Air Products & Chemicals | Set Emission Reductions Targets for Company’s Full Value Chain - Scopes 1-3

Status
Withdrawn
AGM date
Resolution details
Company ticker
APD
Lead filer
Nathan Cummings Foundation
Resolution ask
Set targets or plans
ESG theme
  • Environment
ESG sub-theme
  • GHG targets / emissions
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Materials
Company HQ country
United States
Resolved clause
Shareholders request that Air Products address the risks and opportunities presented by climate change and the global transition toward net zero emissions by setting emission reduction targets covering the Company’s full value chain (Scope 1, 2 and 3) GHG emissions
Whereas clause
In 2018, the Intergovernmental Panel on Climate Change advised that net greenhouse gas (GHG) emissions must fall 45 percent by 2030 and reach net zero by 2050 to limit warming below 1.5°C. This would prevent the worst consequences of climate change. The Fourth National Climate Assessment (2018) reports that with continued growth in emissions, annual U.S. economic losses could reach hundreds of billions of dollars by 2100. A warming climate is associated with systemic portfolio risks to investors, including supply chain dislocations, reduced resource availability, environmental degradation to communities where companies operate, lost productivity, commodity price volatility, infrastructure damage and disruptions from severe weather events, among other things. While Air Products has adopted a goal to reduce CO2 emissions intensity (not absolute emissions) one-third by 2030, this does guarantee that total emissions will fall to match the ambition of the Paris Agreement nor does it cover scope 3 emissions. We believe more ambitious action is necessary to address the Company’s full climate impact and the transition risks associated with a global shift away from a fossil fuel-based economy. Peer companies have begun to set more ambitious climate, renewable energy and energy efficiency goals. Air Liquide and Linde have committed to set science-based greenhouse gas targets and Air Liquide is committed to reducing absolute emissions 33% by 2035. Linde will invest more than one-third of annual R&D in decarbonization by 2028. BASF and Air Liquide have pledged to be carbon neutral by 2050. Ramping up the scale, pace and rigor of its climate-related initiatives could secure a leadership role for Air Products that unlocks opportunities for growth as customers increasingly demand environmental accountability. It will also help prepare the Company for future climate-related regulations. We believe that setting emissions reduction targets for all GHG emissions (Scope 1, 2 and 3) is the best way for Air Products to address these risks and opportunities.
Supporting statement
In assessing what targets to set, we recommend, at management’s discretion, consideration of the following: • Adopting short, medium and long-term GHG emissions reduction targets taking into consideration approaches used by advisory groups such the Science Based Targets initiative (through which over 1,500 companies have set or committed to set science-based GHG reduction targets). • Adopting quantitative targets to increase sourcing of renewable energy, energy efficiency and production of green hydrogen. • Assessing the disparate impacts of the Company’s climate change contributions on communities of color and committing to reduce or mitigate local community health impacts from the cumulative emissions generated from its facilities.

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