Okay. I'd like to welcome everyone to this TD Securities hosted ESG speaker series with Stantec today. For those of you that don't know me, my name is Michael Tupholme, and I cover Stantec and the broader engineering and construction sector on behalf of TD Securities from a research perspective. Very pleased to be joined today by Gord Johnston, President and CEO of Stantec, and Theresa Jang, Executive Vice President and Chief Financial Officer with Stantec. In terms of format, Gord and Theresa are going to run through a short slide deck and make some opening remarks, after which we'll engage in some Q&A.
I'll lead the Q&A discussion, but to the extent that anyone that's attending today's session does have a question, please use the chat feature on your screen, and I would be pleased to ask your question on your behalf anonymously. With that said, Gord and Theresa, I will turn it over to you. Again, thank you very much for joining us today.
Great. Well, thanks, Michael. Thanks, everyone, for the opportunity to speak with you today. You know, as always, just a reminder that our conversation today is gonna make reference to some forward-looking statements. You know, Stantec's a global leader in sustainable engineering, architecture, and environmental consulting. You know, we continue to stand out as the top-ranked firm in our space for sustainability. In addition to being named the fifth most sustainable company in the world by Corporate Knights this year, we consistently come out on top in sustainability ratings across multiple independent third parties. You know, we're ranked as a climate leader with an A- score by CDP, formerly the Carbon Disclosure Project, and we're the only firm in our space that's achieved that rating for the last three years.
You know, as you can see on the slide, our ISS ESG quality scores continue to outperform our peers year- after- year, and Sustainalytics ranks our ESG risk as low, which again is top of class. You know, we've continued this leadership by committing to be carbon neutral for 2022 emissions and to be net zero by 2030. The Science Based Targets initiative has recently validated our 2030 emission reduction targets and determined that they're in line with the 1.5 degrees Celsius trajectory. You know, the Science Based Targets initiative is the most comprehensive and globally recognized standard for emissions management, and they're gonna be soon releasing their standard for net zero.
In fact, I think they might be rolling out today or even actually right now as we're in this call. We find that, you know, overall, our skills and expertise, you know, continue to play a key role in the global pursuit of a more sustainable future. Our communities and clients are relying on us now, you know, more than ever to address their impacts of climate change, water scarcity, and fortifying their critical infrastructure. You know, sustainability isn't something that's new for us here at Stantec. It's been really part of our DNA for decades. You know, often as we talk about E, S, and G, you know, people focus on the E and neglect a little bit the S and G.
What we thought we'd do is start talking about governance. You know, we continue to be a leader in governance, and it starts with our diverse board of directors, largely independent and coming from exceptional backgrounds, very, very accomplished industry leaders and experts in sustainability, mergers and acquisitions, risk assurance, risk management, security, and importantly, foreign affairs as we become even more and more global. We believe that strong governance helps us drive and protect shareholder value. While these high standards of business conduct are modeled from the top, we also require on an annual basis that each employee take ethics and cybersecurity training.
One thing that I think is a differentiator for us is that we recently achieved the ISO 27001 certification for information security, which is the globally recognized gold standard for cybersecurity. We think that with the growing importance of cybersecurity, a lot of our clients and our partners are preparing to implement that certification. This really is a differentiator for us. We still believe that sustainability is woven through the fabric of our company, from our board to the C-suite, through the talented professionals who we have delivering these solutions to our clients every day. We have a board-level sustainability and safety committee that has ultimate oversight for our ESG commitments and our performance.
We have underneath that an executive ESG committee with three members of our C-suite on it, chaired by Theresa. This committee is accountable for our sustainability performance. It communicates our ESG knowledge, performance, and initiatives back and forth to the board. Finally, our Vice President of Sustainability, Carrie Sabin, takes that information and coordinates with our functional services teams, our operational groups, and they monitor the performance. I think what's important is you can see from the board to the C-suite, all the way through our operations, you know, ESG is really top of mind. We do have. We're often asked about do we have scorecard metrics that impact executive comp, and we do. We have scorecard metrics on inclusion and diversity, employee retention, health and safety, and quality.
My scorecard also includes measurement to our carbon commitments. On the social side, you know, we're committed to continuing and expanding our social leadership and long-term support for the Black, Indigenous, and people of color communities around the world. We've been engaged with for many years with organizations that further the interests of these communities through our community investment fund. We've committed to donating over CAD 15 million over the next five years from a community engagement perspective. To ensure that we're making a long-term impact, we've engaged with our internal inclusion and diversity councils to develop the right areas of support to make sure that we're targeting our funding in the right area. We're focused on gender equality through our organization and ensuring we're providing an engaging and rewarding workplace.
As a result, as you can see on the slide here, Stantec's included in the Bloomberg Gender-Equality Index, the Jantzi Social Index, and we've been named a Best Employer for Women in Diversity by Forbes. Our most really important contribution to sustainability is in the area of the work that we do for our clients. Our employees, our innovation office, and, you know, we're evolving and we're leveraging new technologies all the time to solve some of the most intractable problems that we're finding our clients are encountering when it comes to the environment and emissions and contamination and so on. What we've done to track our contributions to sustainability, we've begun reporting our revenue on work that supports the UN Sustainable Development Goals or the SDGs.
We're the first company in our space to do this, and we're glad that other companies are beginning to follow suit. In 2020, this work accounted for more than 49% of our overall gross revenue. We expect our contributions to these each SDGs to fluctuate year- on- year based on the type of work that we're doing, but overall, we expect this percentage is gonna continue as it moves forward. We all often get asked by the investment community and our clients, you know, which SDGs are we prioritizing for growing our revenue? In fact, you know, we like to kind of flip that because it's not really our clients. It's not really us that are driving where we're going from an SDG perspective.
It's our clients, the type of work that they ask us to do. A recent example of this is with Hurricane Ida. You know, it not only validated the pump station, the levee design, the flooding work that we did around New Orleans in the previous, but it also resulted in immediate discussions with some of the neighboring parishes in Louisiana about the type of work that we could do for them. You know, the Metropolitan Transportation Authority in New York called us about how we can support them to fortify their subway system against future flooding and so on. It's really not us deciding what SDGs we wanna focus on. It's the type of work that we're doing for our clients that sort of you know focuses that discussion.
Then, of course, I'd be remiss if I didn't touch on the acquisition of Cardno that we announced last week. You know, we see that as the world and our clients continue to respond to climate change and environmental concerns, like, our environmental services backlog grew to the mid-20% range all the way to the end of Q2. Expanding that, our footprint of service offering is so important in order to continue to grow that revenue there. The 1,100 people that are gonna join us in the U.S. from an environmental services perspective from Cardno, you know, it will add to our ES presence by about 60% and doubles it where we were from five years ago.
You know, while we already occupy a leadership position related to ecosystem restoration, Cardno also brings in a complementary offering through their native seed banks, and they actually own a plant nursery, that's really gonna be a differentiator for us as we continue to grow in that area. With that, Michael, a very, very quick high-level overview. I'll turn things over to you for the Q&A session.
Okay. No, that's great. That's a great overview, Gord, just to get things going. Maybe before we dig further into some of the specifics of your sustainability and ESG-related initiatives, you did touch on this in your prepared remarks, but the Stantec sustainability governance structure, can you talk a little bit more about how the various groups that are part of that structure work together? And then I believe you also have recently looked at establishing or have established a climate change and social value forums at down at the country level. So if you can talk a little bit more about that'd be helpful just before we kind of get into some of the specifics of the initiatives.
Yeah. In terms of the different groups that we have working together, you know, we talk about our board level sustainability and safety committee. We've got our C-suite committee that Theresa actually chairs, and then finally down to the operations level. What we find is it's really a two-way dialogue, both sort of up the chain and down the chain. You know, as we've been working with Carrie Sabin and our various groups, you know, we wanted to come out with a carbon neutrality commitment. We wanted to come out with a net zero commitment, and that was driven from discussions that we had at the board level. We passed that down to the working levels to say, "What can we do?
When can we realistically achieve these timelines by? You know, the groups did a bit of a bunch of work and came back and said, "We can achieve carbon neutrality for the 2022 year. We can achieve, we believe, net zero by 2030." We took that back up to the board, presented that with the budget implications of doing so, certainly got their buy-in. With that, we kind of passed it back down the group. It's really sort of this two-way ground up, but also top-down dialogue that we have. It's very open dialogue.
In fact, at our board meetings next week, Carrie Sabin, who is our VP of sustainability, will come and talk to the board about how we're achieving our objectives year to date, what we're thinking about for next year, how we're gonna continue to evolve our sustainability, our plan that we publish every year as well. Really good dialogue there. A couple other things that you talked about, and one was our climate change initiative that we've rolled out. Really what that was is we've had in each of our groups individually, whether it's Water or Environmental Services or the energy transition group and our Power group all working on climate work in.
We just wanted to bring it all together and really get people to really fully understand all the offerings from the different groups to improve our ability to cross-sell and offer more services to our clients. That's been a very, very strong initiative for us. We've rolled that out over the last couple of months. In fact, even at our board meetings next week, Bob Seeger, who leads our Environmental Services group, is gonna come and share sort of the outcome of that with the board. Very, very strong. You had talked about our inclusion and diversity councils from a global perspective. We've always been very, very strong in North America with our employee resource groups.
We have an I&D council at the country level in both Canada and the United States. This year, we really rolled that out and formalized it from a global perspective. You're right, each of our countries have an I&D council rolls up to our global lead, Cath Schefer, who's our global Chief Operating Officer. What we've done there too is the employee resource groups in each of those countries are fully integrated with our North American groups as well. Our employee resource groups, just for folks who might not be familiar with them, these are ground level groups who are driven by people who self-identify as Pride at Stantec, Women at Stantec, Latinos at Stantec, Military Veterans at Stantec. They self-identify as a group.
They come together to discuss common concerns or common issues that they might have. These aren't run from a corporate perspective because we don't want them to be top-down driven, but they come up and they report up to us as to what sort of issues they have. You know, as an example, as we're talking about how can we engage more with the Latino community from a recruitment perspective, we went to our Latinos at Stantec committee, which is primarily driven in the United States, and they came up with ideas for us to engage with, you know, SHPE. It's the Society of Hispanic Professional Engineers and other groups like that in terms of, you know, starting that two-way dialogue to improve our exposure to those groups.
I think just from all those things, really what we're trying to hopefully convey to you and the people who are participating that, you know, sustainability, this I&D, all of these things are. It's not a board level commitment, it's not a ground level, but there is full engagement and commitment throughout the organization to these initiatives.
Okay. No, that's really helpful, Gord. It makes a lot of sense. I guess if we go back to one of the things you mentioned in your opening remarks, just the percentage of Stantec's revenues that are aligned with UN Sustainable Development Goals, very impressive, 49% of your 2020 growth revenues are aligned. You mentioned that it's not ultimately Stantec that controls which UN SDGs you're aligned with or what percentage of revenue is connected to those SDGs. I guess what I'm wondering though is can you speak to which of those UN SDGs seem to be growing the fastest? You don't control it, but where are you seeing growth in particular SDGs?
Do you have a sense for based on those growth rates, where this percentage of your gross revenues that is aligned, where that could go to over the next several years?
Yeah. No, no. Great questions. Thank you. You know, we're committed to continuing to grow our business on the water, from a water perspective, environmental perspective, the energy transition and so on. As we continue to work with our clients to grow that group, there is a certain number of the UN SDGs that it naturally aligns with. For example, you know, SDG 6 is related to clean water, so that would be all of our work in water and wastewater and sanitation. SDG 7 relates to affordable and clean energy, so that would be our energy transition, solar, biomass, pump storage and so on. SDG 9 relates to industry, innovation and infrastructure. Certainly infrastructure being all of those things being something we're heavily involved with.
SDG 11 is sustainable cities and communities, so that would be a lot to do with our urban places initiative. The densification of the urban cores and so on. SDG 13 is Climate Action, 14 is Life Below Water. You know, SDG 15, Life on Land, is one that we're also very engaged in. Those would be the ones that we find that the work that we do naturally aligns with. In terms of where this could ultimately take us, you know, it, that's hard to say. I wouldn't want to throw out a number at this point. You know, we will continue to evaluate on an annual basis. We do believe that that number will continue to evolve.
You know, we do think there'll be other groups that comes out, you know, SASB and these different EU Taxonomies that are gonna come out. Where this all actually settles in the end with the standard remains to be seen. Certainly we wanted to get out ahead of it and just let people know sort of where we fit in with the competitive set.
Okay. No, that's very helpful. We probably don't have time today to go through all of the various sustainability and ESG initiatives that Stantec's pursuing simply because there are quite a few. You did touch specifically on a number of them in your opening remarks. I'm wondering if we can dig a little bit further into a couple of these. Perhaps starting with your emissions target and the aim to achieve net zero by 2030. Can you speak a little bit to the strategy for getting you there? What is it you are doing and how do you see that unfolding?
All right. Absolutely. We see the transition to net zero as being really a three-step process. First step one that we're working on now is to reduce our emissions as much as possible across really all of our scopes. We're looking at everything from reducing travel to, you know, rental cars and all, you know, all the sort of things that we typically do. Then secondly, as we move towards becoming carbon neutral for 2020, we're looking at, for the emissions that we can't reduce, we're looking to purchase renewable energy certificates and certified carbon offsets to do that. I think a couple things are very important is that for us, we're looking at certified carbon offsets. You know, there's a number of different ways.
You can purchase these carbon offsets in different ways. Certainly, one way you can get them, the least expensive ones that you can find on the market. What we're trying to do, to the best degree that we can, is to purchase these certified offsets to offset emissions in-country. If we wanna reduce emissions in the U.K., we're gonna be looking for certified offsets in the U.K. If we're gonna, you know, and so on. I think that's a differentiator for something that we're trying to do versus what we've seen some of our others try to do. It's a little bit more expensive, but we think it's sort of the right thing to do.
Third, in order to achieve that net zero by 2030, we're looking to reduce that compensation that we're doing through purchase of offsets and sort of with additionality. We're working with our innovation groups and our subject matter experts that, you know, find ways that we can produce new renewable energy sources and sequester carbon and these sorts of things in addition to, you know, what we've done to get us to carbon neutral. So it's a long ways to go, absolutely. It's gonna be hard work to get to carbon neutral by the end of, for 2022.
I think, you know, achieving net zero, not just us, but the industry in general, there's a lot of heavy work to do between now and our commitment to 2030.
