EnerSys Releases Second Annual Task Force on Climate Related Financial Disclosure (TCFD) Report
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Insights
From an environmental sustainability perspective, the active engagement of EnerSys in climate-related disclosures is a significant step toward transparency and accountability. The company's commitment to achieving net zero Scope 1 and Scope 2 emissions by 2040 and 2050, respectively, indicates a strategic alignment with global sustainability efforts such as the Paris Agreement. It is important to note that Scope 1 emissions refer to direct emissions from company-owned and controlled resources, while Scope 2 covers indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the reporting company.
Investors are increasingly considering Environmental, Social and Governance (ESG) factors when making investment decisions. EnerSys's sustainability report, particularly with the TCFD framework, provides investors with a structured and reliable set of data to assess the company's climate-related risks and the robustness of its risk management strategies. This can influence investor confidence and potentially affect the company's cost of capital. Moreover, the company's proactive approach to sustainability can be seen as a competitive advantage, as it may attract customers and investors looking to associate with environmentally responsible companies.
Examining the risk management aspect, EnerSys's implementation of a Risk Management Program that actively identifies risks across the organization is a critical component for mitigating potential financial and operational disruptions. Climate change poses a variety of risks, including regulatory, physical and reputational risks, which can impact business continuity and profitability. By incorporating insights from all business units and functions, EnerSys demonstrates a comprehensive approach to understanding and managing these risks.
For stakeholders, the emphasis on risk management within the TCFD report is reassuring, as it shows a forward-thinking approach to potential challenges that may arise from climate change. This level of preparedness can serve to minimize the impact of unforeseen events, safeguarding shareholder value. It also aligns with industry best practices, which increasingly prioritize risk management in relation to environmental impact as a critical business function.
From an investor relations standpoint, the release of a detailed TCFD report by EnerSys is a strategic move to enhance communication with investors and other stakeholders. The focus on governance, strategy, risk management and metrics and targets provides a holistic view of the company's approach to climate-related issues. Clear communication regarding sustainability goals and progress can build investor trust and potentially improve the company's reputation in the marketplace.
Furthermore, the decision to present this report annually allows for consistent tracking of progress and demonstrates a commitment to long-term sustainability objectives. This can be particularly appealing to institutional investors and funds that mandate ESG compliance. The transparency and accountability expressed through such reporting can be a differentiating factor that sets EnerSys apart from competitors who may not be as forthcoming with their sustainability efforts.
"While we continue to expand and develop our sustainability initiatives, we acknowledge that mitigating risk and reducing our environmental impact cannot be considered separately,” said President & CEO David M. Shaffer. “By identifying climate-related risks that impact EnerSys, we can focus on key mitigation strategies while working toward our goals, improving our operations, and providing customer energy storage solutions and services."
The report navigates through four pivotal TCFD themes: governance, strategy, risk management, and key metrics and targets:
- Governance: The EnerSys sustainability strategy places the management of climate-related matters squarely in the hands of our Board, committees, subject matter experts, and senior leadership.
- Strategy: Continuous evaluation of climate change risks guides our adaptive approach, considering potential impacts on business, operations, and the entire value chain.
- Risk Management: Our robust Risk Management Program actively identifies risks across EnerSys, incorporating insights from every business unit and function.
- Metrics and Targets: Our commitment to transparent reporting on performance and annual goal progress is a cornerstone, fostering trust among investors, customers, and other stakeholders.
The TCFD framework serves as a powerful tool for EnerSys, facilitating effective communication with investors, customers, and employees about our vigilant management of climate-related risks. This report, coupled with previous disclosures such as our 2022 Sustainability Update and CDP report, underscores our commitment to transparent sustainability and climate action.
EnerSys remains an active participant in the United Nations Global Compact, the Alliance to Save Energy, the
About EnerSys
EnerSys is the global leader in stored energy solutions for industrial applications and designs, manufactures and distributes energy systems solutions and motive power batteries, specialty batteries, battery chargers, power equipment, battery accessories and outdoor equipment enclosure solutions to customers worldwide. The company goes to market through four lines of business: Energy Systems, Motive Power, Specialty and New Ventures. Energy Systems, which combine power conversion, power distribution, energy storage, and enclosures, are used in the telecommunication, broadband and utility industries, uninterruptible power supplies, and numerous applications requiring stored energy solutions. Motive power batteries and chargers are utilized in electric forklift trucks and other industrial electric powered vehicles. Specialty batteries are used in aerospace and defense applications, large over-the-road trucks, premium automotive, medical and security systems applications. New Ventures provides energy storage and management systems for various applications including demand charge reduction, utility back-up power, and dynamic fast charging for electric vehicles. EnerSys also provides aftermarket and customer support services to its customers in over 100 countries through its sales and manufacturing locations around the world. More information regarding EnerSys can be found at www.enersys.com.
Sustainability
Sustainability at EnerSys is about more than just the benefits and impacts of our products. Our commitment to sustainability encompasses many important environmental, social and governance issues. Sustainability is a fundamental part of how we manage our own operations. Minimizing our environmental footprint is a priority. Sustainability is our commitment to our employees, our customers and the communities we serve. Our products facilitate positive environmental, social and economic impacts around the world. To learn more visit: https://www.enersys.com/en/about-us/sustainability/.
Caution Concerning Forward-Looking Statements
This press release, and oral statements made regarding the subjects of this release, contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, or the Reform Act, which may include, but are not limited to, statements regarding EnerSys’ projections, plans, objectives, expectations and intentions to reduce emissions and emissions intensity, ability to influence, control and change the environmental impact of its business activities, the development of future technologies, business plans, and other statements contained in this press release that are not historical facts, including statements identified by words such as “believe,” “plan,” “seek,” “expect,” “intend,” “estimate,” “anticipate,” “will,” and similar expressions. All statements addressing operating performance, events, or developments that EnerSys expects or anticipates will occur in the future, including statements relating to the Company’s goals of achieving Scope 1 greenhouse gas neutrality by 2040 and Scope 2 neutrality by 2050 and ability to influence emissions related to its activities, as well as statements expressing optimism or pessimism about such plans are forward-looking statements within the meaning of the Reform Act. The forward-looking statements are based on management's current views and assumptions regarding future events and operating performance, and are inherently subject to significant business, economic, and competitive uncertainties and contingencies and changes in circumstances, many of which are beyond the Company’s control. The statements in this press release are made as of the date of this press release, even if subsequently made available by EnerSys on its website or otherwise. EnerSys does not undertake any obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.
Although EnerSys does not make forward-looking statements unless it believes it has a reasonable basis for doing so, EnerSys cannot guarantee their accuracy. The foregoing factors, among others, could cause actual results to differ materially from those described in these forward-looking statements. For a list of other factors which could affect EnerSys’ results, including earnings estimates, see EnerSys’ filings with the Securities and Exchange Commission, including “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations,” and “Forward-Looking Statements,” set forth in EnerSys’ Annual Report on Form 10-K for the fiscal year ended March 31, 2023. No undue reliance should be placed on any forward-looking statements.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240116349226/en/
Lisa Hartman
Investor Relations and Financial Media
EnerSys
610-236-4040
E-mail: investorrelations@enersys.com
Source: EnerSys
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