2018-2019 SUSTAINABILITY REPORT - BORGWARNER
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2018 –2019 Sustainability Report
1. CEO Letter
2. Mission and Beliefs
3. GOVERNANCE
4. Sustainability Relative Importance Assessment
6. Basic Working Conditions
7. Ethics
8. Protecting What’s Important
9. Cascading to Global Suppliers
10. BorgWarner Government Overview
Index 12.
13.
PRODUCTS
Sustainable Technologies + Products
14. Innovation and PACE Award Summary
16. ENVIRONMENT
17. Environmental Goals
20. Reporting Transparency
21. Operations
22. “LEED-ing” the way
24. Renewable Energy Expands Across BorgWarner
26. C O R P O R AT E S O C I A L R E S P O N S I B I L I T Y
28. Safety
30. All-Employee Survey
31. Diversity
32. Developing our People
34. Giving Back
37. A Sustainable Future
38. GRI Index
Statements contained in this report may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management’s cur-
rent outlook, expectations, estimates and projections. Words such as “anticipates,” “believes,” “continues,” “could,” “designed,” “effect,” “estimates,” “evaluates,” “expects,” “forecasts,”
“goal,” “initiative,” “intends,” “outlook,” “plans,” “potential,” “project,” “pursue,” “seek,” “should,” “target,” “when,” “would,” variations of such words and similar expressions are intended
to identify such forward-looking statements. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control,
that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. Such risks and uncertainties include: fluctuations
in domestic or foreign vehicle production, the continued use by original equipment manufacturers of outside suppliers, fluctuations in demand for vehicles containing our products,
changes in general economic conditions, as well as other risks noted in reports that we file with the Securities and Exchange Commission, including the Risk Factors identified in our most
recently filed Annual Report on Form 10-K. Goals are aspirational targets. They are not promised to be delivered nor guaranteed for achievement. Standards of measurement of perfor-
mance are developing and based on estimates. We do not undertake any obligation to update or announce publicly any updates to or revision to any of the forward-looking statements.
2
2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
AT B O R G WA R N E R W E A R E WO R K I N G TO AC H I E V E O U R V I S I O N O F :
A clean, energy-efficient world.
This broad perspective inspires our employees and reinforces our
belief that we are uniquely positioned to deliver eco-friendly solutions
to protect the environment and improve the world we live in.
We also embrace our mission to be:
A Propulsion System Leader for Combustion, Hybrid and Electric Vehicles.
Our mission, in concert with our vision, sets the future product direction
for our business. At BorgWarner, sustainability starts with the advanced
propulsion system technologies we produce – for passenger cars, light
trucks, commercial trucks, construction equipment and agricultural
applications around the world. It continues with our manufacturing
operations where our employees continually look for ways to conserve,
recycle and reuse resources efficiently.
As product leaders, we are proud of our award-winning,
environmentally friendly technologies. We are equally proud of the
people who work at BorgWarner. The same “can-do” attitude and
spirit of integrity that drives our employees to develop the latest
propulsion innovations also supports local communities. From
the plant floor to the executive office, our employees are actively
involved in giving back.
Sustainability is an integral part of who we are and what we do. I invite
you to learn more about how BorgWarner strives to make the vehicles
we all drive more efficient and the world we live in cleaner, while
supporting the communities where we live and work.
Frédéric Lissalde
President and Chief Executive Officer
1
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BorgWarner Mission
A Propulsion System Leader for Combustion,
Hybrid and Electric Vehicles
BorgWarner Beliefs
As individuals and as a team, we are product leaders guided by our beliefs:
Respect for Each Other
Power of Collaboration
Passion for Excellence
Personal Integrity
Responsibility to Our Communities
2
< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
Governance
Sustainability
At BorgWarner, ultimate oversight for Sustainability lies with the Board of Directors.
The BorgWarner Corporate Governance Committee charter states that the Corporate
Governance Committee is authorized to periodically review and make recommendations
about the Company’s sustainability strategy, policies and procedures to encourage
long-term sustainable performance, and effective communication of sustainability
initiatives to stakeholders.
The Executive Management Team (Strategy Board) determines the sustainability and
Corporate Social Responsibility (CSR) strategies, approves goals and provides resources
to meet performance targets. Periodic progress updates are provided to the Strategy
Board to review performance to goals on a segment and total company basis.
BorgWarner completed its first Sustainability Relative Importance Assessment
(commonly referred to as a sustainability materiality assessment) in 2017.
3
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Sustainability Relative
Importance Assessment
The BorgWarner Sustainability Relative This cross functional team was
Importance Assessment was compiled selected to assure the expectations
to focus and align our organization on of all stakeholders were represented.
the highest ESG (Environmental, Social Next, a survey was developed and
and Governance), CSR (Corporate sent to stakeholders throughout the
Social Responsibility) and sustainable organization to assure their perspective
business priorities as ranked to on priorities was the basis for our
represent our external and internal Relative Importance Assessment. governance
stakeholders’ expectations. We first Responses from the C-suite to
developed an initial set of relevant individual contributors were compiled
topics by canvassing industry sources to develop the Assessment. The graph
such as AIAG (Automotive Industry on the following page identifies the
Action Group), SASB (Sustainability relative importance of these topics
Accounting Standards Board) and to BorgWarner.
the GRI (Global Reporting Initiative).
