Broadcom Inc. | Interfaith Center on Corporate Responsibility

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<h4>Resolution Details</h4>
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<strong>Company:</strong>
<p>Broadcom Inc. </p>
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<strong>Year:</strong>
<p>2026 </p>
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<strong>Issue Area:</strong>
<p>Environment </p>
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<strong>Focus Area:</strong>
<p>Employee Pensions </p>
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<strong>Status:</strong>
<p>Filed</p>
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<h2>Resolution Text</h2>
<p><strong>WHEREAS: </strong>Greenhouse gas emissions (GHG) and resulting climate warming are causing significant, deleterious consequences for the global economy. These consequences are predicted to grow as GHG emissions grow. Prior studies estimate that unmitigated climate change will decrease world gross domestic product (GDP) by $23 trillion by 2050; recent studies indicate the long-term costs may be six times higher than previously estimated.[1],[2]</p>
<p>These effects will have a particularly significant impact on workers’ retirement savings. A substantial portion of retirement plan beneficiaries have longer term investment horizons. “The longer term the investment horizon, the more likely it is that climate will not only be a material risk, but the most material risk,” to retirement savings finds Plansponsor.[3] </p>
<p>Climate-related portfolio risk requires new ways of managing risk. As noted by International Finance Corporation, “the traditional way of managing risk through a shift in asset allocation into increased holdings of more conservative, lower risk, lower return, asset classes may do little to offset climate risks.”[4] </p>
<p>While Broadcom has acted to reduce its operational GHG emissions,[5] it has not meaningfully reduced the emissions generated by its retirement plan investments. The Plan’s most popular option is the Vanguard Target Retirement Funds series which accounts for 28% of plan assets.[6] These funds invest heavily in high-carbon companies and companies contributing to deforestation.[7] </p>
<p>Risk from Plan investments in climate-damaging companies are especially perverse when viewed from the perspective of younger workers.[8] Such investments help fuel the climate crisis and lock in future temperature increases, making negative economic impacts to their retirement savings more likely over time. The savings of younger workers will therefore suffer relatively higher impact from climate-related declines in global GDP than older workers’ retirement savings. Many of the anticipated financial costs of climate change are already being experienced by Broadcom employees. A recent report found that Broadcom 401(k) participants could have earned an estimated $207 million in additional returns if the Plan had not been invested in fossil fuels over the past ten years.[9] </p>
<p>Federal law requires retirement plan fiduciaries to act in beneficiaries’ best interests, including ensuring the prudence of plan investments. Companies that fail to address these concerns may struggle to attract and retain talent, as job seekers are increasingly prioritizing firms with responsible retirement options.[10] Recent regulatory amendments have confirmed that managing material climate risk is an appropriate consideration for retirement plan fiduciaries.[11] Our company can best ensure it is meeting its obligations to employees — especially younger employees — by appropriately mitigating climate risk in its retirement plan investments. </p>
<p><strong>BE IT RESOLVED:  </strong>Shareholders request Broadcom publish a report, at reasonable cost and omitting proprietary information, disclosing if and how the Company is protecting retirement plan beneficiaries — especially those with a longer investment time horizon — from increased future portfolio risk created by present-day investments in high-carbon companies.</p>
<p>[1] https://www.nytimes.com/2021/04/22/climate/climate-change-economy.html </p>
<p>[2] https://www.ucl.ac.uk/news/2021/sep/economic-cost-climate-change-could-be-six-times-higher-previously-thought </p>
<p>[3] https://www.plansponsor.com/in-depth/climate-change-benchmarking-risk-retirement-plans/ </p>
<p>[4] https://documents1.worldbank.org/curated/en/138101493381025955/pdf/114650-IFC-Brief-Mercer-web-PUBLIC.pdf, p.2</p>
<p>[5] https://www.broadcom.com/company/corporate-responsibility/environment</p>
<p>[6] https://investyourvalues.org/retirement-plans/broadcom</p>
<p>[7] https://investyourvalues.org/retirement-plans/broadcom</p>
<p>[8] https://www.bloomberg.com/news/features/2022-10-20/how-to-purge-fossil-fuel-investments-from-your-401-k-or-ira#xj4y7vzkg </p>
<p>[9] https://www.asyousow.org/reports/the-impact-of-energy-sector-investments-on-the-financial-value-of-tech-401ks</p>
<p>[10] https://www.morganstanley.com/content/dam/msdotcom/en/assets/pdfs/MSInstituteforSustainableInvesting-SustainableInvestmentOptionsinRetirementPlans.pdf</p>
<p>[11] https://www.federalregister.gov/documents/2022/12/01/2022-25783/prudence-and-loyalty-in-selecting-plan-investments-and-exercising-shareholder-rights </p>

