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 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.



In its 10-K, Quest Diagnostics Inc. (“Quest” or “the Company”) noted the physical risks of extreme weather events caused by climate change on its facilities, employees, consumers, and ability to conduct core business operations. Despite acknowledging these risks, the proponent believes the Company’s mitigation strategy falls short of what is needed to shield Quest and its investors from climate-related risks.



Quest does not have any specific GHG reduction targets. The Company lags peers, who have continued to make progress in managing climate-related risks since a similar proposal received 48% support from investors at Quest’s 2023 annual meeting. Direct competitor Labcorp has now set a near-term sciencebased target with the Science Based Targets initiative (SBTi) that covers Scope 1-3 emissions. Industry peer Thermo Fisher Scientific has since updated its near-term target to 1.5°C alignment and set long-term and net zero targets through SBTi.



With European operations, Quest may be subject to the Corporate Sustainability Reporting Directive requiring disclosure of “plans to ensure that its business model and strategy are compatible with limiting global warming to 1.5°C.”1 Additionally, as a U.S. government contractor, Quest may be subject to the Federal Acquisition Regulation proposed rule mandating science-based targets for major suppliers.



Investors believe Quest 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. By doing so, the Company may reap benefits from increased efficiency, lower energy costs, more resilient supply chains, and better preparation for climate-related regulations.