We then reviewed customer and peer
reports so we could expand our view of
additional industry relevant topics. A
cross-functional team of BorgWarner product
leadership was then assembled to
finalize the topics and set boundaries.
environment
On the following page is a summary of all
reviewed topics. All of these topics have importance
to BorgWarner and our stakeholders. The topics
selected for focus and reporting are the 13 that
yielded the highest prioritization ranking across all
4 pillars of our Sustainability Platform.
social
4
< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
R E L A T I V E I M P O R T A N C E I N D E X
5.0
9
22 20 8
23 3
1
10
IMPORTANCE TO EXTERNAL STAKEHOLDERS
4.5 21
4
2
11
25 6
14 5
24
4.0
15
16
7
26 17 12
3.5 18
19
13
3.0
3.0 3.5 4.0 4.5 5.0
IMPORTANCE TO BORGWARNER BUSINESS
TOPICS
GOVERNANCE PRODUCT ENVIRONMENT SOCIAL
1 Ethical Business Practices 8 Product Safety 14 Energy &
20 Ethical Behavior
Greenhouse Gasses
2 Compliance Assurance /
9 Quality 21 Human Rights
Audits 15 Resource Management &
10 Propulsion Efficiency/
Waste Conservation 22 orkplace Health,
W
3 Financial Discipline Product Leadership Safety & Wellness
16 E
nvironmental
4 Privacy & Data Security 11 Customer Satisfaction Management Systems
23 Employee Relations
5 Business Process & 12 Materials of Concern 17 Process Emissions 24 Diversity & Inclusion
Transparency
13 Product
End-of-Life & 18 Ecosystems / Biodiversity 25 Talent Management
6 Supply Chain Remanufacturing & Engagement
19 Water Conservation &
7 Government Regulations Protection 26 Community Involvement
& Policy
5
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Basic working conditions
Our Basic Working Conditions Policy requires every BorgWarner location to
provide working conditions that comply with applicable laws and are consistent
with BorgWarner’s Beliefs. The policy prohibits forced labor and child labor,
while requiring freedom of association, lawful compensation and observance
of local laws regulating working hours.
With the increased awareness of violence and human rights violations in mining
conflict minerals in central Africa, BorgWarner is committed to continuing
to operate in a socially responsible manner and expects all of our suppliers
throughout our supply chain to supply products and materials from socially
responsible sources. We comply with the Securities and Exchange Commission
rule governing reporting of sourcing of tantalum, tin, tungsten and gold.
Ta
Tantalum
Sn Tin
W
Tungsten
Au Gold
73 180.948 50 118.710 74 183.84 79 196.967
“Complying with BorgWarner policies and applicable laws
is at the core of all our business activities. There is no
conflict between excellent financial performance and high
standards of integrity. The two reinforce each other.”
Laurene Horiszny
Vice President and Chief
Compliance Officer, Auburn Hills,
Michigan, USA
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Ethics
We expect every employee to make BorgWarner and reinforced through
ethical choices and uphold BorgWarner’s regular interactive training. Anyone who
high standards of integrity. Our valuable suspects unethical or inappropriate
reputation depends on it. behavior is encouraged to use internal Murali, R
reporting channels or our independent Plant Manager Kakkalur, India
Our Code of Ethical Conduct sets Compliance Hotline. All reports are
principles, expectations and guidelines examined and monitored until resolved. “I’ve worked for BorgWarner
for appropriate business behavior.
since 2002. During that time
It is an important component of BorgWarner recruits, hires, trains and
BorgWarner’s Compliance Program, promotes individuals who are qualified I have been impressed with
which addresses anti-corruption, for any position by reason of education, the company’s ongoing
conflicts of interest, accounting training, experience and personal
commitment to operate with
standards, safety, environmental characteristics, without regard to
awareness and international trade, age, race, color, religion, sex, national the highest ethical standards.
among other compliance and legal origin, sexual orientation, gender Our willingness to provide
matters. The code is introduced identity, disability when unrelated to education and support has
to every employee when they join performance of a specific job, veteran
or marital status. been invaluable. For example,
Global Risk Consultants audit
our facility regularly and then
provide guidance to mitigate
potential risks.”
Honesty
Fair Dealing
Loyalty
Integrity l Con duc t
f Ethica
Code o
Respect for the rights
of others
Responsibility
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Protecting what’s important
At BorgWarner, we are focused on protecting our people,
our property, and our information.
People Intellectual Property
BorgWarner has always focused on In order to promote a cooperative
the safety of our people and those environment throughout the global
who visit our facilities. While achieving organization, BorgWarner adheres to
a high standard in the occupational principles and procedures to safeguard
safety field, we also focus intensely private intellectual property. Whether
on the security of our people while the property has been entrusted to us
they are at work and as they travel by our customers and suppliers or is of
the globe in support of business our own creation, the same standard
needs. Our security team consists of of security is applied. These measures
dedicated internal and external security allow the employees of BorgWarner
professionals who manage global risk to maintain a high level of intellectual
wherever our employees are. property management and enhances
our corporate credibility by ensuring
Privacy a consistent approach across all of
Confidentiality is a governing principle. our operations.
BorgWarner has established a standard
for the respect and preservation of Counterfeit Products
personal information for our employees Through private and government
and partners. We take the protection partnerships, BorgWarner cooperates
of people’s personal information very with industry leaders and takes a pro-
seriously and we hold ourselves to a high active approach in terms of detecting
standard to protect the information we counterfeit products, investigating
have been entrusted with. We meet their source, and holding those
and exceed international regulations responsible for counterfeit products
designed to safeguard the privacy through requests for prosecution. Our
of our employees, customers, and Supplier Manual gives specific guidance
suppliers, while constantly performing to Suppliers and requires the use of
critical internal audits designed to legitimate parts and materials in every
protect against unauthorized access aspect of the manufacturing process.
and the loss of personal information. We are cognizant that the possibility of
counterfeit products bearing our name
exists and we are diligent in seeking to
detect unsafe counterfeit products and
removing them from the market, thereby
enhancing customer confidence in the
safety and legitimacy of the high quality
products produced by BorgWarner.
