Avis Budget Group, Inc. (CAR) — ESG & Values Scores

Environment story

Avis faces substantial environmental headwinds tied to fleet electrification strategy instability and undisclosed emissions. The company has shortened useful lives of EV vehicles ($518M impairment in 2025), signaling pivot away from prior EV commitments. No disclosed Scope 1, 2, or 3 emissions data; no net-zero target year published. Climate risks acknowledged in risk factors but no concrete decarbonization roadmap. Environmental compliance program exists for fuel storage tanks; spill/leak remediation liability exposure noted. Heavy reliance on risk vehicles (84% of fleet) creates volatile residual-value exposure unrelated to emissions control. CAR's exposure to policy uncertainty around EV incentives, diesel bans, and carbon fees creates material business risk but does not drive internal emissions reductions. No verified renewable energy or direct power-use decarbonization initiatives disclosed.

Criticisms on file

No disclosed Scope 1, 2, or Scope 3 emissions; no net-zero target year or interim decarbonization goals published.
Source: CAR 10-K 2025; corporate sustainability reporting not provided.
Risk of climate regulation impact: company acknowledges that vehicle travel restrictions, emission caps, diesel bans, and carbon fees in operating jurisdictions could adversely affect demand and increase fleet costs.
Source: CAR 10-K 2025, Risk Factors section: 'Governments may continue to pursue measures related to climate change...'
Fuel storage tank contamination exposure: 'tank systems located at each of our locations may not at all times remain free from undetected leaks' and spills have resulted in remediation requirements and potential uninsured liability.
Source: CAR 10-K 2025, Risk Factors: 'We face risks related to environmental laws and regulations.'
EV policy uncertainty risk: federal and state EV tax credits, rebates, and subsidies have been modified or eliminated (e.g., OBBBA); reduction in government incentives may diminish EV fleet value and reduce consumer demand.
Source: CAR 10-K 2025, Risk Factors: 'Any unavailability, reduction or elimination of government and economic incentives...'

Disclosed initiatives

Environmental Compliance Program

Program designed to ensure fuel storage tanks at locations are properly registered and compliant with technical and operational requirements; includes liability insurance coverage for storage tanks.

Regulatory compliance; does not constitute operational emissions reduction.
EV Fleet Rotation Strategy (Revised)

As of Q4 2025, shortened useful life of certain U.S. EV rental vehicles and accelerated rotation in conjunction with Interpace Ventures transaction; prior acceleration in Q4 2024 reflected similar strategy revision.

Negative: Signals retreat from EV commitments; $518M impairment suggests EV market conditions or demand expectations deteriorated; no public commitment to long-term electrification roadmap.

Social story

Avis reports no disclosed workforce diversity percentages, CEO-to-worker pay ratio, or formal diversity/supplier-diversity programs in available filings. Union standing information is absent; no documented labor disputes, NLRB complaints, or strikes reported within the 24-month window. Company operates significant contingent-labor workforce through independent operators and third-party contractors at rental locations; these operators retain employment control, creating vicarious-liability exposure and potential joint-employer classification risk. No modern slavery statement, forced-labor policy, or high-risk geography supply-chain audits disclosed. Safety recall risk acknowledged (vehicles subject to manufacturer recalls adversely affect fleet utilization). Company maintains self-insurance for liability claims; 2024 saw $46M adjustment to allocated loss adjustment expense reserves, suggesting elevated claims experience. Turnover rate, plant safety metrics, and living-wage commitments not disclosed.

Criticisms on file

No disclosed CEO-to-median-worker pay ratio; no executive compensation benchmarking against worker wages.
Source: CAR 10-K 2025; proxy statement not provided.
No workforce diversity metrics disclosed (women %, underrepresented minorities %, leadership representation); no formal diversity or inclusion program documented.
Source: CAR 10-K 2025; EEO-1 disclosure status unknown.
Contingent-labor exposure: company operates significant share of locations through independent contractors and third-party operators; 'growing trend in the United States aimed at the gig economy to define independent contractors as employees' poses legal and cost risk; company acknowledges potential requirement to convert contractor locations to employee-operated.
Source: CAR 10-K 2025, Risk Factors: 'There is a growing trend in the United States aimed at the gig economy...'
No modern slavery statement, forced-labor policy, conflict-minerals policy, or supply-chain human-rights audit disclosed.
Source: CAR 10-K 2025; corporate responsibility disclosures not provided.
Elevated insurance claims and liability reserves: 2024 saw $46M adjustment to self-insurance reserves for allocated loss adjustment expense, indicating increased claims frequency or severity.
Source: CAR 10-K 2025, MD&A and Note 15 (Commitments and Contingencies reference).
Vehicle safety recall risk: 'Our vehicles have in the past and may in the future be subject to safety recalls by their manufacturers. Such recalls have an adverse impact on our business when we remove recalled vehicles from our rentable fleet.'
Source: CAR 10-K 2025, Risk Factors: 'We face risks related to safety recalls affecting our vehicles.'

