New segment-based structure for Evonik

Evonik has revealed that it is putting a new segment structure in place and adopting a “significantly leaner” management model. The business lines, bundled until now into four divisions, will be led directly by members of the executive board and the operating businesses will be divided into two segments.  

“In our current structure, it is no longer sufficient to solely focus on the criterion of speciality chemicals to drive the company forward,” said executive board chairman Christian Kullmann (pictured). “Its meaning has been completely blurred and no longer sufficiently differentiates us in the eyes of our customers and the capital markets.” 

The two segments, each with around €6 billion/year in sales, will come into place on 1 April 2025. They are:  

* Custom Solutions, including additives for paint and coatings, plus cosmetic and pharmaceutical products. These businesses are defined by innovation-driven business models, and operate in specific niche markets, with strong customer proximity. This segment will be the main focus for acquisitions  

* Advanced Technologies, which are efficiency-driven, featuring a high level of technological expertise and operational excellence, while leading on cost. They include high performance polymers and hydrogen peroxide production, among others 

“The two segments ideally complement each other and play equally crucial roles for the group’s value creation,” Evonik stated. “Custom Solutions businesses play a major role as growth drivers and contribute more than average to adjusted EBITDA growth. Advanced Technologies businesses play a stronger financing role and generate cash flow.” 

Lauren Kjeldsen, currently head of the Smart Materials division, will lead Custom Solutions, while Advanced Solutions will be under Claudine Mollenkopf, head of the Specialty Additives division. Both will also join the executive board, with additional responsibility for innovation and for the Americas region, and for Asia-Pacific and operational excellence, respectively. 

In addition, under the ‘Evonik Tailor Made’ reorganisation programme, which is already being rolled out and will run until the end of 2026, the business lines will become the focus of the group’s entrepreneurial activities. Evonik expects this to facilitate faster decision-making and processes and “drastically” less bureaucracy, with the number of management levels falling from an average of ten to a maximum of six and more than 3,000 organisational units eliminated.