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Cascading to
global suppliers
Engaging our supply chain in the implementation of sustainable
materials and processes for products and people is one of the
responsibilities of our Global Supply Management team. Working
Dennis Rusiewski
within and across businesses we require our suppliers to commit
Director, Enterprise Supply
to the same sustainable principles we follow within our company Chain Management
(see BorgWarner Supplier Manual, borgwarner.com). During the new
supplier vetting process, we communicate our requirements
for compliance to our expectations delineated in our supplier manual. “We need to know
We provide avenues for free sustainability training for our suppliers
more than the quality
so we can be confident that suppliers understand the commitments
they are making when they agree to be a supplier to BorgWarner. This and price of a product,
training is supportive of the Automotive Industry Guiding Principles
to Enhance Sustainability Performance in the Supply Chain document,
we need to know that
published in 2017. Our purchase orders contractually hold the suppliers the earth, air, water
responsible for meeting our Supplier Manual requirements and
sustainability expectations. We encourage our suppliers to deploy and people were all
environmental management systems within their facilities that conform
taken care of as our
to the requirements of ISO 14001 and to deploy best practice
occupational health and safety systems. suppliers partner with
Through a combination of third party
assessment, on site evaluations, and us to supply the global
face-to-face meetings we continually propulsion market.”
increase our confidence that our
global suppliers are progressing
on their sustainability journeys.
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BorgWarner government overview
BorgWarner is engaged with the public
policy process in a manner that is
transparent and supports our business
interests. We communicate regularly
with government officials in our major
markets to share our perspectives
and ideas. We also collaborate with
public-sector representatives on
economic and workforce development
partnerships.
BorgWarner’s Government Affairs
department oversees lobbying
activities, communications with public
officials, and memberships with trade
associations and other tax-exempt
organizations. The department ensures
lobbying compliance through a third-
party verification process. BorgWarner
complies with all laws governing our
employees and their interactions with
government officials in accordance
with BorgWarner’s code of conduct.
Statement on Political
Government Affairs Department Contributions
Simon Godwin BorgWarner does not make any
Michelle Elder political contributions, even where
Erika Nielsen it is lawful. BorgWarner does not
David Sturza have a Political Action Committee
(PAC). Employees may make personal
contributions on their own time and
with their own resources, however,
the reimbursement of such political
contributions by the company is
strictly prohibited.
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Trade Associations
BorgWarner participates in industry broad range of members, and
and trade organizations that may therefore, represent a broad range
communicate in the interest of their of perspectives. The list below Capital Ideas eBlast
members on legislative and regula- provides examples of our participation
tory issues and be engaged in memberships in the Americas, Europe,
political activities. These types of and Asia as of August 1, 2018.
organizations may represent a
T R A D E O R G A N I Z A T I O N S
US-Hungary Business Council (USHBC)/
China Automotive Technology and European Association of Automotive
American-Central European Business
Research Center (CATARC) Suppliers (CLEPA)
Association (ACEBA)
Manufacturers of Emission Controls
European Green Vehicles Initiative Motor & Equipment Manufacturers
Association (MECA)
Association (EGVIA) Association (MEMA)
Detroit China Business Association
Business Round Table Alliance for Vehicle Efficiency
(DCBA)
US China Automotive Exchange U.S. Chamber of Commerce SAE International
China CEO Forum Illinois Manufacturers Association Michigan Manufacturers Association
China Automotive Elite Society Detroit Regional Chamber / MICHauto Mississippi Manufacturing Association
North Carolina Chamber / North
AmCham China Michigan Chamber of Commerce
Carolina Manufacturing Council
AmCham EU Auburn Hills Chamber of Commerce
Manufacturers Alliance of Central South Carolina Manufacturers Alliance /
New York South Carolina Automotive Council
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Products
We have broadened our suite of products driving
growth and diversifying our offering, providing
increased stability and balance.
I N D U S T R Y M O B I L I T Y T R E N D S W E T R A C K
Autonomous Shared Cars Connected Efficiency /
Driving and Rideshare Cars CO2 Emissions
12< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
Leading today means
looking ahead to tomorrow.
There are few challenges as important
today as creating solutions that
support a cleaner, more energy-
efficient world. This requires a
commitment to constantly improve
the transportation of people and REGULATED TWO-STAGE DUALTRONICTM TRANSMISSION
TURBOCHARGER CLUTCH MODULES
things. We, at BorgWarner, made that
commitment decades ago and have
since been creating technologies to
improve efficiency, emissions and
performance in all types of vehicles.
Our proven track record has made
ENGINE TIMING SYSTEMS EXHAUST GAS RECIRCULATION
us a propulsion system leader for
combustion, hybrid and electric
vehicles. We uncover strong trends
and use smart science and technology
to address a future based on varying
regulations, consumer demands and
automaker requirements.
Our employees have earned trusted
ELECTRIC BOOSTING P0 HYBRID ARCHITECTURE
partnerships with customers and TECHNOLOGIES
suppliers around the world. We
leverage these relationships to
gain a deeper understanding of
the challenges at hand and then do
what it takes to develop the next
solution. Our strong operations
and commercialization expertise P2 HYBRID ARCHITECTURE THERMAL MANAGEMENT
result in high volume availability of
competitive, efficient products that
truly drive change.
EV TRANSMISSION POWER ELECTRONICS
ELECTRIC DRIVE MODULES THERMAL MANAGEMENT
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Innovation and PACE award summary
Creating a cleaner, more energy-efficient world tomorrow starts
with advancing the cause today. Over the last decade, no one has
worked harder to push the envelope of what’s possible than the
forward-thinking engineers at BorgWarner. We’re incredibly proud
of the achievements our teams have been recognized for by the
prestigious PACE Awards for automotive innovation.
