Strategic Portfolio Reconfiguration of Plastics Chemical Companies under Strengthening Environmental Regulations

Background/Purpose: This study examines how the tightening of environmental regulation reconfigures the strategic portfolios of plastics chemical companies. Rather than treating environmental regulation as a mere compliance issue, this study regards it as a structural force that reshapes the rules of competition and operates as a selection mechanism inducing stra-tegic differentiation among firms according to their respective resource bases and customer structures. Study Design/Methodology/Approach: A comparative case study of five firms—LG Chem, LOTTE Chemical, SABIC, INEOS Styrolution, and CHIMEI—applies a four-layer integrated framework encompassing regulatory pressure, demand-industry re-quirements, portfolio reconfiguration, and capability building. The study draws on the in-novation hypothesis, Natural-Resource-Based View (NRBV), and dynamic capabilities as analytical reference frames. Findings: Portfolio reconfiguration unfolds across four dimen-sions: product grades, investment priorities, partnership structures, and risk management. Four strategic archetypes emerge: SABIC as system orchestrator, LG Chem as accelerated transition player, LOTTE Chemical as ecosystem builder, and INEOS Styrolution and CHIMEI as selective specialists. These differences reflect heterogeneous resource endowments and customer portfolios rather than variations in sustainability commitment. Originality/Value: Certification and traceability infrastructure—particularly ISCC PLUS mass-balance certifi-cation—emerge as cross-cutting competitive axes absent from the pre-2020 landscape. This study demonstrates that strategic responses to environmental regulation are structurally differentiated by firms’ resource configurations.