SUSTAINABILITY PROGRESS 2020 - Cummins Inc.
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Cummins Inc.
Our path to carbon
neutrality includes
powering the world’s
first hydrogen fuel
cell passenger train.
PAGE 6
2020
SUSTAINABILITY
PROGRESS
REPORT
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
TURNING CHALLENGES
INTO OPPORTUNITY
COVID-19 had a devastating impact to employees. We also expanded We are now confronted with trying
COVID-19 had an unprecedented on our communities, our economy, and employee health care programs and to meet a rapid demand increase
impact on all of us. We have a history our people. It’s hard to think of a way
that the pandemic has not changed
widely promoted counseling and
leave options. We are now focusing
hampered by global supply constraints
while ensuring we keep employees safe.
of turning challenges into opportunities, our lives. Our business was impacted on vaccinations, launching a vaccine This is the challenge ahead of us, and
as well. In the second quarter, we faced education campaign, organizing on-site I’m highly confident we will deliver.
and 2020 presented many of both. the most severe decline in quarterly clinics where possible, and offering paid
sales in our history, followed by a rapid time off to get the necessary shots. MEANINGFUL CLIMATE ACTION
recovery in demand.
Our commitment to the prosperity We continued investment in our most
We navigated the challenges well and of our communities did not waver. important technology programs, which
our focus throughout the pandemic We dispersed a record $22 million in are critical to reaching our sustainability
remained on what’s most important — community grants, including about pledge of carbon neutrality by 2050.
the safety and wellbeing of our $2.6 million in pandemic-related relief.
We are investing in a range of solutions
employees, both physically and We partnered with 3M and DuPont to
to lead the industry on the path to a
mentally. For our facilities that stayed use our filter technology in masks for
zero-emissions future. We are taking
open, we instituted mandatory health healthcare workers. We assembled a
steps today to turn our 2050 targets
screenings before entering, required Safe Work Playbook with the procedures
into real-world products and
masks, enhanced cleaning protocols, used to open and operate our facilities,
applications. We are powering the
and redesigned spaces to allow for and we shared this publicly to help
world’s first hydrogen fuel cell passenger
social distancing. other companies.
trains. We have put more than
We closed facilities that did not need This is all possible because of the 600 electrolyzers into use globally,
to remain open, and many employees extraordinary efforts of our employees. a key part of the solution to enabling
worked from home. We started making They contributed beyond expectations green hydrogen production.
masks and supplied more than 10 million while facing their own struggles during
a global pandemic.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 2
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
As we develop the technologies TAKING ACTION Later this year, we will launch four Equally important to our community
of tomorrow, we need the ON SYSTEMIC RACISM new Cummins Technical Education efforts is acting inside our walls.
partnership of others to be successful. Last year we launched Cummins for Communities workforce Over the last year, we have added
Industries and governments must Advocating for Racial Equity (CARE) development programs, creating two Black members to our Board of
work together to meet our global to take a leading role in undoing pathways for Black residents to Directors, promoted or appointed six
energy and environmental challenges. systemic discrimination against the acquire opportunities in transportation, Black leaders as officers, and continued
We are advocating for public policies Black community. CARE has four key logistics and manufacturing. to assess our hiring, advancement and
that enable the energy transition while focus areas: police reform; criminal retention processes to ensure we are
reducing emissions. This includes We will continue investing in current living our value of diversity and inclusion.
justice reform; economic empowerment;
innovating and scaling low-carbon and future minority-owned suppliers.
and social justice reform in healthcare,
fuels, modernizing the grid, and Recently, we announced a commitment These are important steps, and there
housing, workforce development
developing the hydrogen economy. of $500,000 to the American Express is still much work to be done.
and civil rights, including voting
Coalition to Back Black Businesses,
rights and education.
We have a history of more established to help Black-owned LOOKING AHEAD
than 100 years of solving CARE brings together all of Cummins’ small businesses recover from the
2020 demonstrated that merely
capabilities - our people, our resources, disproportionate impact of COVID-19.
big problems. No matter focusing on the bottom line isn’t
and our philanthropy - to drive racial To date, we have helped 60 businesses
the application, we will enough for sustainable business
equity and combat the impact of racism. through our involvement.
success. We serve each of our
provide customers an We are focusing on select communities
We are partnering with local Community stakeholders by serving them all.
economically viable solution where we have operations, and we are
Development Financial Institutions and
so businesses can thrive, already making progress. I am proud of what we achieved in
organizations to distribute $3 million in
and we can sustain a vibrant 2020 and am optimistic about the
In our headquarters state of Indiana, aid to Black-owned businesses in four
economy while preserving opportunities ahead to continue
we partnered with other businesses of our target communities, and we are
powering a more prosperous world.
the planet for generations and civic groups to successfully also set to release $2 million in loans.
to come. Our communities advocate for a civilian-led board to
and business depend on create policies and procedures on
a healthier planet and police conduct. We committed
$250,000 toward the Indianapolis
this work is our mission
Urban League to invest in Black-owned
in action. businesses and entrepreneurship. Tom Linebarger
Chairman and CEO
Cummins Inc.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 3
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
REPORT CONTENTS
2 19 32 46
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
2 Turning challenges into opportunity 18 Acting today for a more 32 Building more prosperous communities 47 Board provides critical oversight during pandemic
prosperous planet in 2050
5 Sustainability at Cummins 33 Community impact and giving 49 Cummins Board members
20 2020 Environmental goals make
6 About the cover 34 Taking on society’s biggest challenges 50 Sustainability starts with ethical behavior
Cummins cleaner, more efficient
7 Company updates matrix 35 Working for gender equity 52 Making human rights a priority
22 Water goals
to reflect 2020 developments around the world 53 Cybersecurity takes a holistic approach to protecting Cummins’ data
23 Energy and GHG goal
8 Key Performance Indicators 36 New initiatives address 54 Cummins focuses on resiliency in managing risk
24 Waste goals systemic racism, the environment
9 The U.N.’s Sustainable 55 Making the case for a cleaner tomorrow
Development Goals 25 Products in use goals 37 Key health and safety metrics
improve in a most unusual year 56 Lobbying
11 Who we are 26 Logistics goal
40 Driving the value of diversity 57 Innovation plays key role in Cummins’ past, present and future
12 How we do it 27 Environmental goals update
43 Helping employees reach 59 Partnering for progress
13 Cummins’ story 28 Supporting renewable forms
their full potential 61 An innovation focused path to carbon neutrality
of energy around the world
14 Six Sigma
29 Making the world a better place 63 Embracing ‘new normal’ to keep employees safe and support customers
15 Awards and recognition
30 Advocacy, partnerships 66 Cummins supply chain lives company values
16 Future focused
critical to Cummins progress 68 Supporting customers through digital solutions
70 Company rebounds after historic decline caused by pandemic
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 4
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
SUSTAINABILITY
AT CUMMINS
THE CUMMINS CUMMINS 2020 CUMMINS DATA
Cummins’ approach to sustainability 2020 SASB REPORT TCFD REPORT
Data in this report covers well over
aligns with its mission to make Cummins will again produce a report
aligned specifically to the disclosures in
Cummins will also be reporting to
the Taskforce on Climate-related
75% of the company’s operations.