2018 Wire Forming for High-Voltage Motors
2015 Front-Wheel Drive Electronic Limited-Slip Differential (FXD)
2014 Stop/Start Accumulator Solenoid Valve (Eco-Launch™ Solenoid Valve)
2013 Regulated 3-turbocharger System (R3S)
BMW with BorgWarner – Regulated 3-turbocharger System (R3S)
2012 Turbocharger for Internal Combustion Engines
with Low-Pressure Exhaust Gas Recirculation
2009 CTA Camshaft Phasing System
Pressure Sensor Glow Plug (PSG) for Diesel Engines
2008 Turbocharger with R2S Regulated Two-Stage Technology
2007 Gasoline Turbocharger with Variable Turbine Geometry
2005 DualTronicTM Dual Clutch Transmission
2 01 8 W I N N E R
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Overcoming end-of-life concerns in a BIG way
BorgWarner has a remanufacturing through manufacturing. As we consider Ian Buxcey
program (REMAN) for many of the Senior Manager Global Remanufacturing,
product life cycle, remanufacturing
BorgWarner Turbo Systems
original equipment parts we supply. results in a single part having multiple
Turbochargers, alternators, generators, lives, thereby saving raw materials.
and exhaust gas recirculating valves Remanufacturing of aluminum, copper “Over two million
are re-manufactured to original and steel parts save natural resources
specifications. The environmental for future generations. The concept of
turbochargers around
benefits of remanufacturing are “core returns” results in millions of tons the world have been
significant. Remanufacturing uses of waste being diverted from landfills
significantly less energy to produce
and put back into use. And reducing revitalized through the
each product compared to production
the consumption of energy positively BorgWarner REMAN
of new products. Industry experts
contributes to air quality and reduction
estimate up to 80% less energy and
of green-house gasses (GHG). program, contributing to
fewer natural resources are used
a significant reduction in
landfill waste, reduced
energy consumption, and
a reduced use of natural
resources.”
EGR valve and turbocharger before and after REMAN
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Environment
Through innovation in Combustion, Hybrid and Electric
propulsion systems, we make vehicles around the world
more environmentally friendly and energy efficient.
Our operations strive to minimize our impact on
the environment while providing employees with
meaningful employment. Our future is sustained by
creating a clean, energy-efficient world.
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Environmental goals
BorgWarner has been working to reduce greenhouse gas
emissions, save energy, decrease waste and conserve water for
many years. Following a comprehensive study of sustainability
data for the baseline year of 2015, we set targets based on
opportunities for improvement and future business trends with
2022 as our year for achievement.
This report includes our 2016 and 2017 results.
In 2017, BorgWarner established a practices to reduce consumption.
corporate supported program to The teams identified 119 conservation
move energy efficiency to the next projects with a 3 year time line for
level. Teams of employees from our full implementation. A total of 10% of
6 largest manufacturing plants along the projects were implemented in the
with energy experts from sister plants first 6 months and the balance are in
and outside consultants analyzed process. These improvements, along
these largest plants to understand with significant revenue growth from
the sources of energy consumption 2015, resulted in progress towards our
and then went to work reviewing environmental intensity goals on the
available technologies and best following page.
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Our 2016-2017 Results
energy emissions
_ 41 _
110
Emissions KPI Target / Actual
Energy KPI Target / Actual
40 _
_
109.0
109.0
5%
40.9
40.9
105 _
39
(all measurements MWh/$MMUSD)
reduction
40.3
108.2
(all measurements tCO2e/$MMUSD)
107.5
_
39.7
38
100 _ 9% 10%
103.6
reduction
37 _ 9% reduction
reduction
95 _ 14% 36 _
13%
37.1
reduction
36.8
35 _ reduction
90 _ 34 _
99.1
35.5
33 _
85 _
_
94.2
32
31 _
80 _
30 _
75 29
2 015 16 17 18 19 20 21 2 022 2015 16 17 18 19 20 21 2 02 2
Our goal is to improve energy intensity by 5% measured Our goal for improvement in greenhouse gasses
as Megawatt hours consumed per million U.S. dollars of is to reduce tons of CO2 emissions per million U.S. dollars of
revenue by 2022. As of December 2017 we have improved revenue by 10% by 2022. As of December 2017 we have
our energy intensity by 14%. improved our greenhouse gas intensity by 13%.
The fourth environmental goal, set in 2015, was to ensure that every
BorgWarner location had an active recycling program. Goal achieved...
100% of our manufacturing
facilities have an active
recycling program in place.
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water
_
34.0
_
33.5
33.0
_ 33.9
kgal/$MMUSD Next we set a company-wide expectation to reduce
Water KPI Actual
_
32.5
water consumption with a special focus in water
_
32.0
6% stressed areas. We identified we have 8 locations
31.5
_ reduction
_
that are deemed to be in water stressed areas.
31.0 31.8
kgal/$MMUSD
30.5
_
_
Normalized to revenue, water intensity has fallen
30.0
_
from 33.9 kilogallons per million U.S. dollars of revenue
29.5
_
to 31.8 kilogallons per U.S. dollars of revenue, a 6%
29.0
overall reduction. When comparing the 8 water
28.5
201 6 201 7 stressed locations, year over year we achieved a
water intensity reduction of 17.7%.
S U S TA I N A B I L I T Y D ATA T R E N D S
SUMMARY KPI PERFORMANCE
Year Total Energy Energy KPI Energy KPI Energy KPI
Energy (MWh) (MWh/$MMUSD) (MWh/$MMUSD) %
2015 874,720.02 109.02 0.00%
2016 898,593.57 99.06 -9.96 -9.14%
2017* 923,416.00 94.23 -14.79 -13.57%
SUMMARY KPI PERFORMANCE
Year Total Emissions Emissions KPI Emissions KPI Emissions KPI Scope 1 Scope 2
Emissions (tCO2e) (tCO2e/$MMUSD) (tCO2e/$MMUSD) % Market-based
2015 328,203.09 40.91 0.00% 58,850.86 269,352.23
2016 336,623.31 37.11 -3.80 -9.28% 58,419.07 278,204.24
2017* 348,266.00 35.54 -5.37 -13.12% 58,927.78 289,337.95
SUMMARY KPI PERFORMANCE
Year Total Water Water KPI Water KPI Water KPI
Water (kgal) (kgal/$MMUSD) (kgal/$MMUSD) %
2016 307,465.71 33.90 0.00 0.00%
2017 311,165.08 31.75 -2.14 -6.32%
*Third party verified.
Goals are aspirational targets. They are not promised to be delivered nor guaranteed for achievement.
