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Governance

Political engagement

Sempra’s governance structure includes policies and practices for political engagement, necessitating the active involvement and oversight of our board of directors, specifically the corporate Governance Committee of the board. Sempra and our operating companies engage in direct and indirect lobbying activities at the federal, state and local levels of government consistent with our commitment to creating long-term, sustainable value. Among other topics, we are focused on advocating for the important role our infrastructure plays in lowering GHG emissions, helping decarbonize and electrify the markets we serve.

Our direct lobbying activities align with relevant policies within the legislative and regulatory jurisdictions in which we operate, such as California’s goal to achieve economy-wide carbon neutrality by 2045, the U.S. Environmental Protection Agency’s methane rules, and important global multi-lateral collaborations, including the Paris Agreement’s goals of limiting average global warming to well below 2°C above preindustrial levels and pursuing efforts to limit the temperature increase to 1.5°C.1

Trade association alignment

Sempra and our operating companies are also members of trade associations focused on energy industry issues and the interests of our stakeholders. As a general matter, these associations enable us to learn the views of others, obtain feedback and, ultimately, voice our perspectives on proposed legislation and regulations in an educated and thoughtful manner. Some of these associations engage in lobbying activities. We believe that our indirect lobbying activities through these associations are consistent with a transition to a lower-carbon energy system and generally align with the Paris Agreement’s goal to limit global temperature rise.

Trade association policies generally reflect a compromise of the membership, so at times the policy positions and lobbying activities of these associations may not fully align with Sempra’s positions on a particular issue, including the Paris Agreement’s goal to limit global temperature rise, in which case we work to mitigate risks associated with such misalignment.

Specifically, we seek to do this in three primary ways:

  1. Education of the association staff and key members.
  2. Ongoing engagement with the association to try to move consensus positions.
  3. If needed, dissension from association positions, including not providing formal company participation or endorsement.

We have also enhanced our disclosure about our trade associations and their alignment with the Paris Agreement and Sempra’s climate position. To assist in this endeavor, we developed a standardized trade association template in consultation with shareholders and other key stakeholders. This template was sent to trade associations in which we participate with annual dues or membership fees over $20,000 that have lobbying expenditures. More detail on this assessment and a copy of this disclosure form can be found in Appendix.

Political contributions

Sempra makes corporate political contributions in the U.S. as permitted by law only from corporate shareholder funds. Our employees can also take an active role in the political environment through the voluntary Sempra state and federal Employees Political Action Committees (collectively, SEEPAC). Corporate and SEEPAC political contributions are made to candidates, political parties, political action committees and ballot measures. SEEPAC spending plans and decisions are reviewed and approved by SEEPAC’s board of directors and receive political reporting and compliance clearance before checks are issued. All corporate political contributions, SEEPAC contributions and business and trade association memberships of $20,000 or more are posted on sempra.com, along with any indirect lobbying expenditures reported to us by the organizations. In 2021, Sempra was named a Trendsetter by the Center for Political Accountability for the sixth consecutive year, receiving a score of 95.7 out of 100 in its annual Zicklin Index for transparency and disclosure practices.

“At Sempra, we have an optimistic view about our ability to make a difference. As the owner and operator of one of North America’s largest energy networks, we have a critical role to play in advancing energy security, future economic growth, and the development of a lower-carbon society. This is not an either-or discussion.
A better future depends on all the above.”
Jeffrey W. Martin
Chairman and Chief Executive Officer
  1. The Paris Agreement, adopted in 2015, is an agreement under which 196 countries agreed to collaborate on long-term strategies focused on financial, technical and capacity-building programs with a stated goal to hold the increase in the global average temperature to well below 2°C, with a stretch target of 1.5°C, above pre-industrial levels.

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