Climate Change Data

Environmental Metrics

ESG Focus Areas

• Business Ethics and Compliance
• Inclusion and Diversity
• Employee Health and Safety
• Air Quality
• Energy Management
• GHG Emissions

Environmental Achievements

• Installed translucent polycarbonate panels at Huehuetoca, Mexico facility to increase natural light and reduce energy consumption.
• Meyer Utility Structures implemented lower-psi plant air compressors to reduce Scope 2 emissions.
• Arcosa Marine sponsored a tree planting project in Louisiana.
• Construction Products businesses transitioned to higher-efficiency engines to reduce fuel consumption (Scope 1 emissions).

Social Achievements

• Launched ARC 100, a company-wide safety program, resulting in a 56% year-over-year improvement in TRIR.
• Improved diversity metrics, with females representing 33% of senior management and 20% of the managerial team.
• Supported communities through food drives, school supply donations, and virtual charitable events.
• Provided employee development investment of $1.9M

Governance Achievements

• Renamed the Board’s Corporate Governance and Directors Nominating Committee to the Governance and Sustainability Committee.
• Published a series of policy statements on core sustainability values.
• Published a mid-year ESG report.
• Arcosa Wind Towers facilities earned ISO 45001 certification.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting customer demand, supply chain, and employee ability to work.
• Potential for higher raw material costs.
• Unreliable supply chain.
• Changes in customer behaviors towards energy efficiency and lower emission options.
• Climate-related risks such as extreme weather, rising temperatures, and changes in precipitation patterns.

Mitigation Strategies

• Implemented safeguard measures at plants and offices to meet or exceed CDC guidelines.
• Cautiously reopened facility access to key visitors and contractors.
• Supported communities impacted by the pandemic.
• Maintained business resilience by building a “cash culture” and investing in acquisitions.
• Leveraging purchasing power to mitigate material cost increases.
• Improving production efficiency and reliability.
• Diversifying supplier base.
• Investing in low-emission product lines and technologies.
• Participating in energy reduction programs and carbon credit initiatives.

Supply Chain Management

Responsible Procurement

• Partnering with steel suppliers to manage environmental impact of material.

Climate-Related Risks & Opportunities

Physical Risks

• Increased severity of natural disasters
• Extreme temperatures
• Higher rainfall and intense wind
• Changes in precipitation patterns
• Rising average temperatures
• Rising ocean and river levels

Transition Risks

• Carbon tax
• Transition to emission limits
• Stricter regulation of sustainability reporting
• Mandates on and regulation of existing product lines
• Changing regulation of North American pipeline infrastructure
• Increased cost of raw materials
• Unreliable supply chain
• Change in customer behaviors

Opportunities

• Partnerships with renewable energy providers for carbon offsets
• Growth in low-carbon alternatives
• Added demand to strengthen infrastructure for clean energy
• Leveraging governance strengths to align with regulatory reporting changes
• Growth in low-emission product lines
• Opportunities for Arcosa's transportation-related product lines
• Higher steel availability
• Leveraging purchasing power to mitigate material cost increases
• Eliminating waste in production processes
• Diversifying supplier base
• Opportunities for low-emission product lines

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 45001

Sustainable Products & Innovation

• Recycled aggregates

Awards & Recognition

• Cemefi ESR Distinction (Mexico operations)
• Latinos on Boards recognition for Joe Alvarado and Antonio Carrillo

Environmental Metrics

ESG Focus Areas

• Safety
• GHG Emissions
• Inclusion and Diversity
• Community Impact
• Business Ethics and Compliance
• Air Quality

Environmental Achievements

• Reduced Total Recordable Incident Rate (TRIR) by 60% since 2019.
• Implemented energy conservation initiatives resulting in overall emissions and emissions intensity reductions.
• Arcosa’s Recycled Aggregates business recycled over 3 million tons of concrete, nearly 120,000 tons of reclaimed asphalt, and over 35,000 tons of steel.
• Arcosa Wind Towers implemented a formal recycling program.

Social Achievements

• Increased gender diversity on the Board of Directors to 50%.
• Appointed Gail Peck as Chief Financial Officer.
• Launched WE~AR: Women of Arcosa, the company's first employee resource group.
• Improved employee engagement through an inaugural Cultural Climate Employee Engagement Survey with a 72% response rate.
• Invested $1.3M in employee development.

Governance Achievements

• Established ESG committees at multiple levels of the company.
• Invested in system infrastructure to support ESG metric and initiative tracking.
• Published Arcosa’s inaugural annual Sustainability Report, integrating TCFD framework and supporting SASB metrics.
• Maintained VPP OSHA STAR designations for McConway & Torley steel foundry and Standard Forged Products manufacturing facility for 12 years.

