Climate Change Data

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Adverse changes in business or industry conditions and volatility and disruption of the capital and credit markets may result in decreases in our sales and profitability.
• Demand for our products is sensitive to changes in levels of industrial production and the financial performance of major industries that we serve.
• Our ability to access the credit markets and the costs of borrowing are affected by the strength of our credit rating and current market conditions.
• We sell to customers around the world and are subject to the risks of doing business in many countries.
• An inability to respond to changes in customer preferences could result in decreased demand for our products.
• Failures or security breaches of our products, manufacturing environment, or information technology systems could have an adverse effect on our business.
• There are inherent risks in our solutions and services businesses.
• New legislative and regulatory actions could adversely affect our business.
• Our industry is highly competitive.
• We face the potential harms of natural disasters, pandemics, acts of war, terrorism, international conflicts or other disruptions to our operations.
• Intellectual property infringement claims of others and the inability to protect our intellectual property rights could harm our business and our customers.
• Claims from taxing authorities could have an adverse effect on our income tax expense and financial position.
• Our business success depends on attracting, developing, and retaining highly qualified personnel.
• Increasing employee benefit costs could have a negative effect on our operating results and financial condition.
• We rely on our distribution channel for a substantial portion of our sales.
• Potential liabilities and costs from litigation (including asbestos claims and environmental remediation) could reduce our profitability.
• Failure to identify, manage, complete, and integrate acquisitions and technology investments may adversely affect our business.
• We rely on suppliers to provide equipment, components and services.

Mitigation Strategies

• Our Enterprise Risk Management (ERM) process seeks to identify and address significant risks.
• Our information security efforts, under the leadership of our Chief Information Security Officer and Chief Product Security Officer, with the support of the entire management team, include major programs designed to address security governance, product security, identification and protection of critical assets, insider risk, third-party risk, and cyber defense operations.
• Our acquisition strategy focuses on products, solutions and services that will be catalytic to the organic growth of our core offerings.
• Productivity and continuous improvement are important components of our culture.
• We have programs in place that drive ongoing process improvement, functional streamlining, material cost savings and manufacturing productivity.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Sustainability
• Social Responsibility
• Employee Engagement
• Ethics and Integrity
• Supplier Relationships
• Environmental Performance
• Safety
• STEM Education
• Workforce Development

Environmental Achievements

• Reached goal of certifying 100% of largest manufacturing facilities to ISO 14001:2015 standards (24 sites certified)
• Met goal to reduce greenhouse gas emissions normalized to sales by 30% compared to 2008 baseline (four years ahead of schedule)
• Deferred 82% of waste from landfills (close to the 85% goal)
• Ladysmith, Wisconsin plant achieved 100% waste deferral rate

Social Achievements

• Launched Academy of Advanced Manufacturing (AAM), training 97 veterans in 2018
• Named one of Forbes’ America’s Best Employers for Women
• Earned a perfect score of 100% on the Human Rights Campaign’s Corporate Equality Index for the sixth consecutive year
• Spent over $272 million with diverse suppliers in the U.S.
• Increased spend with diverse suppliers providing direct commodities
• Expanded Bystander Intervention training to address harassment

Governance Achievements

• Named to Ethisphere Institute’s World’s Most Ethical Companies list for the tenth year
• Published first Partner Network Code of Conduct
• Expanded annual ethics training program to 15 languages
• Conducted 150 Code of Conduct investigations, resulting in disciplinary actions

Climate Goals & Targets

Environmental Challenges

• Increase in hand and ergonomic injuries in 2018
• Need to improve speed and agility in addressing employee engagement survey results

Mitigation Strategies

• Implemented peer-to-peer Behavioral Based Safety process for hand and ergonomic injuries
• Conducted in-depth analyses and developed corrective plans
• Expanded Gemba walks to include all levels of management
• Increased communications and training
• Each of 3,200 people managers picked “One Thing” to address survey issues

Supply Chain Management

Responsible Procurement

• Partner Network Code of Conduct
• Active sourcing of diverse suppliers

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ISO 14001:2015

Certifications: ISO 14001:2015, OHSAS 18001

Awards & Recognition

• World’s Most Ethical Companies
• Forbes America’s Best Employers for Women
• Human Rights Campaign Corporate Equality Index perfect score
• DiversityInc Noteworthy Company
• Catalyst Award

