The announcement yesterday that Sanjiv Lamba will succeed Steve Angel as CEO of Linde plc is an interesting development on so many levels.
Lamba will officially succeed Angel as Linde’s CEO, effective 1st March 2022, after more than 30 years within the group across various senior positions. Steve Angel, Linde’s current CEO, will become Chairman and succeed Wolfgang Reitzle, who will retire after nearly 20 years with the company.
The very top leadership roles of these huge Tier One players seldom change hands very often, and particularly so if those companies are performing well. That’s why it’s so fascinating to see succession planning in progress, and I look forward to seeing this changing of the guard when it happens in March.
Lamba’s leadership of the business will come at an exciting, if not transitional, time for the business and the industry as a whole. In fact, it’s arguably the most opportunistic time for the industry and those leaders within it and, equally, the most challenging.
This is a whole new period for the industry. It feels very much as though the industrial and specialty gas ecosystem of today and tomorrow is being re-imagined and reinvigorated before our eyes.
For any of the top executives in the industry, it isn’t going to be just about building footprint, delivering strong margins and carving out new growth drivers as we may have seen in years gone by. This is a time of juggling all of those core goals against a backdrop of megatrends that challenge and stimulate the gases industry.
Huge opportunities exist in decarbonisation and sustainability, with the industry undoubtedly at the forefront of this transition – but those same opportunities come with their own challenges. The industry itself has to decarbonise and move to a new footing.
Angel acknowledged in his own words that Lamba’s tenure as CEO will need to see Linde “aggressively implement our new sustainability goals.”
“I am confident that under Sanjiv’s leadership, Linde will maintain our high-performance culture, aggressively implement our new sustainability goals and leverage the many growth opportunities we have in front of us to create significant shareholder value”
Steve Angel, CEO of Linde plc
And Lamba himself said during his Opening Keynote of gasworld’s Asia-Pacific Virtual Event in December 2020, “I have to tell you that I see this [going green] as a double-edge sword. When I say double-edged sword, I mean that decarbonising industry has an impact and potentially causes some threat to many of our customer industries. At the same time, it offers a host of opportunities for the industrial gases industry.”
“Those opportunities take many shapes. They take the shape of technology developments; the use of gases and gas applications to reduce emissions. And then at the other end of the spectrum, we can think of a whole new field around carbon capture, carbon use and carbon sequestration. There’s a broad range of opportunities that we can use as a result of this growing momentum that we see around managing climate change, managing our environment, and ensuring that we are reducing greenhouse gas (GHG) emissions, carbon emissions over the decades to come.”
“The industrial gases industry has a unique opportunity to play a role. I say unique because it has a role by which it can help its customers, by providing technologies and gas applications that ensure that they become more effective at managing their emissions, make them more efficient and more positively environmentally impactful; and at the same time as an industry, we need to recognise that we have a role to play here as well. Most companies recognise that we are part of this emissions circle, as it were.”
Sustainability goals take many shapes and forms themselves, but a key target under Lamba’s tenure as CEO is likely to be Linde further reducing its GHG intensity.
Linde has taken a ‘bold’ step of reducing its GHG intensity by 25%, while growing, over a 10-year period through to 2028. Lamba said during that keynote that “we have to provide leadership on this agenda” and was clear that this leadership means investment, technology development and ensuring that processes become more efficient.
We’ve seen evidence of the industry working hard to reduce its carbon footprint, just in the last month.
Linde has announced the launch of its Linde Green range in October, which will provide carbon conscious customers with liquefied gases that have been produced through a zero-emission process. The company will produce a range of ‘green’ liquid gases such as oxygen, nitrogen, argon and carbon dioxide (CO2) using recycled CO2 or air extracted as a by-product in the production of bioethanol.
Linde also has a wider ‘green’ air gases programme at play, involving renewable power generation for air separation units (ASUs).
Likewise, October also saw Nippon Gases Italia, part of the Nippon Gases Europe group, reveal the launch of a second ‘green’ bulk atmospheric gases farm in Caserta, Italy. The facility came just a month after the start-up of its new plant in Pontinia, Italy, and will provide various industries including pharmaceutical, medical, food and manufacturing markets with nitrogen, oxygen, and argon produced from 100% renewable sources.
Air Liquide is another major player making in-roads in this area, and has been for some time. A more recent announcement from the company concerned a 15-year Power Purchase Agreement (PPA) with TotalEnergies, which will see a total capacity of 15 megawatts (MW) of offshore wind electricity in Belgium supplied to Air Liquide to power part of its industrial and medical gas production assets in Belgium.
Digitisation at the heart…
Another step change in how the industry interacts and operates is also afoot. Digitisation is the concurrent megatrend shaping the industrial gas future and, in some instances, complementing or enabling efforts in decarbonisation.
Lamba reflected on this during the same keynote last year, noting how until recent years digitisation was a ‘smart buzz word’ but the landscape has shifted and “the reality is that digitisation today sits at the heart of our business.”
Underlining the scale of the change ahead, he said, “Whether it’s a web shop driving our revenues, whether it’s contactless deliveries, whether it’s AI helping with some of the decisions we wish to make, whether it’s the use of virtual reality (VR) with training our people – it doesn’t matter where you look, you find that digital interface penetrating our business at a pace unknown.”
“So it’s fair to say that as we look forward, beyond the pandemic and into the future, digitisation is going to play our role in every aspect of our business. That’s not going to happen tomorrow, that already started happening yesterday. The pace at which we, and our businesses adapt and adopt, is going to determine how quickly and successfully we manage this transition. This holds true for every enterprise, large or small, so that’s an interesting conversation that you should be having in your business, about how does digitisation impact your business, your entry to the market, your interface to the customer, your back-end distribution and supply chain?”
“The pace at which we, and our businesses adapt and adopt, is going to determine how quickly and successfully we manage this transition…”
Sanjiv Lamba, CEO-elect of Linde plc
“It is all of that, highly and wholly integrated into the digital tools that provide the momentum today to move our business forward.”
All of which leaves me thinking this is succession change like no other in recent history.
It’s a plan that was perhaps apparent when Lamba took on the role of Chief Operating Officer almost one year ago (January 2021), and we privately suspected at gasworld that this next step might be on the horizon. But to know that the era of ‘Lamba’s Linde’ will be a thing, that it will be official starts in earnest in March, is a hugely exciting prospect. It feels like a plan that says much about not just Linde in the years ahead, but the industry too.