Our annual ESG reporting covers our process for, and progress in addressing environmental, social and governance topics that are relevant to the company and our stakeholders. This report covers 2020 enterprise-wide information and data for Trane Technologies, unless otherwise noted.
A formal materiality process defines our ESG priorities, shapes our strategy, guides our goal setting, and defines our resource allocation and reporting. We start by reviewing our business priorities and conducting a peer analysis. Then, based on both quantitative and qualitative research and feedback from internal and external stakeholders, we identify and capture priority topics in a matrix that provides a snapshot of the ESG challenges and opportunities of highest importance. Our most material ESG topics — the non-financial topics that are of greatest impact to our business and our stakeholders — fall in the upper right-hand quadrant of the materiality matrix.
Our most recent materiality assessment, refreshed in 2018, identifies our most important ESG issues as:
Climate change is an issue that impacts many of those topics. As a result, identifying opportunities to address climate change is a key component of our ESG strategy — read more about our approach.
We are committed to reporting on these topics and to enhancing our disclosures on these issues whenever possible. This report outlines our management approach, data and initiatives for each of these material topics. It is compiled and reviewed by our subject matter experts, the Center for Energy Efficiency and Sustainability (CEES) and sustainability leadership council. Read more about our materiality assessment and governance processes.
Our annual ESG report aligns with leading ESG and sustainability frameworks including
ESG information is integrated into our annual financial reporting — a reflection of our business focus on sustainability and commitment to meeting the requirements of the European Union’s Directive on Non-Financial Disclosures. See our non-financial statements in our 2020 Annual Report.
Throughout this report, we define our organizational boundary using the financial control approach and report on Scope 1 and 2 greenhouse gas (GHG) emissions using the GHG Protocol Initiative’s guidelines. We believe this most accurately reflects the direct impact of our operational footprint. The company’s Scope 3 product-related emissions represent those emissions associated with the product use phase and cover greater than 75% of the revenue associated with the diverse product portfolio. For data associated with the company’s 2030 gigaton commitment, heating and cooling output is normalized in tons to capture product performance improvements.
We report data from newly opened and acquired facilities as soon as valid data is available. For recently closed or sold facilities, the data is included for the time period a site was part of the company to ensure year-over-year comparisons remain consistent. As such events occur, baselines are adjusted to account for these operating footprint changes. As our data collection system continues to mature and improve, the environment data we report improves in accuracy and expands in breadth.
Data is presented in absolute and normalized by company revenue (intensity) terms. We use the A410000 Trade Revenue (Net) to normalize environmental and energy data which provides valuable insights into the level of eco-efficiency across our diversified operations and allows benchmarking against the performance of other capital goods companies. Our safety data is normalized by the number of hours worked.
Our environmental, health and safety data are assured annually by a third party; view the results of our 2020 assurance statement.