Environmental Metrics

Climate Goals & Targets

Environmental Challenges

• Adverse changes in business or industry conditions and volatility and disruption of the capital and credit markets may result in decreases in our sales and profitability.
• We sell to customers around the world and are subject to the risks of doing business in many countries.
• We rely on suppliers to provide equipment, components and services.
• Failures or security breaches of our products, connected services, manufacturing environment, supply chain, or information technology systems could have an adverse effect on our business.
• An inability to respond to changes in customer preferences could result in decreased demand for our products.
• There are inherent risks in our solutions and services businesses.
• New legislative and regulatory actions could adversely affect our business.
• Our industry is highly competitive.
• We rely on our distribution channel for a substantial portion of our sales.
• Failure to identify, manage, complete, and integrate strategic transactions may adversely affect our business or we may not achieve the expected benefits of these transactions.
• We face the potential harms of natural disasters, pandemics, acts of war, terrorism, international conflicts or other disruptions to our operations.
• Intellectual property infringement claims of others and the inability to protect our intellectual property rights could harm our business and our customers.
• Claims from taxing authorities could have an adverse effect on our income tax expense and financial condition.
• Our business success depends on attracting, developing, and retaining highly qualified personnel.
• Potential liabilities and costs from litigation (including asbestos claims and environmental remediation) could reduce our profitability.
• We own common stock in PTC Inc. and are exposed to the volatility, liquidity and other risks inherent in holding that stock.
• Increasing employee benefit costs could have a negative effect on our operating results and financial condition.

Mitigation Strategies

• Our Enterprise Risk Management (ERM) process seeks to identify and address significant risks.
• Our ERM process assesses, manages, and monitors risks consistent with the integrated risk framework in the Enterprise Risk Management - Integrated Framework (2017) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
• A team of senior executives prioritizes identified risks and assigns an executive to address each major identified risk area and lead action plans to manage risks.
• Our Board of Directors provides oversight of the ERM process and reviews significant identified risks.
• Our other Board committees also play a role in risk management, as set forth in their respective charters.
• We maintain several single-source supplier relationships, because either alternative sources are not available or the relationship is advantageous due to performance, quality, support, delivery, capacity, or price considerations.
• Our information security efforts, under the leadership of our Chief Information Security Officer and Chief Product Security Officer, with the support of the entire management team, include major programs designed to address security governance, product security, identification and protection of critical assets, insider risk, third-party risk, and cyber defense operations.
• We continuously evaluate, modify, and enhance our internal processes and technologies to increase employee engagement, productivity, and efficiency, and to mitigate failure risks from older technologies currently in use.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

Social Achievements

• In 2020, we achieved 0.23 recordable cases per 100 employees.
• Annual participation in trainings related to ethics, environment, health and safety, and emergency responses are at or near 100%.
• The latest employee engagement survey showed an EEI of 76% compared to a global norm of 72%.

Climate Goals & Targets

Environmental Challenges

• The COVID-19 pandemic has caused significant disruption to the global economy, impacting demand, supply chain, workforce, and financial markets.
• Adverse changes in business or industry conditions and volatility in capital and credit markets may result in decreases in sales and profitability.
• High competition in the industry.
• Risks associated with global operations in over 100 countries.
• Reliance on suppliers for equipment, components, and services.
• Failures or security breaches of products, connected services, or IT systems.
• Inability to respond to changes in customer preferences.
• Inherent risks in solutions and services businesses.
• Reliance on distribution channels for a substantial portion of sales.
• Intellectual property infringement claims and inability to protect intellectual property rights.
• Dependence on attracting, developing, and retaining highly qualified personnel.
• Increasing employee benefit costs.
• Risks associated with strategic transactions and investments.
• Volatility and risks associated with investment in PTC Inc. common stock.
• New legislative and regulatory actions.
• Claims from taxing authorities.
• Potential liabilities and costs from litigation (including asbestos claims and environmental remediation).

Mitigation Strategies

• Implementation of safety and hygiene processes at manufacturing and distribution locations.
• Actions to keep non-manufacturing employees safe (work from home, travel restrictions, etc.).
• Cost reduction actions (elimination of discretionary spending, delays of non-critical investments, etc.).
• Temporary cost actions (salary reductions, suspension of 401(k) match).
• Maintaining and selectively increasing investments in high-priority areas.
• Closely managing the end-to-end supply chain.
• Continuous improvement programs to improve profitability.
• Enterprise Risk Management (ERM) process to identify and address significant risks.
• Proactive risk management using a structured approach.
• Information security efforts to address security governance, product security, and cyber defense.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Completed 10 global energy conservation projects, eliminating more than 4,500 metric tons of CO2 annually.
• Reduced paper job packets for engineered-to-order products by 70%, eliminating more than 251,000 pounds of paper waste and reducing carbon footprint by 197 tons of CO2.
• Exceeded annual goal to recycle or reclaim 85% of solid waste generated.

Social Achievements

• Maintained best-in-class global safety performance with a 0.27 Recordable Case Rate per 100 employees.
• Launched Parents & CareTakers (PaCT) Employee Resource Group to support working parents and caretakers.
• Expanded Parental Leave benefit from four to six weeks paid time off and added a new Caregiver Leave benefit.

Governance Achievements

• Expanded corporate sustainability team and function with additional investment and resources.
• Released first Global Reporting Initiative (GRI), Task Force on Climate-related Financial Disclosures (TCFD), and Sustainability Accounting Standards Board (SASB) reports.
• Named to the FTSE4Good Index Series for the 20th time and the North America Dow Jones Sustainability Indexes for the 11th time.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting employee well-being and work-life balance.
• Increased frequency and severity of cybersecurity threats.
• Global supply chain challenges.

