DSM is a $12 billion life sciences and materials sciences company headquartered in the Netherlands. The company has intentionally transitioned out of chemicals and is striving to make 80 percent of its pipeline eco-friendly.

DSM's diverse markets include food ingredients, personal care, livestock feed additives, pharmaceuticals, automotive materials, paints and electronics, as well as alternative energy and bio-based materials. The company supplies many of the Fortune 500, including Unilever, PepsiCo and General Motors.

Heather King talks with CEO Feike Sijbesma about the importance of biotech to sustainability, second-generation bio fuels, and the 'green legacy' of Dutch companies.

Over the past decade, DSM has transformed itself from a leading international chemical company to a 'life sciences and material sciences' company. What is the business case for moving a chemical industry giant out of chemicals?

DSM is 109 years old. We started as a coal mining company -- Dutch State Mines. After World War II, we saw that coal mining's future was not promising. Gas had been discovered locally and the government threatened to close mines. In response, we diversified into chemicals.

From 1960 through the 1980s, we were one of the leading international chemical and petrochemical companies, together with Dow, BASF and Borealis. Over the years we learned that the chemical industry is highly cyclical. Competitors who were backwardly integrated into oil and gas had the advantage. So, in the 1990s, we decided to shift into biotech and renewable resources. We ultimately divested ourselves of chemicals.

We are now fully focused on life sciences and materials sciences. Our most significant market is food and nutrition; we are the largest food ingredient supplier in the world. We supply giants such as Nestle and PepsiCo. We are the second largest pharmaceutical supplier in the world. We also produce high technology materials, such as Dyneema, the world's strongest fiber, as a substitute for Kevlar. Such specialty-engineered materials replace metal applications in products like cars, making them lighter and more fuel-efficient. We offer new materials for solar energy, such as coatings for the solar cells that reduce reflection and increase transmission. These are all growth businesses.

Our financials are more robust since our shift away from chemicals and into these fields. Increasingly, our business is all about providing customers sustainability.

Can you provide examples of how you 'supply sustainability?'

Unilever is one of our customers. They want to be a much more sustainable company. We provide Unilever sustainability by supplying products that are made of renewable green raw materials.

We also provide sustainability to electronics and automotive companies. For example, we have materials that go under the hood of a car that are heat resistant and replace steel. The car is lighter, uses less fuel and is easier to recycle at end of life. We provide water based paints as opposed to traditional solvent-based products. They are health and environment friendly.

We are mandating that 80 percent of our product pipeline be 'Eco Plus.' 'Eco Plus' means that our products are better than the mainstream. We calculate the environmental footprint -- including CO2, water, waste -- of our products and the total supply chain. We want our solution to be 5-50 percent better in terms of environmental impact than alternatives.

Are there certain segments where achieving 'Eco Plus' is easier?

Sustainable products play a role in all our end markets. It's a global trend. I see it with our automotive customers, our electronic customers, and our food customers.

It's not that all our offerings need to be 'Eco Plus' tomorrow. But, we want 80 percent of new DSM products to raise the bar. On the converse, we would have difficulties developing an 'Eco Minus' product, a product that might be profitable, but environmentally worse than mainstream solutions.

We are a great promoter of global 'eco' standards. In the U.S. you have 800 green labels; in Europe we have 600. We are working with the United Nations and industry peers like BASF on developing global standards. We absolutely believe in harmonizing industry metrics.

Has DSM ever abandoned a profitable product line in your move out of chemicals?

We have faced dilemmas with our own operations. In China, we build factories with wastewater treatment systems, instead of emptying waste streams into rivers, like some our (local) neighboring competitors do. The costs are higher and so could potentially impact our competitive position. Even so, we would not dump in Europe, so don't do it in China either.