Our Scope of ESG Reporting
Our first global report was published April 9, 2019 based on our performance during fiscal year 2018. Our 2019 Environmental, Social and Governance (“ESG”) Report published August 11, 2020, summarizes our performance for the fiscal year ending December 31, 2019. The report presents our material environmental, social, and governance performance with the recognition that we are always striving for ways to improve our efforts as a responsible corporate citizen and enhance transparency on our business performance. As our sustainability practices improve, so will our reporting. In our next report we will outline our corporate citizenship and ESG program, our approach to managing material topics and our targets which focus efforts on reducing emissions, improving health and safety for employees, mitigating social risks in our value chain and strengthening our governance practices.
We have followed the Global Reporting Initiative ("GRI") Standards: Core option, in preparing this report but at this time we do not necessarily meet the minimum expectation to claim a core or comprehensive accordance. The GRI is an independent institution that provides a standard framework for sustainability and ESG reporting across companies and industries. We have applied the principles of materiality and inclusiveness as recommended by the GRI to assess the relevance of priorities to Westport Fuel Systems and its stakeholders.
The boundaries of this report include all operating entities where employees work at a Company site including offices, production plants or technology centers and excludes any joint ventures. Information on our workforce includes employees regardless of their physical work location.
For a description of each location's operating focus, please refer to our 2019 Annual Information Form, available at https://wfsinc.com/https://www.westport.com/investors-wfs-bak/financial-information/.
Westport Fuel Systems is using this report to summarize our ESG performance in a transparent and accountable manner. Internal reviews and processes are in place to ensure the integrity and the credibility of the data contained within, but aside from the audited financial statements, we have not sought external assurance of the ESG Report. We welcome your questions and feedback on our report or performance. Please feel free to contact us at sustainability@wfsinc.com or online at https://wfsinc.com/sustainability/.
Stakeholder Engagement and Key Collaborations
Cooperation and dialogue with stakeholders help us to understand the critical issues that matter most to them, and to us. Westport Fuel Systems has a range of diverse stakeholders and consider stakeholder engagement to be an essential component of corporate governance and good business practice. Regular and ongoing dialogue with academia, customers and OEM partners, employees, government agencies (including policy makers and regulators), industry consortiums, investors, local communities, media, non-government organizations ("NGOs") and think tanks, and suppliers through formal and informal channels is essential to our business and our ESG performance.
Stakeholder Engagement
Our stakeholder map provides a pathway to better formalize our engagement processes across the organization. Stakeholder relationships are managed by key business leads throughout the Company and we periodically receive inquiries and requests for further engagement from different stakeholder groups. Table 1 contains a list of stakeholders, the informal and formal engagement mechanisms and our understanding of their expectations specific to our business.
Table 1: Stakeholder Engagement Strategy and Approach
| Stakeholder | Engagement Mechanism | Stakeholder Expectations |
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| Academia |
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| Customers and OEM Partners |
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| Employees |
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| Government Policy Makers, Regulators |
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| Industry Consortium |
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| Investors and Shareholders |
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| Local Communities |
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| Media |
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| NGOs and Think Tanks |
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| Suppliers |
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Corporate Memberships and Key Collaborations
Outreach and constructive dialogue are the foundation of our stakeholder engagement activities. Our employees contribute to technical working groups, committees, and advisory panels to learn, share our expertise and help build a body of knowledge about alternative fuel vehicles. We believe in the importance of contributing sound, intelligent, data driven and defensible analysis to conversations on low-carbon transportation, sustainable mobility and the transition to alternative fuels. Our approach to collaboration is driven by a transparent “show your work” philosophy and a keen interest to stay up-to-date on industry and market developments. A key element of this approach is to serve in leadership positions of industry associations, most typically on the Board of Directors, to advance the adoption of clean transportation solutions. A list of our memberships is included in table 2.
Table 2: Industry Associations and Position Occupied in Fiscal Year 2019| Industry and Academic Consortiums | Membership or Governance Position Occupied by Westport Fuel Systems |
|---|---|
| Canadian Chamber of Commerce | Corporate Membership |
| Canadian Natural Gas Vehicle Association | Chair of the Board of Directors |
| CALSTART | Chair of the Board of Directors |
| European Natural Gas Vehicle Association | Secretary of Board of Directors |
| Natural Gas Vehicles America | Chair of the Board of Directors |
| World Liquefied Petroleum Gas (LPG) Association | Corporate Membership |
| Institute of Corporate Directors | Corporate Membership |
Determining Materiality
The intent of the materiality review is to ensure that our annual sustainability report represents the key economic, environmental and social issues that are most critical to our organization and to our stakeholders. As such, the materiality assessment process is a critical element of our global sustainability strategy.
Building on the work conducted in 2018 to identify and map our stakeholders and their collective priorities, we focused our materiality assessment efforts in 2019 on evaluating our five-year strategy, reviewing statements from our industry peers and analyzing third-party research that represented the voice of primary stakeholder groups. For more information on our key stakeholders, see section "Stakeholder Engagement and Key Collaborations". We welcome stakeholder feedback at sustainability@wfsinc.com.
A key element of this approach is to serve in leadership positions of industry associations, most typically on the Board of Directors, to advance the adoption of clean transportation solutions. A list of our memberships is included in table 2.
This assessment, feedback and analysis reaffirmed that the material focus areas established in 2018 remain unchanged for 2019. This review indicated a need to increase the number of disclosures within these areas in our 2019 report.
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Material Priorities
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Our material priorities can be grouped in the following areas:
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Governance, Ethics & Compliance |
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Fairness and Concern for Employees |
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Environmental Responsibility & Leadership |
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Supply Chain Responsibility |
Aligning with the United Nations Sustainable Development Goals
The United Nations Sustainable Development Goals (“UN SDGs”) are the blueprint to achieve a better and more sustainable future for all and call for coordinated public and private sector action to achieve each goal and target by 2030. They embrace a universal framework to advance both public and private sector action in building sustainable societies. Considering our global footprint and our social and environmental impact, we have a role to play in helping support the achievement of the UN SDGs.
While our business and the content of this report may cover many UN SDGs, these specific goals align with our primary sustainability focus areas and material impacts:
Table 3: Aligning Material Impacts with United Nations Sustainable Development Goals
