Engineering Innovative and Forward-Thinking Solutions
Sustainability Priorities
Sustainability is not a destination but a continuous process, and we are committed to executing a thoughtful, long-term sustainability strategy.
– David Moon, President and CEO of Energy Recovery
Our sustainability objectives and goals are driven both by our business strategy and stakeholder feedback. In alignment with our 2024 strategic planning process, we completed our second materiality assessment to ensure that our sustainability strategy continues to reflect our stakeholders’ priorities.
We engaged a thorough cross section of our stakeholders including investors, customers, and employees to evaluate our material sustainability topics. We engaged a third party to survey and interview our investors, and integrated sustainability priorities into our ongoing conversations with customers. To reach employees at every level of our organization, we conducted sustainability roadshows with each department where we surveyed employees about their priorities for the company and solicited suggestions. Energy Recovery’s leadership team also conducted a business evaluation of our material topics where the importance of each topic was assessed through various lenses, such as corporate growth and regulatory requirements.
Through this process, four environmental and social topics were deemed the highest priority and form the basis of our updated sustainability roadmap.
Each of these four areas has associated targets and key performance indicators (KPIs) that we use to measure our progress. Several of our targets are ongoing and will require our continued attention to ensure that we remain on track year after year. Others have specific deadlines and deliverables; as we achieve those goals, we look for opportunities to create new goals and KPIs in their place so that our strategy continues to evolve.
*This topic was previously represented as two topics: CustomersandProducts.
The top environmental and social topics in which we set goals are:
Innovation & Opportunity
Employees
Product Safety & Performance
Operational Impact & Management
Two governance topics (Ethics & Compliance and Systemic Risk Oversight) were also identified as top priorities for the organization. Because these governance topics are part of our normal course of doing business as a public company, we have not set proactive improvement targets. We strive for ongoing improvement in all areas, and we will continue to report relevant disclosures on all topics. We remain committed to periodically refreshing our materiality assessment to ensure that our sustainability strategy aligns with our business priorities.
Material Topics Definitions
Environmental
Physical risks, such as rising sea levels, climate impacts of our business mix, critical material and transition risks related to regulation, technology, and reputation.
Developing diversified solutions across industries to favorably impact energy consumption in addition to associated cost savings for end users.
The operational impact and management of GHG and toxic emissions, waste, biodiversity, land use, and natural resources such as water.
Social
Our engagement and impact on the local communities where we operate including topics such as volunteering, investment and contributions with local impact, disaster response, and supporting community rights.
Management of our employees, focusing on health and safety, well-being, professional development and talent attraction, diversity and inclusion, compensation, and open feedback channels.
Management of supplier labor conditions and workforce safety, human rights, and proper sourcing practices.
Prioritizing customers by delivering products that are safe, reliable, high-quality, energy efficient, and aligned with our trustworthy reputation.*
*This topic was previously represented as two topics: Customers and Products.
Governance
Board structure, diversity, independence, size, expertise, and refreshment.
Stakeholder engagement, ongoing ESG education, and oversight of ESG reporting, sustainability performance, and strategy-setting.
Our processes, policies, and oversight structures ensure strict management of bribery and corruption, conflicts of interest, marketing, tax transparency, and adherence to all applicable regulations.
Executive median pay, long-term incentive ties, long-term incentive vesting structure, and performance incentives tied to ESG metrics.
Our practices regarding shareholder rights and engagement including proxy access, voting rights, right to appoint directors, right to call a special meeting, and the right to act by written consent.
Our formal risk oversight structures and policies related to risks such as cybersecurity succession planning, intellectual property, and climate change.
Goal Progress
Our goal progress dashboard offers a high-level overview of our progress on our goals and targets.
The dashboard is updated annually, and current goal statuses reflect progress as of the end of 2023.
Reduce emissions intensity to 10 MT CO2e per million dollars of revenue by 2026 from 2021 baseline
Double emissions reductions from our products by 2025
Developing technologies that save energy and reduce emissions for our customers is at the heart of Energy Recovery’s business and sustainability strategy. We aim to double this impact by 2025.
Further integrate sustainability into our product innovation process
Develop scorecard by end of 2026
Reduce waste generated in our operations
Commit to setting a hazardous and non-hazardous waste goal by end of 2025
Recycle over 90% of alumina powder waste
Reduce water used in operations
Commit to setting a water reduction goal by end of 2025
