Climate Change Data

Baker Hughes Company

Climate Impact & Sustainability Data (2018, 2019, 2020, 2021, 2022, 2023)

Reporting Period: 2018

Environmental Metrics

ESG Focus Areas

  • People
  • Planet
  • Principles

Environmental Achievements

  • Reduced combined scope 1 and scope 2 emissions by 34% since 2012
  • Achieved an 11% reduction in emissions in 2018
  • Exceeded a stretch goal of a 25% spill volume reduction, decreasing total spill volume by 43% compared to 2017. Spills that may harm the environment were down 97% year over year.

Social Achievements

  • Achieved 153 Perfect HSE Days, a 20% improvement compared to 2017
  • Launched Leading without Bias and Leading Inclusively workshops for people leaders
  • Launched new entry-level leadership program, ASPIRE, targeting 50% gender diversity
  • Launched Supplier Diversity Program to partner with certified minority- and women-owned businesses

Governance Achievements

  • Established clear criteria within executive incentive compensation plan for performance, culture, and diversity and inclusion
  • Implemented an Enterprise Quality Management System to standardize, track and manage the “cost of quality”
  • 91% of supplier audit findings closed in less than 90 days

Climate Goals & Targets

Long-term Goals:
  • Achieve net-zero CO2e emissions by 2050
Medium-term Goals:
  • Reduce CO2e emissions by 50% by 2030
Short-term Goals:
  • Achieve a 30% incremental improvement (over 2018) for all diversity KPIs by 2020

Environmental Challenges

  • Climate change
  • Supply chain risks related to human rights and labor standards
  • Vehicle accidents as a high HSE risk
Mitigation Strategies
  • Commitment to reduce CO2 equivalent emissions by 50% by 2030 and achieve net-zero by 2050
  • Supplier Reputational Guidelines (SRG) program for supply chain monitoring and risk mitigation
  • Commitment to select 5-Star Safety rated vehicles for global light-duty fleet

Supply Chain Management

Supplier Audits: 589 SRG audits conducted in 2018

Responsible Procurement
  • Supplier Integrity Guide, Supplier Reputational Guidelines (SRG) program

Climate-Related Risks & Opportunities

Opportunities
  • Development of low-carbon technologies

Sustainable Products & Innovation

  • LM9000 Gas Turbine
  • LUMEN methane detection system
  • Electric Frac technology

Awards & Recognition

  • Barron’s 100 Most Sustainable Companies (ranked 36th)
  • Wall Street Journal’s Management Top 250
  • MSCI ESG AAA rating
  • Center for Offshore Safety Leadership Award (three times in last four years)

Reporting Period: 2019

Environmental Metrics

Total Carbon Emissions:705,596 tCO2e/year (Scope 1 & 2)
Scope 1 Emissions:383,104 tCO2e/year
Scope 2 Emissions:280,077 tCO2e/year
Scope 3 Emissions:416,626 tCO2e/year
Renewable Energy Share:14.5% of total energy use
Total Energy Consumption:1,862,812 MWh/year
Water Consumption:1,205,083 megaliters/year
Waste Generated:170,588 tons/year
Carbon Intensity:0.0000278 Metric tons CO2e per revenue dollar

ESG Focus Areas

  • Greenhouse gas emissions
  • Water management
  • Waste and the circular economy
  • Attracting, retaining, and developing talent
  • Inclusion and diversity
  • Community and stakeholder engagement
  • Impact of energy transition on business model
  • Business ethics and transparency
  • Corporate governance and board oversight

Environmental Achievements

  • 31% reduction in Scope 1 and 2 carbon emissions compared to 2012 baseline
  • 14.5% of electricity from renewable sources
  • 71% reduction in total spill volume year over year

Social Achievements

  • Relaunched eight global Employee Resource Groups (ERGs)
  • $132M spent with diverse suppliers and small businesses (13% increase over prior year)
  • 29,673 employee volunteer hours

Governance Achievements

  • Formalized ESG management structure with designated executive sponsors
  • Launched Our Way, the refreshed Baker Hughes Code of Conduct
  • 59,464 employees (94.2% of workforce) completed ethics and compliance programs

