Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Energy Management
• Product Sustainability
• Supply Chain Management
• Health and Safety
• Diversity and Inclusion
• Ethics and Compliance
• Responsible Sourcing

Environmental Achievements

• 5.8 percent decrease in greenhouse gas (GHG) emissions compared to 2018
• 1.4 percent decline in energy consumption compared to 2018
• Reduced natural gas consumption at sites (2.7 percent), reduced electricity and natural gas consumption at discontinued/divested sites (0.9 percent) and other reductions (0.4 percent)
• Continued greening of the electrical grid, resulting in reductions in indirect GHG emissions accounting for 1.8 percent of the total 5.8 percent decline.

Social Achievements

• Zero employee and contractor fatalities
• 29 percent decline in days away, restricted and transfer rate
• 40 percent decrease in lost workday rate compared to 2018
• 83 percent of key suppliers having sustainability programs considered leading or active
• New partnership with a third-party ethics and compliance training vendor

Governance Achievements

• Enhanced capability to collect key performance data from all operating facilities
• Aligned EHS management system to refreshed ISO 14001 and new ISO 45001 standards
• Implemented 129 corrective actions based on concerns raised through the Integrity Line

Climate Goals & Targets

Environmental Challenges

• Landfilled waste and water consumption increased over the prior year due to higher production levels
• COVID-19 pandemic impacting operations

Mitigation Strategies

• Landfilled waste and water consumption will be areas of focus in 2020
• Implementing recommendations from the Task Force on Climate-related Financial Disclosures (TCFD) in 2020
• Developing an energy-savings approach commensurate with the new company profile in 2020

Supply Chain Management

Supplier Audits: 83% of key suppliers had sustainability programs considered leading or active in 2019

Responsible Procurement

• Supplier Standards outlining expectations regarding supplier sustainability
• Due diligence to ensure suppliers are not on the consolidated database of denied and restricted parties

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core option, SASB (limited number of metrics)

Certifications: ISO 14001, ISO 45001

Sustainable Products & Innovation

• ARCONIC-THOR™ advanced titanium alloy
• Single crystal turbine airfoils
• Complex ceramic shapes
• Advanced coatings
• Aluminum-lithium front fan blade forging
• Lightweight titanium seat rails
• Flite-Tite® fasteners
• Alcoa® Wheels (Ultra ONE®, Dura-Bright®)
• Monolithic forged aluminum bulkheads on the F-35 Joint Strike Fighter
• Eddie-Bolt® 2 fasteners

Awards & Recognition

• Perfect score of 100 on the Corporate Equality Index 2020

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity and Inclusion
• Health and Safety
• Supply Chain Sustainability
• Ethics and Compliance

Environmental Achievements

• 6.2 percent decrease in GHG emissions compared to 2020
• 3.0 percent decline in energy consumption compared to 2020
• 10.8 percent decrease in water use compared to 2020
• 6.8 percent decrease in landfilled waste compared to 2020
• 81 percent of key suppliers have leading or active sustainability programs

Social Achievements

• Zero employee and contractor fatalities
• 8.3 percent decline in DART rate compared to 2020
• 79 percent employee vaccination rate by early 2022
• 76 percent of locations worldwide were without a lost workday incident
• Named one of the “Best Places to Work for LGBTQ Equality” by the Human Rights Campaign Foundation
• 40 percent of Board of Directors made up of women

Governance Achievements

• Implemented a comprehensive energy and GHG target-setting process
• Published first disclosure following the Task Force on Climate-related Financial Disclosures (TCFD) framework
• Established union representation at Laval facility in Quebec, Canada
• Maintained a strong Ethics and Compliance Program

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting employees, suppliers, and customers
• Climate change and the need to achieve net-zero emissions by 2050
• Supply chain disruptions
• Emerging COVID-19 variants

Mitigation Strategies

• Global health promotion program encouraging vaccination
• On-site vaccination clinics
• Expanded programs around entry screening, hygiene, mask use, social distancing, and testing
• Setting near-term GHG emission reduction goals (21.5% by 2024)
• Developing comprehensive plans to further reduce GHG emissions by 2030
• Engaging suppliers to understand carbon intensity of materials

Supply Chain Management

Supplier Audits: 81% of key suppliers have leading or active sustainability programs (2021)

Responsible Procurement

• Supplier Standards
• Code of Conduct
• Due diligence to ensure suppliers are not on the U.S. Department of Commerce International Trade Commission’s denied and restricted parties list

Climate-Related Risks & Opportunities

Transition Risks

• Major regulatory changes
• Transition to a lower-carbon economy

Opportunities

• Product portfolio that minimizes carbon usage for customers

Reporting Standards

Frameworks Used: GRI Standards (Core option), SASB Aerospace and Defense Sustainability Accounting Standard, TCFD framework

Certifications: ISO 45001, ISO 14001-2015, AS9100D, IATF 16949

Third-party Assurance: Partial third-party assurance of 2020 Scope 1 and Scope 2 emissions

Sustainable Products & Innovation

• Howmet-THOR™ titanium alloy (50% lighter than nickel-based superalloys)
• Lightweight titanium seat rails for Boeing 787
• Alcoa® Ultra ONE® wheel

Awards & Recognition

• Newsweek Most Responsible Company
• Best Places to Work for LGBTQ Equality
• 50/50 Women on Boards 3+ Designation
• Forbes World’s Best Employers 2021
• 2021 Top Diversity Employer
• FACC Excellent Supplier Award
• 2021 Genius Loci Award
• Mitsubishi Honor
• 2021 Ulster County Business of the Year

Environmental Metrics

ESG Focus Areas

• Diversity, Equity, and Inclusion
• Health and Safety
• Environmental Matters
• Climate Change

