Page 26 - Martin Marietta - 2024 Sustainability Report

COMPANY OVERVIEW

Climate Related Risk Analysis and Management

In this report, and in our annual reports to the SEC, we continue to provide enhanced climate related disclosures,
including information about the physical and transition risks and opportunities relating to climate change. We believe our
objectives are consistent with the objectives of the Task Force on Climate-related Financial Disclosures (TCFD)
recommendations and Sustainability Accounting Standards Board (SASB) guidelines for the construction materials sector.

The Board and management have identified certain risks related to the transition to a lower-carbon economy, risks related
to the physical impacts of climate change and other climate-related opportunities.

Transition Risks

The Company’s sustainability risk management framework is designed to identify various transition risks, including policy
and legal risks, technology risks, market risks and reputation risks, associated with climate change and transitions to a
lower-carbon economy.

Policy and Legal Risks

A number of governmental bodies, including U.S. regulatory agencies and various U.S. states, have proposed, enacted or
are contemplating legislative and regulatory changes to mitigate or address the potential impacts of climate change,
including provisions for GHG emissions reporting or reductions, the use of alternative fuels, carbon credits (such as a
cap-and-trade system) and a carbon tax. For example, in the United States, the United States Environmental Protection
Agency (USEPA) promulgated a rule mandating that companies considered to be large emitters of GHGs report those
emissions. The manufacturing operations of the Company’s Magnesia Specialties business release carbon dioxide,
methane and nitrous oxides during the production of lime, magnesium oxide and hydroxide products. The Company’s
two magnesia-based chemicals facilities, as well as its cement plant in Texas, file annual reports of their GHG emissions in
accordance with the USEPA reporting rule. The primary business and operations of the Company, however, including its
aggregates, ready mixed concrete and asphalt and paving product lines, are not considered “major” sources of GHG
emissions subject to the USEPA reporting rule. Most of the GHG emissions from aggregates plant operations are tailpipe
emissions from mobile sources, such as heavy construction and earth-moving equipment.

The Company’s cement plant and its Magnesia Specialties plants are strictly regulated with respect to GHG emissions and
hold Title V Permits, and each (other than the Manistee, Michigan facility) is also subject to the U.S. Clean Air Act’s
Prevention of Significant Deterioration (PSD) requirements, which require a permit program for certain new or modified
sources of emissions. Although several large-scale projects for carbon capture are in the development phase, no
technologies or methods of operation for reducing or capturing GHGs have yet been proven successful in large-scale
applications, other than improvements in fuel efficiency. If future modifications to the Company’s facilities require PSD
review for other pollutants, GHG permitting requirements may be triggered and may require significant additional costs,
which the Company expects would be passed on to customers. It is not currently possible to estimate the cost of any such
future requirements. In addition, the USEPA and the U.S. Supreme Court have taken different positions with respect to
the USEPA’s authority to make rules in these and other areas which could create uncertainty regarding regulatory
compliance on these matters in the future.
Various states where the Company has operations have enacted or are considering climate change initiatives that apply to
the Company. In October 2023, California adopted its California Climate Accountability Package which includes annual
reporting of Scope 1, Scope 2 and Scope 3 emissions on a phased-in implementation schedule, climate-related risk
reporting for certain companies and heightened disclosure standards around net zero emissions claims, carbon-neutral

24 2024 SUSTAINABILITY REPORT