Climate Change Data

Environmental Metrics

ESG Focus Areas

• Governance & Ethics
• Community Involvement
• Safety, Health, & Wellness
• Environment & Sustainability
• Talent Management – Diversity & Inclusion
• Supply Chain Responsibility

Environmental Achievements

• Reduced energy intensity by 14% and emissions intensity by 12% compared to 2011.
• 75 percent reduction in spent solvent waste at ITW Polymers Coatings Houston facility.
• Recycling of acetone at Trident to reduce hazardous waste disposal and solvent costs.
• Installation of FilterAir 2000 system at Tregaskiss to recycle air exposed to welding fumes.

Social Achievements

• Increased participation in the “Living Well at ITW” personal health assessment by 38%.
• Launched the volunteer program, generating $193,490 for 327 nonprofits.
• Matching gift program totaled $11.4 million, with $8.1 million from the ITW Foundation.
• Established the Asia Women’s Resource Group and Young Professionals Network.
• Supported the construction of the ITW David Speer Academy charter high school.

Governance Achievements

• Established the Supplier Code of Conduct.
• Refined processes for obtaining conflict mineral declarations from suppliers.
• Formalized a set of expectations for Great ITW Leaders.

Climate Goals & Targets

Environmental Challenges

• Meeting energy reduction targets for top energy-consuming businesses.
• Ensuring compliance with conflict minerals regulations.
• Maintaining a high level of occupational safety and health compliance.

Mitigation Strategies

• Implemented an energy reduction pilot program with energy audits.
• Revised and clarified instructions for completing the online conflict minerals form.
• Provided support and guidelines to aid businesses in their safety and health efforts.

Supply Chain Management

Supplier Audits: Occasional audits and site visits of suppliers by Foster Refrigerator.

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: ISO 14001 (at more than 60 sites)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Evercoat’s EcoResin™ filler
• ITW Fluids’ new aerosol products with nitrogen propellant and 100% recyclable packaging

Awards & Recognition

• Miller Electric’s Gold Well Workplace Award from the Wellness Council of America

Environmental Metrics

ESG Focus Areas

• Employee Safety
• Diversity & Inclusion
• Community Involvement
• Environmental Responsibility
• Product & Supply Chain Responsibility

Environmental Achievements

• Installed variable frequency drives on injection molding equipment, reducing energy use by an estimated 446,021 kilowatt hours annually.
• Developed a battery-powered ground power unit reducing CO2 emissions by 90% and NOx emissions by 95% compared to a diesel unit.
• 68 sites (approximately 18% of ITW's global sites) achieved ISO 14001 certification for environmental management.

Social Achievements

• Increased percentage of global leaders who are women and percentage of ethnically diverse leaders in the U.S.
• Launched the African American Network (AAN) to support recruitment, development, and retention of African American workforce.
• Launched a formal enterprise internship program in the U.S., placing 92 interns.

Governance Achievements

• ITW's Board of Directors includes two women and two African-American men; 10 of 11 directors are independent (according to NYSE definition).
• Implemented a comprehensive Enterprise Safety Strategy.
• Partnered with ERM to audit environmental and safety risks at facilities.

Climate Goals & Targets

Environmental Challenges

• Reducing environmental footprint of operations and products.
• Meeting 2020 employee diversity goals.
• Maintaining a strong safety culture and achieving Zero Accidents.

Mitigation Strategies

• Implemented a three-pronged approach to managing environmental performance: auditing facilities, voluntary reporting to organizations like CDP, and implementing guiding policies.
• Continued to make progress toward 2020 diversity goals by increasing the percentage of women and ethnically diverse leaders.
• Implemented a comprehensive Enterprise Safety Strategy to build a stronger safety culture.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: CDP

Certifications: ISO 14001

Sustainable Products & Innovation

• Clean-tech products representing approximately 22% of ITW's overall revenue.

Awards & Recognition

• The Just 100 America’s Best Corporate Citizens list by Forbes
• Barron’s 100 Most Sustainable Companies

Environmental Metrics

ESG Focus Areas

• Governance & Ethics
• Our People
• Our Communities
• Our Environment

Environmental Achievements

• 6.5 percent greenhouse gas emissions intensity reduction in 2018 compared to 2017
• Reduced energy costs by up to 85 percent at the Enkenbach, Germany facility through improved cooling system
• Recycled isopropyl alcohol (IPA) at Magnaflux China facility, eliminating three metric tons of waste per year

Social Achievements

• Reduced lost time accidents by 23 percent in 2018 compared with 2017
• Trained over 1,000 leaders to understand and address unconscious bias
• ITW David Speer Academy founding class achieved a 98 percent graduation rate and 97 percent of students were the first in their families to attend college

Governance Achievements

• Strong independent lead director on the Board
• Two female and two African-American men on the 11-member Board

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct
• Supplier Expectations

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: ISO 14001 (87 sites)

Third-party Assurance: Third-party verification of emissions data

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• ElectroPuls™ Dynamic Test Instruments (Instron)

Awards & Recognition

• 2018 Addams-Palmer Award for Exemplary Civic Involvement

Environmental Metrics

ESG Focus Areas

• Governance & Ethics
• Our People
• Our Communities
• Our Environment

Environmental Achievements

• Reduced GHG emissions intensity by 18 percent in 2019 versus the 2017 baseline year.
• 111 sites (approximately 26 percent of ITW’s manufacturing sites globally) had ISO 14001 certification for environmental management.