More than 80% of the Environmental
people’s lives better by powering the Sustainability Accounting Standards Financial Disclosures (TCFD).
Created in 2017, TCFD is designed
and Social Data has been reviewed
Board (SASB) reporting platform. by APEX, a leader in verification and
a more prosperous world. SASB was established in 2011 to to provide investors and others with assurance. Its Independent Assurance
a clearer picture of a company’s Statement is included in the GRI
provide investors with industry-specific
A more prosperous world has a financial component, certainly, but at Cummins climate-related disclosures and Content Index and Data Book.
sustainability information about the
it means more than that. A more prosperous world is also a world with clean air climate-related risks. Cummins’ Financial data comes from Cummins’
companies they are investing in.
and clean water, where businesses partner with other stakeholders to weave a 2020 TCFD Report will be posted Annual Report on Form-10K, which
The Cummins 2020 SASB Report
stronger social fabric. The company has long believed success is about more in the company’s document archive is audited by PricewaterhouseCoopers
will be posted in the company’s
than just the bottom line. by the end of August. LLP, an independent, registered public
sustainability document archive
by the end of July 2021. accounting firm.
The Cummins Sustainability Progress Report is divided into three sections to show CUMMINS 2020
the company’s progress toward its mission: environmental reporting, social reporting, CDP FILINGS
THE CUMMINS 2020 GRI 2020-2021
and governance and economic reporting. Cummins strives to be consistent CONTENT INDEX AND DATA BOOK Cummins is committed to sharing its SUSTAINABILITY OVERVIEW
with the reporting structures established by the Global Reporting Initiative (GRI), CDP (formerly the Carbon Disclosure
The company is again producing Cummins has also put together another
the Sustainability Accounting Standards Board (SASB) and the Taskforce for Project) water and climate filings.
a separate posting aligned to the summary of the company’s sustainability
Climate-related Financial Disclosures (TCFD). The CDP was established to help
Global Reporting Initiative (GRI) programs for readers wanting a high-
build a truly sustainable economy level look at Cummins’ efforts over the
In addition to its disclosures to these and other reporting platforms, platform, which was established
by increasing understanding around past year. The overview is posted with
Cummins regularly reports on the company’s sustainability progress in by the United Nations to provide
a company’s environmental impact. the company’s other sustainability related
The Newsroom on cummins.com. a consistent way for companies to
The filings will be posted in Cummins’ reports and documents in the company’s
report on their ESG performance.
This is the first of the Cummins’ reports related to sustainability and the sustainability document archive document archive.
The Cummins 2020 GRI Content
environment, social matters and governance (ESG) that will come out by the end of August.
Index and Data Book will be posted
over the next 12 weeks. Here’s a look at the others: in the company’s document archive
by the end of July 2021.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 5
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
ABOUT THE COVER
POWERING A NEW WAY TO
PROPEL PASSENGER TRAINS
Alstom’s pioneering Coradia iLint trains,
the world’s first hydrogen-powered
passenger trains, successfully completed
nearly two years of testing in Northern
Germany in 2020 and are scheduled
to go into regular service in 2022.
Using fuel cell technology to convert
hydrogen and oxygen into electricity
for propulsion, emitting only water vapor
and condensation, the trains successfully
completed more than 180,000 kilometers of regular passenger service operating from
September 2018 through February 2020. They soon started three months of additional
testing, transporting passengers in Austria over geographically challenging routes.
Hydrogenics, now a part of Cummins, was selected by Alstom to develop and
implement the fuel cell systems for the Coradia iLint, bringing the environmental benefits
of electrification to passenger rail without the wires frequently associated with the service.
The trains also produce remarkably little noise, with a top speed of 140 km/h.
In January 2021, the Coradia iLint received the European Rail Award for outstanding
achievement in the development of economically and environmentally sustainable
rail transport. Other countries are interested in the technology, including the
United Kingdom,the Netherlands, France and Italy.
Alstom, one of the leading rail manufacturers in Europe, is headquartered
in France with a presence in more than 60 countries and more than
38,000 employees. To learn more about the company’s hydrogen-powered
(Photos courtesy of Alstom)
trains, check out Alstom’s website.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 6
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
COMPANY UPDATES MATRIX TO
REFLECT 2020 DEVELOPMENTS
Cummins updated its Materiality Matrix in this Foundational to sustainability Impact opportunities
report to reflect new issues emerging in 2020, PUBLIC CLIMATE RISK WATER PRODUCT QUALITY
PUBLIC INTEREST
such as COVID-19 and racial equity. ADVOCACY MANAGEMENT CONSERVATION AND CUSTOMER
ENVIRONMENTAL SATISFACTION
WASTE REDUCTION COMPLIANCE
OCCUPATIONAL
HEALTH AND
HUMAN RIGHTS SAFETY
The importance of these topics can be seen in the The cross functional group incorporated the SUPPLIER
(WITHIN COMPANY FACILITY ENERGY
DIVERSITY USE, AIR AND GHG
OPERATIONS)
placement of occupational health and safety and work that went into Cummins’ previous matrix EMISSIONS
PRODUCT GHG
AND AIR EMISSIONS
diversity, equity and inclusion among those issues with feedback from several sources, including MATERIAL
SOURCING
of greatest concern to both the public and Cummins. the Global Reporting Initiative, the Sustainability FACILITY AIR DIVERSITY,
EMISSIONS EQUITY AND
In addition, the sustainability reporting team added Accounting Standards Board, and the Taskforce DISCLOSURE
PRODUCT LIFE CYCLE INCLUSION
AND REMANUFACTURING
cybersecurity and employee engagement and on Climate Related Financial Disclosures. The team INNOVATION
HIGH
workplace culture among its impact opportunities also reviewed topics covered in sustainability surveys ETHICS AND BOARD DIVERSITY SUPPLY CHAIN
ENVIRONMENTAL EMPLOYEE
to reflect their growing importance to the public Cummins was asked to fill out by multiple customers COMPLIANCE AND INDEPENDENCE ENGAGEMENT
PERFORMANCE
AND WORKPLACE
and Cummins. and feedback from institutional investors who have FINANCIAL CULTURE
MANAGEMENT SUPPLY CHAIN
become increasingly interested in sustainability. WORKING
To make these changes, the reporting team CONDITIONS
PAY AND BENEFITS
convened a cross-functional group to review both The group reaffirmed the interest in innovation
CYBERSECURITY
developments in 2020 and the company’s matrix and reducing greenhouse gases and air emissions,
COMMUNITY
developed in 2018, when Cummins’ sustainability which are key issues at Cummins as the company ENGAGEMENT
reporting team worked with Deloitte to identify issues pursues a carbon-neutral future.
where Cummins had the greatest opportunities for
Finally, the cross-functional team renamed and
MEDIUM
environmental, social and governance impact. The
combined several issues for greater clarity and
company and Deloitte interviewed key voices in and
reorganized its matrix to better communicate
outside the company to develop the 2018 matrix.
the company’s priorities.
COMPANY INTEREST
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 7
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
2018 2019 2020
KEY ECONOMIC
PERFORMANCE
Revenue $23.8 billion $23.6 billion $19.8 billion
Net Income $2.1 billion $2.4 billion $1.8 billion
INDICATORS 2018 2019 2020
ENVIRONMENTAL
Cummins takes a broad view GHG emissions (thousands of metric tons CO2e) 808 751 656
of sustainability, including Energy consumption1 (thousands of MMBtu) 14,375 14,043 12,673
the environment, corporate Water use (millions of gallons) 949 895 772
responsibility, health and safety, Water intensity reduction2 (2010 baseline) 50% 53% 53%
diversity and inclusion, employee Energy intensity reduction2,3 (2010 baseline) 29% 31% 27%
development and governance. GHG intensity reduction2,3 (2010 baseline) 37% 42% 41%
The company tracks many key Recycling rate 90% 91% 93%
performance indicators. 2018 2019 2020
Here are just a few: SOCIAL
H&S Severity Case Rate 0.264 0.225 0.209
H&S Incidence Rate 0.646 0.593 0.482
Code of Conduct cases 2,215 2,436 1,601
Cummins believes in transparency. 1 Primary energy excludes sold
This icon identifies multi-year data electricity and associated fuel usage Women leaders in the workforce 23.22% 23.90% 25%
that allows for comparisons. 2 Intensity defined as adjusted for sales
(energy / GHG) or hours worked (water)
3 Reduction includes consolidated entities only
Every Employee Every Community (EEEC) participation rate 83% 82% 34%
People impacted by EEEC projects 4.3 million 6.5 million 1.4 million
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 8
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
THE U.N.’S
SUSTAINABLE U.N. GOAL CUMMINS’ ROLE STATUS SUMMARY LEARN MORE
DEVELOPMENT NO. 1
NO POVERTY
Cummins TEC provides
disadvantaged youth a
path to decent jobs.
TEC has produced 1,700 graduates
since it was launched in 2012.
Page 34
GOALS
NO. 4 Education is one of three areas 14% of the company’s Corporate Page 33
Cummins supports the U.N.’s Sustainable QUALITY of focus for the company’s Responsibility grants in 2020 went to
EDUCATION community engagement efforts. education initiatives, often supporting
Development Goals to “end poverty, protect employee-led projects.
the planet and ensure prosperity for all.”
As a signer of the U.N. Global Compact NO. 5 Cummins Powers Women The Cummins Powers Women Page 35
GENDER works with expert non-profits initiative impacted the lives of
in 2017, the company wants to do its part EQUALITY to address equality for women some 17 million women and girls
and girls. since its launch in 2018.
to make the world a better place to live.
Cummins believes its initiatives touch NO. 6 Water is a key focus Cummins has reduced its Page 22
CLEAN WATER for the company’s absolute water use between
17 goals with a special focus on AND SANITATION PLANET 2050 strategy. 2010 and 2020 by about 28%.
10 where it has the biggest impact.
Here are some examples:
NO. 7 Energy is a key focus A Cummins-supported wind farm Page 28
AFFORDABLE for the company’s expansion in Indiana (U.S.) is sending
AND CLEAN PLANET 2050 strategy. enough renewable power to the grid
ENERGY to offset the electricity the company
uses in its headquarters state.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 9
INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
ABOUT THE GLOBAL COMPACT THE U.N.’S SUSTAINABLE DEVELOPMENT GOALS (CONT.)
Cummins is a member of the United Nations
Global Compact. It is organized around U.N. GOAL CUMMINS’ ROLE STATUS SUMMARY LEARN MORE
10 fundamental principles: NO. 8 The company’s mission is The company has multiple efforts Page 36
DECENT WORK to build a more prosperous in this area including its living
AND ECONOMIC world for all stakeholders. wage initiative internally and Page 43
HUMAN RIGHTS ENVIRONMENT GROWTH its CARE program externally.
