Sustainability
Leadership Statement
At Targa, we strive to conduct our business safely and with integrity, creating lasting benefits for our stakeholders, including investors, lenders, customers, employees, business partners, regulators, and the communities in which we live and work. We are proud to be part of the energy infrastructure that is delivering safe, reliable energy to industry, farmers, and communities across America.
Our operations connect U.S. natural gas and natural gas liquids (NGL) supply to markets where there is growing demand for cleaner fuel and feedstocks. We believe that natural gas, NGLs and liquefied petroleum gas (LPG) are part of the solution to reducing the world’s greenhouse gas emissions. Natural gas, NGLs, and LPG are playing a meaningful role globally in improving public health and the environment with about half of the carbon dioxide (CO2) emissions compared to coal combustion. The increasing use of natural gas has helped the U.S. lower its emissions even as the economy has grown over the last 15 years. Globally, where electricity is not available, the use of LPGs for fuel has a positive impact on the health and prosperity for local people in less industrialized nations.
Safety
At Targa, safety is a core value. We believe that “Zero is Achievable” and our goal is to operate and deliver our products without any injuries. We continually seek to maintain and deepen our safety culture by providing a safe working environment that encourages active employee engagement. To protect our employees, contractors, and surrounding community from workplace hazards and risks, Targa implements and maintains an integrated system of policies, practices, and controls.
Operational Excellence
We recognize that operating our assets, including thousands of miles of pipelines, natural gas processing facilities, and NGL fractionation and distribution facilities, is a great responsibility. Throughout our organization, we are committed to maintaining and operating our assets safely, efficiently, and in an environmentally responsible manner. We invest each year in integrity management, maintenance, and environmental programs. Wherever we operate, we strive to conduct our business with attention to the environment and to manage risks to enable sustainable business growth.
Integrity and Code of Conduct
Our actions are guided by Targa’s Code of Conduct, the overarching policy that empowers us to commit to ethics, integrity, and compliance. Targa’s Code of Conduct establishes the high standard of ethical conduct that our employees are expected to follow and outlines how everyday behavior is expected to align with our core values. We further reinforce our commitment through adherence to our policies and practices, as well as through Code of Conduct annual training.
Throughout our organization, we are committed to operating safely, with excellence and high integrity. This is a commitment that starts with and is maintained by our Board of Directors, where the full Board of Directors holds the senior management team accountable for implementing our sustainability and Environmental, Social and Governance (ESG) objectives, including through administration of the Company’s annual incentive program. Given the importance of ESG, our senior management reports to the full Board on ESG matters on a quarterly basis.
This deliberate decision enables senior management to benefit from the breadth of experiences and knowledge from the full Board. ESG and sustainability remain a core Board agenda item, with metrics and focus topics discussed at each quarterly meeting led by different members of the cross-functional team supporting our ESG efforts. Our performance on sustainability factors played a role in 2019 compensation decisions and will continue to play a role in the Compensation Committee’s evaluation of annual incentive compensation.
To further develop our goals and approach to sustainability, Targa has a cross-functional sustainability working group comprised of leadership from our Environmental, Safety and Health, Operations, Engineering, Human Resources, Legal, Supply Chain, Financial Accounting, Commercial, and Investor Relations departments. The coordinated efforts are led by a key member of this group, our Senior Vice President of Sustainability and Environmental, Safety and Health (ES&H), who reports to our Chief Executive Officer.
Our sustainability objectives are designed to generate attractive economic returns for our investors, while minimizing environmental and social impacts. Based on the materiality assessment that we performed pursuant to the Global Reporting Initiative (GRI) sustainability framework, our sustainability strategy focuses on the most significant ESG topics for our business and our stakeholders. These key topics include safety and health, environmental stewardship, community engagement, human capital management, and talent management and development.
Targa is committed to transparency and disclosure of its ESG performance. Our 2019 Sustainability Report references the GRI Standards – Core option and the Sustainability Accounting Standards Board (SASB) midstream framework.
YTD 2020 Developments
COVID-19 Business Response
As a critical energy infrastructure operator, Targa prioritizes safety in all parts of our organization. At the end of 2019, the world was beginning to be introduced to a novel coronavirus, which the World Health Organization soon thereafter designated as COVID-19. In response to the ongoing COVID-19 pandemic, we moved early and quickly to protect the health and safety of our employees and are continuing to proactively manage our response to an evolving national and global situation.
We activated and continue to operate under our Business Continuity Plan and took several additional strategic, proactive measures in response to information from the Centers for Disease Control and the local, state and national authorities to try to minimize the risk of business disruption and to protect our ability to deliver reliable services to our customers. Our Business Continuity Plan included:
- Forming a critical response team of senior management in January 2020 to collaborate, review, and execute Targa’s business response to COVID-19
- Proactively conducting a mandatory work-from-home drill for all non-field employees ahead of the stay-at-home orders issued by applicable governmental authorities
- Preserving our workforce by providing our non-field employees with technology and equipment to perform their work duties remotely
- Instituting social distancing practices and routine deep cleaning protocols at all facility locations to manage the spread of the virus
- Equipping our facilities’ employees with personal face coverings
- Continuing to provide leading customer service and reliable operations through enhanced facilities protocols, including limiting access to facilities by essential personnel, enabling social distancing, conducting jobsite safety meetings under social distancing protocols and encouraging virtual meetings rather than in-person meetings when possible
- Engaging with our supply chain to review their capabilities and continuity of operations and service
- Implementing plans for safely returning to offices over time
Our Board of Directors receives regular updates around preserving the well-being of our employees and continuity of Targa business operations as COVID-19 evolves.
Our industry continues to navigate through an unprecedented period as a result of COVID-19. The low supply-demand for energy commodities and the low crude oil price environment caused producers to meaningfully reduce their activity levels. Given this lower volume outlook and increased uncertainty around business fundamentals, we moved quickly and decisively as an organization to take key actions to protect our balance sheet and preserve Targa’s financial flexibility to be successful over the long-term.
Election of New Board Members
As previously announced, on March 1, 2020, Mr. Matthew J. Meloy was elected to the Board and we increased the size of Targa’s Board of Directors from ten to eleven directors. On June 1, 2020, we announced the election of Ms. Lindsey M. Cooksen to the Board and increased the size of Targa’s Board of Directors from eleven to twelve directors. Following the election of Mr. Meloy and Ms. Cooksen, 75% of our directors are independent and 25% are women. The data reflected herein is based on our board composition as of June 1, 2020.