Social Achievements

• Achieved a 15 percent reduction in lost time accidents in 2019.
• Continued progress toward company goals for female representation and U.S. ethnic diversity in leadership.
• Cascaded Inclusive Leadership initiative to foster a more inclusive work environment.
• Over 73 percent of colleagues contributed to the annual United Way campaign, resulting in $6.5 million invested in communities.

Governance Achievements

• Board composition of 10 directors, including two females and two African-American men, resulting in 40 percent gender or ethnic diversity (as of May 2020).
• Established a company-wide GHG emissions intensity reduction target: By 2027, reduce combined Scope 1 and 2 GHG emissions per U.S. dollar of operating revenue by 20 percent below 2017 levels.

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: More than 1,300 suppliers representing 38% of global third-party spend audited in 2019.

Responsible Procurement

• Supplier Code of Conduct
• Supplier Expectations
• Purchase order standard terms and conditions

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 14001, ISO 45001, OHSAS 18001

Third-party Assurance: A recognized third party

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• ITW GSE 7400 ground power unit (GPU)

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Governance & Ethics
• Our People
• Our Communities
• Our Environment

Environmental Achievements

• 26 percent GHG emissions intensity reduction through 2020, compared with the 2017 baseline
• 118 facilities (approximately 28 percent of ITW’s manufacturing facilities globally) had ISO 14001 certification for environmental management by the end of 2020

Social Achievements

• 37 divisions and business units achieved zero lost time accidents for the full year 2020
• Launched “Do More” Agenda to promote and support more inclusive economic growth and opportunity in underserved communities
• Joined OneTen, a 10-year initiative to train, hire and advance 1 million Black Americans into family-sustaining jobs

Governance Achievements

• 40 percent overall Board diversity (20 percent gender diversity and 20 percent racial/ethnic diversity)

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic
• Issues of racism and discrimination

Mitigation Strategies

• Implemented protocols in compliance with WHO, CDC, and ECDC guidance to protect employee health and safety during the pandemic
• Implemented aggressive workplace sanitation practices and a coordinated response to ensure access to personal protective equipment
• Launched “Do More” Agenda to address issues of racism and discrimination
• Joined OneTen initiative

Supply Chain Management

Supplier Audits: 99 percent of identified high-risk suppliers obtained certification of compliance with Supplier Code of Conduct in 2020

Responsible Procurement

• Supplier Code of Conduct
• Supplier Expectations
• Conflict Minerals Policy
• Focus on sourcing more environmentally friendly and sustainable materials

Climate-Related Risks & Opportunities

Physical Risks

• flood, wind and hurricanes, earthquakes and fire

Transition Risks

• introduction of climate change-related regulations

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 14001, ISO 45001, OHSAS 18001, ISO 9001

Sustainable Products & Innovation

• RingCycles™ (Hi-Cone)

Environmental Metrics

ESG Focus Areas

• Governance & Ethics
• Our People
• Our Communities
• Our Environment

Environmental Achievements

• 37 percent reduction in GHG emissions intensity through 2021 (compared with the 2017 baseline)
• Clean-tech products represented approximately 29 percent of overall revenue in 2021, a 7 percentage point increase over the last four years.

Social Achievements

• Continued progress on diversity and inclusion goals; expanded inclusive-leader training to all managers and supervisors (nearly 4,300 participated)
• Executed the “Do More” Agenda, focusing on inclusive economic growth and opportunity in underserved communities; initiated programs to hire and develop skilled technicians in partnership with technical colleges.
• Increased U.S. third-party spend on products and services from diverse suppliers.

Governance Achievements

• Updated ITW Code of Conduct in 2021
• Strengthened language related to worker rights in the Supplier Code of Conduct
• Board conducts annual review of ESG strategy; receives periodic updates on ESG performance.

Climate Goals & Targets

Environmental Challenges

• Significant supply chain issues throughout the year
• Modest increase in incident rates in 2021 compared to 2020 (attributed to COVID-19 impacts, new hires, and supply chain challenges).