19< BACK TO INDEX
R E P O R T I N G T R A N S P A R E N C Y
CDP Performance
BorgWarner Inc. first participated in the Carbon Disclosure Project
(CDP) for metrics that occurred in calendar year 2015. The CDP is an
organization based in the United Kingdom that works with shareholders
and corporations to disclose greenhouse gas emissions of major
corporations. BorgWarner shares its performance with interested
stakeholders to elevate the level of transparency on environmental
performance.
In years 2016 and 2017, BorgWarner scored a “C” which is defined as
Awareness in the CDP Climate Change Feedback Chart.
The 2017 performance metrics were verified by a third party prior to
our CDP submittal. The selected third party provider is an accredited
verification partner of the CDP.
CDP verification statement
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O P E R A T I O N S
At BorgWarner, sustainability starts with our products, but continues
in our operations. As an operating team, we strive to ensure we have
safe and environmentally friendly manufacturing and engineering
centers where our people can thrive as they support our customer
needs for innovative propulsion products. We run efficient operations,
but believe in continuous improvement and have set specific
measurable goals to improve in many aspects of our operations
including emissions, energy usage, waste reduction/recycling and
water consumption. As our business grows, we add new facilities
with sustainability in mind, while we invest in updating more
mature facilities to meet our goals. Running efficient/sustainable
operations that are good for the environment are also good for
business. It is a natural part of what we do.< BACK TO INDEX
“LEED-ing” the way
Ningbo, China The plant’s rainwater collection
In March of 2018 at a grand opening system is estimated to collect and
ceremony, BorgWarner celebrated utilize approximately 16,000 m3 of
the inauguration of its new state of grey water. The integrated natural
the art design and manufacturing lighting through the use of solar tubes is
facility in Jiangshan, Yinzhou District expected to reduce energy consumption
of Ningbo, China. With a total area from lighting by about 10,000 kwh
of 50,000 square meters, the new annually. The plant is also equipped
facility is designed to meet the strictest with a solar thermal system to heat
environmental and energy efficiency water for operations, this system will
standards, receiving LEED (Leadership provide over 350,000 kwh of thermal
in Energy and Environmental Design) energy annually. Overall, energy
Gold certification. BorgWarner now consumption for this facility is expected
has 6 LEED certified facilities. to be about 20 percent lower than
comparable production facilities.
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20%
E ST I M AT E D R E D U C T I O N
Solar water heater on the roof
in overall energy
consumption compared
to equivalent production
facilities
Water heater storage
Solar tube lighting in
manufacturing and office areas
Rain water collection system
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El Salto wins an environmental “Double-Header”
On October 24, 2017, at the Honda the implementation of new recycling Government’s environmental
North America Sustainability Symposium, procedures, new in bound packaging, protection agency to receive the
the El Salto plant was recognized for composting and the full engagement of coveted Clean Industry Environmental
Green Excellence in the area of Waste the employees, the plant achieved ZERO Certification. This rigorous voluntary
Stewardship. The plant had been sending LANDFILL STATUS. The fact that they certification process requires fulfilling
410 tons of non-hazardous waste to a accomplished this in just 12 months really all legal obligations, establishing and
landfill every year. The state of Jalisco impressed the North America Honda maintaining a robust management
has been plagued with insufficient team and was key to the award. system, and then passing several
waste disposal options, so waste Then just a few months later El Salto documentation and on site audits.
was really a community concern. With was recognized by the Mexican
Clean Industry
Environmental Certificate
The El Salto team
WASTE NOT
All the sludge waste from our water treatment plant in El Salto, Mexico
– approximately 273 tons per year – is processed using worms and
organic fertilizer to decompose the waste. The end result is a nutrient-
rich compost, which is then sold to farmers and local gardens.
24< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
40 million
gallons of water saved each
year at the Livonia plant = 60
Olympic-sized swimming pools
Renewable energy expands across BorgWarner
Photovoltaic solar panels provide over 141,000 kilowatts of
power at the installation in Taicang, China (top) and Vigo, Spain.
BorgWarner, Seneca, SC continues sustainable efforts
The South Carolina Wildlife Federation (SCWF) re-certified BorgWarner’s
Seneca, SC plant site as a Wildlife And Industry Together (W.A.I.T.) site
100%
of BorgWarner locations
on August 10, 2017. The W.A.I.T. program recognizes industries who are
around the world are ISO-
dedicated to protecting the environment and keeping wildlife needs in
mind when making their land management decisions. In addition to 14001 certified, meeting
W.A.I.T., Seneca is one of BorgWarner’s ZERO landfill facilities.
strict standards to minimize
the impact of our operations
on the environment.
25< BACK TO INDEX
Social responsibility
We are a company of honorable people who value
safety, diversity, development and community. We
sincerely care about the people we work with and are
eager to help the people who live in our communities.
safety diversity development community
26< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
BORGWARNER PORTUGAL:
HEALTHY WORKPLACES AWARD
BorgWarner’s Viana facility was recognized by the Psychologists Association with
the Healthy Workplaces Award (2nd position in 2017 in national ranking for
big companies) that has the objective to recognize and spread orientations
and best practices in Portugal regarding safety, health and occupational well-
being and it’s implemented in partnership with EU-OSHA (European Agency
for Occupational Health and Safety) and ACT (Portuguese Labor Conditions
Government Authority). The award recognizes companies with noticeable and
innovative approaches to safety, well-being and health (both physical and
psychological) in the workplace.
27< BACK TO INDEX
Safety
2017 CEO Award Global Star Safety Framework
At BorgWarner, our employees BorgWarner’s strong safety culture
demonstrate their commitment to is built on our Global Star Safety
safety every day. In 2017, BorgWarner Framework (GSSF), a comprehensive,
presented the CEO Safety Excellence world-class safety management system
Award to 15 facilities, representing implemented in every manufacturing
15 facilities earned the CEO
each facility that worked 1 million facility around the world. The framework
Safety Excellence Award in consecutive hours, or three years, measures leading safety indicators,
without a recordable incident. Each integrating detailed metrics into safety
2017 for achieving 1 million
award includes a $20,000 donation scorecards. Engaging every employee,
hours, or three years, without that is given to a local charity of the at every level requires regular training
employees choosing. and ongoing prevention initiatives,
a recordable incident: performing risk assessments and
In order to build upon the success of inspections, sharing best practices,
■ Changnyeong, S. Korea the CEO’s Safety Excellence Award, hosting safety conferences and
the Enterprise Safety Council revised sponsoring recognition programs.
