SAIC 2022 Task force ON Climate-Related Financial Disclosures (TCFD) Report

 

TABLE OF CONTENTS

 

Introduction
Governance
Board Oversight
Senior Management
Risks and Opportunities
Process to Determine Climate-Related Risks and Opportunities
Climate-Related Risks
Climate-Related Opportunities
Metrics and Targets
Climate Metrics
Climate Targets

 

Introduction

About SAIC

SAIC is a premier Fortune 500® technology integrator driving our nation's technology transformation. Our robust portfolio of offerings across the defense, space, civilian and intelligence markets includes secure high-end solutions in engineering, digital, artificial intelligence and mission solutions. Using our expertise and understanding of existing and emerging technologies, we integrate the best components from our own portfolio and our partner ecosystem to deliver innovative, effective and efficient solutions critical to achieving our customers' missions.

We are approximately 26,000 strong; driven by mission, united by purpose and inspired by opportunities. SAIC is an Equal Opportunity Employer, we foster a culture of diversity, equity and inclusion, which is core to our values and enables us to attract and retain exceptional talent. Headquartered in Reston, Virginia, SAIC has annual revenues of approximately $7.4 billion. For more information, visit saic.com.

About the Report

This document is guided by the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) and discusses our approach to evaluating and managing climate-related risks and opportunities, including our governance structure and relevant metrics. The report covers calendar year 2021, unless otherwise noted.

Governance

Governance Model

Board Oversight

SAIC’s Board Risk Oversight Committee provides oversight of the Company’s regulatory, enterprise and strategic risk. The Committee has responsibility for monitoring policies and practices related to ethics, compliance, corporate responsibility and classified business operations including:

  • The Code of Conduct
  • Third-Party Risk
  • Safety
  • Sustainability and protection of the environment
  • Contributions to charitable and other tax-exempt organizations
  • Political contributions and government relations
  • Case management, including receipt, retention and treatment of complaints
  • Other ethics, compliance and corporate responsibility issues as determined to be appropriate and consistent with the role of this Committee

Senior Management

SAIC's Enterprise Risk Management Committee (ERMC) reports directly to the Risk Oversight Committee of the Board of Directors and assesses risk to the company. We evaluate climate-related risks and have not identified risks with the potential to have a substantive financial or strategic impact on business. Climate-related risk continues to be a topic of periodic discussion by the ERMC. SAIC believes that it has minimal direct business risk exposure to climate change. The limited financial risk to the company primarily relates to the frequency and severity of weather events in areas of employee concentration, which if they occur, could limit their ability to provide services to customers for a period of time. SAIC has policies, procedures and plans for Business Continuity and Crisis Management to respond to any such weather events and possible related incidents.

In 2021, we created the position of Chief Climate Scientist to give greater attention to climate change understanding, knowledge, risks and opportunities in the company, in the community and with our customers. We believe these efforts will lead us to develop a greater climate change catalogue in the future:

  • Increased attention to climate change
  • Providing expertise to our customers
  • Leveraging employee-developed science and technology
 

Risks and Opportunities

Process to determine climate-related risks and opportunities

SAIC seeks to monitor and control risk exposure through an enterprise-wide risk management framework. Managed through the ERMC that reports directly to the Board of Directors through the Risk Oversight Committee, SAIC has identified several major sources of risk:

  1. Cybersecurity
  2. Strategy Execution
  3. Competitiveness
  4. Talent Management
  5. Infrastructure
  6. Business Continuity
  7. Organizational Change
  8. Compliance
  9. Culture

The ERMC is a cross-functional group with representatives from a variety of functions, providing support and insight to the ERMC. The ERMC meets quarterly and considers the current and emerging risks, and their mitigation. The Risk Oversight Committee reports results to the Board of Directors.

Climate-related risks have not been identified as a major source of risk. Risks exist but are highly unlikely to have the potential to have a substantive financial or strategic impact on business.

Additionally, SAIC maintains an enterprise-level Business Continuity Team (BCT) of a cross-functional set of managers that identifies significant business risks and establishes recovery efforts in the event of a business disruption. The BCT reports to the ERMC team, which reports directly to the Risk Oversight Committee of the Board of Directors.

Opportunities exist, but none with current potential to have a substantive financial or strategic impact on business. Expanded customer emphasis on climate change presents greater future opportunities for support in this area. As such, in 2021, we created the Chief Climate Scientist position to give greater attention to climate change understanding, knowledge, risks and opportunities in the company, in the community and with our customers. With increased attention to climate change, we are providing expertise to our customers by leveraging science and technology developed by our employees. We believe these efforts will lead us to develop a greater climate change catalogue in the future.

U.S. spending packages, including the infrastructure bill and future potential spending packages, may provide additional opportunity for SAIC’s efforts around climate resiliency. In the near term, we do not expect this to have a substantive financial or strategic impact on our business.

