Public Storage: GHG Target Setting

WHEREAS: According to the Intergovernmental Panel on Climate Change, the window for limiting global warming to 1.5 degrees Celsius (1.5°C) is quickly narrowing. Investor demand for science-aligned greenhouse gas (GHG) emission reductions reflects the reality that climate change poses a systemic risk to companies and investor portfolios. [1] Failure to reach Net Zero emissions by 2050 is projected to have dramatic economic consequences.[2] Immediate and significant emissions reduction is therefore required of all market sectors.[3]

Shareholders are increasingly concerned about the growing material climate risk to their companies and to their portfolios. The Climate Action 100+ initiative, a coalition of more than 700 investors with over $68 trillion in assets, has issued a Net Zero Benchmark outlining metrics that create climate accountability for companies and transparency for shareholders. The Benchmark requires that companies set short, medium, and long-term GHG reduction targets and create quantitative forward-looking action plans to achieve targets.[4]

As the world’s leading owner and operator of self-storage facilities, Public Storage faces a variety of material climate-related risks. As stated in the Company’s 2022 10-K, in addition to the physical risks posed to company facilities by “increased destructive weather events,” the “transition to a low-carbon economy presents certain risks…including stranded assets, increased costs, lower profitability, lower property values, lower household wealth, and macroeconomic risks related to high energy costs and energy shortages.”[5]

Although Public Storage discloses a 12% by 2025 GHG reduction goal for its operations, this goal is not 1.5°C-aligned, nor is it inclusive of its full value chain emissions.[6] Despite a nearly 35% vote on a 2023 shareholder proposal requesting 1.5°C targets, the Company has failed to act. In contrast, 58 North American companies in the real estate sector have committed to establishing science-aligned GHG targets through the Science Based Targets initiative.[7]

By setting 1.5°C, Paris-aligned GHG reduction targets for its entire value chain, disclosing a climate transition plan, and demonstrating progress toward achieving such goals, Public Storage can provide investors with assurance that management is addressing material climate-related risks and capitalizing on the value-creating opportunities presented by a net zero economy.

BE IT RESOLVED: Shareholders request that the Board issue short- and long-term Scope 1 through 3 greenhouse gas reduction targets aligned with the Paris Agreement's 1.5°C goal requiring Net Zero emissions by 2050.

SUPPORTING STATEMENT: Proponents suggest, at management discretion, the Company: