Climate-Related Risks and Opportunities

We do not anticipate any significant benefits or opportunities from a changing climate. As ADP is not a manufacturer of physical goods, our GHG emissions are considerably less impactful than industries focused on the manufacture of such goods, where material environmental opportunities would be more prominent.

ADP reviews its identified climate related risks and opportunities that would have a material effect on the business. The criteria for determining materiality / priorities include: (1) the evaluation of likelihood and severity of the risk and opportunity based on the nature and size of the risk or opportunity, (2) scope of impact on stakeholder communities, including associates, clients, shareholders, local and global communities, which could be enough to damage company reputation or result in business losses, (3) investment required to implement changes and (4) potential financial and environmental return on investment. Business Resiliency plans are developed by ADP to avoid being impacted by such risks.

Relevant risk factors are disclosed in our annual 10-K filing with the Securities and Exchange Commission. Enterprise risks are identified and managed through a comprehensive Enterprise Risk Management (ERM) program. In addition, in our annual CDP Climate Change response, we provide further detail on the risk types considered in our climate-related risk assessments. We will continue to periodically review climate-related issues to assess their potential to have substantive financial or strategic impact on our business in the future.