CN has released its eighth “Delivering Responsibly Sustainability Report” outlining its ESG (environmental, social and governance) performance.
The 76-page report for 2020 (download below) “is part of our commitment to be open about our business and to communicate our progress with focus, clarity and comparability,” CN said.
Produced biennially, the report covers five principles that “anchor” CN’s sustainability commitment. Following are among the highlights:
1. Environment: “In support of keeping the global temperature increase well below 2 degrees Celsius compared to pre-industrial temperatures, we have revised our science-based target to reduce our carbon emission intensity by 43% by 2030 based on 2019 levels,” according to the Class I railroad, which in November 2021 announced its commitment to “achieving net-zero carbon emissions by 2050.” Also, CN reported delivering its “best locomotive fuel efficiency ever—4% better than the previous record set in 2019—avoiding approximately 275,000 tons of CO2 emissions”; setting a short-term year-on-year rolling target of 2% sustainable renewable fuel consumption for its Canadian locomotive fleet; purchasing a Wabtec FLXdrive battery-electric freight locomotive; and signing a Memorandum of Understanding with Lion Electric to acquire 50 zero-emission trucks for use in urban area intermodal terminals.
2. Safety: In 2020, CN said it invested approximately $2.9 billion in its capital program to support safety, increase capacity, enable growth and drive operational efficiencies. About $1.6 billion was targeted toward track and railway infrastructure maintenance. In addition, the railroad has Health and Safety committees that focus on “engaging employees, addressing safety issues and making concrete improvements,” and it is using automated Inspection Portals to improve fleet inspection, investing in predictive data analytics, incorporating web-based training on electronic track occupancy permits, and digitizing processes for efficiency.
3. People: CN is conducting “regular reviews of pay equity and defining a roadmap to address identified gaps,” and targeting 30% for gender diversity among executives by 2022. Currently, of the 34 current executive roles, six (18%) are held by women.
4. Community: In 2021, CN created an Indigenous Advisory Council, “an independent body comprised of Indigenous peoples from across the country, to provide advice to CN’s Board and the company’s President and Chief Executive Officer.” Additionally, in 2019 and 2020, CN continued its partnership with Tree Canada, “engaging in tree plantings and mass reforestation projects across the country. Since 2012, through our EcoConnexions programs, CN has planted more than two million trees.”
5. Governance: In 2020, 43% of CN Board members were women, and in early 2021, the Board set a new target of 50% gender diversity among its directors by 2022. Additionally, over the past few years, “we have aligned our practices with the UN Global Compact and worked to make our processes more robust,” CN said. “We continue to conduct high-level due diligence assessments across our value chain to identify, address and mitigate potential human rights issues.”
CN also noted such achievements as:
• Recognition in 2021 “for leadership in corporate governance, ranking first in the Globe and Mail’s Report on Business’ annual comprehensive assessment of 220 S&P/TSX Composite Index Members.
• Listed in 2021 on the Dow Jones Sustainability World Index for the 10th consecutive year.
• Listed in 2021 on CDP’s global Climate A List recognizing leadership on carbon disclosure.
• Ranked 10th in the world on the Corporate Knights 2021 Global 100 Index of the most sustainable companies.
“As we look forward to the next great chapter in our company’s history, we are committed to implementing new ESG initiatives that reflect best-in-class practices and reinforce our status as a leader among North American Class I railroads and across the entire transportation sector,” CN Board Chair Robert Pace said in the report.