For sure. Certainly ambitious targets, but that makes a lot of sense. I guess just one follow-up on that. I mean, obviously you only came out with these targets earlier this year, so you know, it's still fairly early in the process, and you obviously are striving for carbon neutral in 2022. I guess that's sort of the first milestone. When investors look at your initiative to be net zero by 2030, how do you see sort of keeping the market apprised of the developments and the progress you're making? Are there any milestones along the path to that net zero in 2030 that we should be looking for over the next several years?
Yeah. You know, in the short term, what we've done is, it's actually in our executive scorecard to make those clear progress towards hitting our carbon neutral for 2022. One of the things that we're looking to develop through 2022 is that sort of milestone check-ins along the way, so that we don't go between 2022 and 2030 and say, "You know, don't worry, we're gonna get there." What can those check-ins be along the way? You know, I hope that we'll be in the position as we and the overall industry evolves, to talk more about that probably in 2022.
Okay. Well, fair enough. Maybe switching gears, I think it was on one of the slides that you ran through, but just the subject of pay equity. Can you talk a little bit about the review that you undertook in 2020, including the findings and the action plan you're taking to move forward? I already know you know, the differential was not particularly great, so that's quite impressive and encouraging. Can you just talk a little bit more about those findings and then the plan going forward? Obviously happy to have Theresa get involved here as well at some point if that makes sense.
Yeah, completely. You're right, we did a pay equity study in 2020, and when we focused on sort of the median comp ratio from men and women in all of our different groups, and we found that we had about a 3% pay gap between men and women at that time. As you say, we were quite pleased with that. What we've done that we wanted to be proactive and intentional about closing that gap. We've had a lot of discussions with our leaders as we're working through annual, you know, our annual pay raise process and so on.
We've been very intentional about people, you know, making sure that they're being aware of, you know, we would often say that, you know, men are more likely to come forward and say, "I want a raise," you know, than women are. You know, consider these things. What we found, actually even in the years leading up to 2020, but even since then and what we're seeing so far this year, is the average rate of pay increase for women at Stantec exceeds that of men. Then, on a percentage basis, the number of women being promoted at Stantec exceeds that of men.
I think this, not only do we start from a good place with a 3% differential, but the intentionality and being proactive in the discussions is actually finding that the pay rate of women, again, is accelerating. I think that we're gonna be closing that gap even further in this year and subsequent.
Okay. I actually jumped ahead. I wanted to actually ask you maybe one or two other questions about your emissions targets. If you don't mind going back to that subject just for a moment, if that's okay. I guess one of the follow-ups I had for you on your emissions targets and the strategy there is your flexible workplace strategy, which I guess has come about as a result of the pandemic, and now there's some savings benefits to that for the company. I'm wondering, is that helping you achieve your emissions reductions targets in any way?
Yeah, absolutely. That's a key element in our emissions reduction strategy. What we have pledged to do is reduce our real estate footprint by 30%, from where it was at the start of 2021. So far, we're at about 16% reduction by the end of Q2. We're making really good progress on that. You know, the beauty of this flexible workplace strategy that we've put in place is that it isn't just good for our emissions, it's good for the bottom line. As you indicated, we expect a CAD 0.10 per share uplift in 2021 from this initiative. It's also really helpful from the perspective of employee engagement.
You know, I know we're not alone with employees that have determined that working from home is kind of a nice thing. Our employees, like everyone else, are expressing, you know, a desire to have more flexibility when things open up again on a more permanent basis. This strategy really achieves a number of objectives for us, including our emissions reduction target.
Okay, perfect. Just the last question I had regarding the emissions reduction targets and the strategy there. Looking through your most recent sustainability report, there's a part to it that includes an ESG materiality matrix, which I thought was interesting. There's a lot of good information I think that one can take from that matrix. I guess the one thing that I was a little bit curious about, I noticed that the emissions is one of the topics under the environmental category in that matrix, and it seems to be under a category that you call manage as opposed to an operational priority, yet there seems to be a lot of focus on emissions.
I was a little bit curious about the placement of that, under that manage category versus operational priority. Perhaps I'm just sort of misunderstanding a little bit what we should be taking from that matrix, but I'd like you to clarify if possible.
Yeah. I can certainly address that. You know, the materiality matrix is really designed to help us focus our efforts and priorities. Certainly as you know, we've been talking about emissions reduction from an operational perspective is very important to us. The reality is that we are a professional services company, so we don't generate a lot of emissions in the first place relative to other companies that might be manufacturers or have a heavy footprint around transport and that sort of thing. From that perspective, that's why it falls into that operational into that manage category, is that we're doing everything we can to manage.
From a priority standpoint, we can make a much bigger impact through the work that we do with our clients in helping them to reduce their emissions, and that's why the materiality matrix falls out the way that it does.
Okay, that makes sense. Can you talk a little bit about the extent to which management compensation at Stantec is linked to the achievement of your various ESG targets, and how that looks?
Yeah. No, absolutely. There are a number of components in our annual scorecard that are tied directly to the S and G. As an example, achieving our carbon commitments for carbon neutral for 2020 is directly on there. As we spoke about, you know, we will transition once we hit that goal to having something on the scorecard related to our net zero commitment. Inclusion and diversity is on our scorecard as well in terms of ensuring that we're, you know, continuing to drive that forward, in addition to employee engagement. Employee retention is on there, of course, referencing to the health of our overall organization.
