Lockheed Martin Inc: Net Zero Targets & Climate Transition Planning
WHEREAS: The Intergovernmental Panel on Climate Change reports that immediate and significant emissions reductions are required of all market sectors to stave off the worst consequences of climate change.[1] Decarbonizing the aviation industry is a critical component of global decarbonization, according to the International Energy Agency.[2] Investor demand for science-aligned emission reductions and transition planning reflects the reality that climate-related risk exposure is growing.[3]
Lockheed Martin is subject to substantial emerging regulation and increasing costs in the US and abroad regarding its emission-intensive operations and products.[4] For instance, the proposed Federal Supplier Climate Risks and Resilience Rule would require large federal contractors, such as Lockheed Martin, to disclose Scope 1, 2, and 3 emissions and set science-based emissions reduction targets.[5] By reducing emissions from its full value chain, Lockheed Martin can reduce regulatory burdens and better assess technological changes, capital deployment needs, and financial opportunities.
Lockheed Martin’s current disclosures lack specific, forward-looking, and quantitative action plans that are sufficient to achieve alignment with the global aim of 1.5°C. While the Company set an emissions reduction target covering its operations, this goal covers less than 5% of the Company’s total emissions and fails to align with a 1.5°C ambition.[6] Lockheed has yet to set a target to reduce emissions from its value chain, which constitutes 95% of the Company’s overall emissions. This absence of emission reduction targets across all scopes, coupled with the absence of a comprehensive transition plan, leaves investors without crucial information regarding the Company’s exposure to climate-related risks in its supply chain and customer use, as well as its strategies for mitigating these risks.
Aerospace and industrial companies are galvanizing action and investment toward decarbonizing. Lockheed risks falling behind as peers Airbus, BAE Systems, Cisco Systems, Deere & Company, Honeywell, and Safran have established targets through the Science Based Targets initiative across all scopes of emissions.[7]
By setting science-aligned emission reduction targets across its full value chain and providing a comprehensive transition plan, Lockheed Martin can improve its competitiveness against peers, prepare for regulation, and position itself to maximize climate-related opportunities.
BE IT RESOLVED: Shareholders request that the Board issue a report, at reasonable expense and excluding confidential information, disclosing how Lockheed Martin intends to reduce its full value chain emissions in alignment with the Paris Agreement’s 1.5°C goal.
SUPPORTING STATEMENT: Proponents recommend, at Board discretion, that the report include:
A timeline for setting 1.5°C-aligned near-term emission reduction targets;
A timeline for setting long-term net zero goals;
A climate transition plan to achieve emissions reduction goals across all relevant emission scopes; and
Annual reporting demonstrating progress towards meeting emission reduction goals.
[1] https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_FullVolume.pdf, p.20
[2] https://iea.blob.core.windows.net/assets/13dab083-08c3-4dfd-a887-42a3ebe533bc/NetZeroRoadmap_AGlobalPathwaytoKeepthe1.5CGoalinReach-2023Update.pdf, p.87,88
[3] https://www.weforum.org/agenda/2023/10/climate-loss-and-damage-cost-16-million-per-hour/; https://corpgov.law.harvard.edu/2023/01/30/eu-finalizes-esg-reporting-rules-with-international-impacts/
[4] https://www.ft.com/content/7a0dd553-fa5b-4a58-81d1-e500f8ce3d2a; https://www.npr.org/2023/10/12/1205068747/climate-change-emissions-companies-disclosure-sec-california
[5] https://www.sustainability.gov/federalsustainabilityplan/fed-supplier-rule.html
[6] https://sustainability.lockheedmartin.com/sustainability/beyond-the-smp/carbon-strategy-and-climate-related-risk/; https://www.lockheedmartin.com/content/dam/lockheed-martin/eo/documents/sustainability/2023-cdp-climate-change-response.pdf, p.30-34
Resolution Details
Company: Lockheed Martin Inc
Lead Filers:
As You Sow on behalf of Amalgamated Bank
Year: 2024
Filing Date:
November 2023
Initiative(s): Climate Change
Status: 32.2% Vote