Non-Financial Statements European Union Directive
The information below, and the policies and related content elsewhere in this report, describes the performance and impact of Trane Technologies plc (formerly known as Ingersoll-Rand plc), a public limited company incorporated in Ireland in 2009, through the environmental, social, human rights and business practices we work to uphold.
The European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups) Regulations 2017 (S.I. 360/2017) (as amended) (the “2017 Regulations”) require us to disclose certain non-financial information in the Directors’ Report (the
“Irish Directors’ Report”) accompanying our Irish statutory financial statements. For the purposes of the 2017 Regulations, the sections entitled Description of Business Model, Environmental Matters, Employee Matters, Social Matters, Human Rights, and Anti-Corruption and Anti-Bribery set out below are incorporated by reference into the Irish Directors’ Report.
Our 2020 Annual Report and ESG Report also provide information that may be relevant to investors in assessing sustainability commitments and achievements but, except as expressly provided above, the 2020 Annual Report and ESG Report are not incorporated by reference into the Irish Directors’ Report. Copies of this 2020 Annual Report and ESG Report can be accessed at www.TraneTechnologies.com.
Description of Business Model
We are a global climate innovator that brings efficient and sustainable climate solutions to buildings, homes and transportation driven by strategic brands Trane and Thermo King and an environmentally responsible portfolio of products and services.
In 2020, we generated revenue and cash primarily through the design, manufacture, sale and service of a diverse portfolio of climate control products and services for Heating, Ventilation and Air Conditioning (HVAC) and transport solutions. We are focused on growth by increasing our recurring revenue stream from parts, service, controls, used equipment and rentals; improving the efficiencies and capabilities of our operations and products and services for our customers; and applying operational excellence strategies to improve our earnings and cash flow.
Approach: Our commitment to sustainability extends to the environmental impacts of our people, operations, and products and services. From the efficiency of our buildings to our progress in managing energy, water and waste, we are focused on reducing our impact on the environment and embedding sustainability throughout our businesses. We engage with key stakeholders to identify the most material sustainability-related matters and metrics for operations strategy as well as public disclosure. We also look at these material topics through the lens of a value chain assessment that we perform. These commitments are embedded in an Environment, Health and Safety (“EHS”) Policy that defines our stakeholders, our roles and responsibilities, and our goals and targets with respect to EHS matters and our Business Partner Code of Conduct (“BPCoC”).
Due diligence processes: We have a vital role to play in mitigating global climate change by reducing our environmental impact. This responsibility begins by setting specific and measurable climate commitments and working to achieve these goals. We also work to systematically ensure that our suppliers share our values and adhere to our standards as specified in our BPCoC. Suppliers must have an effective environmental policy and conduct their operations in a way that protects the environment. They must also obtain and keep current all required environmental permits and meet all applicable environmental rules, regulations and laws in the countries where they operate.
Policy outcomes / Key Performance Indicators: Our global Climate Commitment is the foundation of our efforts to increase energy efficiency and reduce the greenhouse gas emissions related to our operations and products. Our Center for Energy Efficiency and Sustainability (CEES) helps our customers and our company leverage best practices in sustainability. It is a strategic business catalyst that helps us understand the benefits that sustainability can have in growing our company and reducing our operational footprint, while helping increase the pace of sustainable innovation.
Our energy consumption from fuels and electricity totaled 2.8 billion kilojoules in 2020. Greenhouse gases emitted indirectly through the use of electricity, and directly, through the burning of fuels or emissions of refrigerants, totaled 420,050 metric tons of CO2e.
- Absolute energy consumption in 2020 – 2,644,944,325,551Btu (equivalent to 775,157 MWh; 2.8 billion kilojoules)
- Absolute Scope 1 and 2 emissions in 2020 – 420,050 metric tons CO2e in 2020
Approach: As a global organization that employs approximately 37,000 people, we are committed to building a diverse workforce and an inclusive environment in which people of all backgrounds are treated with equality and respect. We work to ensure we provide a safe, secure workplace that supports employee well-being and productivity. Investing in our associates and creating a culture where they feel engaged and included is key to unleashing the power of their innovation and creativity. We have a number of policies to formalize our commitments to our employees and communities including our EHS Policy that addresses employee health and safety among other matters. In addition our Global Human Rights Policy, U.S. Equal Employment Opportunity Policy, and our Policy Prohibiting Harassment or Discrimination are made available to our employees worldwide and affirm these commitments.
