Corporate Footprint and Environmental Stewardship

We are committed to reducing our environmental impact.

At Leidos, we work every day to advance environmental sustainability for our customers and our own operations. Three of our Next Level Leidos goals are focused on environmental stewardship.

• Reduce GHG emissions 25% by 2030
• Reduce waste by 50% in Leidos facilities by 2030
• Increase renewable energy to 25% of total electricity use by 2030

Our roadmap for achieving the 2030 targets will include an array of solutions to reduce the company's environmental footprint and will continuously evolve. In the near-term, high-level strategies in the roadmap include:

• Focusing on core/key facilities
• Prioritizing real estate actions, followed by energy efficiency and renewable energy
• Investigating unique opportunities at labs, manufacturing, data centers, and aircraft
• Developing regional and sub-regional business, and facility plans, as appropriate
• Integrating sustainability considerations across businesses and functions
• Increasing engagement and collaboration, raising awareness, building capacity, and recognizing achievements

Footprint at a Glance

The charts below summarize our environmental performance history and include data from calendar years (CY) 2020 and 2021. Metrics from 2020 have been restated from last year's report to capture data from the businesses we acquired during 2020 and 2021. 

GHG Emissions

Leidos is committed to mitigating climate change by reducing emissions. We quantifiy scope 1, 2, and 3 emissions according to the GHG Protocol and using industry-accepted emission factors. Our annual GHG inventories are third-party verified according to ISO standards to provide external assurance of the accuracy and completeness. In 2021, emissions from Leidos-piloted aircraft and businesses acquired during 2020 and 2021 were captured for the first time. Emissions from 2020 were recalculated to include the same new emissions sources and evaluate year-over-year performance improvements.

Scope 1 & 2 Emissions

Building on the momentum of our 58% emissions reduction from 2010 to 2020, we have set a new target to reduce market-based scope 1&2 emission by at least 25% by 2030. Key strategies for achieving this goal will include:

• Real estate optimization: Utilize real estate effectively by disposing of underperforming or underutilized assets and implementing flexible workplace strategies
• Energy efficiency: Reduce energy consumption by identifying and implementing energy efficiency upgrades to our facilities
• Renewable energy: Increase utilization of renewable energy by exploring opportunities for onsite renewable generation, procuring renewable energy where available, and purchasing Renewable Energy Certificates (RECs) from credible sources
• Technology: Enhance technology and network support, including data center consolidation, upgrades to more energy-efficient equipment and cloud migration, enabling greater workplace flexibility
• Behavioral change: Educate employees on environmental sustainability and workplace behaviors that minimize waste in all forms

In 2021, buildings accounted for 80% of scope 1&2 emissions, followed by aircraft and fleet vehicles at 19% and 1%, respectively. From 2020 to 2021, we reduced scope 1&2 emissions by 3%. This reduction was driven by a 6% reduction in facility emissions which offset emission increases from aircraft and fleet vehicles resulting from business growth.

In addition to absolute emissions, Leidos tracks the emissions intensity of our revenue and our workforce. One of our objectives is to disassociate emissions from revenue and workforce growth. From 2020 to 2021, we reduced the emissions intensity of our revenue and workforce by 13% and 12%, respectively.

Scope 3 Emissions

In 2017, Leidos began quantifying scope 3 GHG emissions from employee commuting and business travel to understand our environmental impacts and to identify opportunities to reduce our indirect GHG emissions. Scope 3 GHG emissions totaled about 45,505 mtC02e in 2020 and were split about 62% from employee commuting and 38% from business travel (car, air, and rail travel). This reflects a 49% decrease from 2019 due largely to restricted travel and increased virtual meetings during the COVID pandemic. We continue to develop and improve our scope 3 data sources and are working to expand the boundary of our scope 3 inventory.

In 2021, commuter travel accounted for 39% of scope 3 emissions, followed by business travel at 31% and fuel and energy-related activities at 30%. Overall, scope 3 emissions increased 27% from 2020 to 2021 as restrictions from the COVID pandemic were lifted and travel picked up. We continue to develop and improve our scope 3 data, incorporate new emission sources into our scope 3 inventory, and explore opportunities to reduce our indirect emissions.

