- About Us
- Corporate Citizenship
- Corporate Sustainability
Corporate Sustainability Strategy and Governance
DistributionNOW's 3rd annual sustainability report, Focused on Sustainable Growth, outlines DNOW’s environmental, social and governance (ESG) strategy and reaffirms our commitment toward increased transparency and a wider focus on sustainability. We're constantly trying to improve employee engagement, diversity and inclusion, product sourcing and supply chain sustainability, workforce health and safety, and environmental performance.
For our 2021 report, we continue this vital journey this year by updating and expanding our commentary in Focused on Sustainable Growth. To find out more, download a copy of the report.

David Cherechinsky
President & CEO
Message from our President & CEO
2021 was a year of transition at DistributionNOW (“DNOW”) as the energy industry emerged from the COVID-induced demand destruction that began in 2020. As the market transformed, so too did DNOW. DNOW responded swiftly and resolutely to defend our bottom-line and lay the groundwork for prosperity in the future. We believe that the market has fundamentally changed, demanding decisive action to redefine our operating model to thrive in the new environment, and scale and optimize many of our locations and employee workforce in response. The highly talented and caring customer-focused women and men of DNOW have not only embraced this change but are the driving force behind this movement.
Our turnaround story was punctuated by improved earnings durability throughout 2021. The results of our decisions over the past two years are evident, not only in the improvement in our financial performance, but in the competence and enthusiasm of our team to provide the superior solutions our customers desire. To meet the challenge, we have been focused on transforming our business, with a relentless focus on serving as the connector or critical link between global manufacturers and our customers. DNOW is dedicated to providing the products and services our customers require in a moment of scarcity and pronounced supply chain uncertainties, as the market recovers. Based on the execution of our strategy, we delivered improved earnings power throughout the year and have positioned the company for future success.
Intertwined with our strategy are our sustainability objectives for the company, as we make progress in our data collection methodologies and expand disclosures to further support our evolving Environmental, Social and Governance (“ESG”) initiatives that align with the Sustainability Accounting Standards Board (“SASB”) reporting standards, Task force on Climate-Related Financial Disclosures (“TCFD”) framework, and United Nations Sustainable Development Goals (“UN SDGs”).
I’m excited to note that for the third year in a row, we have issued our Sustainability Report, Focused on Sustainable Growth, as we continue our commitment to update our report on an annual basis. I’m proud of the progress our team has been making, since our first report in 2019, in areas of employee engagement, diversity and inclusion, product sourcing and supply chain sustainability, workforce health and safety and environmental performance. As a responsible member of the global community, we also continue to make additional progress in providing a wide array of products that enable our customers to lower their environmental impact, specifically lowering their scope 1 greenhouse gas (“GHG”) emissions. To help support the energy transition movement, we are supplying products for a number of biofuels projects as our customers move their refining and petroleum distribution businesses forward in meeting the new renewable fuels standards. Lastly, we are also working with customers to offer products and solutions to support and enable their decarbonization journeys with the development of multiple Carbon Capture, Utilization and Storage (“CCUS”) projects in various points within the front-end engineering and design stages.
Our focus on technology to provide digital solutions to our customers and strategic transactions focused on sustainable growth are integrated with our ESG topics included in this Report. Our 2021 report builds upon our commitment toward increased transparency and a wider focus on sustainability to create a positive impact and reaffirm our focus on sustainable growth. It allows us to share our key performance data with our stakeholders as an integral part of our business strategy.
Our Company
As a leading global supplier of energy and industrial solutions, products, and engineered equipment packages, DNOW provides thousands of products to energy and industrial markets worldwide. Our DigitalNOW® platform allows customers to leverage world-class technologies across a suite of digital channels and solutions, eCommerce, materials management, and cloud-based mobile applications to solve complex operational and supply chain challenges. We are transforming distribution through reliable, comprehensive solutions that mitigate risk and create unmatched convenience for our customers.
Our Sustainability Strategy
At DNOW, we seek to drive sustainability throughout our business to deliver long-term, profitable growth to our shareholders while helping to fulfill the news of our customers as we innovate, develop and uncover more sustainable ways to operate. We endeavor to create positive change globally and in our local communities by minimizing waste and pollution, supporting organizations with aligned sustainability goals, and maintaining fair and honest business policies. We are committed to working to minimize our environmental impact on the environment through energy management conservation initiatives, air quality improvements, responsible water conservation and recycling, where applicable. We are committed to delivering the products and services that our customers demand as they focus on sustainable growth and navigate the energy transition. We also invest in our employees, our communities and the industries in which we operate.
We have created a strategy to create value for all of our stakeholders through our focus on sustainable growth by combining our geographical footprint, highly skilled employees, strategic inventory positioning, relationships with key domestic and international manufacturers and product expertise with disruptive digital innovation. This powerful combination can drive performance, growth and sustainable margins. We believe this strategy is a solid foundation for long-term financial and operational results.
Unlocking Value in Energy Transition
DNOW is committed to supporting efforts to minimize environmental impact and control the emission of methane and CO2 GHGs in our operations. We utilize our catalog of low-emissions products and custom production equipment packages to help our customers monitor and reduce their carbon footprint and meet their scope 1 GHG emissions targets.
Energy Management
- Hydrogen - high grade steel pipe certified to ASME B31.12, low-emissions (“Low-E”) valves and gaskets, pumps, compressors and fabricated pressure vessels
- Renewable Fuels - carbon and stainless steel pipe, fire-safe valves, process pumps, personal protective equipment (“PPE”) and turnaround support
- CCUS - CO2 pipelines, Low-E valves and gaskets, vapor recovery units (“VRUs”), centrifugal pumps, compressors and wellhead injection equipment
Carbon Management & Decarbonization
DNOW helps customers reduce their Scope 1 emissions by supplying a variety of products from reputable top tier suppliers. Examples of products include:
- Instrument air compressor skids that replace gas pneumatic systems
- Low emission products that reduce fugitive emissions
DNOW further helps reduce customer GHG emissions by sourcing products manufactured by low emission manufacturing technology.
Our Sustainability Reporting Framework
In support of our ESG efforts, we align and engage with leading sustainability organizations and industry peers, like the Task Force on Climate-Related Financial Disclosures (TCFD) and the Sustainability Accounting Standards Board (SASB) to remain actively involved in discussions aimed at advancing our sustainability impact and to increase our ESG awareness and enhance our reporting and protocols.

