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ESG goals and executive compensation

Every member of Sempra’s management team is focused on long-term value creation as fundamental to our company’s vision. These leaders set our sustainability strategy and help ensure operating company alignment. A percentage of certain executive compensation is tied to ESG goals selected by the Compensation & Talent Development committee, such as goals related to safety, diversity, system reliability and emissions reduction. Employees at all levels of the company contribute to achieving these goals.

ESG categories are equally weighted and performance results are determined at the discretion of the C&TD committee of Sempra’s board of directors. In 2021, the committee considered accomplishments against the performance factors described below1

  • Environment

    Performance factors
    Establish high-level energy transition plan framework to achieve our aim of net-zero emissions by 2050

    Performance highlights

    • Developed and announced an aim to have net-zero GHG emissions by 2050, including interim operational and value chain targets and action plans around decarbonization, diversification and digitalization
    • SDG&E and SoCalGas developed and announced their respective aims to have net-zero GHG emissions by 2045
    • Worked with industry leaders, academics and environmental organizations to advance innovation and develop technical protocols in support of the enterprise action plan
  • Social

    Performance factors
    Enhance our high-performance workforce culture by advancing diversity and inclusion and promote community engagement and citizenship

    Performance highlights

    • Implemented and completed leadership training for all U.S.-based officers on discussing topics involving race and gender
    • Expanded the use of diverse interview panels to mitigate the risk of selection bias
    • More than doubled participation of women and people of color in enterprise mentorship program and launched programs at SDG&E and SoCalGas that pair mentees with officers
    • Created and distributed diversity and inclusion snapshot to employees to increase transparency about our workforce population
    • Increased overall employee engagement to 87% in the 2021 employee engagement survey from 85% in the 2019 survey, with an 85% positive response on “I feel like I belong at this company”
    • Launched charitable giving priorities that support diverse and underserved communities in the areas of climate action, diversity and inclusion, economic prosperity and energy access
    • Continued to enhance supplier diversity programs, with SDG&E and SoCalGas each spending over $900 million with diverse suppliers and increasing their expenditures relative to 2020 with African American suppliers
  • Governance
    Performance factors
    • Maintain 80% or higher customer satisfaction at SoCalGas and SDG&E
    • Expand training for directors

    Performance highlights

    • SoCalGas’ performance was slightly above target and SDG&E’s performance was slightly below target
    • All operating company directors completed corporate governance training led by the National Association of Corporate Directors as well as internal company-specific governance training
  1. The social category is limited to U.S. companies (i.e., IEnova is excluded). The environmental and governance categories apply to IEnova.

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