Sustainability Blueprint

Progress on Goals

To advance our company’s mission, implement our vision for more sustainable waste management, and advance our sustainability performance across all three pillars of sustainability, we have set a series of goals and targets around our material issues. Our current set of goals was developed by our senior leadership team in 2015 and contained a mix of short- and long-term targets. Over time, including in this reporting cycle, we have updated and augmented our targets to sustain our continuous improvement.

SAFETY AND HEALTH

Goal

Performance Indicators

Progress in 2017–2018

Achieve world-class safety and health performance through disciplined continuous improvement, safety leadership at all levels, full employee engagement and an integrated, interdependent world-class safety culture.

Financial Linkage
Organizations with an integrated and interdependent safety culture are more likely to achieve and sustain injury free workplaces and demonstrate outstanding safety management and performance. Safety leadership, teamwork, peer support, trust, open and honest communication, employee engagement at all levels and organizational pride are hallmarks of integrated and interdependent safety cultures. While incident rates and other safety metrics ultimately demonstrate performance, they are lagging indicators and ineffective at tracking the efficacy of cultural development.

Develop and assess the efficacy of safety culture performance metrics. Implement, track and report these metrics to demonstrate measurable improvements in Covanta’s safety culture through the end of 2020.

Achieved:
Completed the 3^rd party program and culture review in 2017. Improvements made after the review helped lead to a 31% reduction in incidents from 2017 to 2018.

Complete a review of our root cause analysis and corrective action process and implement changes as necessary by the end of 2016 to ensure the process adequately evaluates and resolves issues as identified.

Achieved:
A review of our root cause analysis and corrective action process was completed in early 2017. Initial changes were made in the incident reviews in 2018. Further refinements were made in 2019 which allowed for more detailed investigations and root cause analyses.

New Indicator:

Move Beyond Zero by focusing on the three P’s: Participation, Performance, and Potential opportunities for improvement. Will develop and implement focused behavioral safety observation process to capture and report data by 2020.

In Progress:

To date, employees have completed over 12,000 observations in the ProcessMap tool, initially focused on lockout/tagout procedures, line-of-fire risks and hand safety.

ENVIRONMENT

Goal

Performance Indicators

Progress in 2017–2018

Energy-from-Waste (EfW) facilities are subject to stringent regulatory standards that are currently being reviewed by the U.S. Environmental Protection Agency. In addition, acquisitions and organic growth are also creating new challenges. We are committed to 100% compliance with all discharge limits (air, water, etc.) at all facilities while also maintaining emissions at levels consistent with past performance—well below existing standards.

Financial Linkage
100% compliance with discharge limits avoids fines and other monetary penalties. More importantly, we view full and continual compliance with all applicable laws, regulations and permits to be a basic condition of responsible operation. By demonstrating and continuing full compliance, we build our reputation and garner intangible value as a responsible member of the local community.

100% compliance with stack test standards and continuous emission monitor (CEM) reporting limits at all EfW facilities.

In Progress:
100% compliance with stack test standards and 99.95% compliance with CEM limits at our EfW facilities for 2017-2018.

100% compliance with discharge limits at Covanta Environmental Solutions (CES) and other new facilities within one year of acquisition.

Achieved:
99.8% compliance with POTW wastewater discharge limits at CES facilities.

Maintain EfW emissions performance gains achieved.

Achieved:
All EfW emissions performance gains were maintained as of the end of 2018.

New Indicator:
Set a science-based target and implementation plan by 2022 in line with the level of decarbonization required to keep global temperature increase below 2°C compared to pre-industrial temperatures.

In Progress:

While EfW is a critical element of reducing GHG emissions from the waste management sector today, reaching the levels of GHG reductions that we need by mid-century to stem the largest impacts of climate change will require innovative thinking. This is why we announced this new goal with our 2019 sustainability report.

New Indicator:
Implement five projects by 2023 to further reduce emissions in EJ communities.

In Progress:

Installation of new Low NOx technology is currently in various stages of development in nine units at three facilities.

MATERIALS MANAGEMENT

Goal

Performance Indicators

Progress in 2017–2018

Advance sustainable waste management and life-cycle greenhouse gas reductions through increased landfill diversion, greater operational efficiency and expansion of waste reduction, reuse and recycling.

Financial Linkage

Reducing landfill management of ash from energy recovery by finding new beneficial reuse opportunities, and by recovering more usable materials (e.g., metals) prior to disposal, reduces costs and generates new revenues streams. Increasing the tons of wastes avoided, recycled or reused for our clients expands our service offerings and helps meet our clients’ needs, thereby generating additional sources of revenue and potentially longer-term client relationships.

