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Wabtec Sustainability Report 2013

RESOLVED  
Shareholders request that Westinghouse Air Brake Technologies Corporation (Wabtec) issue a sustainability report describing the company’s environmental, social and governance (ESG) risks and opportunities including greenhouse gas (GHG) emissions reduction targets and goals. The report should be available by December 1, 2013, prepared at reasonable cost, omitting proprietary information.
 
SUPPORTING STATEMENT
We believe tracking and reporting on ESG business practices makes a company more responsive to a transforming global business environment characterized by finite natural resources, changing legislation, and heightened public expectations for corporate accountability. Reporting also helps companies better integrate and gain strategic value from existing sustainability efforts, identify gaps and opportunities in products and processes, develop company-wide communications, publicize innovative practices, and receive feedback. 
 
The Principles for Responsible Investment (PRI) is a United Nations initiative whose members include BlackRock, T. Rowe Price and Goldman Sachs and seek the integration of ESG factors in investment decision making. Members collectively hold over $33 trillion of assets under management and request ESG factor information to analyze fully the risks and opportunities associated with existing and potential investments. Additionally research intermediaries like Bloomberg and Factset gather and make available corporate ESG data to clients.
 
Carbon Disclosure Project (CDP), representing over 655 institutional investors globally with more than $78 trillion in assets, has for years called for disclosure from companies on their climate change management programs. Over two thirds of the S&P 500 now report to CDP.
 
Sustainability reporting is on the rise globally. In 2011, there was a 46% increase in the number of organizations worldwide using the Global Reporting Initiative’s (GRI) Guidelines for their ESG reporting according to G&A Institute. Smaller companies are proactively adopting sustainability reporting to report on progress as they grow and anticipate this request from investors and customers. 
 
Companies are increasingly requiring suppliers to track and report on key ESG factors. Wabtec customer Caterpillar issues a sustainability report and states in its code of conduct that it sees its suppliers as an extension of the company. Industry peers such as New York Air Brake Corporation is a signatory to the UN Global Compact and publishes a sustainability report. 
 
In contrast, Wabtec does not report on its sustainability efforts nor discloses GHG data. Climate change is one of the most financially significant environmental issues currently facing investors. Occupational safety and health, vendor and labor standards, waste and water reduction targets and product related environmental impacts are particularly important factors that may have the potential to pose significant regulatory, legal, reputational and financial risks. 
 
Shareholders currently have no access to substantial information on how the company is managing these business factors. We believe that early adoption of sustainability reporting could help Wabtec more readily adapt rather than react to issues that may affect the business in the future.
 
We recommend that the report include a company-wide review of policies, practices and metrics related to ESG performance using the GRI index and checklist as a reference.