■ Ithaca, New York, USA the criteria of the award to expand BorgWarner requires its global
the risk severity and regulatory facilities to report injuries and illnesses
■ Nabari City, Japan compliance which will be implemented according to U.S. Occupational Safety
in 2019. The new criteria will continue and Health Administration (OSHA)
■ Jingzhou, China to recognize low incidence rates, but standards in addition to other reporting
adds emphasis on making sure robust requirements in their jurisdiction.
■ Kirchheimbolanden, Germany
safety management systems are
■ Ningbo, China (3) implemented to reduce overall risk, Upon the publication of the ISO
with an increased focus on reducing 45001 Health and Safety Management
■ Ochang, S. Korea potential high severity risk. System standard, the GSSF was
revised to harmonize with the new ISO
■ Oroszlány, Hungary Safety standard. The revised safety
framework, which will be implemented
■ Ramos, Mexico (2) in 2019, facilitates certification to the
ISO requirements, while maintaining
■ Rzeszów, Poland BorgWarner industry best practices
that often exceed regulatory and ISO
■ San Luis Potosi, Mexico
requirements.
■ Shanghai, China
Global Star Safety Framework Facility Average Scores
2017 83 100
2016 80
80
2015 79
2014 81
60
2013 78
2012 77
40
201 1 75
2010 71 20
2009 70
08
09
10
11
12
13
14
15
16
17
2008 73 0
28< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
Total Recordable Our focus on safety is As of 2018, BorgWarner had
Incidence Rates driving our results
11 plants certified to OHSAS
2.5
In three, consecutive, biennial,
BorgWarner employee culture 18001 standards and one fa-
surveys, the statement “Workplace
2.0
safety is considered important at cility that is OSHA VPP STAR
my location” has the highest rated certified.
1.5
level of agreement of all employees
across the entire global organization.
1.0 This is evidence that the focus on the
overall safety and risk reduction is the
0.5 driver of our excellent results. This In 2017, BorgWarner’s Global
Recordable Incidence Rate2 was
08
09
10
11
12
13
14
15
16
17
gives us confidence that our metrics
0.61
0.0 are the result of risk reduction and
continual improvement in our work
Over the last 10 years, BorgWarner environment.
has steadily improved our Total
–nearly six times lower than the
Recordable Incidence Rates1 (TRIR).
comparable industry average3.
The historical TRIR trend data includes
the integration of acquisitions. Over
time, acquisitions develop safety risk
management programs that conform
to the BorgWarner World-Class Safety 1. U
.S. Occupational Safety and Health Administration (OSHA)
Management System – GSSF, and standard definition.
achieve TRIR reductions similar to 2. T
he number of occupational injuries or illnesses per 100 full-time
(equivalent) employees per year.
legacy sites.
3. A
ccording to the U.S. Bureau of Labor Statistics, the U.S. total
recordable incidence rate for our comparable industry is 3.6.
T H E I M P O R TA N C E O F S A F E T Y
“It’s critically important to me that everyone – employees, contractors
and visitors – safely return home from BorgWarner every day. Safety is
a fundamental part of our culture, and demonstrates our commitment
to protecting and caring about one another. I have tremendous pride in
our historically impressive safety record, measured by Total Recordable
Incident Rates (TRIR), facility average Global Star Safety Framework
(GSSF) scores and the number of CEO’s Safety Excellence Awards earned
by our locations around the world. As our business continues to grow, it is
Frédéric Lissalde
imperative that we stay engaged and vigilant in identifying and correcting
President and
Chief Executive Officer hazards and managing risk appropriately. I’m committed to continuous
safety improvement and expect the same from all employees as we
promote a workplace of well-being for all.”< BACK TO INDEX
All-employee survey
BorgWarner firmly believes in the value of our third-party administered, anonymous,
Tonit Calaway culture survey. Since 2012, we have conducted the survey every two years. By
Executive Vice President, using a trusted, outside partner, our employees feel confident that their privacy is
Chief Human Resources Officer, protected and this allows them to be totally honest with their ratings. We analyze
Chief Legal Officer and Secretary the results from a total company perspective as well as from groups that are large
enough to assure anonymity, but small enough to develop specific action plans. As
these specific plans are implemented, individual employee groups can see that their
“BorgWarner’s business particular needs are being addressed.
culture is driven by our
employees. Their daily
commitment helps our
company be a place
where we want to
come to work and help
ensure the future of
this great company for
generations to come.”
30< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
Diversity is what drives us forward
With more than 29,000 employees in BorgWarner is striving to provide
66 locations and 18 countries, it’s little access to a diverse group of employees
wonder that BorgWarner understands and candidates through a number
the value of diversity. Our company’s of important initiatives. This effort
strength comes from serving nearly began with recruiting diverse talent
every automaker in every region around by extending immediate job offers to
the globe. To accomplish this mission, exceptional candidates at female, black
we rely on the skills, perspectives and and hispanic-focused engineering
passion of employees from all walks of job fairs. To further develop existing
life in nearly every corner of the world. talent, the company also launched
several innovative programs, including
But it’s not the only reason we BorgWarner Women in Leadership,
understand the power of diversity. Women in Science and Engineering
We’re also committed to innovation. (WISE) and BorgWarner Leadership Minority Supplier Development Council,
We understand that coming up with a Forward. And to foster the growth of BorgWarner has joined more than 70
wide spectrum of great ideas requires younger talent, BorgWarner continues other companies in earning certification
the contributions of a wide spectrum of to support several mentoring programs, by a U.S. national diversity board as
great minds. It means assembling a team an on-boarding buddy system and owned by minorities, women or veterans.
consisting of people from a variety of student intern and co-op programs
backgrounds and perspectives to work impacting hundreds of graduate and But there’s further progress to be
toward our common goal—to meet the undergraduate students. made. To remain an innovative, global
growing demand for advanced vehicle leader, BorgWarner is committed to
propulsion systems that will help create The results speak for themselves. the idea that the key to the company’s
a cleaner, more energy-efficient world. Two recipients of the 2018 and 2017 growth lies rooted in the diversity of its
Women in Manufacturing STEP Ahead workforce.
