Quantitative Goals for Increasing Renewable Energy/Energy Efficiency

Resolution Text

Whereas:

Climate change is an existential threat. Without a robust effort to curb greenhouse gas emissions, the pharmaceutical industry is likely to face significant systemic risks such as an increase in severe weather systems, infrastructure damage, reduced resource availability, lost productivity, and supply chain disruptions. Further, people with underlying health conditions, like the patients BioMarin Pharmaceutical (“BioMarin”) is dedicated to treating, may suffer disproportionately from climate change-induced weather such as increased incidents of heat waves. 

As governments acknowledge the potential costs of a changing climate, they are moving to limit greenhouse gas emissions through such mechanisms as carbon taxes, emissions trading systems, and state or national emissions limits. This creates risk for the pharmaceutical industry. According to an analysis by McMaster University, the global pharmaceutical industry released more carbon emissions than the global automotive industry by a staggering 55% in 2015. Consequently, many pharmaceutical companies, identifying their exposure to this regulatory risk, have taken steps to adopt greenhouse gas emission reduction goals.

Companies that start addressing regulatory risk now, may be better positioned to meet future regulations at a lower capital investment. In California, where BioMarin’s headquarters and a major manufacturing facility are located, an executive order was signed in 2018 committing California to carbon neutrality by 2045. Similarly, a law was passed during the same year committing California to source 100% renewable energy, also by 2045.  

While BioMarin has taken steps to mitigate its risk – through construction of solar panels and charging stations and purchase of renewable energy – investors lack insight into Company’s overarching reduction goals. In addition to setting a greenhouse gas reduction target, we believe it is best practice to adopt public-facing renewable energy procurement and energy efficiency improvement targets. Adoption of such targets makes good business sense.  They indicate to investors that BioMarin has an overall plan to manage climate risk, and increased renewable energy usage and improved energy-efficiency can also reduce operating costs and hedge against a future rise in fossil fuel prices.

Given the impact of climate change on the economy, the environment, and vulnerable human populations, proponents believe BioMarin has a clear responsibility to its investors to account for whether, and how, it plans to reduce its ongoing climate impacts.

Resolved:

Shareholders request that BioMarin issue a public report, at reasonable cost and omitting proprietary information, describing if, and how, it plans to reduce its total contribution to climate change and set public-facing greenhouse gas reduction, renewable energy, and energy efficiency targets.

Supporting Statement:

In the report shareholders seek information, among other issues at board and management discretion, on the relative benefits and drawbacks of integrating the following actions:

  • Quantifying BioMarin’s greenhouse gas emissions for direct (Scope 1) and indirect (Scope 2) emissions,
  • Adopting short- and long-term greenhouse gas emissions reduction targets that are aligned with the Paris Agreement,
  • Developing a public-facing plan for achieving its GHG targets,
  • Adopting public-facing renewable energy and energy efficiency targets.

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Lead Filer

Andrea Ranger
Green Century Capital Management, Inc.