Investments in Braskem Green Polymers: Extraordinary Profits or Decarbonization of the Environment?

Braskem is the only company in the world that produces green polyethylenes (HDPE – high density polyethylene and LLDPE – linear low density polyethylene) derived from the dehydration of sugarcane ethanol. Although the performance of green and fossil nominally same polyethylenes are equivalent, commercial clients may use blends of up to 51% of green polyethylenes and 49% of fossil polyethylenes and still have the right to use the I’m greenTM label which appeals to environmental conscious consumers and places these companies in a noticeable position. The Annual Income Statement - AISs from 2010, when Braskem started production of green PE, until 2018, show there was growth of revenues. Despite of the production of polyethylenes have continued stable and the number of green polyethylenes patents have decreased since 2014, the profits with the BRKM5 stocks increased. There is no transparency of how carbon credits were gained and in the AIS. Investments in securities in the Brazilian financial market (BRKM5 and carbon credits) are much more attractive than the investment in new patents, because they generate greater gains (268% increase in the average share price of BRKM5 from 2012 to 2018) and do not require large investments in R&D.