Quanta Services, Inc. – GHG Goals (2023)
Outcome: Successfully withdrawn following ongoing dialogue with the company.
Whereas: The Intergovernmental Panel on Climate Change has advised that greenhouse gas (GHG) emissions must be halved by 2030 and reach net zero by 2050 to limit global warming to 1.5 degrees Celsius.
Exceeding 1.5 ° presents risks to the global economy and investors with global GDP loss estimated to be 11-14% by midcentury under current trajectories.[1] A warming climate is associated with supply chain disruptions, reduced resource availability, lost production, political instability, reduced worker efficiency, and adverse health impacts that disproportionally affect low-income communities and communities of color.
Quanta Services Incorporated (Quanta) disclosed its Scope 1 and 2 emissions for the first time in its 2022 Carbon Disclosure Project (CDP) report, following D- grades from CDP in 2020 and 2021. However, the company did not include a full accounting of its Scope 3 emissions in its disclosure. And although it has set a target to reduce fleet idling time, it does not have a target which covers its Scope 1, 2, or 3 emissions.[2]
Quanta faces a variety of risks and opportunities stemming from the climate crisis, and the company has named the potential brand risk that could be posed by environmental mismanagement.[3] However, while its peers are addressing climate-related risks by setting emissions goals, Quanta appears to be falling behind. Over 4,000 companies have set or committed to set third-party verified GHG goals aligned with climate science via the Science Based Targets Initiative (SBTi), including many peers identified in Quanta’s 2022 Proxy Statement’s Compensation Discussion & Analysis—Aecom, Corning, Dover, Emcor, KBR, Parker-Hannifin, and Jacobs Engineering.[4]
Given the impact of climate change on the economy, the environment, and human systems, proponents believe Quanta’s board and management have a responsibility to investors and stakeholders to adopt GHG goals aligned with a 1.5° scenario and to outline a clear plan that demonstrates accountability. Independently verified, science-based goals covering Scopes 1-3 would provide shareholders with objective assurance that Quanta is doing its part to adequately manage its climate risk.
Resolved: Shareholders request Quanta adopt independently verified near and long-term science-based GHG reduction targets aligned with the Paris Agreement’s ambition of maintaining global temperature rise to 1.5° and summarize plans to achieve them. The targets should cover the Company’s full range of operational and supply chain emissions.
Supporting Statement: In assessing targets, we recommend:
- Taking into consideration approaches used by advisory groups like SBTi;
- Developing a transition plan that shows how the Company plans to meet its goals, taking into consideration criteria used by advisory groups; and
- Consideration of supporting targets for energy efficiency, low-carbon materials and other measures deemed appropriate by management.
[1] https://www.swissre.com/institute/research/topics-and-risk-dialogues/climate-and-natural-catastrophe-risk/expertise-publication-economics-of-climate-change.html
[2] Quanta Services 2020, 2021, 2022 CDP reports
[3] Quanta Services 2022 CDP report
