Resolved: Shareholders request J.B. Hunt Transport Services (JBHT) adopt company-wide, quantitative, science-based targets to reduce greenhouse gas (GHG) emissions from its vehicle fleet and operations and issue a report, at reasonable cost and omitting proprietary information, discussing its plans and progress towards achieving these targets.
Whereas: The Paris Climate Agreement of 2015 that was agreed to by 195 countries established a target to limit global temperature increases to 2 degrees Celsius above pre-industrial levels. Motivated by the imperative to achieve this limited warming scenario, over 300 businesses have committed to set GHG emissions reduction targets consistent with this global goal. The United States initially supported this effort by establishing a long-term goal to reduce emissions to 80% below 2005 levels by 2050.
The transportation sector is particularly important if the U.S. is to meet this or any other emissions reduction goal; the U.S. Energy Information Administration reports the transportation sector recently passed the electricity generation sector as the largest producer of GHG emissions. Transportation is also the only major sector in the U.S. with increasing emissions – emissions from the residential, commercial, industrial, and electric power sectors have all declined in recent years.
JBHT has stated it takes climate change seriously. It has adopted various initiatives to reduce fuel consumption and its Inter-Modal operations provide emissions reductions for its clients. Yet, according to its CDP responses, JBHT’s emissions per load increased in 2015 and 2016, calling into question the efficacy of the company’s strategies and initiatives.
Proponents believe adopting company-wide, quantitative targets based on climate science would help JBHT align new and existing initiatives, lower costs, increase competitiveness, and prepare for changing regulations, while enabling shareholders to better evaluate JBHT’s emissions management strategies. Proponents recommend JBHT consider the methods outlined by the Science Based Targets Initiative as this would ensure its emissions reductions are consistent with the levels needed to achieve the 2 degree goal.
Over half of JBHT’s S&P 500 peers have set GHG emissions reduction targets. Ryder System, Norfolk Southern, and CSX Corporation are notable transportation sector examples.
Setting GHG reduction goals would also unlock important opportunities for growth as business customers increasingly demand environmental accountability from suppliers. For example, Walmart, one of JBHT’s major customers, is aiming to reduce its supply chain emissions and is encouraging its suppliers to set their own ambitious science-based emissions reduction targets.
Setting GHG goals is frequently found to be sound business strategy. A 2013 report by CDP, WWF, and McKinsey & Company found that companies with GHG targets achieved 9% better return on invested capital than companies without targets.
One of the recommendations of The Task Force on Climate-related Financial Disclosures, whose members include JPMorgan Chase, UBS Asset Management, Generation Investment Management, and BlackRock, is: “Describe the targets used by the organization to manage climate-related risks and opportunities and performance against these targets.”