You know, as we've talked about before, our employee retention, our voluntary turnover rates are always 2%-3% below industry average and continue to be so through the pandemic and as we come out. We have HSSE commitments there in terms of, you know, TRIR rates and so on. So very, very strong there. From a governance perspective, we also have quality metrics related to project reviews to maintain our ongoing ISO certification. You know, we hit on all of the E, the S, and the G in our executive compensation scorecard.
Okay. Thank you for that, Gord. We spoke earlier about the dialogue that occurs within the organization at all levels to, you know, to establish targets and come up with a strategy to meet those objectives and targets. I guess I'm wondering if you can talk a little bit about how you engage with your various stakeholders, whether these be investors or clients, perhaps, you know, communities that you do work in, to better understand what they'd like to see from Stantec, and how those engagements and discussions inform some of the strategies and targets that you come up with.
Yeah. Absolutely. Maybe starting, you know, with our employees. We, you know, we're always engaging with our employees through our strategic planning process, through town halls that we have with them, through individual conversations. Many of them just directly reach out to either Theresa or I or others on our C-suite to talk about these topics. You know, that would be related to, you know, the environment and the type of work that we're doing. Certainly, I get a lot of questions on the social side with regards to I&D and, you know, what more we can do to make a lasting long-term difference there.
We also, you know, engage with our clients, you know, and it's part of our formal client review process, where we're talking to them, not just about, you know, the things that we're doing in the community, whether it's getting, you know, engaging to improve the social fabric of the community through volunteerism or supporting food banks and homelessness shelters and things, but also how can we help them achieve their longer-term ESG goals. If we're talking about a new public library, you know, certainly let's talk about LEED certifications, let's talk about wellness, let's talk about natural light, let's talk about, you know, net zero. You know, these sorts of. We're always having these sorts of dialogues with them. Certainly shareholders.
I found it's been interesting that, you know, over the last five-eight years as I would travel through Europe and meet with our various shareholders there, a lot of discussion about ESG, certainly focused on water, you know, there over the last five-eight years, not so much in North America. We've really seen over the last couple of years that the North American investors have gotten much more interested in what we're doing, how we can contribute to ESG there. You know, we're always getting those discussions now from the shareholder community, where we really weren't two or three years ago.
I think the level of interest from shareholders has certainly increased, you know, really as evidenced by the fact that, you know, we're having this discussion today with our shareholders, where we wouldn't have five years ago.
No, fair enough. That's a great point. We did not, yeah, this is a fairly new thing to be having forums of this nature, you know, in the last several years here in North America, I think. Maybe just following up on that. When you do have discussions with your investors and your shareholders, what are some of the initiatives and targets that you put out that they are most focused on? I mean, there are. You do have a number, and they're all very important for different reasons, but are there some that seem to be a focus for your investors?
Yeah. We often get asked about the overall health of our organization. Employee engagement, employee retention. You know, certainly as a requirement to continue to grow and meet this sort of impending wave of additional infrastructure work that's coming, will you be able to service that? And how can you do that through your existing staff and you know, the health of that? Of course there, we're very strong because of our low voluntary turnover rates compared to overall industry. We also get asked about how the work that we do can support and strengthen the overall communities that we're doing work in from a social equality perspective. We do a lot of work in there.
We actually have a lady who's with us, who is our director of equity and project participation. That's something that we wouldn't have had five years ago either, but we're getting a lot of our clients are asking about that. If you're gonna put in a large infrastructure. An example of some work that we're doing right now in a Western U.S. city where, you know, we're putting in a subway, and the subway has a number of stops in different communities. Around the subway stop, you know, there'll be a lot of work for several years. How can we then increase the participation of underrepresented businesses in the area? Everything from catering trucks that come to, you know, to do that.
How can we employ at-risk youth to work with us on security, get them trained up to do project inspections and so on? Then, by and by, both of those make a long-term lasting impact on the community. Those are the sorts of things that we often get asked. Certainly we get asked about the more obvious ones, carbon commitments and so on. But I think more and more we're seeing people say, "Yes, you know, you've got a carbon neutral commitment. You've got a net zero commitment. That's good, and we expect that you'll achieve those. But now how can you help other things?" That's where we're talking about, you know, our contributions to I&D and our company, how can we help the communities that we serve?
Certainly from a governance perspective, how can we ensure that these things are actually occurring?
Okay. That's great information. Thank you. I'm curious to know when Stantec has you know already achieved quite a bit with respect to your sustainability rankings and tremendous accolades you know earlier this year ranked fifth most sustainable company in the world by Corporate Knights and I believe first in North America. Incredibly impressive strong credentials and some ambitious targets. I'm wondering how all of that is interpreted by your clients and the extent to which all of that is important as part of the decision-making process to award Stantec contracts and work. You know, are these achievements and accolades, do they make a difference as far as your ability to win and secure work?