Climate Goals & Targets

Long-term Goals:
  • Net zero emissions by 2050
Medium-term Goals:
  • 50% reduction in Scope 1 & 2 emissions by 2030

Environmental Challenges

  • Year-over-year increase in emissions driven by increased activity and expanded reporting boundary
  • Complex and challenging task of calculating Scope 3 emissions
  • Maintaining ethical supply chain across 180 countries
Mitigation Strategies
  • Continued emissions reduction projects, including facility upgrades, renewable energy projects, and logistics improvements
  • Initiated a project to quantify an expanded set of Scope 3 emissions
  • Risk-mitigation based approach to supply chain monitoring, including supplier audits and risk assessments

Supply Chain Management

Supplier Audits: 590/year

Responsible Procurement
  • Baker Hughes Supplier Social Responsibility Program (SSRP)
  • Supplier Integrity Guide

Climate-Related Risks & Opportunities

Opportunities
  • Development of energy-efficient products
  • Carbon capture, use, and storage (CCUS)
  • Hydrogen-fueled turbines
  • Energy storage technologies

Reporting Standards

Frameworks Used: GRI-Core, UN Sustainable Development Goals

Certifications: ISO 14001, ISO 9001, ISO 45001/OHSAS 18001:2007

Third-party Assurance: TRC Companies, Inc. (Limited Assurance on Scope 1, 2, and 3 emissions data)

UN Sustainable Development Goals

  • Not disclosed

Reporting aligned to the United Nations Sustainable Development Goals

Sustainable Products & Innovation

  • LM9000 gas turbine
  • Integrated Compressor Line
  • Aptara Subsea System

Awards & Recognition

  • In Kingdom Total Value Add award in Saudi Arabia for “Best in Supplier and Small and Medium Enterprises Development”

Reporting Period: 2020

Environmental Metrics

Total Carbon Emissions:3,033,659 tCO2e/year
Scope 1 Emissions:432,316 tCO2e/year
Scope 2 Emissions:252,069 tCO2e/year
Scope 3 Emissions:2,349,274 tCO2e/year
Renewable Energy Share:22%
Total Energy Consumption:734,734 MWh/year
Water Consumption:5,798 million liters/year
Waste Generated:677,830 tons/year
Carbon Intensity:0.0000330541 Metric tons CO2e per revenue dollar

ESG Focus Areas

  • People
  • Planet
  • Principles

Environmental Achievements

  • Reduced Scope 1 and 2 carbon emissions by 15% compared to 2019.
  • Increased share of renewable and zero-carbon electricity from 15% to 22%.

Social Achievements

  • Increased hiring rates for women (from 22% to 27%).
  • Improved total recordable incident rate by 18% (to 0.23).

Governance Achievements

  • Renamed the Governance and Nominating Committee to the Governance and Corporate Responsibility Committee.
  • Updated ESG materiality assessment.

Climate Goals & Targets

Long-term Goals:
  • Net-zero Scope 1 and 2 GHG emissions by 2050
Medium-term Goals:
  • 50% reduction in Scope 1 & 2 GHG emissions by 2030
Short-term Goals:
  • 50% reduction in Scope 1 & 2 GHG emissions by 2030

Environmental Challenges

  • COVID-19 pandemic and economic downturn leading to workforce restructuring.
  • Complex calculation of Scope 3 emissions.
  • Climate change as a financial risk and opportunity.
Mitigation Strategies
  • Provided severance and outplacement assistance to affected employees.
  • Expanded Scope 3 emissions reporting to include new categories.
  • Began climate change scenario analysis to evaluate financial resilience.

Supply Chain Management

Supplier Audits: 434 (virtual) audits/year

Responsible Procurement
  • Supplier Integrity Guide
  • Supplier Social Responsibility Program

Climate-Related Risks & Opportunities

Physical Risks
  • Extreme weather events impacting operational sites and equipment.
Transition Risks
  • Changing demand for hydrocarbons.
  • Policies prohibiting upstream oil activities.
Opportunities
  • Increased demand for low-emission products and services.
  • Expansion into new markets for low-carbon energy technologies.