» Businesses should support » Businesses should support
and respect the protection of a precautionary approach to
internationally proclaimed human environmental challenges. NO. 9 Cummins is working to improve In 2020, Cummins received a record Page 57
rights. INDUSTRY its traditional technologies such 312 patents while spending more than
» Businesses should undertake INNOVATION AND as diesel and natural gas engines $900 million on research, development
» Businesses should make sure initiatives to promote greater INFRASTRUCTURE and develop new low-carbon and engineering for a third consecutive year.
technologies such as fuel cell
that they are not complicit in environmental responsibility. electric and battery electric.
human rights abuses. » Businesses should encourage
the development and diffusion NO. 12 Reducing the company’s In 2020, Cummins fell just short of its Page 23
LABOR RESPONSIBLE energy consumption was energy intensity reduction goal, achieving
of environmentally friendly
CONSUMPTION a key focus of Cummins’ a 27% reduction from company facilities
» Businesses should uphold the technologies. AND PRODUCTION 2020 environmental goals. compared to a 2010 baseline.
freedom of association and the
effective recognition of the right ANTI-CORRUPTION
to collective bargaining. » Businesses should work
NO. 13 Addressing climate change The strategy includes science-based Page 18
» Businesses should work for the against corruption in all its forms, CLIMATE is part of the company’s 2030 goals, aligned with the Paris
elimination of all forms of forced including extortion and bribery. ACTION PLANET 2050 strategy. Agreement to address climate change.
Cummins also held first Hydrogen Day in
and compulsory labor. 2020 to showcase its products connected
to this promising low carbon fuel source.
» Businesses should strive for the
effective abolition of child labor.
NO. 17 Cummins believes strongly Cummins partnered on a wide Page 63
» Businesses should support the PARTNERSHIPS in partnering to improve its range of projects, including with
elimination of discrimination in TO ACHIEVE products, build stronger DuPont and 3M to produce
GOALS communities and address personal protective equipment
employment and occupation. the environment. for medical professionals in 2020.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 10INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
WORLD
HEADQUARTERS
500 Jackson St.
Columbus, IN 47201 EST.
WHO WE ARE FORTUNE 500
cummins.com
RANKING
150
Cummins Inc., a global power leader, is a
(2021)
corporation of complementary business
segments that design, manufacture,
distribute and service a broad portfolio
of power solutions. The company’s products
CMI 57,825
include diesel, natural gas, electric and hybrid
powertrains and powertrain-related components
EMPLOYEES
such as filtration, aftertreatment, turbochargers,
WORLDWIDE
fuel systems, controls systems, air handling
systems, automated transmissions, electric More than 50% of the company’s employees
STOCK SYMBOL
power generation systems, batteries, are located outside the United States.
(New York Stock Exchange)
electrified power systems, hydrogen (as of Dec. 31, 2020)
generation and fuel cell products.
CUSTOMERS SALES / EARNINGS
Cummins serves its customers online,
through a network of company-owned
Cummins earned
and independent distributor locations, $1.8 billion on
and through thousands of dealer
locations worldwide. sales of $19.8 billion.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 11INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
HOW WE DO IT ENGINE SEGMENT
Clean, efficient, dependable and
For almost 20 years Cummins was durable, Cummins engines are found
in nearly every type of commercial truck
NEW POWER
organized into four business segments. and equipment on Earth. The Engine The New Power segment includes
business segment designs and builds battery-electric and fuel cell electric
Then, in 2018, the company established products as well as products used in
the Electrified Power segment to develop
diesel and natural gas engines for heavy-
and medium-duty trucks, buses, light COMPONENTS renewable hydrogen production and
duty trucks and for off-highway markets potentially other new power initiatives.
Engine manufacturers around the world
electric powertrains and related components. including agriculture, construction and incorporate the Components segment’s
Cummins in 2019 acquired Hydrogenics,
In 2019, the segment was renamed New military equipment. technologies to make their products truly
a fuel cell and hydrogen production
technologies company, which is now
outstanding. Components is organized
Power to better reflect its expanded portfolio, included in the segment.
including electrification, hydrogen-powered POWER SYSTEMS around these entities:
fuel cells and potentially other new technologies. Cummins Power Generation is a world
leader in the design and manufacture of
» CUMMINS EMISSION SOLUTIONS designs
and builds exhaust aftertreatment
DISTRIBUTION
power equipment. The Power Systems solutions to reduce engine emissions. The Distribution segment provides
segment produces power generation sales, service and support to customers
» CUMMINS FILTRATION designs and around the world through the largest
systems, components, and services in
builds heavy-duty air, fuel, hydraulic number of certified service and support
standby and prime power, distributed
and lube filtration, and chemical and locations of any engine manufacturer.
power generation, combined heat and
exhaust system technology products. Cummins has the technical expertise
power and auxiliary power in mobile
applications. It also designs and builds and experience to deliver fast, high
» CUMMINS FUEL SYSTEMS designs quality repairs; planned maintenance
the high horsepower engines used for and builds fuel systems that maximize
these and other purposes. and upgraded solutions.
power and fuel economy while
helping reduce emissions.
» CUMMINS TURBO TECHNOLOGIES
designs and builds turbochargers
to maximize engine performance
and reduce emissions and
fuel consumption.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 12INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
CUMMINS’ STORY HOW WE WILL DO IT
VALUES LEADERSHIP
WHY WE EXIST INTEGRITY CULTURE
Doing what you say you will
Inspiring and encouraging
MISSION do and doing what is right
all employees to achieve
DIVERSITY & INCLUSION their full potential
Making people’s lives better by Valuing and including our
differences in decision making
BRAND
powering a more prosperous world is our competitive advantage
CARING
PROMISE
Demonstrating awareness Powering our customers
and consideration for the through innovation
WHAT WE WANT TO ACCOMPLISH wellbeing of others and dependability
EXCELLENCE
VISION Always delivering superior results STRATEGY
Innovating for our customers
Delivering value
TEAMWORK
to all stakeholders
Collaborating across teams,
to power their success
functions, businesses and
borders to deliver the best work
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 13
13INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
SIX SIGMA KEY NUMBERS IN 2020
Cummins is a big proponent of Six Sigma, TWENTY
using the business improvement tool to save Years Cummins has used Six Sigma
as its principal problem-solving tool
the company and its customers billions of dollars.