You know, it's interesting. They very much do, Michael. It's interesting that this is the type of work that we've been doing for quite some time. We've for a long time been helping our clients, you know, as they're starting to think about their carbon targets, their ESG targets. Now with these accolades that we've got there, we have even more clients reaching out to us to ask how we can help them achieve their objectives. You know, some of the things that we spoke about just a moment ago about, you know, how can we improve the social fabric of your business through the subway project that we're running through, they hadn't even thought of that.
You know, it's just a lot of what we do is now able to help our clients. They're now hiring that person I mentioned, that director of project equity and so on. They're hiring us, paying for her to work on their projects to help them sort of as, you know, work through the overall chain. Those things are very, very strong and it actually is a new line of work that while we've already always supported our clients in it's now really a formal piece of work that we do. Sort of that virtuous circle. You do the work, you get the accolades, you get more client districts. You do more work, you get more accolades.
It's sort of that virtuous, positive cycle that we're enmeshed in right now.
Okay. That makes a lot of sense. I wanted to ask you about your energy and resources business. If we go back a number of years, this was a significant portion of your revenue. If I recall correctly, something on the order of about 30% sort of in the pre-2014 period. Now not all of that was oil and gas, but a significant portion of it was and also mining-related work. I know that part of the business has come down in terms of its relevance as a percentage of the total over time. I'm just wondering where you see that going over the next several years and how that fits into your thinking related to focusing on sustainability and some of the more environmental related ESG initiatives.
Absolutely. You're right. Pre-2014, our oil and gas group would have been almost 35% of our net revenue generation of the company. Now that group is 8.something%, you know. In our 2019 strategic plan, we had made the statement as well that we wanted to see our exposure to the commodities-driven markets, oil and gas, mining and so on to be less than 15%, 15% of our overall net revenue generation. We certainly are well within that band now. The type of work that we do, for example, to support our oil and gas clients is primarily midstream pipelining. First of all, our oil and gas work is primarily midstream pipelining.
We're doing a lot of environmental work there, where we're looking for route selection. We're doing environmental monitoring during construction. We're engaging with the communities and particularly First Nations communities along the way to get in and include community participation and leave that longer term lasting benefit. Also, though, it's interesting that the type of work that we're doing as we support our mining clients is increasingly moving towards things like selenium treatment at coal mining plants. We're removing the toxicity from the mine effluent. When we talked even last week about Cardno and some of the work that they do in the mining space is they have a particular specialty in mine closure.
A lot of the work that we're doing while it is for oil and gas and mining clients, again, much less than we were previously. It's to sort of reduce the environmental footprint of the work that these companies do and to assist in closure activities and that sort of thing. That's sort of how we see that transitioning over, you know, now and through the next several years.
Okay. Wanted to ask you about acquisitions, and the linkage between your pursuit of certain acquisitions, and your sustainability and ESG initiatives. Specifically, obviously acquisitions are a core part of Stantec's strategy. You recently just last week announced a significant transaction, which you mentioned earlier, that the Cardno asset that you're acquiring. I guess the question is, when you look at acquisitions, to what extent do you take ESG considerations into account? And how do you factor those considerations into your acquisition analysis?
You know, with all of our M&A activity, the very first thing that we look for is cultural fit. You know, as you think about the social governance sort of group, you know, the S and the G in particular, you know, we're looking for firms that have an engaged workforce, that are mature from an I&D perspective, that are really considering these sorts of activities. As we acquire a firm, like Cardno is a perfect example, you know, they meet our. You know, they have similar investment. Community investment. They have similar philosophies in terms of employee resource groups and so on. And so that's extremely important for us. Great, strong governance.
You know, the type of companies that we're looking to grow into also typically will support our continued growth in the environmental space. You know, we're looking for, as Cardno had, a strong environmental presence to grow our revenue generation there. We're looking at certainly, firms related to the water space to continue to grow in there. We're looking at firms in the building space where we can look at increasing our, you know, net zero and, you know, all these sorts of targets as well. The firms that we're looking to deploy capital are that water, transportation, public transit, environmental buildings type firm. You know, we've sort of
We've stated that we don't see ourselves deploying capital over the next couple of years to further increase our growth in oil and gas space and so on. I think, you know, as we look at growing that revenue, you know, we're considering the type of work these companies do. From a cultural perspective, we're considering, you know, how they'll support our social and our governance growth as well.
Okay. Clearly it sounds as though you've been taking into account some of these considerations, you know, all along. For example, cultural fit, that's always been important for Stantec, for example. I'm wondering if you've noticed a change in the targets that you look at, or that are out there in terms of how they're approaching sustainability and ESG related initiatives. You know, thinking about Cardno, that was a public company or is a public company. But some of the acquisition targets you're looking at are private companies, and so perhaps not as much in the spotlight as a public company would be.
I'm just wondering to what extent, you know, they are looking at some of these things as seriously as you are and some of your peers are, and if you've noticed a change over time in their focus in this area of sustainability and ESG.