Environmental Achievements

• Not disclosed

Social Achievements

• Created a culture that embraces diversity, drives inclusion, and empowers and engages employees.
• Implemented a new Applicant Tracking System to reach a wider range of diverse partners.
• Offers an onboarding program to develop a sense of belonging, teamwork, and productivity.
• Provides diversity awareness training and resources.
• Strong health and safety culture with a goal of zero incidents.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Global economic conditions and cyclical fluctuations in lightweight metals end-use markets.
• High volatility and increasing prices for energy supplies due to the conflict between Russia and Ukraine.
• Increased costs of raw materials (nickel, titanium, aluminum, cobalt, and rhenium).
• High levels of inflation worldwide.
• Supply chain disruptions.
• Meeting program demand, production targets, and commitments.
• Attracting and retaining a qualified workforce.
• Loss of key customers or significant changes in the business or financial condition of its customers.
• Changes in military strategy, policy, and priorities, or reductions in defense spending.
• Information technology system failures, cyberattacks, and security breaches.
• Continued effects of the COVID-19 pandemic.
• Significant competition.
• Challenges to intellectual property rights.
• Unanticipated changes in tax provisions or exposure to additional tax liabilities.
• Labor disputes and other employee relations issues.
• Environmental, health, and safety risks.
• Global climate change or legal, regulatory, customer, or supplier responses to such change.
• Potential substantial tax liability from the Arconic Inc. Separation Transaction.

Mitigation Strategies

• Generally attempts to pass along higher raw material and energy costs to customers through price increases.
• Focus on cost reductions, productivity improvements, and other programs.
• Maintaining annual or long-term contracts for a majority of supply requirements.
• Intensified focus on capital efficiency.
• Developing innovative new products and services.
• Implementing advanced manufacturing technologies.
• Working to safeguard its systems and mitigate potential risks from cyberattacks.
• Disciplined approach to cash management and strengthening its balance sheet.
• Procurement efficiencies and overhead rationalization to reduce costs.
• Working capital initiatives.
• Maintaining a sustainable level of capital expenditures.
• Negotiating successor collective bargaining agreements.
• Compliance with health, safety, and environmental laws and regulations.
• Implementing remediation obligations.
• Risk management processes to prevent fatality and serious injury.
• Talent review and succession planning process.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Flooding, extreme winds, extreme precipitation, wildfires, drought

Transition Risks

• Regulatory changes, market shifts, increased energy costs, costs to transition to renewable energy sources, customer decarbonization requirements, carbon pricing, product energy efficiency requirements

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Lighter, more fuel-efficient aircraft and commercial trucks

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate change
• Supply chain decarbonization
• Integrity and compliance
• Diversity, Equity and Inclusion (DEI)
• Product Safety
• Human Rights

Environmental Achievements

• Reduced greenhouse gas (GHG) emissions intensity by 13.6 percent in 2023 vs. 2022.
• Achieved a 19.8 percent reduction in absolute Scope 1 and Scope 2 GHG emissions from the 2019 baseline.
• Avoided approximately 25,000 metric tons of GHG emissions through various projects.
• Improved water withdrawal intensity by 11.7 percent compared to the 2019 baseline, exceeding the 2024 target.
• Reduced hazardous waste generation by approximately 985 metric tons annually through process improvements.
• Reduced use of chlorinated solvents by 40 percent.

Social Achievements

• Zero fatalities and serious injuries among employees and contractors.
• Overall employee turnover rate decreased to 19.3 percent.
• Women’s representation increased to 27.1 percent, and U.S. minority representation reached 41.8 percent.
• Introduced resources providing therapy sessions and messages through a virtual therapy platform.
• Expanded training access to hourly employees using technology.
• Implemented a formal mentoring program.

Governance Achievements

• Launched a collaborative supplier due diligence process with industry peers.
• Received third-party limited verification on Scope 3 emissions.
• Revamped and strengthened the Global Supplier Sustainability Program.
• Zero monetary losses from legal proceedings associated with corruption, bribery, or illicit international trade.
• Zero new high-risk environmental compliance cases.

Climate Goals & Targets

Environmental Challenges

• Increased competition for skilled individuals and changing employee expectations.
• Supply chain disruptions.
• Increased production offsetting GHG emission reductions.
• Need for suitable alternatives to certain hazardous chemicals.
• Maturity of Scope 3 data limiting the setting of a target.

Mitigation Strategies

• Adapted and refreshed talent acquisition and retention strategies.
• Leveraging master agreements with preferred vendors.
• Implementing energy-efficiency projects and transitioning to lower-carbon power sources.
• Conducting trials to identify suitable alternatives to hazardous chemicals.
• Engaging with key suppliers to analyze their contribution to Scope 3 emissions.

Supply Chain Management

Supplier Audits: Joined aerospace industry’s ESG supplier assessment initiative (EcoVadis); targeted key suppliers in 2023.

Responsible Procurement

• Supplier Code of Conduct (aligned with IFBEC model)
• Due diligence to exclude suppliers on denied and restricted parties lists

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Regulatory changes, market shifts

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI Standards, SASB Aerospace and Defense Standard, TCFD framework

Certifications: ISO 14001, ISO 45001

Third-party Assurance: Third-party assurance for 2022 Scope 1, 2, and parts of Scope 3 emissions

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Lighter aerospace engine and structure products and materials
• Howmet-THOR® advanced titanium alloy
• Alcoa® Ultra ONE ULT36 wheel

Awards & Recognition

• Forbes World’s Best Employers 2023
• Forbes Best Employers for Diversity 2023
• TIME Magazine World’s Best Companies 2023
• Heavy Duty Trucking Top 20 Product Award