Corporate Governance Oversight
Strong corporate governance includes being responsive to the shareholders and other stakeholders of our company. We are accessible and willing to engage with our shareholders to discuss operational, financial, governance, environmental, safety and social issues. Maintaining shareholder trust and goodwill through our policies and performance and adhering to our values remain primary objectives of our company.
DNOW’s Board of Directors and management recognize their responsibility and are committed to high standards of ethical conduct and corporate governance. Our Board’s core responsibilities are to foster our company’s long-term success, to oversee the business, supervise management and to act honestly, in good faith and in the best interests of our shareholders. In addition, our Board has oversight of certain categories of risk management, including risks related to climate change and other ESG-related matters.
In furtherance of carrying out these duties, our Board of Directors has appointed the following committees to assist in fulfilling its oversight responsibilities: the Audit Committee, the Environmental, Social, Governance and Nominating Committee and the Compensation Committee. The Environmental, Social, Governance, and Nominating Committee was restructured in 2021 to give more oversight at the board level to the Company’s ESG initiatives including (1) providing assistance and oversight on future sustainability reports; (2) overseeing and working with management on ESG risk assessment and managing and mitigating these risks, including risks related to climate change and other ESG-related matters; and (3) overseeing and working with management to determine future areas of opportunities, goal setting and expansion in its ESG initiatives.
Management-Led ESG Committee
We formed an ESG Committee in 2019 to oversee the identification, measurement and disclosure of sustainability performance data most relevant to our operations. This committee is comprised of representatives from various departments across our company and is overseen by members of our executive management team. Meeting at least quarterly, this group facilitates collaboration across divisions and departments to increase understanding of consistent issues.
With the oversight of the Environmental, Social, Governance and Nominating Committee of the Board of Directors, our employee-led ESG Committee ensures that the relevant sustainability metrics and disclosures align with our strategic plan and that the results are communicated to stakeholders. The ESG Committee coordinates with Internal Audit under the oversight of the Audit Committee of the Board of Directors to conduct risk assessments related to certain key sustainability metrics and disclosures. Once issues are identified, the ESG Committee leads the effort in ensuring opportunities can be exploited or risks can be minimized in determining how performance will be monitored.
Management of the Legal & Regulatory Environment
Our customers are being impacted by the shift towards a low-carbon energy transition economy. This shift has the potential to impact our business from many directions, including the demand to diversify the energy supply with renewable energy and the increased expectation of cleaner burning energy sources. We are also affected by changes in public policy, geopolitical tensions, and environmental, health and safety laws. These laws, together with regulations and permitting requirements, influence the products and solutions our customers demand.
The legal and regulatory landscape is ever changing, and there is increased focus on greenhouse gases and emissions standards. While it is impossible to accurately predict the effect that changes in laws and regulations (or their interpretation or enforcement) may have on us, we approach business opportunities and risks in a highly disciplined manner. Change in political controls, both domestic and internationally, have the potential to impact our business with the potential for reduced emission targets and global climate change regulations on the oil and gas industry. Should environmental laws and regulations become more stringent, our associated costs or the costs for our customers could increase. Our Board and senior management, in tandem with our Internal Audit department, Legal department, Compliance department, Finance/Accounting department and Information Technology department, stay up to date on the evolving legal and regulatory landscapes. Risks including financial, market, political, climate, regulatory, compliance, operational, cybersecurity safety and reputational, among others, that inherently may affect our business are evaluated and addressed through strategic planning by various stakeholders within the organization.
Business Ethics & Payments Transparency
Our Code of Business Conduct and Ethical Standards enhances our relationships with key stakeholders, including our people, customers, suppliers, other business partners, shareholders and local communities around the world. Our Anti-Corruption & Anti-Bribery Policy includes measures, controls and guidance to identify and assess risks, applicable laws and reported concerns. DNOW strictly prohibits bribery, including offering, promising, giving or accepting any financial or other advantage to any person, intending that person to improperly perform a function or activity. We have implemented internal controls to monitor and track any issues related to corruption and bribery.
Supply Chain Stewardship
At DNOW, we work with thousands of best-in-class suppliers spanning over 40 countries to make hundreds of thousands of SKUs available to our customers located in approximately 80 countries. Our commitment to ensuring our supply chain operates responsibly and sustainably is pervasive throughout the supply chain. From the high standards in our supplier selection and onboarding process to our environmentally-conscious distribution and fulfillment process, we are committed to sourcing the highest quality products and services to best help our customers execute their strategies and achieve their ESG goals.
Sourcing Responsibly and Sustainably
Our commitment to quality starts with our supplier selection and onboarding process, which holds our business partners to the same high standards we have. Through our Triple Impact Supplier Management Program (“TISMP”), we actively manage our supply chain to maximize the quality of products and services procured and ensure our suppliers share our values.
Our program starts with qualifying suppliers for our Approved Suppliers List (“ASL”), which provides powerful benefits to our customers. We conduct a thorough assessment to only admit companies in market-share-leading positions that are highly regarded with strong reputations for high quality products and services and compliance with health, safety and environmental business practices. Only once a supplier is part of our ASL, and have withstood our continuous evaluation process, do we regularly stock their prequalified products and offer their services to ensure the highest quality and reliability for our customers.
Our IMPACT quality goals:
Increase employee capabilitiesMaintain accurate inventory
Provide quality products and services
Always deliver on-time
Continually improve
Total customer satisfaction

Supplier Code of Conduct
Doing business with suppliers who share our values and commitment to doing the right thing is important to us at DNOW. During 2021, we began to outline a Supplier Code of Conduct in an effort to more fully and formally document what we expect from our suppliers. Our Supplier Code of Conduct is aimed at ensuring our business partners commit contractually to upholding the foundational aspects of the International Bill of Human Rights, The International Labor Organization’s Declaration on Fundamental Principles and Rights at Work, the Organization for Economic Co-operation and Development’s Guidelines for Multinational Enterprises, the United Nations (“UN”) Guiding Principles on Business and Human Rights and the Ten Principles of the UN Global Compact.
In 2022, the Supplier Code of Conduct was approved for distribution and roll-out to our suppliers. Implementing our Supplier Code of Conduct identifies the requirements we carry down to manufacturers in order to build cohesiveness in the supply chain to best service our end users.
We are proud to work with thousands of best-in-class suppliers to stock quality, trade-compliant and responsibly traded products.


Workforce Health & Safety
At DNOW, safety is at the center of our actions. Our safety culture is driven through our health, safety and environment (“HSE”) management system, which consists of our HSE Policy Statement, HSE guiding principles, corporate policies and procedures and our business level HSE policies and procedures.
Our HSE Policy Statement sets the tone for our organization and outlines our HSE expectations for all employees, vendors, customers, contractors, subcontractors and third parties. Our 17 HSE Guiding Principles provide a framework for our HSE management system and contribute to a culture of safety. They describe the minimum corporate requirements, as well as how we intend to comply with client and regulatory expectations.
Employee Engagement & Development
At DNOW, we place a strong emphasis on employee growth and development, and provide opportunities for valued contribution and innovation. We know that every person on the DNOW team plays a part in delivering excellence to our customers and helping us execute on our commitment to be our industry's preferred supplier. In order to deliver on this commitment, we provide our employees with opportunities for growth through a variety of training and development programs.
As part of their career development and advancement, employees are encouraged to participate in annual performance reviews to seek feedback and opportunities for growth. Each year, we survey all our employees to assess employee engagement. This survey, conducted by a third party, is a way for our leadership to measure, understand and improve employee engagement. Due to the impacts of the COVID-19 pandemic, our employee survey was postponed to February 2021, with approximately 81% of our employees providing responses to the survey.
Workforce Diversity & Inclusion
We value the individual differences of our employees, which include but are not limited to age, color, ethnicity, family and marital status, gender identity and expression, national origin, physical and mental abilities, political affiliation, race, religion, sexual orientation, socio-economic status, veteran status, and other characteristics. While we have long been committed to advancing a diverse, equitable and inclusive (“DEI”) culture where all employees feel welcomed, valued, appreciated, and respected, we recognize that we have room to improve. Our DEI Mission commits to creating an inclusive environment and managing workplace equity and fairness where our differences drive innovative solutions to power the world for a sustainable future.
We CARE.
Create an inclusive environment by engaging diverse talent and influencing recruitment, development, advancement and retention
Articulate our DEI progress through proactive communications
Refine workplace equity and equality
Engage employees in DEI through education and awareness with an emphasis on a greater sense of belonging at DNOW
Community Involvement
DNOW strives to build strong relationships with our neighbors and to make positive and tangible contributions to the communities where we operate. Our company and our employees regularly support a variety of organizations through the donation of time and talent, as well as through financial contributions, to cultivate strong connections to the communities we serve while also strengthening coworker relationships.
Although the global pandemic restricted many volunteer opportunities and charity events, DNOW employees have been able to continue service in our communities with appropriate safety measures in place. For example, in October 2021, we hosted our annual Charity Golf Tournament benefiting The Boys and Girls Club of Greater Houston and The American Cancer Society, which enabled us to donate over $60,000 to these charities. As more organizations begin to allow in-person volunteering, we are planning to increase our in-person volunteer efforts.
Data Security

At DNOW, we recognize the performance of information systems is critical to the successful operation of our business. We depend on our information management systems to process orders, track credit risk, manage inventory and monitor accounts receivable collections. Our information systems also allow us to efficiently purchase products from our vendors and ship products to our customers on a timely basis, maintain cost-effective operations and provide superior service to our customers.
In order to reduce information system vulnerability and protect critical data, we continuously evaluate security risks utilizing knowledge assembled from a variety of sources, including in-house experience, data security law enforcement task force notifications and information technology consultants. Our team of information technology specialists collaborate on risk assessment and mitigation, policies and controls implementation and data incident response preparedness. We have procedures in place to address threats to our information systems and to report any security incidents. DNOW did not experience a reportable data breach in 2021, 2020 or 2019.

DNOW is committed to being a responsible steward of the environment.
DNOW is committed towards responsible environmental stewardship, we have released DNOW’s Environmental Policy Statement which outlines our commitment to work towards minimizing our impact on the environment through energy management, conservation initiatives, responsible water conservation and recycling, where applicable.
We categorizes climate change risks into three categories:
- Transitional Risks
- Physical Risks
- Regulatory Risks
To mitigate transitional risks, DNOW brings products to the market that address customers' needs to reduce their environmental impact. The company is also taking advantage of market growth opportunities in the transition to a lower-carbon economy by providing its solutions to the renewable energy and other emerging markets.
Delivering Sustainable Growth for Our Customers
At DNOW, we understand the needs of our customers and provide a diverse portfolio of products and services that meet those needs. This includes products and services to help reduce environmental impact, mitigate GHG emissions and enable sustainable water management processes. We also have deep expertise in digital channels and solutions, which we are applying to new markets such as the renewable energy market.
Delivering Sustainable Solutions
We sell products that help reduce our customers' environmental impact, and we assemble and fabricate process, production and measurement equipment to measure, detect, prevent and minimize leaks and emissions of hydrocarbons. We increasingly offer products produced in sustainable ways to limit our customers' carbon footprint, including through the use of wind power, recycled water and wood pellet inputs.
DigitalNOW® Initiatives

We are continuously expanding our digital suite of products to increase value for our customers. Our solutions include outsourcing portions or entire functions of our customers’ procurement, inventory and warehouse management, logistics, point of issue technology, project management and business process and performance metrics reporting. Through our growing DigitalNOW® platform, customers can leverage world-class technology across eCommerce, data management and supply chain optimization applications to solve a wide array of complex operational and product sourcing challenges to assist in maximizing their return on assets and sustainability initiatives. We continue to work with our digitally-integrated customers to further enhance their eCommerce experience by optimizing their product catalogs and developing customized workflow solutions through our shop.dnow.com platform.
Delivering Solutions to Manage Water Use
We provide products that customers need for sustainable water management processes, including produced water transfer, recycle, disposal and reservoir injection packages that responsibly dispose of produced water in permitted areas. We help production and midstream customers maximize the use of fresh and produced water efficiently, including reuse in well stimulation operations. Our product lines can help clean, transfer, dispose of or reuse water brought to or produced in the field.
Delivering Solutions for Energy Transition
We have a strong record serving customers throughout the energy value chain. In addressing our climate change transition risks, we are developing a strategy to expand our preferred supplier status to companies within the rapidly growing focus on energy transition.
Our customers are increasingly investing in technology and projects that seek to reduce the emission of greenhouse gases to the atmosphere. This includes, but is not limited to, capturing and reducing methane emissions, reducing or eliminating the flaring of natural gas and VOCs and capturing CO2 emitted from a variety of industrial processes.
Delivering Solutions to Renewable Energy Markets
We currently provide products into global renewable energy markets including biofuels, wind, solar and geothermal. Our products include electrical, PPE, lubricants, PVF, pump packages and rotating equipment. We provide vendor managed inventory (VMI) services to customers in Canada and support offshore wind farm development with key product offerings.
DNOW Environmental Performance & Supply Chain Sustainability
Our global business is comprised of a network of strategic locations close to our customers’ operations. Our branches and distribution and fulfillment centers ensure our customers obtain access to products and obtain service and support in a manner that efficiently supports their operations.
We are committed to sustainable growth and supply chain stewardship as we continue to modernize our fulfillment model, including further executing our hub-and-spoke distribution centers in response to changing market cycles. We are optimizing our network by standing up regionally-located distribution Supercenters and orbiting branches to regionalize fulfillment and drive efficiencies to deepen intimacy and access to our customers and work towards a more sustainable future.

About This Report
The information included in this report is subject to DNOW’s policies and requirements surrounding the disclosure of financial and non-financial data. The financial information included in this report was sourced from our Form 10-K filed with the SEC on February 17, 2022. All non-financial data included in this report was not subject to a third-party audit verification process.

