Century-Old Steel Company Changes Name, But Not its Core Values

SEATTLE (Scrap Monster): The word late last month that Schnitzer Steel Industries would change its name meant the end of a moniker that had served the 117-year-old company well.

But the new name, Radius Recycling, reflects what CEO Tamara Lundgren says is a more accurate depiction for the Portland company (Nasdaq: SCHN). Specifically, the metals recycler and producer said the new name shows that it's looking to help reduce greenhouse gas emissions and fight climate change.

We talked to Lundgren via Teams in early August. Here's an edited transcript from our interview.

Portland Business Journal: Talk about the decision to change names.

Tamara Lundgren: It was just such the right time to do it. We have this historic legacy, and, particularly in Portland, a name that a lot of people are familiar with, whether it's directly (related) to our company or just generally.

But what we found was that the more we were expanding our business and we were speaking to new customers and entering into new service agreements and the like, that when people would meet us, they would say, “So what kind of steel do you make?” And our answer would be, well, we make steel, but our largest business is recycling, and when you start introducing yourself by kind of triangulating who you are, you realize it's really time for a name change.

PBJ: When did you realize it was time to do so?

Lundgren: Probably around right before the pandemic. If you were to read my earnings calls, the scripts going back six or seven years, we have been articulating a message about how important metals are and recycled metals in the transition to low-carbon technologies.

And fundamentally, because these low-carbon technologies are more metal-intensive than the technologies that they're replacing, there's more metal in an electric vehicle than there is in a gas vehicle. The commitment of other major industries like the auto industries and the like to move to low-carbon technologies really didn't start to take hold until probably four years or so ago and that's when it started.

Then the pandemic came.

PBJ: Was there a feeling that you’re taking a big chance by getting completely away from the Schnitzer name? And will you keep something from it in some form?

Lundgren: It is a legacy that we honor. We had created and articulated three core values more than a decade ago that are summarized in three words: safety, sustainability and integrity. Those three words actually are the same as the initials of Schnitzer Steel Industries. And so while we are changing our name, we are not changing our core values. Those initials will continue to remind us of our legacy.

PBJ: You’ve made a lot of moves in the sustainability arena, like introducing GRN Steel. Operationally, are there any other changes like that coming, like, more carbon-neutral initiatives?

Lundgren: We've issued a sustainability report for at least a decade now, and several years ago, we articulated a number of multiyear goals to create a steel product that was also net-carbon free. We launched a branded service offering called 3PR, or third party recycling, which was is similar to 3PL [which refers to logistics]. We help companies increase recycling activities for everything that's going through their supply chain. And then we track what is being recycled versus what's going to landfills. And then they're able to use that data in their own sustainability reports and in their own sustainability goals and metrics.

So whether it's GRN Steel, whether it is just reducing the overall environmental impact of our operations or whether it's providing services to other companies so that they can reduce their environmental impact, this is the majority of what we do now and that's why the name was catching up to our strategy versus the other way around.

PBJ: It’s been about a year now since you unveiled GRN. How’s it doing for you?

Lundgren: We've gotten a lot of inquiries. I think that the demand for the product will really start to take hold when we see ordering activity for rebar connected with the U.S. infrastructure projects because the infrastructure bill that was passed has both a Buy America and a clean directive. GRN Steel is going to fit very nicely into those into those requirements.

PBJ: Any other programs you’re excited about at Radius?

Lundgren: One thing we expect to conclude this calendar year is the rollout of a multiyear capital program that's been focused on extracting more and more non-ferrous materials from the materials that we recycle. Take, for example, a car that we will recycle, it has ferrous metal, which is steel, and non-ferrous metal, which are things like copper and aluminum. We’ve been investing in technology and equipment that allow us to extract smaller and smaller pieces from what we recycle and then separate them into their intrinsic parts.

That project has been multiyear and will cost about $130 million. It’s almost complete and we expect to see the benefits of that come through when we’re done.

PBJ: Does that include facilities too, or is that just for the equipment and the science or technology development?

Lundgren: We're deploying that in our Portland facility, and in Oakland (Calif.) and Boston.

PBJ: The Portland expenditures is good news for the area. Is that an indication that you’re committed to, say, keeping your headquarters here (and that Portland can again thrive)?

Lundgren: Oregon has phenomenal potential and we would love to continue to expand in Oregon. We're an industrial company. There are not a lot of us in the state. We are focused on recycling or focused on sustainability, so our mission and our vision and our purpose align very much with I think what the core of Portland and Oregon is all about.

Do I think that there are things that could be done to facilitate that? Absolutely. And we've been working very closely with the governor and her staff. They've been very supportive, very responsive, because they understand what we do, and that what’s made in Oregon and made by Radius Recycling are very highly correlated.

PBJ: You serve on a lot of federal groups and are on the San Francisco Federal Reserve Board of Directors. What’s your take on the economy?

Lundgren: If you look at comments from economists, you’ll see that most think the U.S. has a significantly reduced... likelihood of a recession. No matter what I think, there is a 15% to 20% chance of recession in any year. A lot of economists, a lot of the investment banks, put the risk of a recession to slightly above that.

I think the view now is that there may well be a soft landing and the job market is staying strong, unemployment is low, it looks like supply chain issues have declined.

Courtesy: www.bizjournals.com