Diamondrock Hospitality Energy Efficiency Sustainability Report
|Company||Diamondrock Hospitality Co.|
|Filer||Laborers' International Union of North America|
|Subject(s)||Energy Efficiency (buildings); Sustainability Reporting|
|Resolved Clause Summary||Sustainability Report|
|Status||Withdrawn; Company will address|
RESOLVED: That the shareholders of DiamondRock Hospitality Company (“Diamond Rock” or “the company”) request that the Board of Directors prepare a sustainability report that includes strategies to reduce greenhouse gas emissions, addresses energy efficiency measures as well as other environmental and social impacts, such as water use and worker safety. The report, prepared at reasonable cost and omitting proprietary information, should be published and made available to the public by the end of 2012.
Investors increasingly seek disclosure of companies’ social and environmental practices in the belief that they impact shareholder value. A growing number of investors believe companies that are good employers, environmental stewards and corporate citizens are more likely to generate stronger financial returns, better respond to emerging issues, and enjoy long-term business success.
Mainstream financial companies are also increasingly recognizing the links between sustainability and shareholder value. Information from corporations on their greenhouse gas emissions, environmental stewardship policies, and overall sustainability strategies is essential to investors as they assess the strengths of corporate securities in the context of climate change and increased public awareness of corporate social and environmental responsibility. This is reflected in the growth of investor coalitions such as the Investor Network on Climate Risk (INCR), which represents over 100 investors worth more than $10 trillion in assets under management. Such investors require comprehensive information on material ESG (environmental, social, and governance) factors to analyze fully the risks and opportunities associated with existing and potential investments.
As such, it is no surprise that other major REIT’s such as Prologis and Brookfield Properties Corporation have taken leadership roles in this area through the publication of comprehensive sustainability reports that address company impacts with regards to greenhouse gas emissions, environmental stewardship, water use, and other related considerations.
Further, as concerns about rising energy prices, climate change, and energy security continue to arise, we believe a focus on energy efficiency is necessary for real estate companies to remain competitive. In fact, studies by the CoStar Group, Maastricht University, the University of Arizona, and others have found that LEED and ENERGY STAR buildings can command rent and sales premiums, as well as higher occupancy rates. Ignoring this quickly growing trend could position our company as an industry laggard and expose it to competitive, reputational and regulatory risk.
The report that we are requesting should include the company’s definition of sustainability and a company-wide review of company policies, practices, and metrics related to long-term social and environmental sustainability. We recommend that the company use the Global Reporting Initiative’s Sustainability Reporting Guidelines to prepare the sustainability report. The Global Reporting Initiative (GRI, www.globalreporting.org) is an international organization developed with representatives from the business, environmental, human rights and labor communities, and their guidelines provide a flexible reporting system that allows the omission of content that is not relevant to company operations. The GRI provides a supplement to its reporting framework specifically geared toward the construction and real estate sectors.