You know, we absolutely have seen a change even on the private firms, particularly on the ones that are a little bit larger in size. You know, some of the smaller firms I think are still you know working through what does it mean to them. Certainly the type of companies that we're buying, like we mentioned at Paleo Solutions some time ago, you know, all their work is 100% driven by environmental work. They're you know archaeologists and paleontologists and so on. It was a company that was run by a lady.
I think that she never had thought about we should create an employee resource group for women at Paleo because it was a small firm of, you know, 65 people. Actually the type of the gender diversity of a company like that is actually hugely in favor of women, just because the type of work that they do. As we look at larger firms in the several hundred to 1,000 person range, even on the private side, ESG is something that they're more and more interested in. Many of them have developed programs. Others that we talked to are looking to build upon our programs should a transaction be successful.
Okay, maybe just one last follow-up on all of this. You know, perhaps part of the opportunity set that's available to Stantec from an acquisition perspective is obviously in part a function of the competitive environment and landscape, you know, others pursuing acquisitions as well. As some of these firms that you are looking at have maybe, you know, begin to take sustainability and ESG more seriously, you know, for lack of a better term, you know, has that expanded the sort of the opportunity set or the pipeline?
There may have been a firm that you once looked at or would have looked at, but, you know, didn't check all the boxes, but now some of these things are taking on greater importance and, you know, maybe they do check those boxes. Is that a thing?
Yeah, you know, it is. I also think that what's interesting is that it's making some firms that had perhaps thought about, well, why don't we go a private equity route, starting to think, well, maybe we should line up with a strategic like a Stantec, a strategic buyer like a Stantec. One of the reasons would be like if you're a firm and you really and you transact, you sell to private equity, you're basically gonna do the same thing tomorrow that you did today. You know, there's not a lot that private equity firm is gonna bring to you. In fact, they might even be thinking that you will be the platform for further growth.
Some of the firms that we've been talking to lately have said, "You know, we see the world is changing, and we wanna be part of that change." That's a benefit of coming to someone like Stantec with a strong ESG, you know, DNA. It's something that's actually been attractive to some of the firms that we've been talking to recently.
Okay. No, perfect. That's very interesting. We've been chatting for a while. I think we've covered a fair bit of ground. I'm just going to remind the attendees that are listening in today and watching, certainly if you do have any questions or a question, please feel free to use the chat feature. Be happy to ask it on your behalf anonymously. We have about sort of just under or just over 10 minutes left, and I do have a few other questions for you, but I wanna remind the attendees of that option. I'm not seeing anything yet, but happy to take any that come in.
I guess what I'd maybe move on to next is a question, and perhaps this is best directed to you, Theresa. We've seen some companies enter into a sustainability-linked financing facilities. I'm wondering if this is something that Stantec has considered or would consider, and your thoughts on that.
Yeah. I mean, it's a really great question. For us, you know, the short answer is absolutely. It is something we are beyond considering, we're actually working on, because it's a very strong belief of mine and of the broader organization that, you know, connecting our corporate finance strategy to our ESG performance is an opportunity for us. We are working on developing a sustainability-linked loan. It's primarily focused on two metrics, one that is emissions-based and one that has a social element to it. Stay tuned. We'll be talking about that a little bit more in the near future.
Perfect. I'm sure we could devote an entire discussion of this nature to that particular topic and the market and how it's evolved. Any sort of high-level thoughts on the options for sustainability-linked financing today versus several years ago to the extent that you were looking at them then?
Well, I think several years ago, it really wouldn't have been on the radar screens of many. The opportunity is really vast. I think what is great about this particular period of time that we're in is, you know, as more and more organizations look to create their SLLs, we're not yet in a space where you end up being pigeonholed as to, you know, here's the particular metrics that you must follow because everybody else is doing it. That's what we found, you know, that we had the opportunity to create bespoke metrics that weren't just because it's what everybody else is doing, they're metrics that matter to us and that are relevant to our business and resonate through our whole organization.
That, I think, is the nice place that we are today. When I talked about, you know, our two metrics, emissions reduction is very common. But for us, when we looked at, you know, what other metrics might be appropriate or relevant, this notion of selecting a metric that relates to our social targets, actually you'll find that there isn't anyone else yet that has a target like what we're creating. That's pretty exciting for us.
Okay. We'll stay tuned, and I look forward to hearing more about that. While we're talking, Theresa, I guess one other question for you. The question is about whether you can talk about your involvement with the UN Global Compact CFO Taskforce for the SDGs, which you are a part of. I guess maybe making a linkage back to the last question, I don't know if this is relevant at all, but you know, with sustainability-linked loans, is that something that taskforce is also working on?
Yeah. Very much so. To step back for a second. The CFO Task Force, it's a group of about 60 CFOs from around the world, represents more than $1.7 trillion in market cap of companies that are all signatories to the UN Global Compact. The Task Force is focused on creating that stronger link between corporate investment and sustainability and to mobilize investment dollars to support the SDGs in areas like sustainable infrastructure, renewable energy, water, health. Even from that description, you can hear how well that ties into Stantec's service offerings and our expertise.
