Whereas: Climate change is creating systemic risks to the economy, and immediate, sharp emissions reduction is required of all
market sectors and industries.1 Publicly traded corporations both contribute emissions that augment climate change and are
subject to multiple risks created by climate change. Lack of comprehensive efforts to curtail emissions threatens investor value,
particularly for diversified holders, for whom climate change poses an undiversifiable and unhedgeable risk.2
In response to this systemic risk, more than 6,000 companies, representing a broad range of industries, have set or committed to
set science-based greenhouse gas reduction targets covering their Scopes 1-3 emissions aligned with a 1.5 degrees Celsius
scenario with the Science Based Targets initiative (SBTi). SBTi provides third-party validation of corporate targets.
IBM has declined to set comparably comprehensive targets or seek third-party validation for its existing targets, raising concerns
about the credibility of its commitments. Rather, it has adopted a 2030 net zero target narrowly focused on its operational
emissions and a single category of Scope 3 emissions. Of the emissions IBM discloses for 2022, its target covers only half of its
carbon footprint.
Meanwhile, Company peers Accenture, Microsoft, Hewlett Packard Enterprise, Salesforce, and SAP have set or committed to set
near-term science-based 1.5 degree Celsius-aligned targets with SBTi inclusive of their full Scopes 1-3 emissions. Additionally,
Accenture, Hewlett Packard Enterprise, and Microsoft, have committed to set ambitious long-term 1.5 degree Celsius-aligned netzero by 2050 targets, vetted by SBTi.
IBMÕs opposition to setting an emissions reduction target verified by a third party creates business and reputational risks. For
example, the Company markets and sells end-to-end sustainability solutions including cloud-based software, Envizi ESG Suite,
which helps customers calculate and report Scope 3 emissions, and it notes in a Wall Street Journal ad that, ÒCompanies need tools
that can help them do detailed carbon accountingÉÓ3
However, in its recent CDP climate report, IBM chooses not to disclose a number of Scope 3 emissions categories indicating that
there is no reliable data for reporting the emissions, controverting its stated capabilities of providing detailed carbon accounting.
Further, IBM describes Envizi as valuable for customers reporting greenhouse gas emissions data to CDP, or who have committed
to the SBTi.
Regrettably, IBM disparages SBTi in its 2022 CDP climate report as Òa self-appointed arbiter for judging a companyÕs goals,Ó
undermining the value of its own services.