To realize this mission, BorgWarner Awards were BorgWarner employees.
is committed to a strategy of access— Both were honored for demonstrating
finding and fostering the future excellence and leadership in their careers.
engineers and leaders who will BorgWarner was also presented the
contribute to our success today and General Motors 2015 Supplier Impact
help guide our efforts tomorrow. Award for making a positive difference
in using certified, diverse suppliers.
And as a member of the National
31< BACK TO INDEX
Developing our people
As a Product Leadership Company, talented people are the key to
BorgWarner’s ongoing success. Our Talent Development Principles
are at the foundation of the development practices, personal and
professional, that matter most to our employees and to BorgWarner.
Grow and place the right BorgWarner professional employees. Development is employee-owned,
talent for today and tomorrow The process begins at the plant or manager-led and organization-
We have a responsibility to develop functional level and cascades upward to ally championed
and place people who are not only a joint cross-business senior executive We want to put individuals in the driv-
capable to fill today’s expectations, review. In addition to any training or er’s seat of their own career develop-
but also demonstrate the potential and preparation meetings, the series of ment. Managers’ primary responsibility
desire to adapt and grow to meet the events that make up the GTDP include: is to partner with employees through
business needs of the future. Leaders ongoing coaching and support. The
■ T
alentSymposium – bringing
are expected to make decisions based organization facilitates this process by
business leaders together from
on solid talent management practices providing an environment of learning
around the world to ‘Talk Talent’
and to create opportunities for individ- and development.
uals, who are the right fit for our culture ■ C
ountry-specific Talent Reviews
and our business needs. BorgWarner leverages a robust talent
■ E
xecutive Resources Review (ERR)
management system (TMS) that
and President’s Roundtable – attended
Our Global Talent Development Process includes setting of individual perfor-
by C-Suite members and executives
(GTDP) is a strategic, long-term mance and development objectives
to discuss succession planning and
investment that aligns with our corpo- each year. Each employee works with
talent development
rate strategy and our beliefs. We look their manager to align performance
internally first to fill leadership positions objectives to business goals, and de-
The GTDP is an integrated process of
and have achieved our goal consistently. velopment objectives to personal and
understanding the organization’s talent
Talent review sessions are at the heart of professional goals that will help them
and managing the development and
this process, guiding discussions about progress down the career path they
movement of people to build a strong
the performance, competencies, and have set for themselves. The Employ-
leadership pipeline for the future.
potential development needs of ees Profile in TMS enables employees
to document their career interests,
recent accomplishments, willingness
to relocate and record external training
P E R F O R M A N C E and certifications. As positions become
REWARDS
available, we mine this data to look
for internal talent that may be a fit.
Employees also have the opportunity
We implement variable com- to search for and apply to open posi-
pensation tied to performance tions in all of our businesses, functions
metrics because we believe and locations through our Career
it is a best practice. It forges
Opportunity System.
unity around goals, cements
collaborative processes and
rewards people as results
are achieved.
32< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
For front-line leaders and operators in we specifically focus on cross-training
our manufacturing facilities, we locally operators to work in multiple areas,
offer unique instructor-led programs to increasing their skill and opportunity to
teach leadership skills, safety-related take on more supervisory responsibility.
topics, on the job training and personal You’ll see in our Giving Back section
Everyone gets the development. We also offer more than that our learning extends beyond our
development they need 131 unique instructor-led programs professional skills and aligns to our
We recognize that career development including local training for our front BorgWarner Beliefs.
needs are unique to each person. line leaders and operators, technical
Talent development at BorgWarner training, as well as corporate sponsored Development is enabled through
means striving to align career inter- training and compliance related train- honest, personal and purposeful
ests, performance and potential with ing programs. conversations
opportunities that move individuals We commit to talk to our employees
and the business forward. Deepest learning comes about development opportunities
from experiences – diverse, and career aspirations. Effective
We advance employee development challenging and global are best development requires ongoing and
using TMS Learning, our online learning We know that experience is the best open dialogue. Being honest and direct
management system. This system has teacher and that people learn primar- about any ambitions or requirements
been implemented in our technical ily by doing. Lasting development is to get to the next role or level is best
centers and manufacturing facilities powered by our ability to learn from a handled through conversations.
around the world, allowing us to track variety of experiences in diverse set-
training for our professional employees. tings and intense efforts in challeng- BorgWarner prepares leaders for these
We offer a library of more than 500 ing conditions. conversations through our corporate
eLearning courses that align to our programs that teach communication
product leadership competencies, busi- Through our GTDP, we identify short essentials like active listening with
ness processes, systems and products. and long-term assignments for tal- empathy, providing feedback and
BorgWarner employees complete more ented individuals who have the skills asking powerful questions. These skills
than 10,000 eLearning courses avail- to contribute to strategic initiatives are applied throughout the GTDP,
able in 15 languages each year. in other locations both domestically including formal objective setting,
and internationally. In 2016 and 2017, mid-year conversations between
we had 86 people on long-term expat employees and managers to focus on
assignments and more than 100 people status of work, priorities, performance
who participated in short term assign- feedback and career development
ments. We challenge our employees planning conversations.
by inviting them to participate in
cross-business, global projects that
increase the breadth and depth of their
skills. In our manufacturing facilities,
33< BACK TO INDEX
Charity Focus
BorgWarner efforts are directed in
four main categories: community,
education, safety, and wellness.