The CFOs and the Task Force are committing to make pretty material investments over the next five- years toward the SDGs and to link close to half of all of our corporate financing to sustainability performance through the issuance of new sustainable finance instruments, as we've been talking about. I've been on the Task Force for the last couple of years. I think their goals are very important to achieve. When we talk about our SLL, we talk about our recent announcement on Cardno and deploying capital to acquire that, you know, really strengthens our environmental services offerings. These are all really great examples of the kinds of actions that the CFO Task Force is promoting.
Great. Thank you for that. I wanted to ask you a little bit about innovation. This is, as I understand it, a very important aspect of Stantec's overall strategy. I'm wondering if you can talk a little bit about how important, from your perspective, you know, innovation is to your strategy. You have something called the innovation office or Stantec's innovation office. I'm wondering if you can talk a little bit about that and whether there are any linkages to your focus on innovation, that innovation office, and some of the things you're doing with respect to sustainability.
Absolutely. We did it in December 2019 when we rolled out our new strategic plan. One of the key pillars that we had was innovation. We've had a creativity and innovation fund for well over a decade. What we wanted to do was formalize it, our innovation office. We set out to formalize innovation throughout the organization. We have a number of different programs, very strong for employee engagement. We have our annual innovation summit that we just had back here in September.
To qualify for that, people from around the world submit ideas that they're working on, things that can be innovative from the perspective of, you know, how we can support our clients in climate solutions, how we can increase employee engagement. There was four main tracks. From that we shortlisted to about 40 people, and they each gave like a 15-minute type of a TED Talk type of. We've just done that. Interestingly, you know, we have roughly 22,000 employees. We webcast these. We recorded them and webcast them. We had almost 10,000 unique hits on our people who. Almost half our company at some time or another through there, you know, dialed in to see what these folks are up to.
Very strong there. A lot of the ideas that come out of it are things that we're using to support our clients as they achieve their climate change initiatives, their ESG initiatives, but also Stantec. Not only do we see it as a competitive advantage because we've looked at it from a couple of perspectives, what can we do internally to improve our operations? Second stream is what can we do externally to support our clients? You know, we see it as a competitive advantage, strong from an employee engagement perspective, but also sort of supports our longer-term ESG goals.
Okay. That's helpful color. Thank you, Gord. Perhaps somewhat related to that, but also maybe a little bit different. You made an announcement earlier this year about a partnership with a group called or a firm called BlueSky Resources, and this was aimed at providing real-time tracking of air pollutants and GHG emissions. I'm just wondering, I mean, perhaps you can comment a little bit just on that particular announcement. But more broadly, should we be looking for Stantec to be, you know, looking at additional partnerships or alliances of this nature going forward?
Sure. Yeah, BlueSky is a startup. If, as part of you know a startup accelerator program that we have, we wanted to engage with them just to provide some support to help them get to the next level. Exactly right. BlueSky uses a variety of remote sensing tools to determine GHG and other component emissions from effluent or from everything from non-point source pollution to point sources like manufacturing facilities, landfills, and so on.
What we're able to do is working with some of these large clients that we're beginning to engage with, we can provide them a dashboard where they can see how their emissions are trending over time, where they might be in compliance with regulatory or their own internal goals. The beauty of it is not only do we have that line of work, but then if there are any things that are out of compliance, we can then roll it over to our groups who can help them get back into compliance. It's sort of a two-pronged approach there. You know, we are looking for other opportunities where we could invest with firms that might support our autonomous vehicle programs or support our overall climate change initiatives from other perspectives.
You know, that's something that as we find firms that meet our, not just our investment criteria, but our long-term, where we wanna take our company perspective, you know, I think you would see other announcements of us, you know, taking, you know, a stake in it and supporting these from an acceleration perspective.
Okay. That's interesting. Thank you. We are almost at the top of the hour. I think we've covered a lot of ground. I think you know, we'll probably wrap it up there, but what I'll do is turn it back to you, Gord, Theresa, for any final remarks or thoughts before we close it out.
Well, yeah, I just wanted really to thank you, Michael, and everyone for taking some time to meet with us today to talk about this topic. You know, it is something that, as we've said, it's something that we've done for decades. It's sort of in our DNA. We're just glad that more and more, you know, of our employees, of our clients, and certainly the investment community is taking more of an interest in it as well. It'll continue to push us and our industry overall forward. I think it's very, very positive and just thanks again for the opportunity.
Well, thank you for joining us and for sharing all the information you did. Again, you know, I think it came up at various points in the presentation, but in the discussion, you know, Stantec truly does appear to be a leader in this area, and again, tremendous accolades. Congratulations on all of that and the credentials, and certainly we look forward to following the progress in the years ahead.
Great. Thanks again.
Thank you.
Grateful. Thank you, everyone. Thank you.