Effective Climate Impact Management: Reducing GHG Emissions and Achieving Sustainability Goals

Environmental Protection and Climate Impact Management 

Our Commitment

To build a safer world, we are dedicated to responsible environmental stewardship and reducing our impact on the planet. Our long-term climate objectives are aligned with scientific targets to combat climate change and facilitate the shift toward a low-carbon economy.

Our Strategy 

Our primary focus is on managing greenhouse gas (GHG) emissions as part of our broader environmental strategy. We are working across the company to identify GHG emission sources, accurately measure scope 1, 2, and 3 emissions, and develop effective reduction strategies.

Our Objectives 

Starting from a 2019 baseline, we aim to cut our global scope 1 and 2 market-based GHG emissions by 65% by 2034 and achieve net zero emissions by 2050. This 65% reduction target over a 15-year span aligns with the Science Based Targets initiative (SBTi) 1.5°C scenario. We aim for an average annual reduction of 4.3% in global scope 1 and 2 market-based GHG emissions. Based on current data, we are confident in reaching our target and monitor our progress annually.

2023 Actions and Performance

Scope 1 and 2 GHG Emissions 

Since 2010, we have been tracking and reporting our U.S. GHG emissions. In 2022, we expanded to report global emissions from our owned or controlled locations. Our U.S. emissions account for nearly 76% of our global scope 1 and 2 market-based emissions. 

In 2023, we observed significant reductions in both U.S. and global emissions. U.S. scope 1 and 2 market-based GHG emissions decreased by 13.9% from 2022 to 2023, while global emissions fell by 14.6% during the same period. These reductions were due to changes in leased office spaces, favorable weather conditions, and improvements in lighting fixtures. For instance, closing a data center in March and relocating services, downsizing and closing office buildings, and enhancing lighting fixtures contributed to lower energy usage. Additionally, warmer winter temperatures in Des Moines, Iowa, reduced electricity and natural gas consumption. 

Since 2019, we have achieved an annual global GHG emissions reduction of 11.5%, surpassing our 4.3% annual reduction target. In 2023, we achieved a 46% reduction in scope 1 and 2 market-based emissions from the 2019 baseline, exceeding our 2023 target of a 17.3% reduction. 

Our environmental stewardship earned us a “Management” status from CDP, following a B rating on the 2023 CDP Climate Change Questionnaire based on 2022 data. This rating, above the global average (C) and North American regional average (C), is in line with the Financial Services sector average (B). We plan to complete the 2024 CDP Climate Change Questionnaire for 2023 data in Q3 2024.

Scope 3 GHG Emissions 

We measure and report scope 3 GHG emissions from various sources, including purchased goods and services, fuel and energy-related activities not covered in scope 1 or 2, waste, business travel, employee commuting, and leased assets. 

In 2023, we began searching for a new tool to enhance our capabilities and gather supplier information on environmental performance. These advancements will help us better understand our scope 3 emissions, though some data gaps remain. We are proud of the progress made thus far.
 

Looking Ahead 

In 2024, we will focus on gaining greater transparency into our scope 3 emissions as more data becomes available. This will support improved strategic planning, reporting, and the further development of our climate transition strategy. Our focus will include purchased goods and services, business travel, employee commuting, leased assets, and investments. 

Click here to know more about the Principle Financial Group’s 2023 Sustainability Report.