Forward-Looking Statements
Certain information contained in this Sustainability Report may constitute forward-looking statements within the meaning of applicable securities laws, including, but not limited to, statements regarding our plans to: move forward with identified climate change opportunities, foster programs regarding diversity and inclusion and plans to seek opportunities to further integrate sustainability factors into investment decisions. Readers are cautioned not to place undue reliance on forward-looking statements, as they are subject to a number of assumptions and known and unknown risks and uncertainties that may cause the actual results, performance or achievements of DNOW to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements contained herein are made as of the date of this document. We also describe risks and uncertainties in our reports filed with the SEC, including our Form 10-K for the year-ended December 31, 2021 (under the headings “Risk Factors” and “Information Regarding Forward- Looking Statements” and elsewhere) and our subsequent reports, which are available through the SEC’s EDGAR system at www. sec.gov, and on our website at dnow.com. DNOW assumes no obligation to update or otherwise revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
SASB Index
The SASB framework aims to provide a standard for companies to disclose financially-material and decision-useful ESG information to investors and other stakeholders. The index below maps our performance under each of the suggested disclosure topics for the following two industries:
- Oil & Gas Services (Code EM-SV)
- Multiline and Speciality Retailers & Distributors (Code CG-MR)
According to SASB’s Sustainable Industry Classification System (SICS®), these two industry standards most accurately reflect our business operations. Other topics disclosed throughout this report beyond the scope of these standards are not reflected in this index.
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
Greenhouse Gas Emissions | |||||
EM-SV-110a.1 | Total fuel consumed | Gigajoules (GJ) | 248,228 | 286,930 | 441,477 |
Metric tons carbon dioxide equivalent (MT CO2e) | 16,623 | 20,444 | 29,253 | ||
Percentage renewable | Percentage (%) | 0% | 0% | 0% | |
Percentage used in on-road equipment and vehicles | Percentage (%) | 99.8% | 99.7% | 100% | |
Percentage used in off-road equipment | Percentage (%) | 0.2% | 0.3% | 0% | |
EM-SV-110a.2 | Discussion of strategy or plans to address air emissions-related risks, opportunities, and impacts | n/a | Pages 38-47 | See 2020 Report | See 2019 Report |
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
Greenhouse Gas Emissions | |||||
CG-MR-130a.1 |
Total electricity consumed |
Gigajoules (GJ) |
69,358 |
71,026 |
87,130 |
Metric tons carbon dioxide equivalent (MT CO2e) |
8,247 |
10,219 |
12,969 |
||
Total natural gas consumed |
Gigajoules (GJ) |
112,104 |
82,081 |
165,070 |
|
Metric tons carbon dioxide equivalent (MT CO2e) |
5,683 |
4,156 |
8,349 |
||
Total energy consumed |
Gigajoules (GJ) |
181,462 |
153,107 |
252,200 |
|
Percentage energy consumed that is grid electricity |
Percentage (%) |
38% |
46% |
35% |
|
Employee Health & Safety |
|||||
EM-SV-320a.1 |
Total recordable incident rate (TRIR) |
Rate |
0.92 |
0.91 |
1.51 |
Fatality rate |
Rate |
0 | 0 | 0 | |
Near miss frequency rate (NMFR) |
Rate |
not disclosed |
not disclosed |
not disclosed |
|
Total vehicle incident rate (TVIR) |
Rate |
0.61 |
0.59 |
1.08 |
|
Average hours of health, safety, and emergency response training for (a) full- time employees, (b) contract employees, and (c) short- service employees |
Hours |
Not available |
Not available |
Not available |
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
EM-SV-320a.2 | Description of management systems used to integrate a culture of safety throughout the value chain and project lifecycle | n/a | Pages 28-29 | See 2020 Report | See 2019 Report |
Data Security | |||||
CG-MR-230a.1 | Description of approach to identifying and addressing data security risks | n/a | Page 37 | See 2020 Report | See 2019 Report |
Number of data breaches | Number | 0 | 0 | 0 | |
Percentage involving personally identifiable information | Percentage (%) | 0% | 0% | 0% | |
CG-MR-230a.2 | Number of customers affected | Number | 0 | 0 | 0 |
Labor Practices | |||||
CG-MR-310a.3 | Total amount of monetary losses as a result of legal proceedings associated with labor law violations | Dollars ($) | See note 1 below | See note 1 below | See note 1 below |
Employee Engagement, Diversity & Inclusion | |||||
CG-MR-330a.1 | Percentage of gender and racial/ethnic group representation for (1) management and (2) all other employees | Percentage (%) | Pages 34 | See 2020 Report | See 2019 Report |
CG-MR-330a.2 | Total amount of monetary losses as a result of legal proceedings associated with employment discrimination | Dollars ($) | See note 1 below | See note 1 below | See note 1 below |
1Total monetary losses resulting from legal proceedings related to claims which contained allegations of employment discrimination or labor law violations for the year ending December 31, 2021 were less than $87K, or 0.03% of total warehousing, selling and administrative expenses.
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
Business Ethics | |||||
EM-SV-510a.1 | Amount of net revenue in countries that have the 20 lowest rankings in Transparency International’s Corruption Perception Index | Percentage (%) of Total Revenues | 0.15% | 0.07% | 0.19% |
EM-SV-510a.2 | Description of the management system for prevention of corruption and bribery throughout the value chain | n/a | Pages 22-23 | See 2020 Report | See 2019 Report |
Critical Incident Risk Management | |||||
EM-SV-540a.1 | Description of management systems used to identify and mitigate catastrophic and tail-end risks | n/a | Pages 16, 19 | See 2020 Report | See 2019 Report |
Product Design & Lifecycle Management | |||||
CG-MR-410a.1 | Revenue from products third-party certified to environmental and/or social sustainability standards | Dollars ($) | Not available | Not available | Not available |
CG-MR-410a.3 | Discussion of strategies to reduce the environmental impact of packaging | n/a | Pages 45-46 | See 2020 Report | See 2019 Report |
Management of the Legal & Regulatory Environment | |||||
EM-SV-530a.1 | Discussion of corporate positions related to government regulations and/or policy proposals that address environmental and social factors affecting the industry | n/a | Pages 19-21 | See 2020 Report | See 2019 Report |
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
CG-MR-000.A | Number of retail locations | Number | 175 | 188 | 238 |
Number of distribution centers | Number | 5 | 6 | 7 | |
CG-MR-000.B | Total area of retail space | Square meters (m2) | 2,344,347 | 3,288,389 | Not available |
Total area of distribution center | Square meters (m2) | 389,026 | 613,700 | 693,062 |

TCFD Alignment
GOVERNANCE | Disclose the organization’s governance around climate-related risks & opportunities. | |
With the oversight of the Environmental Social Governance and Nominating Committee of the Board of Directors, DNOW has established an internal employee-led ESG Committee that provides leadership and oversight around climate-related issues, ensuring DNOW minimizes the impact of related risks and capitalizes on opportunities. The Committee is responsible for the identification, measurement and disclosure of sustainability performance data most relevant to our operations and ensures that such metrics and disclosures align with our strategic plan. | Pages 16, 19-21 | |
STRATEGY | Disclose the actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy and financial planning where such information is material. | |
At DNOW, we seek to drive sustainability throughout our business to deliver long-term sustainable growth for our stakeholders. With growing demand from customers within renewable energy markets who are under increasing pressure to seek solutions to reduce their environmental impact and mitigate energy transition risk, we strive to innovate our product and service offerings and uncover more sustainable ways to operate, positioning us for the opportunities expected to arise from the transition to a lower-carbon economy. We have designed a strategy to create value for all our stakeholders and focus on sustainable growth by combining our geographical footprint, highly skilled employees, strategic inventory positioning, relationships with key domestic and international manufacturers and product expertise with disruptive digital innovation. | Pages 10-12 | |
RISK MANAGEMENT | Disclose how the organization identifies, assesses and manages climate risks. | |
DNOW recognizes that ESG objectives have a significant impact to DNOW’s core business strategy. We apply a "top-down, risk-based" approach to identify and prioritize risks based on actual and potential likelihood of occurrence and significance, both quantitatively and qualitatively. We evaluate the applicable financial, operational, environmental, social, legal and compliance related factors and implications. During this process, we continue to develop our understanding of the physical, transitional and regulatory risks of climate change. We continuously improve and adjust our risk management system to address actual and potential risks in the short-, medium- and long-term, and various levels of severity and frequency, to avoid disruptions in the short-term and ensure long-term alignment with our strategic plan. | Pages 19-21 | |
METRICS | Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material. | |
We strive to make our operations more efficient, and in turn, work to reduce use of these resources and resulting emissions. We report our energy consumption data and our Scope 1 and Scope 2 emissions per the Greenhouse Gas Protocol. | Pages 49-53 |
UN SDG Alignment
UN SDG Topic | UN Sustainable Development Goal | DNOW Goal Progress and Key Performance Indicators | Section, Page # |
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Ensure healthy lives and promote well-being for all. |
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Board Oversight of Risk Management, Page 19 Workforce Health & Safety, Page 28 |
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Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all. |
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Employee Engagement & Development, Page 30 |
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Achieve gender equality and empower all women and girls. |
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Board Diversity, Page 17 Workforce Diversity & Inclusion, Page 32 |
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Ensure access to affordable, reliable, sustainable and modern energy for all. |
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Delivering Sustainable Growth for Our Customers, Page 40 Environmental Performance & Supply Chain Sustainability, Page 45 |
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Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. |
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Board Diversity, Page 17 Supply Chain Stewardship, Page 24 Workforce Health & Safety, Page 28 Workforce Diversity & Inclusion, Page 32 |
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Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation. |
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Supply Chain Stewardship, Page 24 Environmental Performance & Supply Chain Sustainability, Page 45 |
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Ensure sustainable consumption and production patterns. | ||
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Take urgent action to combat climate change and its impacts. |
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Management-Led ESG Committee, Page 20 Environmental Performance & Supply Chain Sustainability, Page 45 TCFD Alignment, Page 54 |
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Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels. |
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Corporate Governance Oversight, Page 16 Business Ethics & Payments Transparency, Page 22 |
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Strengthen the means of implementation and revitalize the global partnership for sustainable development. |
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United Nations Sustainable Development Goals, Page 14 UN SDG Alignment, Page 55 |