Due diligence processes: To reinforce our commitment to cultivate a diverse and inclusive workplace, we were the first company in our industry to enter the Paradigm for Parity Coalition, a pledge to bring gender parity to our corporate leadership structure by 2030. We also provide anti-harassment training to all salaried employees and make clear policies available to employees worldwide. Creating and sustaining a safety-focused, zero-incident culture is a priority. We communicate our safety expectations through quarterly CEO town hall meetings and monthly EHS meetings at the facility and service-organization levels.
Policy outcomes / Key Performance Indicators: Consistently high annual employee engagement scores demonstrate that we are creating an environment where our people are learning, thriving and expanding their capabilities. We offer a range of learning experiences for managers and employees to expand our culture of inclusion. Our Bridging Connections sessions create an opportunity for employees to speak openly about topics such as race, gender, ethnicity and sexual orientation, and address issues related to unconscious bias. Our growing number of employee resource groups serve as a foundation to discuss these topics at a deeper level and to engage in the learning and training critical to building a stronger company.
- 25.3% of global workforce are women
- 21.7% of leadership positions are held by women
- 90% participation rate in annual employee engagement survey
- World-class employee engagement score
Approach: Through a variety of social sustainability initiatives, we seek to engage directly with the communities where our associates live and work, which helps to create shared value and engage our worldwide team in the mission and purpose of the company. Our commitment to social sustainability is also expressed through our supplier diversity program.
Our most prominent community initiatives include our Glocal (global + local) program that encourages our employees to partner with local nonprofits and community organizations to advance our social sustainability efforts and nurture authentic engagement. We are taking action on specific social and environmental imperatives that create shared value, result in sustained customer and employee loyalty, and improve the communities where we have business operations. These actions include increasing female representation in the fields of science, technology, engineering and math, addressing nutrition and food waste reduction and supporting housing and shelter needs. Our supplier diversity program embraces suppliers whose ownership is primarily minorities, women, veterans, LGBTQ individuals or people with disabilities.
Due diligence processes: We track employee and community engagement data including the hours and number of volunteers who participate in community or sustainability initiatives. We use a 7-step strategic sourcing process that includes a Supplier Diversity Matrix, which enables us to avoid using price as the primary driver for supplier selection.
Policy outcomes / Key Performance Indicators: Implementing Glocal and our supplier diversity program has contributed to increases in global contributions as measured by the number of associates who have participated in community or sustainability initiatives, the total number of hours volunteered and the dollar value of philanthropic giving.
- $380.4 million in purchased goods and services from diverse-owned businesses
- $10,933,910 million in total philanthropic giving
- 49% of employees globally participated in virtual community or sustainability initiatives
Approach: We believe in fundamental standards that support our commitment to our employees, our business partners, our customers and our communities. We have adopted a number of policies that underline our commitment to human rights. Our Global Human Rights Policy aligns with basic working conditions and human rights concepts advanced by international organizations such as the International Labor Organization and the United Nations. Our Modern Slavery and Human Trafficking Statement outlines our commitment to taking steps to ensure that human trafficking and forced labor is not taking place in our supply chain or business. Our BPCoC prohibits human trafficking, including forced or child labor.
Due diligence processes: We engage in reasonable due diligence and screening of customers and distributors to ensure compliance with laws that regulate international trade. We also established a Global Procurement Sustainability Council to work with suppliers on improving conditions and addressing non-compliances.
In 2020, we used our supplier risk assessment process to review the environmental, social and governance practices of our suppliers, including human rights. We worked with suppliers on improving conditions and all were found to be in compliance.
Policy outcomes: Our Global Human Rights Policy is communicated to employees through our Code of Conduct training. As part of our annual compliance training, we have implemented a full training course dedicated to anti-human trafficking.
Anti-Corruption and Anti-Bribery
Approach: We are proud of our strong business ethics and sustainable business practices, and our values centered in integrity, respect, teamwork, innovation and courage. Our values, ethics and commitment to sustainability are core to how we operate and serve customers. Our BPCoC applies to all entities doing business with us and communicates our expectations that our business partners will practice the highest legal, moral and ethical standards when conducting our affairs.
Due diligence processes: Business partners and service providers are risk-rated and vetted with higher risk third parties undergoing enhanced compliance due diligence. We leverage the services of a third-party vendor to conduct compliance screenings from thousands of global public records databases.
Policy outcomes: Salaried employees receive role-based, online compliance training every year. In 2020, 100% of U.S. salaried employees received anti-corruption training.