S U P P O R T I N G O U R C O M M U N I T I E S ( 2 0 1 7 D ATA )
Giving back
The BorgWarner Belief – ‘Responsibility to
Communities’ – is held at every position in the
company. Every BorgWarner location participates
$2.7
in activities that support their local communities.
M I L L I O N D O N AT E D
“It is so overwhelming to be able to
help the children and youths of the EMPLOYEE & COMPANY CONTRIBUTIONS
villages. We get so much more back
from them in return than what we SAFETY 6%
give or donate. That is why so many WELLNESS 12%
employees want to help.”
STEM 20%
Doris Utzinger-Ditscher
Senior HR Generalist COMMUNITY 62%
GIVING IN 2017
Anderson, IN, USA • Gyeonggi, Korea • Oroszlany, Hungary • Anseong-si, Korea • Heidelberg, Germany • Piracicaba, Brazil • Arcore, Italy • Iga, Japan • Pontiac, MI, U
Thailand • Auburn Hills, MI, USA • Jincheon, Korea • Rzeszow, Poland • Beijing, China • Jingzhous, China • San Luis Potosi, Mexico • Bellwood, IL, USA • Joliet, IL, USA
Kaiserslautern, Germany • Cadillac, MI, USA • Landskrona, Sweden • Saarbrucken, Germany • Calumet, IL, USA • Lepecq, France • Taichang, China • Changyeong, Korea
MI, USA • Tiruvallur, India • Clyde, NC, USA • Markdorf, Germany • Tralee, Ireland • Daegu, Korea • McBain, MI, USA • Tulle, France • Dalian, China • Viana, Portugal •
Oberboihingen, Germany • Fenton, MI, USA • Ochang, Korea • Frankfort, IL, USA • Oklahoma City, OK, USA
Rewarding Experiences in the Classroom
NINGBO, CHINA
At the nearby primary school, students are learning real-world
lessons with help from BorgWarner employees in Ningbo, China.
Working with Junior Achievement, employees are volunteering in
the classroom where the students’ enthusiasm inspires them to
share experiences and build the students’ character, creativity and
leadership skills. It’s a rewarding experience for everyone.
34< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
Supporting Schools in India
KAKKALUR, INDIA
furniture were distributed to two schools.
Underprivileged and disabled children “Delivering our donations to the schools
and adults are grateful for the generous was a heartwarming experience,” said
donations provided by our facility in Plant Manager R. Murali. “We are pleased
Kakkalur, India. Learning materials, to promote education for people with
hearing aids, therapy equipment and special needs in our local community.”
28,538
EMPLOY E E H OU R S
450
OV E R
C H A R I TABLE AC TI VI TI E S
USA • Chennai, India • Irapuato, Mexico • PyongTaek, Korea • Arnstadt, Germany • Itatiba, Brazil • Ramos, Mexico • Asheville, NC, USA • Ithaca, NY, USA • Rayong,
• Seneca, SC, USA • Bourbonais, IL, USA • Juarez, Mexico • Seoul, Korea • Bradford, UK • Kibo, Germany • Eisenberg, Germany • Brusque, Brazil • Krasne, Poland •
• Livonia, MI, USA • Tatabanya, Hungary • Ludwigsburg, Germany • Tambaram, India • Chicago, IL, USA • Manesar, India • Taicang, China • Chungju, Korea • Manton,
Ketsch, Germany • Nabari, Japan • Water Valley, MS, USA • Dixon, IL, USA • New Lenox, IL, USA • Yokohama, Japan • El Salto, Mexico • Ningbo, China • Eumsung, Korea •
R E G I O N / P E R C E N TA G E Hours Given Back
The employees of BorgWarner volunteered 28,538 service hours to their local
communities. Employees all over the world volunteered their time and talents
Asia at over 450 events, while reaching 324 different charities around the globe.
26%
Americas
36%
Europe
38%
35< BACK TO INDEX
4 0 B AC K PAC K S F I L L E D F O R N E E DY S T U D E N T S
40
ASHEVILLE, NORTH CAROLINA
BorgWarner’s Outreach Team expanded its annual school supply drive to include
SOS Children’s Village in Florida. BorgWarner purchased school supplies, and em-
ployees helped organize and pack backpacks. Through their efforts, the facility filled
40 backpacks for needy students. The event was just one example of BorgWarner’s
partnership with SOS Children’s Villages around the world.
Celebrating Pinktober and Movember
Flash mobs and fun runs, cooking competitions
and bazaars, educational presentations and free
mammograms, pink T-shirts and pink nails, and, of
course, whiskers! Around the world, BorgWarner
employees found creative ways to raise funds for
breast cancer during Pinktober and men’s health
awareness in Movember.
36< BACK TO INDEX 2 0 1 8 – 2 0 1 9 S U S TA I N A B I LT Y R E P O R T
A sustainable future
We believe a clean, energy-efficient world is achievable through
a variety of propulsion systems solutions specifically engineered
to improve efficiency.
Our innovations are already helping drivers around the world travel farther using
less energy and emitting fewer emissions. As the mobility industry evolves, we are
uniquely positioned to deliver propulsion solutions that protect the environment
and improve the world we live in.
We are problem solvers, constantly innovating and passionately pursuing excellence.
Our “can-do” spirit is responsible for developing award-winning technologies that
enable the industry to speed ahead.
The same spirit inspires our operations. From LEED-certified facilities and zero-
landfill sites to responsibly sourced raw materials, we continually strive to minimize
our impact on the environment. At the same time, we recognize our capacity for
positively impacting our local communities – helping to improve health and
wellness, aiding those in need, and educating for our future.
Working toward a clean, energy-efficient world is not just our business; it is the
right thing to do. As part of a worldwide community, we believe we all play a role
in using resources wisely and supporting each other respectfully. At BorgWarner,
our “can-do” spirit drives our sustainability.
WE CAN create a cleaner, more energy-efficient world because WE DO
■ Make vehicles around the world more environmentally friendly and energy efficient
■ Strive to minimize our impact on the environment and
■ Support the people around us
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