David Cherechinsky
President & CEO
Message from our President & CEO
2021 was a year of transition at DistributionNOW (“DNOW”) as the energy industry emerged from the COVID-induced demand destruction that began in 2020. As the market transformed, so too did DNOW. DNOW responded swiftly and resolutely to defend our bottom-line and lay the groundwork for prosperity in the future. We believe that the market has fundamentally changed, demanding decisive action to redefine our operating model to thrive in the new environment, and scale and optimize many of our locations and employee workforce in response. The highly talented and caring customer-focused women and men of DNOW have not only embraced this change but are the driving force behind this movement.
Our turnaround story was punctuated by improved earnings durability throughout 2021. The results of our decisions over the past two years are evident, not only in the improvement in our financial performance, but in the competence and enthusiasm of our team to provide the superior solutions our customers desire. To meet the challenge, we have been focused on transforming our business, with a relentless focus on serving as the connector or critical link between global manufacturers and our customers. DNOW is dedicated to providing the products and services our customers require in a moment of scarcity and pronounced supply chain uncertainties, as the market recovers. Based on the execution of our strategy, we delivered improved earnings power throughout the year and have positioned the company for future success.
Intertwined with our strategy are our sustainability objectives for the company, as we make progress in our data collection methodologies and expand disclosures to further support our evolving Environmental, Social and Governance (“ESG”) initiatives that align with the Sustainability Accounting Standards Board (“SASB”) reporting standards, Task force on Climate-Related Financial Disclosures (“TCFD”) framework, and United Nations Sustainable Development Goals (“UN SDGs”).
I’m excited to note that for the third year in a row, we have issued our Sustainability Report, Focused on Sustainable Growth, as we continue our commitment to update our report on an annual basis. I’m proud of the progress our team has been making, since our first report in 2019, in areas of employee engagement, diversity and inclusion, product sourcing and supply chain sustainability, workforce health and safety and environmental performance. As a responsible member of the global community, we also continue to make additional progress in providing a wide array of products that enable our customers to lower their environmental impact, specifically lowering their scope 1 greenhouse gas (“GHG”) emissions. To help support the energy transition movement, we are supplying products for a number of biofuels projects as our customers move their refining and petroleum distribution businesses forward in meeting the new renewable fuels standards. Lastly, we are also working with customers to offer products and solutions to support and enable their decarbonization journeys with the development of multiple Carbon Capture, Utilization and Storage (“CCUS”) projects in various points within the front-end engineering and design stages.
Our focus on technology to provide digital solutions to our customers and strategic transactions focused on sustainable growth are integrated with our ESG topics included in this Report. Our 2021 report builds upon our commitment toward increased transparency and a wider focus on sustainability to create a positive impact and reaffirm our focus on sustainable growth. It allows us to share our key performance data with our stakeholders as an integral part of our business strategy.
Our Company
As a leading global supplier of energy and industrial solutions, products, and engineered equipment packages, DNOW provides thousands of products to energy and industrial markets worldwide. Our DigitalNOW® platform allows customers to leverage world-class technologies across a suite of digital channels and solutions, eCommerce, materials management, and cloud-based mobile applications to solve complex operational and supply chain challenges. We are transforming distribution through reliable, comprehensive solutions that mitigate risk and create unmatched convenience for our customers.
Our Sustainability Strategy
At DNOW, we seek to drive sustainability throughout our business to deliver long-term, profitable growth to our shareholders while helping to fulfill the news of our customers as we innovate, develop and uncover more sustainable ways to operate. We endeavor to create positive change globally and in our local communities by minimizing waste and pollution, supporting organizations with aligned sustainability goals, and maintaining fair and honest business policies. We are committed to working to minimize our environmental impact on the environment through energy management conservation initiatives, air quality improvements, responsible water conservation and recycling, where applicable. We are committed to delivering the products and services that our customers demand as they focus on sustainable growth and navigate the energy transition. We also invest in our employees, our communities and the industries in which we operate.
We have created a strategy to create value for all of our stakeholders through our focus on sustainable growth by combining our geographical footprint, highly skilled employees, strategic inventory positioning, relationships with key domestic and international manufacturers and product expertise with disruptive digital innovation. This powerful combination can drive performance, growth and sustainable margins. We believe this strategy is a solid foundation for long-term financial and operational results.
Unlocking Value in Energy Transition
DNOW is committed to supporting efforts to minimize environmental impact and control the emission of methane and CO2 GHGs in our operations. We utilize our catalog of low-emissions products and custom production equipment packages to help our customers monitor and reduce their carbon footprint and meet their scope 1 GHG emissions targets.
Energy Management
- Hydrogen - high grade steel pipe certified to ASME B31.12, low-emissions (“Low-E”) valves and gaskets, pumps, compressors and fabricated pressure vessels
- Renewable Fuels - carbon and stainless steel pipe, fire-safe valves, process pumps, personal protective equipment (“PPE”) and turnaround support
- CCUS - CO2 pipelines, Low-E valves and gaskets, vapor recovery units (“VRUs”), centrifugal pumps, compressors and wellhead injection equipment
Carbon Management & Decarbonization
DNOW helps customers reduce their Scope 1 emissions by supplying a variety of products from reputable top tier suppliers. Examples of products include:
- Instrument air compressor skids that replace gas pneumatic systems
- Low emission products that reduce fugitive emissions
DNOW further helps reduce customer GHG emissions by sourcing products manufactured by low emission manufacturing technology.
Our Sustainability Reporting Framework
In support of our ESG efforts, we align and engage with leading sustainability organizations and industry peers, like the Task Force on Climate-Related Financial Disclosures (TCFD) and the Sustainability Accounting Standards Board (SASB) to remain actively involved in discussions aimed at advancing our sustainability impact and to increase our ESG awareness and enhance our reporting and protocols.

