Sempra

The Corporate Governance Committee reviews Sempra's public policy priorities on an annual basis, including political contributions and lobbying activities. While our board provides oversight, Sempra's senior vice president of corporate affairs is responsible for the activities, positions and daily decision-making consistent with this oversight. In 2023, we implemented a political reporting and compliance plan, including launching an improved political compliance training program, auditing existing guidance and reference materials, strengthening policies, and enhancing tracking and reporting systems [...] Sempra and our businesses are members of trade associations focused on the important business and technical issues critical to our mission to be North America's premier energy infrastructure company. As a general matter, these associations enable us to learn the views of others, obtain feedback and participate in forming industry perspectives on legislation and regulations. Some of these associations engage in lobbying activities on various issues. [...] In 2023, Sempra continued our work started in 2021 to advance standardized climate lobbying disclosures by trade associations, in support of our shareholders and industry as a whole. A request for participation was sent to all U.S.- based trade associations to which Sempra, Sempra California or Sempra Infrastructure pays annual dues or membership fees of $20,000 or more that include lobbying expenditures. We excluded any trade associations that did not lobby on climate and/or energy policy. We evaluated the trade associations' responses to assess their climate-related policy and advocacy positions and determined: Alignment with 29 associations; Partial alignment with eight associations; and Misalignment with zero associations.

New trade association climate lobbying disclosure template, developed by Sempra in consultation with shareholders and other key stakeholders that is now adopted by some of the most significant trade associations in the United States (page 106).

Our internal audit department reviews key data points for accuracy each year and we conduct periodic audits to review overall ESG data reporting processes. The SS&T committee reviews the report and the controls and procedures around ESG data collection and verification. [...] A lobbying activity tracking system helps us manage political activity and meet local, state and federal political reporting requirements. [...] 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. [...] 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. [...] 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.

Sempra's Board of Directors, specifically the Board's Safety, Sustainability and Technology Committee, consistent with the Board's risk management and oversight role and responsibilities, reviews and makes recommendations to management regarding policies, practices and strategies with respect to environmental, climate change, sustainability and other related ESG matters.

Additionally, the Board's Corporate Governance Committee reviews Sempra's public policy priorities on an annual basis, including charitable giving, political contributions and lobbying activity, which covers a broad array of efforts in support of the company's overall strategic objectives, climate-related and otherwise.

Procedurally, corporate political spending plans and decisions are reviewed and approved by senior management.

1. Individuals responsible for government affairs in each of Sempra's business units prepare political contributions budgets for the local jurisdictions and states where the company has operations.
2. Those budgets are then reviewed by the business units' boards of directors and are submitted to Sempra Energy external affairs for review and approval.
3. Once budgets are finalized, each contribution is reviewed and authorized by a vice president or higher-level officer.
4. Legal compliance reviews are conducted before contributions are made to ensure they comply with applicable laws. Contributions over $100,000 require approval of the most senior external affairs officer.

Sempra has a department dedicated to all aspects of compliance with applicable political laws and reporting obligations. This department, with the assistance of legal counsel, informs and educates employees, analyzes legal compliance, monitors and communicates changes in laws, and collects disclosure information in a centralized database which is then used to prepare disclosure reports. The training and outreach program consists of the following:

* An online training course required for all external-facing employees, officers, attorneys and directors;
* In-person and/or webinar training regimen for all new hires and transfers;
* In-person and/or webinar training for groups identified as having the potential for interface with public officials; and
* A company intranet site dedicated to political reporting and compliance, which has information on lobbying, gifts, contributions and political fundraising.

Management oversight for corporate political activity and the Sempra Energy Employees' Political Action Committee resides with the highest-ranking external affairs executive of the company.

