American Airlines ESG Strategy - Management and Governance
Originally published in American Airlines 2021 ESG Report
Since ESG issues touch nearly every aspect of our business, day-to-day management of individual elements is distributed throughout our operations and functions. American’s Managing Director for ESG is responsible for guiding and coordinating our activities at the executive level. She receives guidance and feedback from a cross-functional and cross-operational group of senior leaders with responsibility for regularly assessing the effectiveness of our ESG strategy, its implementation and further integration of sustainability into our company strategy and operations.
At the Board level, the Corporate Governance, Public Responsibility and Safety (CGPRS) Committee has primary responsibility for overseeing ESG efforts. The CGPRS Committee is regularly updated on the company’s efforts related to sustainability and to addressing climate change. (See A Director’s View on ESG on page 6 of the report.)
Climate-related governance
Because climate change is a pressing challenge for our company and our planet, American takes a coordinated approach to ensuring we have robust governance of climate-related risks and opportunities. It begins with Board-level oversight and accountability and extends to our day-to-day operations.
American’s Board oversees our climate strategy as part of an enterprise-wide approach to risk management. Either as a full Board or through one or more of its committees, the Board reviews management’s strategy and its assessment of material risks affecting our business. This includes potential climate-related risks.
In 2022, we formally assigned Chief Executive Officer Robert Isom, who also serves on our Board of Directors, with responsibility for oversight of American’s climate change strategy. In addition, climate-related issues are a standing agenda item in the CGPRS Committee’s quarterly meetings. The full Board receives updates as well at least three times per year.
At the management level, responsibility for climate-related issues is embedded in senior roles across our company. For example, the Airport Operations team does resiliency planning for more frequent and severe weather events; our Fuel Procurement team works to secure cost-competitive supplies of sustainable aviation fuel (SAF); and our Flight Operations and Fleet Engineering teams are focused on improving fuel efficiency in the air and on the ground. Our Climate Change Steering Committee — which is led by an Executive Vice President and includes representatives from Airport Operations, Flight Operations, Technical Operations, Cargo, Finance, Safety, People and Communications, Legal, Government Affairs and Investor Relations — provides guidance across these efforts. And American’s Managing Director of ESG is responsible for developing and coordinating the company’s overall climate strategy and driving its implementation.
Public Policy and Political Contributions
Political, legislative and regulatory decisions can play an important role in American’s success, and we have adopted policies that guide our participation in these processes. Reflecting best practices, our Statement on Public Policy Engagement and Political Participation precludes American from using corporate funds for contributions to candidates, political party committees and political action committees. Our Board reviews this statement annually and last approved a revision in January 2022.
We do not use corporate funds for the electioneering activities that the Supreme Court allowed in Citizens United. On the rare occasion when we do use corporate funds to contribute to a state or local ballot initiative or a 501(c)(4) organization, we have committed to disclose that contribution. In 2021, American did not make any political contributions.
The CGPRS Committee oversees the company’s major advocacy priorities and activities, political contributions and principal trade association memberships. For example, we have committed to aligning our lobbying efforts with the priorities and goals of the Paris Agreement, the international treaty on climate change. In 2022, we will also assess our trade groups’ alignment with this agreement and include that in our reporting.