Corporate Governance Oversight
Strong corporate governance includes being responsive to the shareholders and other stakeholders of our company. We are accessible and willing to engage with our shareholders to discuss operational, financial, governance, environmental, safety and social issues. Maintaining shareholder trust and goodwill through our policies and performance and adhering to our values remain primary objectives of our company.
DNOW’s Board of Directors and management recognize their responsibility and are committed to high standards of ethical conduct and corporate governance. Our Board’s core responsibilities are to foster our company’s long-term success, to oversee the business, supervise management and to act honestly, in good faith and in the best interests of our shareholders. In addition, our Board has oversight of certain categories of risk management, including risks related to climate change and other ESG-related matters.
In furtherance of carrying out these duties, our Board of Directors has appointed the following committees to assist in fulfilling its oversight responsibilities: the Audit Committee, the Environmental, Social, Governance and Nominating Committee and the Compensation Committee. The Environmental, Social, Governance, and Nominating Committee was restructured in 2021 to give more oversight at the board level to the Company’s ESG initiatives including (1) providing assistance and oversight on future sustainability reports; (2) overseeing and working with management on ESG risk assessment and managing and mitigating these risks, including risks related to climate change and other ESG-related matters; and (3) overseeing and working with management to determine future areas of opportunities, goal setting and expansion in its ESG initiatives.
Management-Led ESG Committee
We formed an ESG Committee in 2019 to oversee the identification, measurement and disclosure of sustainability performance data most relevant to our operations. This committee is comprised of representatives from various departments across our company and is overseen by members of our executive management team. Meeting at least quarterly, this group facilitates collaboration across divisions and departments to increase understanding of consistent issues.
With the oversight of the Environmental, Social, Governance and Nominating Committee of the Board of Directors, our employee-led ESG Committee ensures that the relevant sustainability metrics and disclosures align with our strategic plan and that the results are communicated to stakeholders. The ESG Committee coordinates with Internal Audit under the oversight of the Audit Committee of the Board of Directors to conduct risk assessments related to certain key sustainability metrics and disclosures. Once issues are identified, the ESG Committee leads the effort in ensuring opportunities can be exploited or risks can be minimized in determining how performance will be monitored.
Management of the Legal & Regulatory Environment
Our customers are being impacted by the shift towards a low-carbon energy transition economy. This shift has the potential to impact our business from many directions, including the demand to diversify the energy supply with renewable energy and the increased expectation of cleaner burning energy sources. We are also affected by changes in public policy, geopolitical tensions, and environmental, health and safety laws. These laws, together with regulations and permitting requirements, influence the products and solutions our customers demand.
The legal and regulatory landscape is ever changing, and there is increased focus on greenhouse gases and emissions standards. While it is impossible to accurately predict the effect that changes in laws and regulations (or their interpretation or enforcement) may have on us, we approach business opportunities and risks in a highly disciplined manner. Change in political controls, both domestic and internationally, have the potential to impact our business with the potential for reduced emission targets and global climate change regulations on the oil and gas industry. Should environmental laws and regulations become more stringent, our associated costs or the costs for our customers could increase. Our Board and senior management, in tandem with our Internal Audit department, Legal department, Compliance department, Finance/Accounting department and Information Technology department, stay up to date on the evolving legal and regulatory landscapes. Risks including financial, market, political, climate, regulatory, compliance, operational, cybersecurity safety and reputational, among others, that inherently may affect our business are evaluated and addressed through strategic planning by various stakeholders within the organization.
Business Ethics & Payments Transparency
Our Code of Business Conduct and Ethical Standards enhances our relationships with key stakeholders, including our people, customers, suppliers, other business partners, shareholders and local communities around the world. Our Anti-Corruption & Anti-Bribery Policy includes measures, controls and guidance to identify and assess risks, applicable laws and reported concerns. DNOW strictly prohibits bribery, including offering, promising, giving or accepting any financial or other advantage to any person, intending that person to improperly perform a function or activity. We have implemented internal controls to monitor and track any issues related to corruption and bribery.
Supply Chain Stewardship
At DNOW, we work with thousands of best-in-class suppliers spanning over 40 countries to make hundreds of thousands of SKUs available to our customers located in approximately 80 countries. Our commitment to ensuring our supply chain operates responsibly and sustainably is pervasive throughout the supply chain. From the high standards in our supplier selection and onboarding process to our environmentally-conscious distribution and fulfillment process, we are committed to sourcing the highest quality products and services to best help our customers execute their strategies and achieve their ESG goals.
Sourcing Responsibly and Sustainably
Our commitment to quality starts with our supplier selection and onboarding process, which holds our business partners to the same high standards we have. Through our Triple Impact Supplier Management Program (“TISMP”), we actively manage our supply chain to maximize the quality of products and services procured and ensure our suppliers share our values.
Our program starts with qualifying suppliers for our Approved Suppliers List (“ASL”), which provides powerful benefits to our customers. We conduct a thorough assessment to only admit companies in market-share-leading positions that are highly regarded with strong reputations for high quality products and services and compliance with health, safety and environmental business practices. Only once a supplier is part of our ASL, and have withstood our continuous evaluation process, do we regularly stock their prequalified products and offer their services to ensure the highest quality and reliability for our customers.
Our IMPACT quality goals:
Increase employee capabilitiesMaintain accurate inventory
Provide quality products and services
Always deliver on-time
Continually improve
Total customer satisfaction

Supplier Code of Conduct
Doing business with suppliers who share our values and commitment to doing the right thing is important to us at DNOW. During 2021, we began to outline a Supplier Code of Conduct in an effort to more fully and formally document what we expect from our suppliers. Our Supplier Code of Conduct is aimed at ensuring our business partners commit contractually to upholding the foundational aspects of the International Bill of Human Rights, The International Labor Organization’s Declaration on Fundamental Principles and Rights at Work, the Organization for Economic Co-operation and Development’s Guidelines for Multinational Enterprises, the United Nations (“UN”) Guiding Principles on Business and Human Rights and the Ten Principles of the UN Global Compact.
In 2022, the Supplier Code of Conduct was approved for distribution and roll-out to our suppliers. Implementing our Supplier Code of Conduct identifies the requirements we carry down to manufacturers in order to build cohesiveness in the supply chain to best service our end users.
We are proud to work with thousands of best-in-class suppliers to stock quality, trade-compliant and responsibly traded products.


Workforce Health & Safety
At DNOW, safety is at the center of our actions. Our safety culture is driven through our health, safety and environment (“HSE”) management system, which consists of our HSE Policy Statement, HSE guiding principles, corporate policies and procedures and our business level HSE policies and procedures.
Our HSE Policy Statement sets the tone for our organization and outlines our HSE expectations for all employees, vendors, customers, contractors, subcontractors and third parties. Our 17 HSE Guiding Principles provide a framework for our HSE management system and contribute to a culture of safety. They describe the minimum corporate requirements, as well as how we intend to comply with client and regulatory expectations.
Employee Engagement & Development
At DNOW, we place a strong emphasis on employee growth and development, and provide opportunities for valued contribution and innovation. We know that every person on the DNOW team plays a part in delivering excellence to our customers and helping us execute on our commitment to be our industry's preferred supplier. In order to deliver on this commitment, we provide our employees with opportunities for growth through a variety of training and development programs.
As part of their career development and advancement, employees are encouraged to participate in annual performance reviews to seek feedback and opportunities for growth. Each year, we survey all our employees to assess employee engagement. This survey, conducted by a third party, is a way for our leadership to measure, understand and improve employee engagement. Due to the impacts of the COVID-19 pandemic, our employee survey was postponed to February 2021, with approximately 81% of our employees providing responses to the survey.
Workforce Diversity & Inclusion
We value the individual differences of our employees, which include but are not limited to age, color, ethnicity, family and marital status, gender identity and expression, national origin, physical and mental abilities, political affiliation, race, religion, sexual orientation, socio-economic status, veteran status, and other characteristics. While we have long been committed to advancing a diverse, equitable and inclusive (“DEI”) culture where all employees feel welcomed, valued, appreciated, and respected, we recognize that we have room to improve. Our DEI Mission commits to creating an inclusive environment and managing workplace equity and fairness where our differences drive innovative solutions to power the world for a sustainable future.
We CARE.
Create an inclusive environment by engaging diverse talent and influencing recruitment, development, advancement and retention
Articulate our DEI progress through proactive communications
Refine workplace equity and equality
Engage employees in DEI through education and awareness with an emphasis on a greater sense of belonging at DNOW
Community Involvement
DNOW strives to build strong relationships with our neighbors and to make positive and tangible contributions to the communities where we operate. Our company and our employees regularly support a variety of organizations through the donation of time and talent, as well as through financial contributions, to cultivate strong connections to the communities we serve while also strengthening coworker relationships.
Although the global pandemic restricted many volunteer opportunities and charity events, DNOW employees have been able to continue service in our communities with appropriate safety measures in place. For example, in October 2021, we hosted our annual Charity Golf Tournament benefiting The Boys and Girls Club of Greater Houston and The American Cancer Society, which enabled us to donate over $60,000 to these charities. As more organizations begin to allow in-person volunteering, we are planning to increase our in-person volunteer efforts.
Data Security

At DNOW, we recognize the performance of information systems is critical to the successful operation of our business. We depend on our information management systems to process orders, track credit risk, manage inventory and monitor accounts receivable collections. Our information systems also allow us to efficiently purchase products from our vendors and ship products to our customers on a timely basis, maintain cost-effective operations and provide superior service to our customers.
In order to reduce information system vulnerability and protect critical data, we continuously evaluate security risks utilizing knowledge assembled from a variety of sources, including in-house experience, data security law enforcement task force notifications and information technology consultants. Our team of information technology specialists collaborate on risk assessment and mitigation, policies and controls implementation and data incident response preparedness. We have procedures in place to address threats to our information systems and to report any security incidents. DNOW did not experience a reportable data breach in 2021, 2020 or 2019.

