Environmental injustice is a structural threat that intensifies the impacts of the climate crisis on vulnerable communities. According to Parnassus Investments, companies that fail to manage and reduce their pollution impacts increase exposure to material financial risks, including heightened regulatory scrutiny, potential litigation, operational disruptions, and damage to brand reputation.[1] This is particularly true when company actions create environmental injustice, which amplifies the impacts of the climate crisis on already overburdened communities, reducing their capacity to adapt and recover from climate harm.[2] Investors recognize that unmanaged environmental justice risks can disrupt operations, weaken competitiveness, and erode long-term shareholder value.

According to the Environmental Protection Agency’s (EPA) Enforcement and Compliance History Online (ECHO) database, United Parcel Service Inc (UPS) has incurred hundreds of Resource Conservation and Recovery Act (RCRA) pollution violations over the last five years that disproportionately affected Black, Indigenous, and People of Color communities (BIPOC).[3] As of October 20, 2025, it had accrued 568 RCRA violations in communities with 25% or more people of color; and 378 in communities with 40% or more people of color.[4] These violations range from improper waste disposal and storage to inadequate record keeping and training.

In October 2022, United Parcel Service (“UPS”) paid a $5.325 million penalty to resolve violations of hazardous waste regulations at 1,160 facilities across forty-five states and the territory of Puerto Rico.[5] In August 2025, UPS was ordered to pay another $1.745 million for unlawful disposal of hazardous and medical waste at 140 of its facilities.[6]

UPS’ most recent 10-K acknowledges the material risk arising from “adverse publicity or public sentiment surrounding labor relations, safety matters, environmental, sustainability and governance concerns” and cites “environmental liability” as having the potential to subject the Company to “various claims and lawsuits that could result in significant expenditures”.[7] An environmental justice audit would assist UPS in mitigating adverse impacts on affected communities while reducing legal liabilities and brand damage.

[1] https://parnassus.com/insights/article/investment_case_for_environmental_justice

[2] https://news.climate.columbia.edu/2020/09/22/climate-change-environmental-justice/

[3] https://echo.epa.gov/

[4] https://echo.epa.gov/

[5] https://www.epa.gov/newsreleases/ups-settles-epa-correct-alleged-hazardous-waste-violations-nationwide

[6]https://rivcoda.org/UPS_violation#:~:text=United%20Parcel%20Service%20(UPS)%20has%20been%20ordered,Corrosive%20materials%20*%20Items%20containing%20Drug%20Facts

[7] https://investors.ups.com/sec-filings/all-sec-filings?form_type=10-K&year=##document-4275-0001090727-25-000019-2