Time Frame

Years

Risks

Opportunities

Short-term

1-2

Emerging regulations, Physical risks (extreme weather)

Climate resiliency services

Medium-term

3-5

Emerging and current regulations, Physical risks (extreme weather)

Climate resiliency services

Long-term

5-10

Physical risks (extreme weather)

 
 

Climate-Related Risks

Risk Types Considered

Explanation

Current regulations

Enhanced emission-reporting and climate-change regulation by federal, state and local governments and/or the SEC.

Emerging regulations

Enhanced emission-reporting and climate-change regulation by federal, state and local governments and/or the SEC.

Legal

Our customers, both government and civil, may shift priorities, requirements and business processes in response to climate change. This could affect our business and revenues, especially if customers face external legislative or regulatory pressure they feel obliged to respond to.

Technology

Market

Our customers, both government and civilian, may shift priorities, requirements and business processes in response to climate change, which could affect our business and revenues.

Customers could change priorities and approaches due to their operations experiencing a direct climate-change impact, have future concerns about their long-term sustainability, face external legislative or possibly regulatory pressure. They may also feel obliged to respond to other external market factors such as investor, consumer or societal requests or demands. Such changes and responses by our customers have the potential to adversely impact our future revenues, profitability and prospects.

Reputation

Physical – Acute (brief and high impact)

Severe storms, increased precipitation and flooding, heat waves and other weather-related obstacles due to climate change could adversely affect our ability to execute our strategy and may disrupt our operations. In the short term, a climate-related event could temporarily suspend our ability to do the required work in person and perhaps produce operational or other unforeseen challenges.

Physical – Chronic (ongoing impacts)

We face risks related to climate change if associated increases in extreme weather events prohibit or adversely affect our employees’ ability to work.

Severe storms, increased precipitation and flooding, heat waves and other weather-related obstacles due to climate change could adversely affect our ability to execute our strategy and may disrupt our operations. Any failure of our employees’ ability to work could potentially impair our capability to efficiently perform and meet our contractual obligations, timely address our customers’ needs and ultimately win new business, all of which could adversely affect our business, financial position, results of operations and/or cash flows. While we have a distributed workforce with employees working remotely across the U.S., we do have employees who, because of client requirements or contractual obligations, must work at specified locations. In these instances, if there is a severe weather event that impacts such a location we may not be able to meet the client’s requirements or our contractual obligations. In the shorter term, a climate-related event could temporarily suspend our ability to do the required work in person or produce operational or other unforeseen challenges and in the longer term, threaten our ability to perform contracts in a timely manner or meet other requirements of the contract, any of which could harm our business and its results.

 

Climate-Related Opportunities

Opportunity Types Identified

Explanation

Resource efficiency

Reduced operating costs (e.g., through efficiency gains and costs reductions).

Energy source

Products and services

Development of climate adaptation or resiliency solutions as well as development of new products and services through research and development and innovation could lead to business revenue and potentially new markets.

SAIC’s Climate Enterprise Mission is designed to provide climate change services to our accounts and enable customer missions. SAIC’s government customers are dealing with the effects of year-round wildfires, rising sea levels, higher intensity storms and the desertification of military bases among other issues. The company is actively developing a suite of services to address the climate-change needs related to national security; energy, environment and natural resources; infrastructure; transportation; health, air quality and environmental sustainability; and agriculture, food security and forest management.

Markets

Resilience

 

METRICS AND TARGETS

CLIMATE METRICS

Greenhouse Gas (GHG) Emissions

SAIC recognizes the risks climate change pose to our environment and we are committed to reducing our environmental footprint. As part of this commitment SAIC continues to take active steps to measure, monitor and track our GHG emissions (Scope 1 and Scope 2) at those facilities over which we have operational control and to publicly disclose those emissions against our stated reduction goal.

Calendar year 2021 Scope 1 emissions were approximately 850 metric tons of carbon dioxide equivalents or approximately 3% above the 2019 base year; the modest increase in Scope 1 emissions is attributed to a more severe winter. Scope 1 emissions in 2020 were approximately 611 metric tons of carbon dioxide equivalents or approximately 25% below the 2019 base year (~ 823 metric tons of carbon dioxide equivalents).

Calendar year 2021 Scope 2 emissions were approximately 9,583 metric tons of carbon dioxide equivalents or approximately 33% below the 2019 base year; the Scope 2 decrease reflects ongoing efforts to find innovative ways to cut our carbon footprint. Scope 2 emissions in 2020 were approximately 11,109 metric tons of carbon dioxide equivalents or approximately 21% below the 2019 base year (~ 14,214 metric tons).

A GHG emission intensity metric of metric tons of carbon dioxide equivalents per square foot of facility space is calculated annually. Scope 1 and Scope 2 emissions are the numerator of this intensity metric. As SAIC is primarily a services business, the primary metric by which we evaluate the overall efficiency of our space utilization is by tracking the total square footage in our property portfolio and occupant density.

