Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Stewardship
• Employee Health and Safety
• Corporate Governance
• Community Engagement
• Diversity and Inclusion

Environmental Achievements

• 7% decrease in greenhouse gas emissions (sales weighted)
• 12% decrease in scrap rate
• 4% increase in payload efficiency
• 16% decrease in downtime rate
• 2% increase in fleet MPG
• 550 million pounds of recycled plastic purchased
• 44% increase in purchased recycled plastic

Social Achievements

• 400+ employees participated in leadership training
• ADS Philanthropic Foundation Established in 2020
• $2 Million donated to charitable organizations
• 14% increase in female employees in Fiscal 2020

Governance Achievements

• ESG Board of Directors Sub-Committee Established in 2020
• 2 enhancements made to corporate governance program
• Declassifying the board structure and eliminating supermajority voting requirements
• Adoption of the majority vote standard for director elections

Climate Goals & Targets

Environmental Challenges

• Increased severity of weather events impacting supply chain and transportation
• Transition to a low-carbon economy increasing costs
• Potential shifts in demand and supply of raw materials
• Stakeholder concerns about the plastics industry
• Majority of incidents related to strains and sprains from manual tasks

Mitigation Strategies

• Reducing carbon footprint, limiting energy consumption, improving fuel efficiency
• Automating processes and updating equipment to reduce manual tasks
• Using third-party logistics partners for certain deliveries
• Implementing a Stop Work Program
• Focusing on operational excellence objectives to improve manufacturing efficiency

Supply Chain Management

Responsible Procurement

• Purchasing over 550 million pounds of recycled plastic annually

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events disrupting supply chain and transportation

Transition Risks

• Regulatory changes, market shifts, increased cost of raw materials

Opportunities

• Increased demand for water management solutions due to climate change
• Opportunities for operational efficiency improvements

Reporting Standards

Frameworks Used: SASB

Sustainable Products & Innovation

• N-12® Flex pipe, Barracuda water separation unit, recycled pipe for public markets

Environmental Metrics

ESG Focus Areas

• Recycling
• Environmental impact reduction
• Accountability
• Social purpose
• Operational excellence
• Diversity, Equity & Inclusion

Environmental Achievements

• Reduced GHG emissions intensity by 6%
• Recycled 510 million pounds of plastic, avoiding 670 million pounds of GHG emissions
• 4% decrease in energy intensity
• 21% decrease in total recordable incident rate (TRIR) at focus plants
• 9% decrease in downtime rate
• 21% decrease in scrap rate
• 66% of pipe revenue derived from re-manufactured products

Social Achievements

• 50% of senior level hires were diverse
• $450,000 contributed to charitable organizations
• $2 million contributed to The ADS Foundation
• Established partnership with The Recycling Partnership

Governance Achievements

• Board adopted resolution affirming commitment to diversity, equity and inclusion
• MSCI rating improved from A to AA

Climate Goals & Targets

Environmental Challenges

• Availability of virgin material at a more competitive price, resulting in decreased recycled material usage
• Supply chain disruptions due to extreme weather events
• Potential increase in cost of operations due to higher carbon prices and stricter environmental standards
• Potential shifts in demand and supply of raw materials
• Stakeholder concerns about the plastics industry
• Reputational risk tied to changing customer or community perceptions

Mitigation Strategies

• Pursuing science-based targets in line with the 1.5°C scenario
• Implementing a supplier sustainability program
• Improving energy efficiency
• Increasing fleet efficiency
• Evaluating fleet electrification
• Implementing closed loop cooling water at all manufacturing locations
• Using recycled materials in production
• Partnering with governments and communities to mitigate climate change effects
• Improving efficiency through reducing downtime and minimizing scrap
• Increasing payload efficiency and reducing fleet miles per gallon

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• Supplier ESG Self Assessments
• Supplier Workshops
• Focus on increasing spend with diverse suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Changes to weather patterns

Transition Risks

• CO2 prices
• Limits on emissions
• Stricter environmental standards
• Shifts in demand and supply of raw materials
• Stakeholder concerns about the plastics industry

Opportunities

• Increased demand for water management solutions
• Opportunities to reduce carbon footprint and energy consumption
• Development of energy-efficient products

Reporting Standards

Frameworks Used: SASB, UN Global Compact, UN SDGs

Sustainable Products & Innovation

• Products made from recycled content and fully recyclable at end of life

Awards & Recognition

• Columbus Smart 50 Sustainability Award 2021

Environmental Metrics

ESG Focus Areas

• Recycling
• Environmental Impact Reduction
• Accountability
• Social Purpose
• Operational Excellence
• News

Environmental Achievements

• Scope 1 GHG emissions decreased 4.6% in Fiscal 2024, primarily due to the reduction in fuel consumption by the ADS fleet.
• Scope 2 GHG emissions decreased 4.6% (Market Based) and 4.1% (Location Based), primarily due to the decrease in manufacturing volume.
• Purchased 540 million pounds of recycled plastic for use in products in Fiscal 2024.
• 62% of waste was diverted from landfills through internal recycling programs or external partnerships in Fiscal 2024.

Social Achievements

• Contributed $2 million to charitable organizations, including $1 million through the ADS Foundation.
• Implemented a parental leave policy providing paid leave for new parents.
• Completed Culture of Belonging training for people leaders in operations network.
• Launched a supplier code of conduct in the first quarter of Fiscal 2024.
• Infiltrator donated over 28 septic systems, valued at over $92,900, to 21 different Habitat for Humanity partners.

Governance Achievements

• Became a signatory to the United Nations Global Compact in the first quarter of Fiscal 2024.
• Established a Sustainability Committee to oversee sustainability programs, policies, and practices.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to extreme weather events.
• Potential increase in cost of operations due to higher carbon prices and stricter environmental standards.
• Potential shifts in demand and supply of raw materials.
• Reputational risks associated with the use of plastic.
• Downstream manufacturing processes present safety challenges.

Mitigation Strategies

• Working to reduce carbon footprint, limit energy consumption, and improve fuel efficiency.
• Focusing on automation to improve safety and employee retention.
• Using recycled materials in production.
• Implementing a supplier code of conduct.
• Investing in fleet modernization for better fuel economy and safety.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct launched in Fiscal 2024.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events, supply chain disruptions

Transition Risks

• Regulatory changes, market shifts, increased cost of raw materials

Opportunities

• Increased demand for sustainable products, opportunities in new markets

Reporting Standards

Frameworks Used: GRI, SASB, UN Global Compact

Third-party Assurance: Limited assurance for Scope 1 and 2 GHG emissions

UN Sustainable Development Goals

• SDG 6
• SDG 9
• SDG 12
• SDG 13

See page 67 of the report for details on how ADS initiatives contribute to these goals.

Sustainable Products & Innovation

• Stormwater management products made with recycled plastic.

Awards & Recognition

• America’s Climate Leaders (USA Today and Statista)
• Company of the Year (American Business Awards)
• Gold Level honoree (Ohio EPA E3 Awards)