DNOW is committed to being a responsible steward of the environment.
DNOW is committed towards responsible environmental stewardship, we have released DNOW’s Environmental Policy Statement which outlines our commitment to work towards minimizing our impact on the environment through energy management, conservation initiatives, responsible water conservation and recycling, where applicable.
We categorizes climate change risks into three categories:
- Transitional Risks
- Physical Risks
- Regulatory Risks
To mitigate transitional risks, DNOW brings products to the market that address customers' needs to reduce their environmental impact. The company is also taking advantage of market growth opportunities in the transition to a lower-carbon economy by providing its solutions to the renewable energy and other emerging markets.
Delivering Sustainable Growth for Our Customers
At DNOW, we understand the needs of our customers and provide a diverse portfolio of products and services that meet those needs. This includes products and services to help reduce environmental impact, mitigate GHG emissions and enable sustainable water management processes. We also have deep expertise in digital channels and solutions, which we are applying to new markets such as the renewable energy market.
Delivering Sustainable Solutions
We sell products that help reduce our customers' environmental impact, and we assemble and fabricate process, production and measurement equipment to measure, detect, prevent and minimize leaks and emissions of hydrocarbons. We increasingly offer products produced in sustainable ways to limit our customers' carbon footprint, including through the use of wind power, recycled water and wood pellet inputs.
DigitalNOW® Initiatives

We are continuously expanding our digital suite of products to increase value for our customers. Our solutions include outsourcing portions or entire functions of our customers’ procurement, inventory and warehouse management, logistics, point of issue technology, project management and business process and performance metrics reporting. Through our growing DigitalNOW® platform, customers can leverage world-class technology across eCommerce, data management and supply chain optimization applications to solve a wide array of complex operational and product sourcing challenges to assist in maximizing their return on assets and sustainability initiatives. We continue to work with our digitally-integrated customers to further enhance their eCommerce experience by optimizing their product catalogs and developing customized workflow solutions through our shop.dnow.com platform.
Delivering Solutions to Manage Water Use
We provide products that customers need for sustainable water management processes, including produced water transfer, recycle, disposal and reservoir injection packages that responsibly dispose of produced water in permitted areas. We help production and midstream customers maximize the use of fresh and produced water efficiently, including reuse in well stimulation operations. Our product lines can help clean, transfer, dispose of or reuse water brought to or produced in the field.
Delivering Solutions for Energy Transition
We have a strong record serving customers throughout the energy value chain. In addressing our climate change transition risks, we are developing a strategy to expand our preferred supplier status to companies within the rapidly growing focus on energy transition.
Our customers are increasingly investing in technology and projects that seek to reduce the emission of greenhouse gases to the atmosphere. This includes, but is not limited to, capturing and reducing methane emissions, reducing or eliminating the flaring of natural gas and VOCs and capturing CO2 emitted from a variety of industrial processes.
Delivering Solutions to Renewable Energy Markets
We currently provide products into global renewable energy markets including biofuels, wind, solar and geothermal. Our products include electrical, PPE, lubricants, PVF, pump packages and rotating equipment. We provide vendor managed inventory (VMI) services to customers in Canada and support offshore wind farm development with key product offerings.
DNOW Environmental Performance & Supply Chain Sustainability
Our global business is comprised of a network of strategic locations close to our customers’ operations. Our branches and distribution and fulfillment centers ensure our customers obtain access to products and obtain service and support in a manner that efficiently supports their operations.
We are committed to sustainable growth and supply chain stewardship as we continue to modernize our fulfillment model, including further executing our hub-and-spoke distribution centers in response to changing market cycles. We are optimizing our network by standing up regionally-located distribution Supercenters and orbiting branches to regionalize fulfillment and drive efficiencies to deepen intimacy and access to our customers and work towards a more sustainable future.

About This Report
The information included in this report is subject to DNOW’s policies and requirements surrounding the disclosure of financial and non-financial data. The financial information included in this report was sourced from our Form 10-K filed with the SEC on February 17, 2022. All non-financial data included in this report was not subject to a third-party audit verification process.