Climate Goals & Targets

Environmental Challenges

• Climate-related risks including transition risks (policy & regulatory, technology, market), and physical risks (acute and chronic).
• Supply chain disruptions.
• Maintaining a safety culture during a pandemic.
• Addressing health equity within the employee population.

Mitigation Strategies

• GHG emissions reduction through energy conservation.
• Development of a renewable energy roadmap.
• Diversification of supplier base.
• Implementation of Business Continuity Plans (BCPs).
• Investment in system infrastructure for ESG reporting.
• Competitive healthcare programs tailored to employees' needs.

Supply Chain Management

Responsible Procurement

• Focus on sourcing recycled steel.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme temperatures
• Higher rainfall
• Intense wind
• Changes in precipitation patterns
• Rising average temperatures
• Rising ocean and river levels

Transition Risks

• Carbon tax
• Emissions limits
• Stricter regulation of sustainability reporting
• Cost of transition to lower emissions technology
• Electricity grid reliability
• Mandates on existing product lines
• Increased cost of raw materials
• Unreliable supply chain
• Price increases due to transition to renewable sources
• Potential revenue loss
• Accelerated stakeholder expectation
• Stigmatization of less 'green' products
• Change in customer behaviors

Opportunities

• Partnerships with renewable energy providers
• Added demand to strengthen infrastructure for clean energy
• Low-carbon alternatives for certain product lines
• Regulatory incentives
• Supporting reconstruction after severe weather
• Market transition to lower-emissions product offerings
• Further acquisitions into low-emissions products
• Investment in technology to reduce energy and water consumption

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 45001

Sustainable Products & Innovation

• Recycled aggregates
• Wind towers

Awards & Recognition

• Newsweek’s America’s Most Responsible Companies 2022
• American Waterways Operators (AWO) Safety Award
• Cemefi ESR Distinction (Mexico)

Environmental Metrics

ESG Focus Areas

• Air Quality
• Business Ethics and Compliance
• Employee Health and Safety
• Greenhouse Gas (GHG) Emissions
• Inclusion and Diversity

Environmental Achievements

• 19% reduction in Scope 1 and 2 greenhouse gases emissions intensity with respect to revenue, compared to baseline (2020)
• Implementation of a renewable energy plan for high energy consuming plants and piloting onsite solar projects
• Expansion of recycled aggregates business in Southern California and Arizona

Social Achievements

• Over 70% reduction in incident rate since 2019 (first year of reporting), with a 30% improvement compared to 2021. This was achieved through the ARC 100 safety culture initiative.
• Increased employee participation in volunteer projects, office fundraisers, and plant open houses.
• Implementation of Arcosa Celebration of Excellence (ACE) employee recognition and reward program.

Governance Achievements

• Amendment of the Governance and Sustainability Committee charter to address the Committee's review and assessment of sustainability and ESG related practices, policies, goals, and programs.
• Publication of a Supplier Code of Conduct.
• Enhanced incentive plans aligning compensation with long-term stakeholder value creation.

Climate Goals & Targets

Environmental Challenges

• Potential for increased cost of raw materials as supply chain participants decarbonize.
• Possible additional climate-related mandates and regulation of existing product lines.
• Accelerated stakeholder expectation of public commitment to a low-carbon economy.
• Climate event-driven risks (increased severity of natural disasters, extreme temperatures, etc.).
• Long-term shifts in climate conditions (changes in precipitation, rising temperatures, etc.).

Mitigation Strategies

• GHG emissions reduction through conservation and renewable energy strategies.
• Focus on stricter regulation over climate-related reporting and internal controls.
• Decarbonizing production processes and growing in environmentally-friendly product lines.
• Leveraging EHS-driven business continuity plans and geographic diversity.
• Evaluating acquisition and organic growth in lower-risk regions, investing in new technologies, and building sustainable operational practices.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Increased severity of natural disaster impacts
• Extreme temperatures
• Higher rainfall and intense wind
• Changes in precipitation patterns
• Rising average temperatures
• Rising ocean and river levels
• Inconsistent access to reliable electricity supply

Transition Risks

• Policy & Regulatory Risks
• Technology Risks
• Market Risks
• Reputation Risks

Opportunities

• Increased infrastructure product demand due to physical climate impacts
• Contribution to climate transition through product lines
• Demand for low-carbon alternatives
• Infrastructure build-out to support clean energy
• Market transition to lower emissions product offerings
• Market transition to more efficient modes of transportation

Reporting Standards

Frameworks Used: TCFD, SASB

Certifications: ISO 45001 (Iowa and Oklahoma wind tower facilities), VPP OSHA STAR (Pennsylvania-based McConway & Torley and Standard Forged Products)

UN Sustainable Development Goals

• 3
• 5
• 10
• 12
• 13
• 16

See Appendix for details.

