RESOLVED: Shareholders request that Sherwin-Williams senior management, with oversight from the Board of Directors, issue a report on climate change mitigation strategies, assessing the feasibility of adopting quantitative, company-wide goals for increasing the company’s use of renewable energy, energy efficiency, and any other measures deemed prudent by company management to substantially reduce the company’s greenhouse gas (GHG) emissions and climate change risks associated with the use of fossil fuel-based energy. The report should be issued within one year of this filing at reasonable cost and omit proprietary information.

Supporting Statement: By assessing goals to improve energy efficiency, to increase renewable energy usage, and to adopt other such measures that the company deems feasible, our company could prepare to take practical steps to reduce our emissions of greenhouse gases that contribute to climate change.

The Intergovernmental Panel on Climate Change estimates that a 45% reduction in anthropogenic GHG emissions globally is needed (from 2010 levels) by 2030 to avoid the worst impacts of climate change (Global Warming of 1.5 degrees C, IPCC, Oct 2018).

Assessing the feasibility of clean energy goals and other greenhouse gas-reducing measures could serve as a practical step towards aligning our business operations with global efforts to limit climate change. This could help insulate our company from regulatory uncertainty and position Sherwin-Williams as contributing to climate solutions and produce reputational benefits.

Fortuitously, many major companies are finding that greenhouse gas-reducing measures are both practical, and cost effective. The US Energy Information Association reports the average cost of electricity at $0.1068/kWh for commercial customers in 2017, up from $0.1043 in 2016. By contrast, according to the 2018 Sustainable Energy in America Factbook (Bloomberg) "the most competitive power purchase agreements (PPAs) came in at just over $20/MWh for solar [$0.02/kWh], while wind PPAs… averaged an estimated $17/MWh in 2017 [$0.017/kWh]." Likewise, a 2018 report from Lawrence Berkeley National Laboratory found that commercial and industrial customers paid just $2.8 per MWh [$0.028 per kWh) saved for investments to improve energy efficiency.

Our company has a wide range of practical options. For instance, a 2018 survey of 160 large industrial firms from the Alliance for Industrial Efficiency found that 79 percent have adopted GHG reduction goals and that 43 percent had adopted energy-efficiency improvement goals. Globally, 154 companies have committed to adopt 100 percent renewable electricity.

The company lags behind such peers as Akzo Nobel and 3M which have already set ambitious clean energy targets.

Accordingly, we urge Sherwin-Williams to emulate the best climate risk mitigation practices among its corporate peers and to study the feasibility of adopting clean energy sourcing goals.