As a technical services business, SAIC’s real estate portfolio consists of approximately 3.9 million square feet of commercial real estate office warehouse and integration space of which approximately 2.2 million square feet was under our operational control in calendar year 2021.

From 2019 to 2021, we lowered our emissions by square foot of property from 0.0060 to 0.0047 metric tons CO2e/sq. ft. (tons of carbon dioxide equivalents per square foot). Substantially all property space is leased. See 10-K Item 2 Properties section for more details on property portfolio.

In addition, for its 2022 GHG Emissions Inventory (concerning data for the period January 2021 to December 2021), SAIC attained independent assurance under the AA1000 Assurance Standard. The assurance engagement was a Type 2 moderate assurance in accordance with the AA1000AS v3 standard and consisted of:

  • Evaluation of SAIC’s adherence to the AA1000 AccountAbility Principles (AA1000AS v3) of Inclusivity, Materiality, Responsiveness and Impact; and 
  • Evaluation of the reliability of the specified sustainability performance information and associated data collection and management processes and systems. 

In compiling these GHG emissions, SAIC follows the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard. All seven gases are included in the reported emissions. Calculations are performed utilizing a well-known industry reporting system that leverages the EPA’s Emissions & Generation Resource Integrated Database (eGRID). Thus, Scope 2 emissions are based on the location-based method.

 

 

Metric Tons CO₂-equivalent

Greenhouse Gas Emissions

Definition

2021

2020

2019

Scope 1

Emissions from operations that are owned or controlled by a reporting company.

850

611

823

Scope 2

Emissions from the generation of purchased or acquired energy such as electricity, steam and heating and cooling, consumed by a reporting company, but excluding the impact of the purchase of renewable energy credits.

9,583

11,109

14,214

Scope 1 and 2 per sq. ft. of property

Scope 1 and 2 GHG emissions per square foot of facility space.

.0047

.0050

.0060

 

Energy

SAIC has an ongoing, monthly program to track and evaluate electrical utility data at those facilities over which we have operational control. This includes the comparison of current and prior year utilization to identify variances in kWh consumption, costs, impacts due to weather and other factors. Electrical energy consumption in calendar year 2021 was 31,150,117 kWh based on utility provider invoices. Annual usage of natural gas and propane, though utilized to a much more limited extent, are also tracked. Consumption from renewable sources is not currently evaluated.

Ongoing efforts related to our real estate strategy and Future of Work initiative seek to maximize operating efficiencies related to space utilization, retiring underperforming assets as part of our leasing strategies, investing in more energy efficient building systems, deploying building automation systems, installing energy efficient lighting and implementing programs addressing after-hour setback and interior temperature controls for HVAC systems.

 

Waste

SAIC’s generation of hazardous waste from its operations is generally immaterial. Less than 2% of SAIC's approximately 150 operating locations generate hazardous waste, which is generally not as result of daily operations, but rather on an infrequent episodic basis.

At SAIC, we promote several initiatives to encourage our employees to be proactive and aware of non-hazardous waste reduction and disposal. These initiatives include:

  1. Recycling and promoting responsible disposal practices, including recycling bins for plastic, aluminum and glass.
  2. Alternative transportation incentives for our workforce that encourage mass transit and van pool use.
  3. Fostering a digitally-connected workforce, to minimize printer ink and paper use and to facilitate employees’ ability to work remotely.
  4. Working with an electronics vendor to properly dispose of retired SAIC electronic equipment, such as laptops and monitors, and to refurbish for resale to maximize a product’s lifecycle or to recycle its components.
  5. Reducing paper waste by setting all network multi-function copier/printers to default to print double-sided.
  6. Committing to use of 30% recycled paper for all network multi-function copiers/printers.

Additional details with respect to our non-hazardous waste reduction and disposal efforts can be found in SAIC’s ISO 14001 Standards Fact Sheet.

 

CLIMATE Targets

GHG Emissions Goals

In 2014, SAIC established a goal of reducing emissions (Scopes 1 and 2) by 15% by 2025. We are proud to have exceeded that goal early and are establishing a new interim goal of an additional 15% by 2025 (Scopes 1 and 2), over a newly defined base year of 2019, that will further encourage our teams to find innovative ways to cut our carbon footprint. SAIC chose 2019 as the new base year due to significant changes in our real estate portfolio associated with the acquisition of Engility in January 2019.

Even considering the new base year of 2019, we continue to make significant progress in reducing GHG emissions. Though in 2021 Scope 1 emissions increased slightly by approximately 3% compared to our 2019 base year due to a more severe winter, our GHS emissions reductions were driven primarily through Scope 2 emissions reductions, which were approximately 33% below 2019 levels.

As SAIC is principally a services business, the primary metric by which we evaluate the overall efficiency of our space utilization is by tracking the total square footage in our property portfolio and occupant density.

Related Resources

SAIC Corporate Responsibility Report

SAIC 2022 ESG Reporting Framework and Standards Index

SAIC 2022 GRI Index