Six Sigma uses data-based analysis to
identify defects and variation in a wide
The company’s Six Sigma program
has now identified an estimated
7.7 BILLION
range of manufacturing and business $7.7 billion in Profit Before Interest MORE THAN PBIT (Profit Before Interest and Taxes)
situations. Cummins employees also and Taxes savings since the tool was COST SAVINGS savings in dollars since Six Sigma
was implemented at Cummins
2020: A YEAR TO REMEMBER frequently use Six Sigma when working first implemented in 2000, including
Six Sigma’s impact at Cummins
with community partners on community $284 million in 2020. Cummins goes beyond cost savings and
52.5%
Cummins employees exceeded the engagement projects. customers, meanwhile, have saved building stronger communities.
company’s target for Six Sigma related
an estimated $2.55 billion through
savings despite the global pandemic. In 2020, Cummins’ Six Sigma program The tool provides the company
Six Sigma since the tool was first
evolved to provide more on-demand with a common language and
offered to them in 2005, including collective mindset that can be Six Sigma savings identified
$915 million tools, methods and learning support $129.7 million in 2020.
1000 used to address a problem or over historical targets in 2020
through a new website with less challenge almost anywhere
800
emphasis on classroom training. The Completed projects in 2020 tackled in the world
change paid immediate dividends with everything from tax issues in Mexico
284
$600 million
As a continuous improvement
600 many employees working from home to engine shipping challenges and data
company, Cummins is committed
because of the pandemic. storage issues across the company.
to providing its employees with
MILLION
400 The program now says more than half of the tools they need to solve
Cummins saw a 52.5% increase in the company’s salaried employees have the most important challenges
200
Six Sigma related savings in 2020 been trained in the problem-solving tool. in the business.
compared to historical targets, including
0
cost reductions and cost avoidance Savings in dollars
Q1 Q2 Q3 Oct 2020 Nov 2020 Dec 2020
initiatives. Closed projects for the year identified by Six Sigma
Savings achieved by employees
had a value of $915 million compared
projects in 2020
Historical target to a target of $600 million.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 14INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
AWARDS AND RECOGNITION
Cummins received several awards and recognition related to
sustainability during 2020 and early 2021. Here’s a brief look:
ENVIRONMENT AND SUSTAINABILITY DIVERSITY AND INCLUSION ETHICS AND ETHICAL BEHAVIOR
» Cummins is named to the 2020 S&P DOW JONES INDICES » Cummins in 2020 receives the highest ranking for » Cummins is named to the ETHISPHERE INSTITUTE’S 2021
OF THE MOST SUSTAINABLE COMPANIES IN NORTH AMERICA a culture of diversity and inclusion as part of the LIST OF THE WORLD’S MOST ETHICAL COMPANIES for a
for a 15th consecutive year. CULTURE CHAMPIONS STUDY BY THE MASSACHUSETTS 14th consecutive year. The list honors top companies
INSTITUTE OF TECHNOLOGY AND GLASSDOOR. for ethics and compliance around the world.
» Cummins qualifies for the 2021 SUSTAINALYTICS ESG The company also receives high marks for creating
INDUSTRY TOP RATED BADGE for high performers among cultures of integrity and respect. » Cummins in 2020 is named to NEWSWEEK’S LIST OF
the 12,000 companies reviewed by the environmental, AMERICA’S MOST RESPONSIBLE COMPANIES for 2021,
social and governance research and ratings firm. » Cummins is named in 2020 to the 20th annual list ranking No. 24.
of AMERICA’S TOP CORPORATIONS FOR WOMEN’S
» Cummins is named to INVESTOR’S BUSINESS DAILY’S BUSINESS ENTERPRISES, honoring world class » Cummins is named in 2020 to FORBES’ 2021 JUST 100
2020 BEST ESG COMPANIES list for performance on supplier diversity programs. LIST, A RANKING OF AMERICA’S MOST JUST COMPANIES.
environmental, social and governance matters, Cummins finishes No. 99.
ranking No. 37 (up from No. 48 on 2019 list). » Cummins is named a TOP SCORING COMPANY
ON THE 2020 DISABILITY EQUALITY INDEX, a national MANAGEMENT AND WORKPLACE
» Cummins is named to BARRON’S 2021 LIST OF benchmarking tool enabling businesses to self-report
THE 100 MOST SUSTAINABLE COMPANIES, ranking » Cummins in 2020 moves up 24 places to No. 64 in
on disability inclusion policies and practices.
No. 84 on the magazine’s list. the WALL STREET JOURNAL’S 2020 MANAGEMENT TOP 250,
The company is also named a BEST PLACE TO
a ranking developed by the Drucker Institute for
WORK FOR DISABILITY INCLUSION by the index.
» Cummins is named to FTSE4GOOD 2020 INDEX of the newspaper.
companies demonstrating strong environmental, » Cummins again receives a perfect score in the Human
» Cummins in 2021 is named one of AMERICA’S BEST LARGE
social and governance performance. Rights Campaign’s 2021 CORPORATE EQUALITY INDEX,
EMPLOYERS OF 2021 by Forbes magazine and Statista,
qualifying the company as a BEST PLACE TO WORK FOR
a leading provider of market and consumer data.
LGBTQ EQUALITY. The Human Rights Campaign is the
world’s leading advocate for LGBTQ rights.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 15INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
INTRODUCTION //
1972
Miller lays out his thinking on Corporate
FUTURE FOCUSED
Responsibility in Cummins’ 1972 Annual Report.