Mitigation Strategies

• Strong supplier relationships and considerable effort from the ITW team overcame significant supply chain issues.
• Implemented protocols in compliance with CDC, WHO, and ECDC guidance to address COVID-19 challenges.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• Supplier Expectations
• Standard Terms and Conditions
• Focus on diverse suppliers
• Local sourcing
• Sustainable materials

Climate-Related Risks & Opportunities

Physical Risks

• Flood, wind and hurricanes, earthquakes and fire

Transition Risks

• New regulations impacting cost of energy or ability to use certain materials

Opportunities

• Growing electric vehicle market

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 14001, ISO 45001, ISO 9001

Sustainable Products & Innovation

• Hobart rack type dishwasher CS line (reduced water and energy consumption)
• Lumex LED lighting options
• Lumex Switch (supports electric bike industry)
• Formex EV battery and energy storage solution
• Instron test equipment (testing alternative materials)
• MTS test equipment (supports alternative materials)

Awards & Recognition

• Smart Fox award (ITW Engineered Fasteners & Components in Selb, Germany)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Governance
• Employee Safety
• Community Investment
• Supply Chain Responsibility

Environmental Achievements

• Reduced combined Scope 1 and Scope 2 GHG emissions per U.S. dollar of operating revenue by 45% from the 2017 baseline, exceeding the 40% goal.
• Clean-tech products represented approximately 30% of ITW’s 2022 revenue, an 8-percentage-point increase since 2017.

Social Achievements

• Improved diversity of leadership pipeline with female representation at 28% and U.S. racial/ethnic diversity increasing to 19% among top 1,000 leaders.
• More than 4,900 global managers and supervisors participated in inclusive leader training.
• Total philanthropic giving was $22 million, supporting various community initiatives.
• Approximately 50% reduction in lost time accidents and medically treated incidents since 2017.
• $200 million in U.S. third-party spend with diverse suppliers.

Governance Achievements

• Refreshed sustainability strategy in 2022 with Board of Directors collaboration.
• Established a new GHG emissions reduction target: 50% absolute reduction of Scope 1 and Scope 2 GHG emissions by 2030 (compared with 2021 baseline).
• Updated Code of Conduct, Supplier Code of Conduct, and Corporate Governance Guidelines in 2022.
• 45% gender and/or racial/ethnic board diversity.

Climate Goals & Targets

Environmental Challenges

• Scope 3 emissions quantification and reduction.
• Supply chain disruptions.

Mitigation Strategies

• Data-driven approach to study Scope 3 emissions and feasibility of carbon neutrality.
• Strong supplier relationships and efforts to overcome supply chain issues.

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• Supplier Expectations
• Responsible Minerals Sourcing
• Combating Modern Slavery

Climate-Related Risks & Opportunities

Physical Risks

• Flood, wind, hurricanes, earthquakes, fire (at some facilities)

Transition Risks

• Changes in energy costs and material usage due to regulations

Opportunities

• Customer-Back Innovation for energy-efficient products

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 14001, ISO 9001, ISO 45001

Sustainable Products & Innovation

• Lightweight fasteners, door handles, EV charging port components, battery cans, energy-efficient tools, low energy/water consumption kitchen equipment, lubricants and cement for wind turbines, engine oil additives, beverage ring carriers with recycled content, zero-emissions ground power units, etc.

Awards & Recognition

• United Way of Metro Chicago’s 2022 Corporate Leadership Award

Environmental Metrics

ESG Focus Areas

• Governance & Ethics
• Environment
• People
• Communities

Environmental Achievements

• ~30% absolute reduction in Scope 1 and Scope 2 GHG emissions compared with a 2021 baseline
• 65% of total electricity spend was on green electricity
• Completed 10+ solar projects, with 20+ projects in the due diligence phase
• ~31% of ITW’s revenue came from clean-tech products, up from 22% in 2017

Social Achievements

• 29% women (global) and 20% people of color (U.S. only) among our top 1,000 leaders
• 87% of colleagues recommend ITW as a great place to work
• Rolled out a data-driven framework to help ensure a consistent employee experience across our global businesses
• $40+ million multi-year investment in buildings and property acquisition, capital improvements and workforce development to add manufacturing jobs in the Austin/Belmont-Cragin neighborhood

Governance Achievements

• Board diversity: 42% overall diversity (25% gender diversity and 17% racial/ethnic diversity)
• Annual Code of Conduct training for all colleagues and directors
• Multiple channels for reporting ethics or compliance concerns (including a confidential helpline)

Climate Goals & Targets

Environmental Challenges

• Understanding and reducing Scope 3 emissions
• Maintaining a consistent employee experience across global, decentralized businesses

Mitigation Strategies

• Investing in resources to better understand value chain (Scope 3) emissions, identifying top categories, engaging key suppliers and customers, and identifying reduction opportunities
• Developed and rolled out a data-driven framework to ensure a consistent employee experience

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct
• Responsible Materials Policy
• ITW Human Rights and Modern Slavery Statement

Climate-Related Risks & Opportunities

Physical Risks

• Flood, wind and hurricanes, earthquakes and fire

Transition Risks

• New regulations impacting cost of energy or ability to use certain materials

Opportunities

• Development of energy-efficient products and solutions

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 14001, ISO 9001, ISO 45001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Automotive OEM lightweighting components
• Energy/water conservation in food equipment
• Emissions reductions in welding

Awards & Recognition

• Not disclosed