Disclosed initiatives

Third-Party Operator Compliance Monitoring

Company actively monitors operations of licensees, dealers, and independent operators; agreements require compliance with all laws and regulations; ability to terminate for failure to adhere to operational standards; vigorously seeks dismissal from claims involving third-party operators and pursues indemnity.

Governance mechanism for indirect labor practices; does not guarantee labor-law compliance or worker protections at contractor locations.
Insurance and Liability Claims Management

Company self-insures public liability, property damage, personal accident insurance, and other claims; estimates liabilities using actuarial methods based on historical loss experience and projected loss development factors.

Financial risk management; indicates operational awareness of injury/incident trends but does not constitute proactive safety improvement.

Governance story

Avis operates a single-class share structure with no dual-class voting disclosed. Board independence percentage not disclosed in filing. SRS Investment Management holds >45% of outstanding common stock under a Cooperation Agreement requiring proportional voting above 45% threshold; company acknowledges risk that SRS ownership >50% could trigger change-of-control provisions in senior-note indentures. Lobbying expenditure not disclosed; however, risk factors identify exposure to vehicle-travel restrictions, emission limits, diesel bans, and carbon fees, indicating active regulatory monitoring and likely policy engagement. Company has not disclosed any antitrust, consumer-safety, or financial-fraud regulatory proceedings currently active. No evidence of shareholder litigation blocking climate proposals. Multiple significant legal and financial risks disclosed: contingent liabilities for wage-and-hour disputes, misclassification claims, discrimination litigation, and data-privacy enforcement (GDPR, CCPA, UK DPA, VCDPA). Company maintains D&O insurance. Governance structure lacks transparency on board composition and independent director percentage.

Criticisms on file

Board independence percentage not disclosed; governance structure lacks transparency on independent director composition.
Source: CAR 10-K 2025; proxy statement not provided.
Significant shareholder concentration: SRS Investment Management holds >45% of outstanding common stock; Cooperation Agreement requires proportional voting above 45% threshold; change of control could trigger senior-note redemption provisions if ratings downgraded.
Source: CAR 10-K 2025, Risk Factors: 'We face certain risks related to our share repurchase program.'
Multiple contingent litigation exposures: wage-and-hour disputes, discrimination claims, misclassification litigation, class-action lawsuits, personal-injury claims, and data-privacy enforcement actions; company maintains self-insurance and D&O coverage but exposure to uninsured liability acknowledged.
Source: CAR 10-K 2025, Risk Factors: 'Costs associated with lawsuits, investigations or increases in legal reserves...'
Cybersecurity breach history and ongoing threats: company has experienced cybersecurity attacks in past; discloses regular attempts to gain unauthorized access; acknowledges vulnerability to encryption/authentication breaches, ransomware, and phishing despite implemented security measures.
Source: CAR 10-K 2025, Risk Factors: 'We face risks related to cybersecurity breaches of our systems and information technology.'
Data privacy regulatory enforcement risk: company subject to GDPR, UK DPA, CCPA, VCDPA, and evolving privacy laws across multiple jurisdictions; non-compliance could result in substantial monetary penalties, government consent decrees, and regulatory enforcement actions.
Source: CAR 10-K 2025, Risk Factors: 'We are subject to privacy, data protection, data security and other regulations...'
Lobbying expenditure not disclosed; company faces risks from vehicle-travel restrictions, emission limits, diesel bans, and carbon fees, indicating regulatory engagement likely but lack of transparency.
Source: CAR 10-K 2025, Risk Factors section on climate and environmental regulations.
Tax regulatory uncertainty: company navigating OECD Pillar One and Pillar Two proposals, unilateral country measures, and Advanced Pricing Agreement negotiations; describes 'high level of uncertainty in today's tax environment.'
Source: CAR 10-K 2025, Risk Factors: 'We face risks associated with changes in tax laws...'

Disclosed initiatives

Regulatory Compliance Monitoring

Company acknowledges exposure to wide variety of environmental, labor, employment, consumer-protection, data-privacy, antitrust, and financial-reporting laws in multiple jurisdictions; indicates ongoing monitoring of compliance.

Risk-awareness mechanism; does not constitute proactive governance improvement.
Data Privacy and Security Compliance Program

Company has adopted policies and procedures in compliance with GDPR, UK DPA, CCPA, VCDPA, and similar privacy and data-protection laws; implements access controls, data encryption, vulnerability assessments, continuous monitoring, and backup systems.

Regulatory compliance; company acknowledges ongoing cybersecurity threats and past breaches; indicates elevated exposure to data-breach liability.
Intellectual Property Protection

Company has registered trademarks in U.S. and certain other countries; enforces proprietary rights and has acquired internet domain names to prevent consumer confusion.

Brand protection mechanism; does not relate to governance quality.

These are Missionomics' own editorial scores — directional signals built from disclosed facts under a published method, not certifications or definitive ratings of Avis Budget Group, Inc.. Coverage and confidence vary by data point, and figures can lag real-world changes. Read the full Methodology for sourcing, scoring, and correction details — or open Avis Budget Group, Inc. in the app for interactive charts and portfolio building.

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