Sustainable Products & Innovation

• Recycled aggregates
• Inland barges
• Wind towers

Awards & Recognition

• EcoVadis Silver Medal (Arcosa Wind Towers)
• Cemefi ESR Distinction (Arcosa Mexico)

Environmental Metrics

ESG Focus Areas

• Safety
• Greenhouse Gas (GHG) Emissions
• Employee Engagement
• Community Investment
• Inclusion & Diversity
• Recycled Aggregates
• Renewable Energy
• Climate Risk Management
• Corporate Governance

Environmental Achievements

• 17% reduction in GHG emissions intensity compared to 2020 baseline (surpassing the 10% goal by 2026)
• Implementation of a new 'dry' crushing process at a British Columbia mine, reducing water requirements by nearly 1 million gallons monthly, reducing natural gas consumption, and improving material efficiency.
• Expansion of recycled aggregates footprint into Florida.

Social Achievements

• More than 60% decline in total lost workdays due to injuries.
• Conducted second employee engagement survey with favorable overall company rating.
• Over 350 employees recognized by peers for excellent work through the ACE program.
• Nearly 2,000 e-cards sent through the ACE program.
• More than 5,500 recognition activities driven by the ACE program.
• Continued investment in community through education support, food donations, and volunteer projects.

Governance Achievements

• Successful completion of first five years as an independent public company.
• 30% female representation on the Board of Directors.
• More than 35% female representation in Senior Management.
• 100% Independent Audit, Human Resources, and Governance and Sustainability Committees.
• Annual Board and Committee self-performance evaluations.
• Enterprise Risk Management program with full Board and Committee oversight.

Climate Goals & Targets

Environmental Challenges

• Dry spring and summer in British Columbia impacting water reserves for aggregate mines.
• Ramp-up of production in Transportation Products segment with higher proportions of new employees impacting safety metrics.
• Divestment of storage tank business impacting overall TRIR calculation.
• Evolving ESG regulatory landscape and emerging regulatory requirements.
• Potential for increased cost of raw materials due to supply chain decarbonization.
• Potential for unreliable supply chain due to vendor resilience being tested during transition.
• Potential change in customer behaviors as markets shift to prioritize low-carbon products and services.
• Accelerated stakeholder expectation of public commitment to a low-carbon economy.
• Climate event-driven risks (increased severity of natural disasters, extreme temperatures, high rainfall, intense wind).
• Long-term shifts in climate conditions (changes in precipitation, rising temperatures, changing ocean levels, inconsistent electricity supply).

Mitigation Strategies

• Implementation of a new 'dry' crushing process at a British Columbia mine.
• Improved safety culture onboarding program.
• Safety Mentorship Program.
• GHG emissions reduction through conservation and renewable energy strategies.
• Leveraging purchasing power to mitigate material cost increases.
• Diversifying supplier base.
• Integrating sustainability into all aspects of the business.
• Leveraging business continuity plans and geographic diversity to address climate risks.
• Improving production efficiency and reliability.
• Evaluating acquisition and organic growth in lower-risk regions.
• Investing in new technologies.
• Implementing sustainable operational practices.
• Decarbonizing production processes and growing environmentally friendly product lines.
• Diversifying products to maintain a balanced emissions portfolio.
• Participating in energy reduction programs and renewable energy solutions.

Supply Chain Management

Responsible Procurement

• Partnering with steel suppliers to focus on material management and target 50% or greater acquisition of recycled steel.

Climate-Related Risks & Opportunities

Physical Risks

• Increased severity of natural disaster impacts
• Extreme temperatures
• High rainfall and intense wind
• Changes in precipitation patterns
• Rising average temperatures
• Changing ocean and river levels
• Inconsistent access to reliable electricity supply

Transition Risks

• Policy & Regulatory changes
• Technological advancements
• Market shifts
• Reputational risks

Opportunities

• Growth in low-carbon alternatives
• Infrastructure build-out to support clean energy
• Expansion of climate-friendly product lines
• Leveraging regulatory incentives for energy-efficient equipment
• Supporting reconstruction after severe weather events
• Meeting customer needs for sustainability
• Further acquisitions into low-emissions products and platforms
• Investment in technology to reduce energy and water consumption

Reporting Standards

Frameworks Used: TCFD, SASB

Certifications: VPP OSHA STAR, ISO 45001, Green Marine

UN Sustainable Development Goals

• 3
• 5
• 10
• 12
• 13
• 16

Good Health and Well-Being, Gender Equality, Reduced Inequalities, Responsible Consumption and Production, Climate Action, Peace, Justice and Strong Institutions.

Sustainable Products & Innovation

• Recycled aggregates
• Wind towers
• Inland barges

Awards & Recognition

• Newsweek’s America’s Most Responsible Companies of 2024