WHEREAS: The Intergovernmental Panel on Climate Change has advised that greenhouse gas (GHG) emissions must be halved by 2030 and reach net zero by 2050 in order to limit global warming to 1.5°C. Every incremental increase in temperature above 1.5°C will entail increasingly severe physical, transition, and systemic risks for companies and investors alike. Up to 10 % of global economic value could be lost by 2050.1
The health sector accounts for an estimated 8.5% of U.S. carbon emissions.2 Climate change is expected to increase the cost of healthcare services, making it more expensive for healthcare organizations to operate due to damage to infrastructure, supply chain disruptions, and increased complexity of care. Climate-related health conditions are also expected to increase and drive up the total cost of care, affecting profits for both healthcare systems and plans.3 In its 10-K, Centene acknowledges that the "the effects of climate change…could reduce our ability to accurately predict and effectively control the costs of providing health benefits."
Despite acknowledging this risk, the Company's mitigation strategy falls short of what is needed to shield the Company and its investors from climate-related risks. While Centene currently reports Scope 1 and 2 and some categories of Scope 3 emissions, the Company has not published GHG targets or issued a climate transition plan. By contrast, peers UnitedHealth Group and Humana have committed to setting science-based targets with the Science Based Targets initiative (SBTi).
Centene must take additional action to comprehensively address its climate impact and mitigate both the physical risks to its operations and the transition risks associated with new regulation and a global shift to a clean energy economy. Investors believe Centene should adopt 1.5°C-aligned science-based emissions reduction targets for its full carbon footprint and publish a climate transition plan — detailing the forward-looking, near-term, and quantitative actions the Company will take to achieve its medium- and long-term sustainability goals.