Reporting Standards

Frameworks Used: GRI Core Standards, Greenhouse Gas Protocol, TCFD, SASB Oil & Gas Services Industry Standard

Certifications: ISO 14001, ISO 45001, ISO 9001

Third-party Assurance: KPMG LLP

Sustainable Products & Innovation

  • Low-carbon energy technologies
  • Energy-efficient products

Awards & Recognition

  • Security Magazine’s Security 500 (ranked #1 in energy sector)

Reporting Period: 2021

Environmental Metrics

Scope 1 Emissions:391,346 tCO2e/year
Scope 2 Emissions:215,996 tCO2e/year
Scope 3 Emissions:237,010,432 tCO2e/year
Renewable Energy Share:24%
Total Energy Consumption:2,643,674 MWh/year
Water Consumption:3,143,000,000 liters/year
Waste Generated:482,806 tons/year
Carbon Intensity:0.000129 MWh/ $ revenue

ESG Focus Areas

  • People
  • Planet
  • Principles

Environmental Achievements

  • Reduced Scope 1 and 2 GHG emissions by 23% compared to 2019 base year
  • Increased share of renewable and zero-carbon electricity to 24%
  • Expanded Scope 3 emissions reporting to include four new categories

Social Achievements

  • Launched educational partnership with four Historically Black Colleges and Universities in the US
  • Expanded DEI programs and disclosures, including publishing US EEO-1 report summary
  • Increased employee resource group membership by 24%

Governance Achievements

  • Improved data governance and assurance, including reasonable assurance of Scope 1 and 2 emissions
  • Launched Carbon Out program to drive emission reductions
  • 100% of Baker Hughes security personnel completed human rights training

Climate Goals & Targets

Long-term Goals:
  • Achieve net-zero Scope 1 and 2 GHG emissions by 2050
Medium-term Goals:
  • Reduce Scope 1 and 2 GHG emissions by 50% by 2030
Short-term Goals:
  • Not disclosed

Environmental Challenges

  • Meeting increasing energy demand while simultaneously reducing greenhouse gas emissions
  • Supply chain disruptions
  • COVID-19 pandemic
Mitigation Strategies
  • Advancing sustainability efforts within Baker Hughes
  • Strengthening industry relationships
  • Implementing robust vaccination and flexible work programs

Supply Chain Management

Supplier Audits: 545/year

Responsible Procurement
  • Supplier Integrity Guide
  • Supplier Social Responsibility Program (SSRP)

Climate-Related Risks & Opportunities

Physical Risks
  • Severe weather events
Transition Risks
  • Changes in energy markets
Opportunities
  • Growth in energy transition solutions

Reporting Standards

Frameworks Used: GRI Core Standards, Greenhouse Gas Protocol, TCFD, SASB Oil & Gas Services Industry Standard–Extractives & Minerals Processing Sector

Certifications: ISO 14001, ISO 45001, ISO 9001

Third-party Assurance: KPMG LLP

Sustainable Products & Innovation

  • Carbon Optimizer
  • ProductionLink Edge
  • LUMEN Analytics

Awards & Recognition

  • AA ESG rating from MSCI
  • B rating from CDP
  • 2022 EcoVadis Bronze Sustainability Rating
  • Wall Street Journal Management Top 250
  • 100 Best Corporate Citizens by 3BL Media
  • America’s Most Responsible Companies by Newsweek
  • Hart Energy ESG Awards – Best Public Service Company
  • Included on S&P 500 ESG Index in May 2022

Reporting Period: 2022

Environmental Metrics

Total Carbon Emissions:376,172 + 193,933 + 252,414,204 = 252,984,309 tCO2e/year
Scope 1 Emissions:376,172 tCO2e/year
Scope 2 Emissions:384,865 tCO2e/year
Scope 3 Emissions:252,414,204 tCO2e/year
Renewable Energy Share:26.0%
Total Energy Consumption:2,213,972 MWh/year
Water Consumption:3,214 ML/year
Waste Generated:235,403 tons/year
Carbon Intensity:Not disclosed