2019
“While some still argue that business
1962 has no social responsibility, we believe
2020
Cummins celebrates
that our survival in the very long run is
Cummins begins operations 100 years in business. Cummins holds first virtual
as dependent upon responsible citizenship
For more than 100 years 1937
in India, first as a joint venture
with one plant in Pune.
in our communities and in the society as it
Cummins unveils PLANET 2050
Hydrogen Day, showing
an audience of nearly
is on responsible technological, financial
Cummins has been at the Cummins earns
Today, the company owns all or part of
20 manufacturing facilities in the country
and production performance.” strategy to further reduce its 2,000 the company’s
progress working with the
carbon footprint and address
forefront of new ideas. its first profit. and employs nearly 14,000 people. climate change. promising low-carbon fuel.
Here’s a brief look 1934
at the company’s 1951
J. Irwin Miller, great-nephew
remarkable history. of W.G. Irwin, becomes
Miller becomes Chairman
general manager of
Cummins at the age of 24. of the Cummins Board.
1910 1920 1930 1940 1950 1960 1970 1980 1990 2000
Clessie Cummins creates the Cummins takes Irwin for a ride in a used Packard Miller helps Dr. Martin Luther King, Jr. with Cummins purchases President and Chief Operating A global pandemic closes
Cummins Engine Company limousine that he equipped with a diesel engine some of the organizing behind the 1963 86% of the Onan Officer Tom Linebarger succeeds most Cummins locations
based in Columbus, Indiana (U.S.). on Christmas Day, convincing Irwin of the engine’s March on Washington. Miller was acting as Corporation in suburban Tim Solso as Chairman and CEO for at least several weeks,
William G. Irwin, who employed potential. Irwin invests a much-needed infusion of cash. leader of the National Council of Churches. Minneapolis, Minnesota on Jan. 1. During Solso’s 10 years but the company learns to
Cummins as a driver, supplies (U.S.), which would leading Cummins, the company safely reopen and support
become the basis for its customers performing
nearly all of the $50,000 in 1929 1963 experienced record growth.
startup capital. Power Systems Business. essential work.
2012
Cummins barnstorms across the country, Miller becomes Executive 1986
demonstrating the power and fuel Vice President of Cummins.
efficiency of the diesel engine in his Cummins establishes its Electrified Power
Coast to Coast Cummins Diesel Test Bus. 1944 business segment, renaming it New Power
Cummins enters China as part of a Miller retires as Chairman of
in 2019 to reflect investments in hydrogen
deal involving heavy construction the Board, although he remains
generation and hydrogen fuel cells.
equipment with active with the company until
Cummins engines. his death in 2004. 2020
1919 1975 1977
1932
2018
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 16INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
ENVIRONMENT
Cummins is committed to reducing its WHAT’S INSIDE:
carbon footprint and doing more to use PLANET 2050 UPDATE.......................................................... 18
less of the world’s natural resources. ACCOMPLISHMENTS........................................................... 20
2020 GOAL PROGRESS........................................................ 22
The company is also committed to CUMMINS AND RENEWABLES............................................ 28
ENVIRONMENTAL SITE MAP............................................... 29
acting with transparency. PARTNERSHIPS..................................................................... 30
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 17INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
U.N. GOAL #13
PLANET 2050 UPDATE // CLIMATE ACTION
ACTING TODAY FOR A
In 2019, as part of Cummins’ 100th the supply chain, transitioning to UP FOR THE CHALLENGE
anniversary, Chairman and CEO Tom a circular economy that eliminates While the company has good examples
MORE PROSPEROUS
Linebarger launched PLANET 2050 – the waste and extends product life of optimizing material efficiency in
company’s environmental sustainability as long as possible. key areas today, more is needed to
strategy that sets eight quantifiable goals » Define operational improvements increase the breadth of coverage and
PLANET IN 2050
for 2030 along with visionary longer-term with a focus on manufacturing and enable product development teams to
aspirations timed to 2050. The three testing for goal achievement. assess environmental impacts across
focus areas for the strategy are: the lifecycle of Cummins’ products.
There are several key areas that are The company is adding in-house
Creating a bold strategy and aggressive goals was » Reducing greenhouse gas (GHG) a major focus for 2021. One is to Lifecycle Analysis (LCA) tools to inform
and air emissions in line with experts’
hard work. Now comes the even more challenging recommendations.
identify and refine product and improve these decision-making
decarbonization pathways for the
part — creating what it takes to make Cummins’ » Using natural resources in the most 2030 goals and the 2050 aspiration
processes and allow Cummins to set
material efficiency targets.
PLANET 2050 vision a reality. sustainable way possible. of carbon neutrality. The team is
working on evolving the company’s The company is also building on its
» Helping communities address their
Science-Based Target baseline data deep expertise and experience with
major environmental challenges.
to a higher level of fidelity for scenario reducing energy use and GHGs, as
MAJOR THEMES planning and integration into technical well as waste production and water
and product planning processes. use at Cummins operations globally.
The Cummins PLANET 2050 team
The 2030 goals involve reductions that
in 2020 focused on defining the In recognition of the increasing require both greater investment and
integration and execution plans importance of working across deeper understanding and changes to
required to make the foundational stakeholders, the team is also manufacturing and testing operations.
changes needed for the company’s establishing a system that would better
2030 goals. Cummins will more formally facilitate working collaboratively and So, the challenges are plentiful as
begin reporting the progress of these proactively with customers on collective Cummins begins implementing its
efforts starting in 2022. The team’s sustainability goals. This framework will PLANET 2050 strategy and looks
work over the last year can be leverage cross-business insights and ahead to its 2030 goals and beyond.
categorized along three major themes: commitments to align and build the right The challenges will mean more hard
processes, data, tools, training and more work, but the company intends
» Building capability in teams, tools,
to forge even stronger partnerships. to meet them.
resources, and data management
New solar panels line a parking lot at » Implementing operational excellence
the Cummins campus in San Luis Potosí, for engaging with customers across
Mexico. The company is working to increase
its use of low-carbon, renewable power.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 18INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
PLANET 2050 UPDATE //
2030 KEY NUMBERS
PLANET 2050 ASPIRATIONS 2030 GOALS Percentage reduction
1. Reduce absolute greenhouse gas 50 goal for absolute GHG
emissions from facilities
SCIENCE-BASED TARGETS
(GHG) emissions from facilities and operations by 2030.
