Old Dominion Freight Line | Interfaith Center on Corporate Responsibility

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<h4>Resolution Details</h4>
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<strong>Company:</strong>
<p>Old Dominion Freight Line</p>
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<strong>Year:</strong>
<p>2025 </p>
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<strong>Issue Area:</strong>
<p>Climate Change </p>
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<strong>Focus Area:</strong>
<p>GHG Reduction and Targets </p>
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<strong>Status:</strong>
<p>Filed</p>
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<h2>Resolution Text</h2>
<p class><strong>WHEREAS:</strong> The Intergovernmental Panel on Climate Change reports that immediate emission reductions are required to limit global warming to 1.5°C, thereby avoiding the most catastrophic consequences of climate change. Investor demand for science-aligned emission reduction strategies underscores the reality that companies and investors are increasingly exposed to severe physical, transition, and systemic climate risks.</p>
<p class>Old Dominion Freight Line Inc, a leading less-than-truckload (LTL) carrier with a fleet of 10,700 vehicles across the continental United States, faces customer and investor demand for decarbonized supply chains and increasing climate regulations. Despite a shareholder proposal on emissions last year with nearly 25% support, the Company has not demonstrated any meaningful progress.</p>
<p class>The Company’s actions remain limited to disclosure of emissions and fuel-efficiency metrics, ongoing route-optimization, and limited pilots of alternative fuels and vehicles.[1] The Company lags competitors in setting emissions reduction targets, integrating alternative vehicles, and providing customer-specific decarbonization services.</p>
<p class>Transportation, responsible for 28% of U.S. energy consumption, faces increasing climate-protective regulations. [2] A consortium of 17 states in key operating corridors has set targets to achieve 100% zero-emission truck sales by 2050.[3] California’s Advanced Clean Fleets rule requires commercial fleets to phase out non-zero emission vehicles starting in 2027.[4] Per Old Dominion’s 2024 10-K, the increase in climate-related laws and regulations could increase direct costs and impact operational risks.[5]</p>
<p class>Heavy-duty zero-emission vehicle technology is accelerating. Battery-electric Class 8 vehicles are expected to achieve cost parity with diesel models by 2030, driven by higher energy efficiency and lower operating costs.[6] Additionally, current battery technologies provide economically viable alternatives for a variety of other vehicle classes and duty cycles.[7] Setting emissions reduction targets would position Old Dominion to systematically incorporate cost-effective technologies and optimize long-term fleet management.</p>
<p class>Competitors in the LTL space, including Knight-Swift Transportation, Werner Enterprises, DHL, and FedEx,[8] have emission reduction targets. DHL and FedEx also provide advanced services to support customer decarbonization, a critical advantage as a growing number of companies set targets to reduce their value chain emissions.[9]</p>
<p class>By committing to emission reduction targets and creating a climate transition plan, Old Dominion can address customer, regulatory, and competitive pressures and position itself to benefit from the transition to a low-carbon economy.</p>
<p class><strong>BE IT RESOLVED:</strong> Shareholders request the Board disclose how Old Dominion intends to reduce its Scope 1 and 2 greenhouse gas emissions in alignment with interim and long-term climate targets aligned with the Paris Agreement.</p>
<p class><strong>SUPPORTING STATEMENT:</strong> Proponents suggest, at management discretion, the Company disclose:</p>

<p class>A timeline for setting emission reduction targets; and</p>

<p class>An enterprise-wide emissions transition plan to meet evolving consumer demand and regulations, including anticipated costs and emissions reductions.</p>

<p class>[1]https://d1io3yog0oux5.cloudfront.net/odfl/db/515/4165/pdf/ODFL+2023+ESG+Data+Supplement+Report.pdf</p>
<p class>[2] https://www.epa.gov/greenvehicles/fast-facts-transportation-greenhouse-gas-emissions</p>
<p class>[3] https://www-f.nescaum.org/documents/multi-state-medium-and-heavy-duty-zero-emission-vehicle-action-plan/</p>
<p class>[4] https://www.movingforwardnetwork.com/wp-content/uploads/2024/03/MFN_Key-Facts_Understanding-the-Advanced-Clean-Fleet-Rule_2024.pdf, pg.8</p>
<p class>[5] https://www.sec.gov/ix?doc=/Archives/edgar/data/878927/000095017024020176/odfl-20231231.htm, p.15</p>
<p class>[6] https://theicct.org/wp-content/uploads/2023/04/tco-alt-powertrain-long-haul-trucks-us-apr23.pdf, p.1, 31</p>
<p class>[7] https://nacfe.org/research/emerging-technologies/electric-trucks/charting-the-course-for-early-truck-electrification/rch/emerging-technologies/electric-trucks/charting-the-course-for-early-truck-electrification/ </p>
<p class>[8] https://s24.q4cdn.com/286931391/files/doc_financials/2024/sr/knx-sustainability-report-2023-final.pdf; https://s1.q4cdn.com/812671447/files/doc_downloads/ESG/Werner-2023-CSR-Report.pdf; https://group.dhl.com/en/sustainability/environment.html; https://newsroom.fedex.com/newsroom/asia-english/sustainability2021</p>
<p class>[9] https://www.cdp.net/en/corporate-environmental-action-tracker?report=target_setting</p>

