According to the most recent annual "Emissions Gap Report" issued by the United Nations Environment Programme (November 26, 2019), critical gaps remain between the commitments national governments have made and the actions required to prevent the worst effects of climate change. Companies have an important and constructive role to play in enabling policymakers to close these gaps.

Corporate lobbying activities that are inconsistent with meeting the goals of the Paris Agreement present regulatory, reputational and legal risks to investors. These efforts present systemic risks to our economies, as delays in implementation of the Paris Agreement increase the physical risks of climate change, threaten economic stability, and introduce uncertainty and volatility into our portfolios. We believe that Paris-aligned climate lobbying helps to mitigate these risks and contributes positively to the long-term value of our investment portfolios.

Of particular concern are trade associations and other politically active organizations that speak for business but too often present unnecessary obstacles to progress in addressing the climate crisis.

As investors, we view fulfillment of the Paris Agreement's agreed goal-to hold the increase in the global average temperature to "well below" 2 degrees Celsius above preindustrial levels, and to pursue efforts to limit the temperature increase to 1.5 degrees Celsius-as an imperative. We believe unabated climate change will have a devastating impact on the value of our portfolio. We see future "business as usual" scenarios of 3-4 degrees Celsius or greater as both unsustainable and unacceptable.

While we commend Norfolk Southern for setting short-term greenhouse gas emission goals and for considering a science-based reduction target,[1] transporting coal represents one of its primary lines of business: in 2019 shipping coal represented 12 percent of its shipping volume and 15 percent of its revenue.[2] According to press reports[3], Norfolk Southern has supported its coal customers by funding lobbying organizations, such as the American Coalition for Clean Coal Electricity, which work to discredit climate science and oppose most federal climate policies.

We believe it is in the interest of shareholders that Norfolk Southern's management and Board of Directors ensure that its lobbying activities, both directly and indirectly through its trade and other associations, align with the Paris Agreement's goals and the company's own climate risk mitigation actions (e.g. emissions targets). Misalignment squanders company resources and presents reputational and other risks.

Thus, we urge the Board and management to assess Norfolk Southern's climate-related lobbying and report to shareholders.