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<h3>Lead Filer</h3>
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<div class=”views-field views-field-nothing”><span class=”field-content”> Grant Bradski</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>As You Sow</span></div>
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Resolution Details

Company:

Broadcom Inc.

Year:

2024

Issue Area:

Climate Change, Environment

Focus Area:

Climate Change

Status:

Withdrawn for Agreement

Resolution Text

WHEREAS: To limit global warming to 1.5 degrees Celsius, the Intergovernmental Panel on Climate Change has advised that greenhouse gas emissions must be halved by 2030 and reach net zero by 2050. Every incremental increase in

temperature above 1.5 degrees will increase physical, transition, and systemic risks for companies and investors alike. Up to 10 percent of global economic value could be lost by 2050.1

Broadcom recognizes that active environmental management makes Broadcom “more resilient to climate change while allowing [the Company] to increase operational performance and reduce costs.”2 Yet, Broadcom lacks long-term targets in line with Science-Based-Targets-initiative (SBTi) methodologies and fails to comprehensively inventory and set scope 3 emission-reduction targets. To date, Broadcom only aims to reduce Scope 1 and 2 greenhouse gas emissions 38 percent by 2030. It also lacks a climate transition plan.

The Semiconductor Climate Consortium urges companies to set net-zero-emission targets and transparently report progress.3 Broadcom’s customers Apple and Cisco have set net-zero-emission-reduction targets and will consider

suppliers’ own net-zero goals as they work to eliminate upstream emissions. Peers Qualcomm and Analog Devices have set ambitious and transparent science-based targets. Both companies have Scope 1, 2, and 3 SBTi-approved targets that are 1.5 degrees Celsius aligned for FY2030 and net zero commitments by 2050.

Investors seek disclosure on how companies are addressing climate risks and opportunities through emissions-reduction targets and climate-transition plans. Such plans should detail near-term quantitative actions to achieve medium- and long-term goals.

Investors believe Broadcom must take additional action to comprehensively address its climate impact and mitigate risks, including adopting 1.5-degrees-Celsius-aligned science-based targets for its full carbon footprint and developing a climate-transition plan.

RESOLVED: Shareholders request that Broadcom issue near- and long-term science-based-greenhouse-gas-reduction targets aligned with the Paris Agreement’s ambition of limiting global temperature rise to 1.5 degrees Celsius and summarize plans to achieve them. The targets and plan should cover the Company’s full range of operational and supply chain emissions.

SUPPORTING STATEMENT: In assessing targets, shareholders recommend,

· Taking into consideration approaches used by advisory groups like the Science-Based-Targets initiative;

· Developing a transition plan that outlines how the Company plans to achieve its goals, taking into consideration criteria used by advisory groups like the Task Force for Climate-Related Financial Disclosures, CDP, and Transition Plan Taskforce;

· Consideration of setting targets for renewable energy, supply chain engagement, and other measures deemed appropriate by management.

1 https://www.swissre.com/institute/research/topics-and-risk-dialogues/climate-and-naturalcatastrophe-risk/expertise-publication-economics-of-climate-change.html

2 https://docs.broadcom.com/doc/environment-social-governance-report

3 https://semi.org/en/industry-groups/semiconductor-climate-consortium

Report on Systemic Climate Risk from Retirement Plan Options

Resolution Details

Resolution Text