COMMUNITIES ARE and operations by 50%.
BETTER BECAUSE DOING OUR PART TO 2. Reduce scope 3 absolute lifetime
WE ARE THERE
2050 TARGETS:
ADDRESS CLIMATE CHANGE
AND AIR EMISSIONS
GHG emissions from newly
sold products by 25%. 55 MILLION
2050 TARGETS: 3. Partner with customers to Reduction goal for scope
Net positive impact in
every community where Customer success is powered
reduce scope 3 GHG emissions
from products in the field by
3 GHG emissions from
Cummins operates. by carbon neutral technologies 55 million metric tons. products in the field by 2030,
that address air quality. partnering with customers.
Near zero local site 4. Reduce volatile organic
Carbon neutrality and near zero
environmental footprint. pollution in Cummins’ facilities
compounds emissions from paint
and operations. and coating operations by 50%.
Percentage reduction goal
5. Create a circular life-cycle
25 for waste in facilities and
CIRCULAR ECONOMY
plan for every part to use less, operations as a percent
USING NATURAL use better, use again. of revenues by 2030.
RESOURCES IN THE 6. Generate 25% less waste
MOST SUSTAINABLE WAY in facilities and operations
as a percent of revenue. Percentage reduction
50
2050 TARGETS: goal for volatile organic
7. Reuse or responsibly recycle compound (VOC) emissions
Design out waste in products from paint and coating
and processes 100% of packaging plastics and
operations by 2030.
eliminate single-use plastics in
Use materials again for next life dining facilities, at employee
Reuse water and return clean events and as amenities.
to the community Percentage goal for
8. Reduce absolute water
100
recycling of packaging
consumption in facilities plastics and elimination
NOTE: Company facilities include all consolidated operations and joint ventures that are part of the Cummins Enterprise Environmental Management System. and operations by 30%. of single use plastics in
The company’s strategy also includes addressing environmental needs in communities where Cummins employees live and work and where the company dining facilities by 2030.
does business. Those goals are under development.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 19INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
ACCOMPLISHMENTS //
2020 ENVIRONMENTAL
GOALS MAKE CUMMINS
CLEANER, MORE EFFICIENT
Cummins wrapped up work on the company’s 2020
environmental sustainability goals with a number
of achievements, including significant gains in water
conservation and waste and energy reduction.
The company, for example, achieved On energy, Cummins significantly
its goal of reducing water use intensity increased its use of renewable wind and
(water use adjusted by hours worked) solar energy by 2020 and the company
by 50% in 2018 and extended that also increased high efficiency LED lighting
reduction to 53% in 2020. Sixteen coverage to about 85%. Over the past
sites achieved Cummins’ definition of five years, Cummins invested $65 million
water neutrality by the end of 2020 — in energy improvements, saving about
exceeding the goal of 15. $19 million per year.
Meanwhile, 35 sites reached the Finally, the company worked with
company’s zero disposal standard, customers to exceed for a third
exceeding the goal of 30. Cummins consecutive year Cummins’ goal of
recycled 93% of the total waste it reaching an annual run-rate reduction of
Cummins employees (left) at the company’s
generated, the highest performance in 3.5 million metric tons (MMT) of carbon engine plant in Rocky Mount, North Carolina
company history, although just short dioxide (CO2) from Cummins products (U.S.), officially launch the plant’s Water Hub
(above) in 2020. It uses a variety of treatment
of the company’s 2020 goal of 95%. in use, ending 2020 with a run rate technologies including hydroponics to return
reduction of 4.9 million MMT of CO2. millions of gallons of water to the plant
annually for non-potable uses.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 20INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
LEADERSHIP VOICES
I can’t say enough about
There’s no question, taken as a whole, progress. (See page 27 for final goal water were adjusted by hours worked.
the tremendous work done KEY NUMBERS IN 2020
to meet our 2020 goals, the 2020 goals have made the company statistics in individual areas as well as Cummins’ energy intensity target for
from goal leaders and their a cleaner, more efficient partner in the details on each of the principal goals.) 2020 was 32% and the company
teams to the efforts of all communities where Cummins facilities reached 31% in 2019 but ended Percentage reduction
53
employees who did their The final numbers, however, don’t tell in water intensity (water
are located. 2020 at 27%. use adjusted by hours
part for sustainability. the entire story, especially during 2020.
worked) achieved in 2020,
Our employees persevered. Reaching the logistics efficiency goal exceeding Cummins’ goal.
They found creative ABOUT THE GOALS
COVID’S TOLL was hampered by expedited shipments
solutions. They kept moving The company announced its first required during the crisis. Cummins’
forward even when it was hard Last year’s progress report included
93
comprehensive global environmental products power many critical functions
and there were constraints. a story on the potential impact the
And yes, the final year of our plan sustainability plan in 2014. That plan had including the transportation of food Percentage of total
seven goals; five involving water, waste pandemic could have on achieving waste recycled in 2020.
was during a global pandemic. and medicine.
Yet Cummins did what we said and energy in Cummins facilities, one some 2020 goals. And it did.
we would do and did it well.” dealing with logistics in the company’s For example, the company had to There were also some instances where
intercompany network, and the products postpone more than half of its planned Cummins narrowly missed its goal that
65 MILLION
TIM MILLWOOD
in use goal to reduce the CO2 used by capital improvement projects to had little to do with COVID-19. For
Vice President, Manufacturing
Cummins products already in the field. address COVID-19 safety and other example, the company knew its recycling
pandemic-related matters.