Mitigation Strategies

• Provided additional paid time off for vaccine appointments and hosted onsite vaccination clinics.
• Invested in a more robust cybersecurity offering, including a new Cyber Security Operations Center and partnerships with cybersecurity providers.
• Used own technologies and data to augment decision making and provide greater visibility into supply chain planning and operations.

Supply Chain Management

Responsible Procurement

• Spent $256M with diverse suppliers in FY2021.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications: ISO 14001, ISO 45001

Sustainable Products & Innovation

• FactoryTalk® Energy Manager software
• Smart water solutions
• Waste management and recycling solutions

Awards & Recognition

• World’s Most Ethical Companies (13th time)
• FTSE4Good Index Series (20th time)
• North America Dow Jones Sustainability Indexes (11th time)
• Barron’s 100 Most Sustainable Companies

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Progress toward carbon neutral goal by 2030 (Scope 1 and 2 emissions).
• Established Scope 3 baseline.
• 88% of total waste recycled.
• Reduced hazardous waste from 8.8% in 2022 to 4.2% in 2023.
• Zero reportable spills.

Social Achievements

• Launched OnTrack, a personalized well-being program.
• Global Well-Being Champions initiative launched.
• Recordable Case Rate (RCR) better than internal goal of 0.28.
• Invested $192.4M with small businesses and businesses with veteran, minority, women, and LGBTQ owners.
• Continued investment in STEM education.

Governance Achievements

• Joined UN Global Compact.
• Joined The Science Based Targets initiative (SBTi).
• Joined IFRS Sustainability Alliance.
• Achieved Maturity Level 4 of the IEC 62443-4-1 industrial cybersecurity certification.
• 59% of investigations substantiated, significantly higher than global benchmark.

Climate Goals & Targets

Environmental Challenges

• Employee turnover and production backlogs.
• Increasing cybersecurity threats in manufacturing.
• Skills gap in advanced manufacturing.

Mitigation Strategies

• Transitioned to a new digital employee health and safety management platform.
• Expanded cybersecurity offerings through acquisitions and partnerships.
• Upskilling current employees, reskilling military veterans, partnering with academic organizations and government agencies, and filling the future talent pipeline through STEM initiatives.

Supply Chain Management

Responsible Procurement

• RBA Code of Conduct
• Supplier Code of Conduct
• Conflict minerals compliance
• Extended mineral reporting campaign for cobalt and mica (2024)

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products and solutions

Reporting Standards

Frameworks Used: SASB, TCFD, Greenhouse Gas Protocol, UN Global Compact

Certifications: ISO 14001, ISO 45001, IEC 62443-4-1 (Maturity Level 4)

UN Sustainable Development Goals

• Goal 4 (Quality Education)
• Goal 6 (Clean Water and Sanitation)
• Goal 5 (Gender Equality)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 12 (Responsible Consumption and Production)
• Goal 7 (Affordable and Clean Energy)
• Goal 13 (Climate Action)

Rockwell's initiatives contribute to these goals through various programs and partnerships.

Sustainable Products & Innovation

• FactoryTalk® Energy Manager™
• Sustainable product design principles (3Cs: Compliance, Carbon footprint, Circular economy)

Awards & Recognition

• World’s Most Ethical Companies (15 times)
• MSCI AA rating
• Digital Engineering Awards

Environmental Metrics

ESG Focus Areas

• Sustainable Customers
• Sustainable Company
• Sustainable Communities

Environmental Achievements

• Reduced carbon emissions (Specific figures not provided in the report)
• Improved water management (Specific figures not provided in the report)
• Enabled circular economy for managing automation assets (Specific figures not provided in the report)

Social Achievements

• Achieved 0.27 recordable cases per 100 employees in fiscal 2023.
• Employee engagement index (EEI) of 76, eight points higher than the industry norm.
• Global inclusion index score of 81, six points higher than the industry norm.
• Over 650,000 learning hours in employee training programs in fiscal 2023.

Governance Achievements

• 11 board members include four female and two African American directors.
• Formal ethics and compliance organization and an Ombuds office.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to increased demand, pandemic-related and other global events.
• Cybersecurity threats.
• Attracting, developing, and retaining highly qualified employees.

Mitigation Strategies

• Closely managing end-to-end supply chain, extending order visibility, securing long-term supply agreements, re-engineering products, capacity investments, and qualifying additional suppliers.
• Major programs to address security governance and risk, product security, identification and protection of critical assets, insider risk, third-party risk, security awareness, and cyber defense operations.
• Prioritizing employee safety and health, capturing and acting upon employee feedback, investing in employee growth and development, and offering employee assistance and work-life benefits.

Supply Chain Management

Responsible Procurement

• Partner code of conduct and supplier code of conduct prohibits corrupt acts, bribery, and anticompetitive behavior.

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters (including those as a result of climate change)

Transition Risks

• Laws, regulations, and governmental policies affecting our activities, including those related to climate change.

Sustainable Products & Innovation

• Energy management software solutions
• Smart water solutions
• Solutions to automate industry-specific processes