Top 100 Chemical Distributors: NACD builds on a solid foundation

18 July 2011 00:00  [Source: ICB]

NACD enters its fifth decade with a growing member base, international influence and a program of assertive advocacy founded on the credibility of responsible distribution

Now in its 40th year, the US-based National Association of Chemical Distributors (NACD) is stronger than ever and enlisting new members ­attracted by the organization's energetic ­representation, high standards and expanding service offering.

"We are looking to grow," says Chris Jahn, NACD president. NACD's membership, whittled away in recent years by industry consolidation, is on the rise again and at the highest level in a decade: 261 distributor members and 140 affiliate members, 401 in total, of which 40 joined in the last year.

Jahn credits the result to NACD's commitment to advocacy, Responsible Distribution and membership value.

Advocacy has always been fundamental to NACD's mission, of course, but the association has multiplied its effectiveness by soliciting the active participation of members.

"NACD members have never been more engaged and more effective on federal legislation than at any other time in our history," Jahn says. "It's the involvement of our members in the process - grassroots advocacy."

The strategy is particularly appropriate for chemical distribution, a fragmented, geographically diverse industry largely comprised of small businesses, none of which, alone, could marshall the kind of resources like those available to multibillion dollar chemical manufacturers.

"Our members are not, on average, big companies," Jahn observes. "On the other hand, NACD members have over 1,500 facilities across the country. We have a presence in ­almost every congressional district, so we have broad reach, and we're able to have some influence with folks when we need to."

Most members will have had scant experience of the political process, so NACD has developed tools to help them participate effectively. For example, members can download a 20-page advocacy toolkit that outlines the key issues, explains how to contact Members of Congress, suggests ways to involve employees, and introduces a suite of web-based resources that NACD members can use to keep informed and respond quickly to legislative developments.

The toolkit also describes an innovative Site-Visit Program, through which NACD staff help members arrange, prepare for and conduct facility tours for Members of Congress.

The payoff for these efforts is a fair hearing when issues affecting chemical distributors come before the legislature.

This year, the agenda is topped by ­extension of the Chemical Facility Anti-­Terrorism Standards (CFATS), reform of the Toxic Substances Control Act (TSCA) and reform of railroad regulation. "We've got a lot of momentum behind moving forward on ­chemical security in a way that will be helpful to the industry," says Jahn. "Our members have done an even better job of educating congress on the importance of dealing with this issue."

Issued in 2006, CFATS would have expired in 2009, but Congress granted two one-year renewals. NACD is now hoping for a renewal of seven years or more to provide longer-term regulatory certainty. A House Committee approved a seven-year extension (HR-908) in May, but the Senate bill, S.473, which moved out of committee late last month, would ­provide only a three-year extension. For TSCA, Jahn says, the way forward is unclear.

"Senator [Frank] Lautenberg of New Jersey has introduced a bill into Senate, S.847, but we're opposed to that for a variety of reasons. The bottom line is, we're still looking for common sense federal reform. We would like a solid federal standard based on sound science that weighs both the danger of a chemical and the risk of exposure."

The last item, railroad transportation, is a sore subject for the chemical industry.

"I've visited over 100 members in the five years that I've been at NACD," says Jahn, "and exactly one has been satisfied with their rail service." Two-thirds of the chemical industry is served by a single carrier, a monopoly situation that results in poor service and unreasonable costs, he explains.

"So we're supporting two bills - one that would repeal the antitrust exemption that railroads enjoy, and a second that would reform the way the Surface Transportation Board regulates the railroads. The goal is to create more competition."

The two bills - S.49, the Railroad Antitrust Enforcement Act of 2011 and S.158, the Surface Transportation Board Reauthorization Act of 2011 - were introduced to the Senate in January and have moved out of committee, Jahn says. "But we would really like to see more momentum in the House," he adds.

Responsible Distribution, the NACD's environmental, health, safety and security management system, contributes heavily to the impact of the association's advocacy efforts. Adopted in 1991 as the Responsible Distribution Process, it has been a requirement of NACD membership since 1998.

Third-party document and site verification maximize Responsible Distribution's credibility, but industry shorthand for the program has tended conversely to minimize its visibility. NACD recently addressed the problem with a rebranding.

"Everyone called it RDP, but if you weren't a chemical distributor, you didn't know what that meant," Jahn explains.

"To remove that obstacle, particularly for all of our stakeholders in government, both on the Hill and in the agencies, we decided to call the program what it is - not RDP, not RD, but ­Responsible Distribution."

The rebranding was rolled out last August, along with a new NACD logo and a facelift for the association's website and magazine.

"We've got brand equity in Responsible Distribution," Jahn says. "It means something."

Jahn would like to extend that brand equity beyond the shores of the US.

A memorandum of understanding signed last December by NACD, the Brazilian Association of Chemical Distributors (ASSOCIQUIM) and the Canadian Association of Chemical Distributors (CACD) is a first step.

"Our hope is that it will serve as a stepping stone for greater international recognition of Responsible Distribution by chemical manufacturers, customers and governments," he says. "We're talking to other associations in the Americas, Europe and Asia about joining our effort, and I'm cautiously optimistic that we will see progress in that area."

The objective would not be to export an exact replica of the NACD program, he points out. "We won't be telling other countries how to do things - different countries have different laws and different business processes," he ­explains. "But we are saying that certain ­fundamentals should apply, such as third-party verification. Third-party verification is the linchpin."

NACD aims to extend Responsible ­Distribution's influence not only around the world, but also throughout the chemical ­supply chain.

Last year, for example, the association signed an agreement with the US-based National Tank Truck Carriers (NTTC) to solidify and extend the existing relationship, the ultimate objective being to improve quality, safety and business processes.

The association's affiliate programs fulfill a similar function by inviting suppliers and producers not qualified for membership, ­service providers that handle chemicals such as warehousers, recyclers and carriers, and even companies that do not handle chemicals, such as insurers, to engage more closely with the association and its members.

While NACD programs such as these ­create new venues for interaction, others provide access to expertise that might otherwise be unaffordable.

For example, a program announced in March helps members achieve regulatory compliance.

Based on partnerships with four consulting firms, it offers members discounted consultations, detailed compliance information, training sessions and webinars, and regular updates on changing requirements.

A program still under consideration would commission market research to give members a clearer view of developments in the market place. As always, membership value will determine whether an initiative leaves the drawing board, Jahn points out.

"We are always looking for new opportunities to provide additional benefits to our members," he says.

By: Clay Boswell
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