Alstom

Alstom is committed to reduce its scope 3 greenhouse gas (GHG) emissions intensity from the use of sold products from its portfolio of rolling stock solutions by 42.3% per passenger-kilometre and 35% per tonne-kilometre by 2030 from a 2021 baseline. The company has also set a target to achieve net zero emissions by 2050, aiming for at least a 90% absolute reduction across its value chain compared to 2021 levels, which is closely aligned with its 1.5°C pathway. Furthermore, the rate at which its future scope 1 and 2 absolute emissions is expected to decrease between 2023 and 2028 is fully aligned with its 1.5°C pathway.

Alstom has a comprehensive low-carbon transition plan informed by climate scenario analysis that has considered the implications of a 1.5°C scenario. Furthermore, the company is focused on advancing zero-emission hydrogen-powered trains, with an ambitious goal of capturing a 33% market share by 2040.

No leading practices were identified for this company.

Alstom has an extensive supplier engagement strategy that includes quantified emissions reduction requirements both for the selection of new suppliers and renewal of contracts with existing suppliers. In case of non-compliance with its GHG emissions reduction requirements, the company permanently excludes suppliers that fail to show significant improvement after the period of engagement.

The assessment of Alstom’s emissions trends is limited by the lack of data prior to 2021, resulting from its merger with Bombardier that year. In recent years, the company has demonstrated significant reductions in its scope 1 and 2 emissions, as well as emissions associated with the use of sold products. Conversely, Alstom’s emissions from purchased goods and services increased in 2023 compared to 2022. Furthermore, the company has set a 2030 target for its scope 3 upstream emissions. However, this target is based on financial metrics, whereas it should instead consider a physical metric, such as absolute emissions or emissions intensity.

Alstom can strengthen its climate scenario analysis by expressing the results in quantitative and financial terms and translating them into value-at-risk. Furthermore, the company should make a clear commitment to phasing out its diesel locomotive segment, supported by a well-defined timeline, and quantify the projected growth of battery-powered trains in passenger service.

Alstom discloses its capital expenditure (CapEx) values for 2023, with a low-carbon CapEx share of 80%. However, there is no publicly reported evidence that the company plans to keep up this share in 2024 and 2025. The company invested USD 148 million in 2023 in R&D of low-carbon technologies, equivalent to 35% of its total R&D investments. However, Alstom needs to scale up its low-carbon R&D ambition to drive innovation to achieve its climate goals. Furthermore, while Alstom has a cutting-edge innovation program to collaborate with suppliers on increasing the use of eco-design and circular economy principles to increase the energy efficiency and recyclability of products, the company could quantify the impact of the intervention on emissions.

Alstom integrates GHG emissions reduction targets into its client engagement strategy but does not quantify its requirements. The company can improve in this area by setting and reporting its targeted level of client emissions reduction. It can also expand the proportion of clients targeted by the strategy based on client-related revenue or scope 3 emissions.

The company publicly discloses a commitment to engaging in social dialogue with workers and unions. However, no relevant disclosure was found regarding the categories of stakeholders it engages with on a just transition. The company discloses the steps it takes to engage with identified stakeholders as part of its approach to supporting a just transition. It also discloses that it has an ongoing social dialogue with stakeholders on all aspects of a just transition, but it does not provide specific examples. No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s actions to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks. The company discloses the actions it takes to provide reskilling and upskilling opportunities for workers and affected stakeholders. For instance, it invests in the Alstom University, which offers a wide range of training programmes in collaboration with expert partners, and supports local workforce development through partnerships with educational institutions and small businesses. Furthermore, the company discloses the measures it takes to embed equality of opportunity for women and vulnerable groups in these actions. It does this through its Supplier Disadvantaged Business Enterprise (DBE) programme, which promotes partnerships with small, disadvantaged women- and minority-owned businesses. However, no evidence was found of the company having a process for identifying skills gaps for workers and stakeholders affected by the low-carbon transition or a public commitment to help workers displaced by the transition to reskill or upskill.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work. However, it can strengthen its disclosure on its human rights due diligence process and engagement with affected stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment from its business relationships. However, no evidence was found of the company having a time-bound target for paying all workers a living wage. While the company discloses the proportion of its direct workforce covered by collective bargaining agreements, no relevant disclosure was found of the company’s required working hours. The company discloses some indicators of workforce diversity, including the age and gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. The company has a commitment towards gender equality and women’s empowerment.

The company commits to protecting personal data and discloses a privacy statement regarding the use of personal data. While it has implemented clear board accountability for its tax practices, a formal company tax policy approved by the highest governing body could not be found in the public domain. Moreover, while the company has a policy prohibiting bribery and corruption, no evidence was found of a process to identify bribery and corruption risks in company operations. The company states that it does not make political contributions, but no other relevant disclosure was found on the company’s lobbying practices.