmenich, innovation is the cornerstone of our growth. Our innovation pipeline is driven by our eight cutting-edge science capabilities: chemical and process sciences; nutritional and food sciences; formulation and materials science; analytical sciences; artificial intelligence and data science; receptor biology and sensory sciences; microbiome; and biotechnology. China's continuous efforts to drive innovation will further enhance innovation capabilities across industries and the country continues to be an innovation and production hub in our global value chain. Building on a legacy of excellence and investment in science and research, we will continue to introduce exciting new innovations to the Chinese market across nutrition, health and beauty and work closely with our customers in China on what is essential for life, desirable for consumers and more sustainable for the planet.
CHEN: We launched Syensqo.ai within the first year after the establishment of the company following a spin-off. We see tremendous opportunities for using AI to advance innovation. AI enables engineers in the labs and in the plant to look at bigger and more complex scientific and mathematical problems, and to develop solutions which are more universal and have a bigger impact. At Syensqo, we have a digital plan that relies strongly on the adoption of artificial intelligence. It's absolutely clear to us that we need to have AI as a partner of our researchers. It will not be a replacement, but a partner of our researchers to identify innovative ideas. We also believe AI will play a significant role in mapping value chains and assessing vulnerabilities. We've seen more and more Chinese colleagues getting used to work with the help of AI, which is a new productive force.
SHEN: Artificial intelligence is reshaping the automotive industry. Marelli sees tremendous opportunities in vehicle intelligence, manufacturing efficiency and optimizing user experiences. Additionally, Marelli is globally promoting the MAYA generative AI platform and plans to implement Deep Learning AI projects, including product appearance inspections, manufacturing process optimization and production automation. These AI technologies are helping us improve manufacturing efficiency, reduce costs and strengthen quality control capabilities. China demonstrates robust capabilities in AI innovation, supported by government initiatives, extensive talent pools and a thriving AI industrial ecosystem. Marelli will leverage China's innovation strengths to collaboratively develop cutting-edge AI applications, driving the automotive industry toward an intelligent future.
Q4 Driving domestic consumption is one of the top priorities for China to spur economic growth this year. How do you see China's potential to drive a consumption-led impetus for the economy? How will that affect your company's profitability this year?
YIN: AkzoNobel is confident in the economic development of China and sees significant opportunities from the country's focus on driving domestic consumption. The recent consumption demand for high quality, sustainable, user-friendly and innovative solutions is highly recognized by our consumers and customers. For our decorative paint business, rising disposable incomes and a growing middle-income group are boosting demand for high-quality, trendy and green home products. For our coatings business, the increased investment in urban renewal and green infrastructure creates strong demand for our solutions in many areas, like the new energy sector, marine and aviation, wind power, consumer electronics and home appliances. China's domestic consumption growth will definitely boost AkzoNobel's business. This momentum, combined with our focus on sustainability and localization, will enhance profitability while supporting China's transition to a consumption-led economy.
ZHOU: We are highly encouraged by the government's proactive measures to stimulate domestic consumption and bolster consumer confidence, which are pivotal to sustaining China's economic momentum. The country's vast consumer base, coupled with increasing awareness of nutrition, health, beauty and quality of life, underscores its unparalleled potential to drive consumption-led growth. This trend aligns with our business focus to deliver innovative, science-backed solutions through our highly innovative portfolio of nutritional, natural and renewable ingredients. By leveraging our complementary science capabilities and technologies, we aim to pioneer high-quality products, reinforcing our role as a trusted partner in China's high-quality development journey. In 2024, thanks to the strategic plan executed, we delivered strongly improved financial results in all our businesses. Together with the ongoing good momentum in our end markets, this leads us to a positive full-year outlook for 2025.
CHEN: China has a robust supply chain and vast market potential. The shift toward a consumption-led economy represents new growth opportunities as the geopolitical shifts are accelerating a "local for local" strategy. The company's business will benefit from the initiatives to drive consumption-led impetus as we expect to see customers welcome more smarter solutions and products that are more natural and more sustainable.
SHEN: China's vast consumer base and rapidly growing middle-income group have shown strong purchasing interest in new energy vehicles, high-end smart cars and personalized mobility experiences. Furthermore, government policies, such as the promotion of intelligent connected cars, have further stimulated market demand. As Chinese consumer demand for high-tech, sustainable and personalized mobility solutions rises, the market presents significant growth potential. To seize this opportunity, we are strengthening our local R&D and manufacturing capabilities, developing cost-effective and innovative solutions to reduce weight, cost and environmental impact. Meanwhile, China has become a key innovation hub for our global business. Marelli Guangzhou, in Guangdong province, serving as Marelli's global display R&D and production center, leverages the advantages of a deeply vertical integrated supply chain and a robust overseas OEM (original equipment manufacturer) sales channel to enhance product competitiveness.
Q5 As China continues to pursue high-quality development along a Chinese path to modernization, what opportunities do you anticipate for your business as this process gains more traction? Will you increase investment in China in the coming years? How will you further expand your footprint in China?
YIN: As China advances its high-quality development and green modernization journey, AkzoNobel sees significant opportunities to align with the country's sustainability goals and growing demand for eco-friendly solutions. We will continue to invest in this important market, in which the manufacturing upgrade will always be a major part of it. As part of a 14 million euros ($15.3 million) investment in 2024, we upgraded our Suzhou site to accelerate growth and double the plant's capacity for marine and protective coatings by the end of 2025. This includes accelerating Suzhou's transition to using 100 percent renewable electricity by the end of 2025. We will continue investing in localized production, renewable energy and sustainable solutions to drive growth while supporting China's transition to a low-carbon economy.
ZHOU: China's pursuit of modernization opens significant opportunities for dsm-firmenich in the nutrition, health and beauty sectors. Over the past year, we have intensified our localization strategy, strengthened partnerships with domestic players and fostered synergies across multiple sectors. We acquired full ownership of Artsci Biology Technologies HangZhou Corporation last year, bolstering our leadership in China's dairy, beverage, bakery and confectionery markets through its nationwide distribution network. In 2025, dsm-firmenich will continue to expand our investments in China, focusing on increasing fragrance and perfume production capacity and enhancing operational facilities to better meet the growing demands of Chinese customers and the consumer market.
CHEN: As the Chinese chemicals market is projected to continue its rapid growth over the next eight-10 years, Syensqo sees opportunities in contributing to the high-quality development of China with green initiatives as a major driver. We will continue investing in clean energy infrastructure, research and development, which enables us to provide innovative sustainable solutions that help industries lower emissions through electrification, advanced connectivity, resource efficiency, improving quality of life and sustainable sourcing. We believe our business operations with a more focused strategy targeting local regions will bring us more opportunities and lead to faster and more impactful decarbonization along the Chinese path to modernization.
SHEN: As China accelerates its transition toward intelligent, electrified and sustainable mobility, we see immense potential to deepen our presence and expand our investments. With China being a key innovation hub, we are continuously strengthening our local R&D capabilities to develop cutting-edge solutions tailored to market needs, including smart lighting, intelligent thermal management, software-defined vehicle architecture and advanced interior solutions. To support this transformation, we are expanding our local manufacturing footprint to enhance agility, cost efficiency and sustainability. Marelli has established clear sustainability targets — achieving operational decarbonization by 2030 and supply chain decarbonization by 2045.
