As an industrial manufacturing company that depends on natural resources and serves as the supply chain for industrial customers, ITW has a special relationship with and responsibility to the environment.

A new sustainability program kicks off

Our position on sustainability is simple: while striving for economic success, we must address any potentially harmful environmental impacts of our products and processes. We are committed to reducing waste and energy usage, focusing our innovation on low-impact, more efficient products and understanding the entire product life cycle. We believe environmental impact reduction parallels our long-standing efficiency-driven operating philosophy.

In 2009, we determined as an organization to elevate this commitment to a higher level of accountability that would allow us to report on our sustainability efforts. Using a phased approach, a web-based data collection site was introduced to our business units worldwide. The site is used to collect data on the amount of electricity, natural gas, oil and propane consumed to determine the amount of greenhouse gas emitted from our facilities. In addition to energy usage, data on the amount of water consumed are also collected. This information will be available later in 2010.

We also introduced a sustainability page on the ITW intranet that includes a set of tools for our businesses to conduct energy-usage assessments, establish recycling programs and participate in existing programs and share success stories and ideas.

Innovative Solutions, Reduced Emissions

Although our corporate sustainability-reporting program is new, many of our business units have continuously used ITW’s long-standing, efficiency-driven operating philosophy to make meaningful changes to lessen the environmental impact of their operations and products. For example, in 2009:

• ITW Dahti Seating, seating component designer and manufacturer, made numerous facility upgrades to reduce energy consumption, including applying the principles of geothermal heating to use process-generated heat to warm and cool its facility and melt snow from a walkway.
• Wilsonart, a global leader in decorative surfaces, has increased the amount of recycled content in its decorative laminate products to more than 20 percent.
• Signode, producer of plastic and steel strapping and strap application equipment, is one of the largest polyethylene terephthalate (PET) recyclers in the United States. Signode has improved its PET strap product, allowing it to use less material to create an end product that is stronger than previous versions.
• Thirty-five environmental compliance audits revealed more than 40 sustainability-related projects among our business units. These projects include energy conservation through lighting changes; upgrading equipment to increase efficiency; pollution reduction through reduced use of petroleum-based cutting fluids and oils; increased recycling; ergonomic improvements; and employee training.

In addition to the efforts of our business units, at the corporate level we have also made progress in sustainability-related initiatives. ITW has responded to the Carbon Disclosure Project for the past five years, and we have seen an annual increase in our scores. Our Toxic Release Inventory (TRI)-based air emissions have decreased by 30 percent from 2004 through the most recent reporting year, 2008, while our revenue increased by 35 percent during this same period. We currently have approximately 50 sites registered to the International Standards Organization (ISO) 14001, an environmental management system standard.

Also at the corporate level, the ITW Strategic Sourcing Group began its Go Green Initiatives to help our businesses reduce energy consumption. By partnering with a leading lighting technology provider, the Strategic Sourcing Materials Repair and Operating Group implemented multiple lighting retrofit projects that will reduce our businesses’ energy consumption by 4,000,000 kilowatts year after year, reducing our indirect emissions.

Looking ahead

As we move forward with our new sustainability-reporting program, our businesses and their employees will be supported by the sustainability tools and programs we already have in place. In the future, these tools will also include educational modules, and the Go Green Initiatives will include a waste management and recycling program. We will also continue to expand our energy reduction program. To increase the level of accountability and monitor our progress, we will implement an internal score card program and establish reduction targets.

At ITW, we are truly excited about the growth of our sustainability reporting program, and we look forward to sharing our progress with you in the future.