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<h3>Lead Filer</h3>
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<div class=”views-field views-field-nothing”><span class=”field-content”> Lyndsay Fritz</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>Amalgamated Bank</span></div>
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Resolution Details

Company:

Old Dominion Freight Line

Year:

2024

Issue Area:

Climate Change

Focus Area:

GHG Reduction and Targets

Status:

Filed

Resolution Text

WHEREAS: In 2015, global governments agreed in the Paris Agreement that global warming must be limited to 1.5 degrees Celsius (1.5°C) to avoid the most catastrophic impacts of climate change. As a means of driving progress, global governments at this year’s COP 28 meeting committed to transition away from fossil fuels and triple renewable energy deployment.

Companies are responding to these global imperatives. Over 6,000 have set or committed to set emission reduction targets, with 96% of these targets inclusive of full supply chain emissions.1

Freight transportation, which accounts for 8% of global greenhouse gas (GHG) emissions, is used by almost all market sectors, but is still primarily fossil-fuel based.2 Freight companies have a critical role to play in helping to decarbonize global supply chains.

Old Dominion is a national leader in road freight transportation but has not set emission reduction targets, nor has it developed a climate transition plan, despite stating in its 2022 10-K that “risks associated with future climate change concerns or environmental laws and regulations, sustainability requirements and related investor expectations could have a material adverse effect on our financial condition, results of operations, liquidity and cash flows.”3

To help meet changing customer preferences for low-carbon transportation, Old Dominion must reduce its carbon footprint and decouple its growth from its climate impact. By failing to act on climate change, Old Dominion risks losing customers to competitors with higher efficiencies or to alternatives such as rail and battery-electric trucks. It also faces risk associated with being unprepared for new state and federal regulations intended to increase vehicle efficiency and reduce GHG emissions. California now requires that 40% of all tractor-trailers sold be all-electric by 2035,4 and the EPA has proposed regulation with stronger emission reduction standards for heavy duty trucks starting in 2027.5

To help achieve U.S. climate goals, the Inflation Reduction Act provides billions of dollars in federal support for vehicle and battery manufacturers and purchasers; the Infrastructure Investment and Jobs Act will supply charging infrastructure to help lower costs and barriers to zero-emission vehicles.

By setting 1.5°C-aligned GHG reduction targets for its value chain, and developing a plan to achieve such goals, Old Dominion can demonstrate that management is addressing material climate-related risks, ensuring its competitiveness, and capitalizing on the value-creating opportunities presented by a net zero economy.

RESOLVED: Shareholders request that the Board issue interim- and long-term greenhouse gas reduction targets aligned with the Paris Agreement’s 1.5°C goal requiring Net Zero emissions by 2050.

SUPPORTING STATEMENT: Proponents suggest, at management discretion, the Company:

· Disclose a timeline for setting a Net Zero by 2050 GHG reduction target and 1.5°C-aligned interim targets;

· Disclose an enterprise-wide climate transition plan to achieve 1.5°C-aligned emissions; and

· Disclose annual progress towards meeting its emissions reduction goals.

1 https://sciencebasedtargets.org/companies-taking-action ; https://sciencebasedtargets.org/blog/scope-3-stepping-up-science-based-action#:~:text=Scope%203%20targets%20are%20a,scope%203%20target%20is%20required

2 https://climate.mit.edu/explainers/freight-transportation

3 https://ir.odfl.com/sec-filings/all-sec-filings/content/0000950170-23-003783/0000950170-23-003783.pdf , p.15

4 https://www.nytimes.com/2023/03/31/climate/california-electric-trucks-emissions.html

5 https://www.nytimes.com/2023/03/31/climate/california-electric-trucks-emissions.html ; https://www.epa.gov/regulations-emissions-vehicles-and-engines/proposed-rule-greenhouse-gas-emissions-standards-heavy

Paris Alignment and GHG Reduction Goals

Resolution Details

Resolution Text

Lead Filer

Co-filer