ESG Focus Areas

  • People
  • Planet
  • Principles

Environmental Achievements

  • Reduction in scope 1 and scope 2 GHG emissions compared to 2019 base year (217,251 MT CO2e)
  • 26.0% of electricity from zero-emission sources

Social Achievements

  • 45,454 employees completed professional development planning with their manager
  • 75.0% of employees received regular performance and career development reviews
  • $75,272,787 in total charitable pledges and contributions

Governance Achievements

  • 53,846 employees completed annual Code of Conduct training
  • 96.7% of employees completed the annual Code of Conduct training
  • 100.0% of operations assessed for risks related to corruption

Climate Goals & Targets

Long-term Goals:
  • Not disclosed
Medium-term Goals:
  • Not disclosed
Short-term Goals:
  • Not disclosed

Environmental Challenges

  • Not disclosed
Mitigation Strategies
  • Not disclosed

Supply Chain Management

Supplier Audits: 408 SSRP audits

Responsible Procurement
  • SSRP policy

Climate-Related Risks & Opportunities

Physical Risks
  • Not disclosed
Transition Risks
  • Not disclosed
Opportunities
  • Not disclosed

Reporting Standards

Frameworks Used: GRI, SASB Oil & Gas Services Industry Standard—Extractives & Minerals Processing Sector, TCFD

Certifications: ISO 14001:2015, ISO 45001, ISO 9001, ISO 50001

Third-party Assurance: KPMG (partial)

UN Sustainable Development Goals

  • Not disclosed

Not disclosed

Sustainable Products & Innovation

  • Not disclosed

Awards & Recognition

  • Not disclosed

Reporting Period: 2023

Environmental Metrics

ESG Focus Areas

  • environmental sustainability
  • people-first culture
  • governance

Environmental Achievements

  • 28% reduction in Scope 1 & 2 GHG emissions compared to 2019 base year

Social Achievements

  • nearly $3 million in charitable donations through our Baker Hughes Foundation
  • record levels of volunteer engagement by our employees

Governance Achievements

  • periodic review of governance practices
  • Board monitors and provides oversight over ESG policies

Climate Goals & Targets

Long-term Goals:
  • Elevated margin and returns profile
  • Differentiated shareholder returns
  • Strong exposure across the industrial and energy growth vectors
  • Net-zero emissions by 2050
Medium-term Goals:
  • 20+% OFSE/IET EBITDA margins mid to late 2020s
  • >15% OFSE/IET ROIC mid to late 2020s
  • $6-7B new energy orders
Short-term Goals:
  • 20% OFSE/IET EBITDA margins through 2025
  • 20+% OFSE/IET ROIC through 2025

Environmental Challenges

  • supply chain disruptions
  • inflation
  • rising interest rates
  • shortages in labor supply
  • geopolitical risks
  • climate change related risks (extreme weather, supply chain disruptions)
  • aeroderivative supply chain tightness
Mitigation Strategies
  • strategic agreements with global suppliers to minimize price impacts and availability challenges
  • cost-out initiatives
  • corporate optimization process
  • flexible capital allocation policy
  • strategic acquisitions (Altus Intervention)
  • new digital solutions for more intelligent operations and cleaner energy
  • operational and cost improvements across all IET product lines

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks
  • extreme weather
  • flooding
  • hurricanes
  • wildfires
  • rising sea levels
  • changes in precipitation patterns
Transition Risks
  • regulatory changes
  • market shifts
  • reduced demand for oil and gas
Opportunities
  • development of energy-efficient products
  • geothermal
  • CCUS
  • hydrogen energy

Reporting Standards

Frameworks Used: UN Global Compact, Paris Agreement

Sustainable Products & Innovation

  • Leucipa™ (automated field production software)
  • Cordant™ (integrated suite of solutions supporting industrial asset performance management and process optimization)
  • LM9000TM and Nova LTTM gas turbines
  • Allam Cycle turboexpander
  • CCUS technologies
  • hydrogen and geothermal technologies
  • Orbit 60 Bently Nevada product