Climate Change Linkage

More sustainable waste and materials management can be a significant source of GHG emissions mitigation. Growing landfill diversion and moving up the waste hierarchy, both for our own operations and for our clients’, are our most powerful drivers in reducing GHG emissions.

By 2020, increase the amount of waste managed through energy recovery and other sustainable waste management operations by 10% relative to a 2014 baseline.

In Progress:

2018 overall tons processed up 1.7% relative to baseline. Current U.K. development pipeline will add another 1.6M tons of capacity.

Original Indicator:

Increase total wastes avoided, recycled or reused under our management by 25% by 2020 relative to a 2014 baseline of 548,000 tons.

Revised Indicator:

Increase total wastes avoided, recycled or reused under our management by 100% by 2022 relative to a 2014 baseline of 548,000 tons.

Achieved:

After meeting our goal in 2016, we’ve continued to improve. In 2018, we avoided, recycled or reused 933,000 tons of waste, a 64% increase in four years. Our total ash processing system (TAPS) will significantly expand these gains.

To continue to drive our success, we are expanding our target with this report.

Achieve additional energy efficiency improvements at our energy recovery facilities of 60,000 MWh in total by the end of 2020.

In Progress:

22,000 MWh of additional energy efficiency improvements, over one-third of our goal of 60,000 MWh, has been completed.

COMMUNITY RELATIONS

Goal

Performance Indicators

Progress in 2017–2018

Expand the number and quality of our community outreach programs.

Financial Linkage
Covanta has been investing in community outreach programs for more than two decades. This comprehensive outreach translates to improved business opportunities, including renewal of existing contracts and favorable permitting terms; strong relationships; and better operational standing.

New Indicator:

Update the Community Affairs engagement plan using a new facility-centered process to better integrate community outreach into business management and planning.

In Progress

Resource guide completed by 2016 and in use by facilities. Existing plan has been a great resource but can be better integrated into facility-level planning.

At each EfW facility, perform a minimum of eight community interactions per year, beginning in 2016, that deliver demonstrative impact to our Protecting Tomorrow programs, local community programs and sustainable solid waste management education.

In Progress:
97.5% of our EfW facilities met the goal. The one facility not meeting the goal was closed in early 2019 and still completed seven out of eight of the required elements.

WORKFORCE ENGAGEMENT

Goal

Performance Indicators

Progress in 2017–2018

Create and maintain an inclusive, respectful and equitable environment that leverages the unique talents, perspectives and experiences of our diverse workforce to help retain top talent, meet and exceed our business objectives, and surpass the expectations of our diverse client communities, business partners and shareholders.

Financial Linkage
Our employees drive our business and our success. Attracting the best talent; hiring and retaining a diverse workforce with regard to age, race, gender, ethnicity and other dimensions of diversity; fostering/encouraging/etc. the inclusion of all employees and their ideas—this fosters innovation and continuous improvement, thereby contributing to reduced costs and revenue growth, including through the development of new businesses and services. A low attrition rate, especially for top performers, means that we can retain qualified and talented individuals, preserve institutional knowledge and reduce recruiting and training costs.

Develop diversity and inclusion educational awareness training for employees and managers. Complete training with 30% of the workforce by the end of 2016 with full completion in the following year.

Achieved:

Training fully completed in 2019.

Create and initiate a mentoring program by the end of 2016 to facilitate the retention, development and advancement of our workforce. Develop and monitor metrics to drive gender, ethnic & racial diversity and senior management participation in the program.

Achieved:
The first wave of the program began in 2017 with a group of 40 mentor/mentee pairs. Currently on the second wave of the program. 18% of mentees were female and 24% were non-white.

Original Indicator:

Attract the best talent and increase the diversity of our external and internal candidate pools by 2018 as measured by the percentage of diverse new hires relative to the overall U.S. workforce and the percentage of diverse promotions into management relative to the U.S. management workforce.

Revised Indicator:

Continue to increase the share of diverse gender and race/ethnicity representation at all levels of the organization, and more specifically in leadership positions. Ultimately, we strive to have similar representation as the communities in which we operate and serve.

Refocused:
Tracking candidate pools proved very difficult and, in the case of external candidate pools, in conflict with the need to protect candidate privacy. Our revised goal is more readily measured and aligns with work already underway to improve diversity. As a result of our initial efforts, the share of women and underrepresented groups in management positions reached 14% and 22% respectively in October 2019 (manager and higher).

Sustainability Blueprint

Progress on Goals

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