Forward-Looking Statements
Certain information contained in this Sustainability Report may constitute forward-looking statements within the meaning of applicable securities laws, including, but not limited to, statements regarding our plans to: move forward with identified climate change opportunities, foster programs regarding diversity and inclusion and plans to seek opportunities to further integrate sustainability factors into investment decisions. Readers are cautioned not to place undue reliance on forward-looking statements, as they are subject to a number of assumptions and known and unknown risks and uncertainties that may cause the actual results, performance or achievements of DNOW to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements contained herein are made as of the date of this document. We also describe risks and uncertainties in our reports filed with the SEC, including our Form 10-K for the year-ended December 31, 2021 (under the headings “Risk Factors” and “Information Regarding Forward- Looking Statements” and elsewhere) and our subsequent reports, which are available through the SEC’s EDGAR system at www. sec.gov, and on our website at dnow.com. DNOW assumes no obligation to update or otherwise revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
SASB Index
The SASB framework aims to provide a standard for companies to disclose financially-material and decision-useful ESG information to investors and other stakeholders. The index below maps our performance under each of the suggested disclosure topics for the following two industries:
- Oil & Gas Services (Code EM-SV)
- Multiline and Speciality Retailers & Distributors (Code CG-MR)
According to SASB’s Sustainable Industry Classification System (SICS®), these two industry standards most accurately reflect our business operations. Other topics disclosed throughout this report beyond the scope of these standards are not reflected in this index.
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
Greenhouse Gas Emissions | |||||
EM-SV-110a.1 | Total fuel consumed | Gigajoules (GJ) | 248,228 | 286,930 | 441,477 |
Metric tons carbon dioxide equivalent (MT CO2e) | 16,623 | 20,444 | 29,253 | ||
Percentage renewable | Percentage (%) | 0% | 0% | 0% | |
Percentage used in on-road equipment and vehicles | Percentage (%) | 99.8% | 99.7% | 100% | |
Percentage used in off-road equipment | Percentage (%) | 0.2% | 0.3% | 0% | |
EM-SV-110a.2 | Discussion of strategy or plans to address air emissions-related risks, opportunities, and impacts | n/a | Pages 38-47 | See 2020 Report | See 2019 Report |
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
Greenhouse Gas Emissions | |||||
CG-MR-130a.1 |
Total electricity consumed |
Gigajoules (GJ) |
69,358 |
71,026 |
87,130 |
Metric tons carbon dioxide equivalent (MT CO2e) |
8,247 |
10,219 |
12,969 |
||
Total natural gas consumed |
Gigajoules (GJ) |
112,104 |
82,081 |
165,070 |
|
Metric tons carbon dioxide equivalent (MT CO2e) |
5,683 |
4,156 |
8,349 |
||
Total energy consumed |
Gigajoules (GJ) |
181,462 |
153,107 |
252,200 |
|
Percentage energy consumed that is grid electricity |
Percentage (%) |
38% |
46% |
35% |
|
Employee Health & Safety |
|||||
EM-SV-320a.1 |
Total recordable incident rate (TRIR) |
Rate |
0.92 |
0.91 |
1.51 |
Fatality rate |
Rate |
0 | 0 | 0 | |
Near miss frequency rate (NMFR) |
Rate |
not disclosed |
not disclosed |
not disclosed |
|
Total vehicle incident rate (TVIR) |
Rate |
0.61 |
0.59 |
1.08 |
|
Average hours of health, safety, and emergency response training for (a) full- time employees, (b) contract employees, and (c) short- service employees |
Hours |
Not available |
Not available |
Not available |
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
EM-SV-320a.2 | Description of management systems used to integrate a culture of safety throughout the value chain and project lifecycle | n/a | Pages 28-29 | See 2020 Report | See 2019 Report |
Data Security | |||||
CG-MR-230a.1 | Description of approach to identifying and addressing data security risks | n/a | Page 37 | See 2020 Report | See 2019 Report |
Number of data breaches | Number | 0 | 0 | 0 | |
Percentage involving personally identifiable information | Percentage (%) | 0% | 0% | 0% | |
CG-MR-230a.2 | Number of customers affected | Number | 0 | 0 | 0 |
Labor Practices | |||||
CG-MR-310a.3 | Total amount of monetary losses as a result of legal proceedings associated with labor law violations | Dollars ($) | See note 1 below | See note 1 below | See note 1 below |
Employee Engagement, Diversity & Inclusion | |||||
CG-MR-330a.1 | Percentage of gender and racial/ethnic group representation for (1) management and (2) all other employees | Percentage (%) | Pages 34 | See 2020 Report | See 2019 Report |
CG-MR-330a.2 | Total amount of monetary losses as a result of legal proceedings associated with employment discrimination | Dollars ($) | See note 1 below | See note 1 below | See note 1 below |
1Total monetary losses resulting from legal proceedings related to claims which contained allegations of employment discrimination or labor law violations for the year ending December 31, 2021 were less than $87K, or 0.03% of total warehousing, selling and administrative expenses.
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
Business Ethics | |||||
EM-SV-510a.1 | Amount of net revenue in countries that have the 20 lowest rankings in Transparency International’s Corruption Perception Index | Percentage (%) of Total Revenues | 0.15% | 0.07% | 0.19% |
EM-SV-510a.2 | Description of the management system for prevention of corruption and bribery throughout the value chain | n/a | Pages 22-23 | See 2020 Report | See 2019 Report |
Critical Incident Risk Management | |||||
EM-SV-540a.1 | Description of management systems used to identify and mitigate catastrophic and tail-end risks | n/a | Pages 16, 19 | See 2020 Report | See 2019 Report |
Product Design & Lifecycle Management | |||||
CG-MR-410a.1 | Revenue from products third-party certified to environmental and/or social sustainability standards | Dollars ($) | Not available | Not available | Not available |
CG-MR-410a.3 | Discussion of strategies to reduce the environmental impact of packaging | n/a | Pages 45-46 | See 2020 Report | See 2019 Report |
Management of the Legal & Regulatory Environment | |||||
EM-SV-530a.1 | Discussion of corporate positions related to government regulations and/or policy proposals that address environmental and social factors affecting the industry | n/a | Pages 19-21 | See 2020 Report | See 2019 Report |
CODE | ACCOUNTING METRIC | UNIT OF MEASURE | 2021 RESPONSE | 2020 RESPONSE | 2019 RESPONSE |
CG-MR-000.A | Number of retail locations | Number | 175 | 188 | 238 |
Number of distribution centers | Number | 5 | 6 | 7 | |
CG-MR-000.B | Total area of retail space | Square meters (m2) | 2,344,347 | 3,288,389 | Not available |
Total area of distribution center | Square meters (m2) | 389,026 | 613,700 | 693,062 |

TCFD Alignment
GOVERNANCE | Disclose the organization’s governance around climate-related risks & opportunities. | |
With the oversight of the Environmental Social Governance and Nominating Committee of the Board of Directors, DNOW has established an internal employee-led ESG Committee that provides leadership and oversight around climate-related issues, ensuring DNOW minimizes the impact of related risks and capitalizes on opportunities. The Committee is responsible for the identification, measurement and disclosure of sustainability performance data most relevant to our operations and ensures that such metrics and disclosures align with our strategic plan. | Pages 16, 19-21 | |
STRATEGY | Disclose the actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy and financial planning where such information is material. | |
At DNOW, we seek to drive sustainability throughout our business to deliver long-term sustainable growth for our stakeholders. With growing demand from customers within renewable energy markets who are under increasing pressure to seek solutions to reduce their environmental impact and mitigate energy transition risk, we strive to innovate our product and service offerings and uncover more sustainable ways to operate, positioning us for the opportunities expected to arise from the transition to a lower-carbon economy. We have designed a strategy to create value for all our stakeholders and focus on sustainable growth by combining our geographical footprint, highly skilled employees, strategic inventory positioning, relationships with key domestic and international manufacturers and product expertise with disruptive digital innovation. | Pages 10-12 | |
RISK MANAGEMENT | Disclose how the organization identifies, assesses and manages climate risks. | |
DNOW recognizes that ESG objectives have a significant impact to DNOW’s core business strategy. We apply a "top-down, risk-based" approach to identify and prioritize risks based on actual and potential likelihood of occurrence and significance, both quantitatively and qualitatively. We evaluate the applicable financial, operational, environmental, social, legal and compliance related factors and implications. During this process, we continue to develop our understanding of the physical, transitional and regulatory risks of climate change. We continuously improve and adjust our risk management system to address actual and potential risks in the short-, medium- and long-term, and various levels of severity and frequency, to avoid disruptions in the short-term and ensure long-term alignment with our strategic plan. | Pages 19-21 | |
METRICS | Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material. | |
We strive to make our operations more efficient, and in turn, work to reduce use of these resources and resulting emissions. We report our energy consumption data and our Scope 1 and Scope 2 emissions per the Greenhouse Gas Protocol. | Pages 49-53 |
UN SDG Alignment
UN SDG Topic | UN Sustainable Development Goal | DNOW Goal Progress and Key Performance Indicators | Section, Page # |
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Ensure healthy lives and promote well-being for all. |
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Board Oversight of Risk Management, Page 19 Workforce Health & Safety, Page 28 |
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Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all. |
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Employee Engagement & Development, Page 30 |
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Achieve gender equality and empower all women and girls. |
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Board Diversity, Page 17 Workforce Diversity & Inclusion, Page 32 |
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Ensure access to affordable, reliable, sustainable and modern energy for all. |
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Delivering Sustainable Growth for Our Customers, Page 40 Environmental Performance & Supply Chain Sustainability, Page 45 |
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Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. |
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Board Diversity, Page 17 Supply Chain Stewardship, Page 24 Workforce Health & Safety, Page 28 Workforce Diversity & Inclusion, Page 32 |
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Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation. |
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Supply Chain Stewardship, Page 24 Environmental Performance & Supply Chain Sustainability, Page 45 |
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Ensure sustainable consumption and production patterns. | ||
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Take urgent action to combat climate change and its impacts. |
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Management-Led ESG Committee, Page 20 Environmental Performance & Supply Chain Sustainability, Page 45 TCFD Alignment, Page 54 |
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Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels. |
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Corporate Governance Oversight, Page 16 Business Ethics & Payments Transparency, Page 22 |
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Strengthen the means of implementation and revitalize the global partnership for sustainable development. |
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United Nations Sustainable Development Goals, Page 14 UN SDG Alignment, Page 55 |