###### Risk management processes\nOur ethics and compliance systems and processes help us manage risk and operate more efficiently and effectively based on six core elements:\n**1. Leadership oversight and accountability**\n - Leaders are expected to demonstrate integrity, honesty and respect, consistent with our value of doing the right thing.\n - Sempra's compliance and ethics culture is measured periodically and leaders are updated on results to help inform, enhance and align our ethics and compliance programs.\n**2. Codes of conduct, policies and procedures**\n - [Sempra's Code of Business Conduct is the foundation of our compliance](https://www.sempra.com/sites/default/files/content/files/node-media-document/2022/Policies/Sempra_COBC_NoCP_121522.pdf)\nprogram and our guide for maintaining a workplace that follows legal\nand ethical standards in compliance with federal, state and local laws and\nregulations and is in line with our company's values. Corporate policies\nprovide additional details.\n - [Sempra's Supplier Code of Conduct is based on similar standards](https://www.sempra.com/sites/default/files/content/files/node-media-document/2022/Policies/Sempra_SCOBC_091421_updates.pdf)\nthat apply to employees of Sempra and its businesses. Suppliers are\nexpected to conduct their businesses in compliance with all laws, rules\nand regulations. If suppliers are found to be out of compliance with our\nsupplier code of conduct, the business relationship is re-evaluated.\n**3. Education, communication and awareness**\n - All employees complete three mandatory ethics and compliance training\ncourses each year.\n - Additional compliance-related courses may be assigned based on an\nemployee's work location and responsibilities, covering a wide range of\ntopics including, among others, safety; discrimination and harassmentfree workplace; information management; privacy; environmental\nprotection; charitable activities; political participation; anti-trust and unfair\ncompetition; anti-bribery and anti-corruption; conflicts of interest; and\nsecurities trading.\n - We build and maintain awareness with pulse surveys, videos and\nother communications.\n - In collaboration with Ethisphere, Sempra conducted an employee survey\nevaluating employee perceptions of our ethics and compliance culture\nin 2022 and scored above the benchmark across all eight categories,\nincluding observing and reporting misconduct, manager and leadership\nperceptions, and organizational justice.\n - All employees who are directly or indirectly involved in activities that\ncould involve contact with a foreign government official and/or who\nhave access to, or control of, funds or accounts relating to such activities\nare required to complete anti-corruption and anti-bribery training and\ncertifications, which are provided on a periodic basis.\n**4. Accountability**\n - Annual employee evaluations include reflection on employees'\ncommitment to doing the right thing and efforts to support company\nculture and high standards for ethics and compliance.\n**5. Risk assessment, auditing and monitoring**\n - Compliance program owners regularly collaborate with internal and\nexternal auditors and consultants to help ensure programs are risk\ninformed and adequately designed.\n**6. Reporting processes and procedures**\n - Sempra's ethics and compliance helpline is available to all employees, third\nparties and the public to support reporting of suspected code of conduct\nviolations, including corruption, anti-competitive behavior and other\nconcerns. Every report is reviewed for appropriate handling.\n - Across Sempra, SDG&E, SoCalGas and Sempra Infrastructure, there were\n460 reports made in the U.S. and Mexico in 2022. 53% of these reports\nwere made anonymously and 16% were substantiated as of January 2023.[1]\nThis represents a 2.9% case volume rate per 100 employees.\n**Lobbying activity tracking system: Helps us manage political and lobbying**\n**activity and meet local, state and federal political reporting requirements.**"
"Sempra and our businesses are members of trade associations focused on the important business and technical issues critical to our mission to be North America's premier energy infrastructure company. As a general matter, these associations enable us to learn the views of others, obtain feedback and participate in forming industry perspectives on legislation and regulations. Some of these associations engage in lobbying activities on various issues. We are transparent about the fact that we may not agree with all of the positions of every industry, trade or policy organization in which we participate. However, we believe there is great value in open dialogue and having shared context to create opportunities to promote meaningful influence and engagement. It is our view that having a seat at the table allows us to have constructive dialogue to address global climate issues, as well as foster a community of learning in all areas of sustainable business practices. Regular participation with these organizations helps provide us an opportunity to influence their positions in a manner that aligns with Sempra's energy transition action plan—including our aim to have net-zero GHG emissions by 2050—and our commitment to sustainability in advancing the long-term interests of our shareholders and other stakeholders. In 2022, Sempra continued our work started in 2021 to advance standardized climate lobbying disclosures by trade associations, in support of our shareholders and industry as a whole. A request for participation was sent to all U.S.- based trade associations to which Sempra, Sempra California or Sempra Infrastructure pays annual dues or membership fees of $20,000 or more that include lobbying expenditures. We excluded any trade associations that did not lobby on climate and/or energy policy. We evaluated the trade associations' responses to assess their climate-related policy and advocacy positions and determined: - Alignment with 27 associations; - Partial alignment with 10 associations; and - Misalignment with 0 associations

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. [...] 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.

Sempra's board has ultimate responsibility for risk oversight. Management has developed an integrated risk management framework to assess, prioritize, manage and monitor risks across the company's operations. This framework is managed by Sempra's chief compliance officer, who reports directly to Sempra's chief executive officer and regularly interacts with the board regarding the company's risk management practices and policies and other related matters. Consistent with this approach, Sempra's corporate governance guidelines provide that the specific functions of its board of directors include assessing and monitoring risks and risk management strategies. [...] Lobbying activity tracking system: Helps us manage political and lobbying activity and meet local, state and federal political reporting requirements.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]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.

Attach commitment or position statement(s)[…]Sempra and its 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. We believe that our indirect lobbying activities through trade 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. (Page 106).

Does your organization have a public commitment or position statement to conduct your engagement activities in line with the goals of the Paris Agreement?[…]Yes