Energy Consumption

In 2021, Leidos buildings accounted for 76% of total energy consumption, followed by aircraft at 23% and fleet vehicles at 1%. Aircraft fuel consumption increased 17% from 2020 to 2021 and we are closely monitoring and exploring opportunities to curb these increases as the associated businesses continue to grow.

Buildings are the focus of our current environmental sustainability strategy. We carefully manage our real estate portfolio and drive operational improvements to reduce energy and emissions. Key strategies include flexible workplace programs, disposal of underperforming or underutilized assets, energy audits and efficiency projects, standardized operating procedures and design practices, and renewable energy.

The Leidos real estate portfolio grew in 2020 and 2021 due to M&A activity. This growth presents both challenges and new opportunities for reducing energy and emissions. During 2021, Leidos completed energy audits at nine facilities representing over 1.2 million square feet. This initiative identified over 50 savings opportunities with combined annual savings of 5.2 million kilowatt-hours of electricity, 87 thousand therms of natural gas, 2,700 metric tons of carbon dioxide equivalent, and $500 thousand in avoided utility and maintenance costs. In 2022, additional energy audits will be conducted, and implementation plans will be developed.

In 2021, we reduced building energy consumption by 4% compared to 2020. Keys to this reduction were a 2% reduction of our real estate footprint and a 2% decrease in energy intensity of our portfolio from operational improvements and efficiency upgrades.

Renewable energy utilization decreased from 9% of total electricity consumption in 2020 to about 5% in 2021 primarily because our largest facility and largest source of Renewable Energy Certificates (RECs) was eliminated from the portfolio during 2020. We have committed to increase renewable energy utilization to at least 25% of total electricity by 2030. In 2022, we will implement plans to procure renewable energy at 11 facilities in Maryland while continuing to source renewable energy in California and the United Kingdom. We are working with facility and energy services partners to identify long-term strategies and opportunities across the portfolio to drive up renewable energy utilization and surpass our target.

Waste Reduction and Landfill Diversion

Leidos is committed to minimizing our resource consumption and our impact on the environment. We set a goal to divert 50% of our landfill waste from Leidos facilities by 2030. To reach this target we will continue to partner with our suppliers and our employees to develop strategies that prioritize the top of the waste hierarchy; rethink/redesign, reduce, reuse, and recycle/compost over disposal.  We have identified data as the first challenge in meeting this goal as we occupy primarily leased space in multi-tenant office buildings. To drive improvements in data collection, we are partnering with our facility partners, landlords and suppliers. We are also planning to conduct forensic waste audits in early 2023.  As we work to improve our data and meet our goal, we will continue the following initiatives:

• Enhance and expand our existing programs such as office furniture refurbishment and reuse, smart printing, recycling (construction waste, paper, and coffee pods), and composting
• Follow international guidelines for electronic waste disposal and responsibly reuse/recycle/redeploy 100% of our corporate managed electronic waste
• Post-pandemic, eliminate single-use plastics in our largest facilities
• Work with our supply chain partners to source environmentally friendly materials and identify circularity opportunities

Leidos understands that our value chain is one of the largest sources of impact on the environment and that we have an opportunity to both learn, and benefit from, their innovations in waste reduction and circularity. In 2020, we refreshed our supply chain sustainability program and launched supplier sustainability assessments to identify best practices and partnership opportunities. In 2021, we published the inaugural Supplier Code of Conduct which outlines our environmental expectations for suppliers.  See the Supplier and Small Business section for more information. 

Water Stewardship 

We have identified both Water Stewardship and Biodiversity as issues to watch on our recent ESG materiality matrix. At Leidos water is mostly limited to typical commercial office consumption, which does not currently have a significant effect on national or local water sources. We monitor our water use and work to reduce consumption through water-efficient technologies, especially in water-sensitive climates like California and Florida.  As we grow, we will continue to evaluate our impact and usage.