I remember when we
Most of the goals in the plan were
target of 95% was aggressive, and it Amount in dollars invested
seemed even more so after Cummins
created the 2020 plan,
new. However, the company had been Cummins sites that remained open were over the past five years
expanding into a wide absorbed or acquired additional sites
range of public goals working to reduce energy use for some asked to increase facility ventilation rates
and faced challenges finding places
on energy improvements
across greenhouse time. Cummins’ 2020 energy goal was and disable energy recovery systems,
to recycle in some parts of the world. at Cummins.
gases, water and waste. actually the company’s fourth energy- which increased energy use. Work was
Despite those challenges, the company
It is amazing to now spread across multiple shifts to facilitate
greenhouse gas reduction goal since only missed its recycling goal by two
35
reflect on how we used employee social distancing.
our data and experience — 2006. Cummins established new percentage points. Sites achieving Cummins’
combined with our passion and energy goals upon achieving its zero disposal standard,
While many offices and other facilities five above the 2020 goal.
commitment — to produce really previous targets. As was the case with that goal,
were closed for extended periods of
powerful results. Our employees even when Cummins missed it made
The company’s environmental team was time, those facilities still required some
took on hundreds of projects significant progress toward the standard
and championed them with skill energy to maintain critical building
SIXTEEN
an early adopter of establishing goals it was trying to reach — an important
and determination. It has been a and publicly reporting its progress on operations. All of these actions increased
fantastic journey so far with really lesson as the company now begins
them as a means to drive environmental energy intensity, which for energy and
terrific work and more to come!” work on Cummins’ 2030 goals.
Sites achieving Cummins’ water neutrality
standard, one above the 2020 goal.
BRIAN MORMINO
Executive Director,
Technical & Environmental Systems
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 21INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
U.N. GOAL #6
2020 GOAL PROGRESS // CLEAN WATER AND SANITATION
WATER PROGRESS 14% reduction in hours worked in 2020 Cummins’ water neutrality efforts have
Cummins exceeded both of its rather than a change in the intensity of also yielded success. Sixteen sites were WATER STRATEGY
2020 water goals. The company water use. validated as achieving the company’s
hit its water use intensity (water standard for water neutrality, surpassing The goals of Cummins’
Since the 2010 baseline, direct water comprehensive water strategy,
use adjusted by hours worked) the company’s 2020 goal of 15.
use at the company is down by 32%, which addresses both direct-water
reduction target of 50% in 2018, In many instances these locations are
use and community engagement,
and surpassed it in both 2019 even with an increase in the number of offsetting their water use with community are to mitigate business risk, to be
and 2020, ending 2020 with a facilities during that time period. improvements to either conserve water a good global citizen and to reduce
WATER GOALS 53% reduction. or make new water sources available. costs and compliance risks.
Much of Cummins’ water efficiency
The company reduced its overall water improvements in company facilities These goals are consistent with
Reduce direct Examples include initiatives in villages
consumption to 772 million gallons, a to meet its 2020 goal were achieved the core commitments of the CEO
near the company’s campus in Phaltan,
water use across reduction of 361 million gallons from through low- and no-cost efforts, notably Water Mandate, which Cummins
India, where Cummins employees have joined in 2019. The U.N. Global
Cummins by 50% Cummins’ 2010 baseline year and a fixing leaks and optimizing processes. worked with village residents for many Compact’s commitment initiative
by 2020, adjusted decrease of 200 million gallons since Efforts have also involved capital years to establish water supplies that mobilizes business leaders on
the company initiated its water strategy projects, primarily equipment efficiency
by hours worked. make the villages less vulnerable to water, sanitation and the U.N.’s
in 2014. The reduction of 123 million upgrades and other high-impact projects periods of drought. Water neutral sites Sustainable Development Goals.
gallons between 2019 and 2020 was the such as single pass cooling elimination, must be re-evaluated every year to
Achieve water single biggest year-to-year drop in direct additional regenerative dynamometer
Endorsers of the CEO Water
count toward goal achievement. Mandate commit to continuous
neutrality at 15 Cummins water consumption since the baseline installations and innovative wastewater progress against six core elements
manufacturing, technical, was set. This was primarily due to a reuse projects. of stewardship and, in so doing,
understand and manage their own
and other larger sites
2020
water risks. The mandate’s six
2019
located in regions where commitment areas:
water is in short supply.
54% 53%
2018 » Direct operations
WATER 2020 GOAL ACHIEVED 50% » Supply chain and
BASELINE YEAR: 2010 INTENSITY 2017
watershed management
PROGRESS » Collective action
2016 44%
Percentage reduction of 2015
42% » Public policy
direct water use adjusted 41%
by hours worked. » Community engagement
2014
WATER NEUTRALITY STATUS » Transparency
35%
16 SITES
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 22INTRODUCTION ENVIRONMENT SOCIAL GOVERNANCE / ECONOMIC
U.N. GOAL #12
2020 GOAL PROGRESS // RESPONSIBLE CONSUMPTION AND PRODUCTION
ENERGY AND GHG PROGRESS Despite the pandemic-related setback, The company has also done outstanding The GHG intensity reduction did not
Cummins’ improvement over the goal work to optimize energy use through include the impact from the company’s
Cummins energy intensity period was significant. The 2020 goal low/no cost improvements, especially virtual power purchase agreement
target (absolute energy use
was the company’s fourth energy- in India, China and Latin America. to support the 2018 expansion of a
adjusted by hours worked)
greenhouse gas (GHG) reduction goal northwest Indiana wind farm in the
for 2020 was 32%, but ultimately, Absolute energy use decreased
the company fell just short, since 2006. Upon achieving a goal, United States. Cummins’ share of the
Cummins set new targets to reach. quarter to quarter through the third expansion sends enough low carbon
ending the year at 27%.
quarter of 2020. The fourth quarter energy to the grid to offset all of the
ENERGY AND The company had been on track to The company has long identified energy saw a fractional increase in energy electricity used at Cummins’ facilities
GHG GOAL reach its goal, achieving a 31% intensity and GHGs as an important metric and consumption as compared to the third across the state.
reduction in late 2019, but the year-end had completed the relatively inexpensive quarter. By the end of 2020 rolling four
energy reduction projects before the quarter energy use had fallen 12% from
Achieve a 32% energy 2020 intensity reduction was impacted
by COVID-19. Cummins’ absolute 2020 goal period began. Over the past the last quarter of 2018, the highest
intensity reduction from five years, Cummins invested $65 million absolute quarter of energy use at the ENERGY STRATEGY
energy use fell by 10% in 2020, but
company facilities by hours worked decreased even more — in energy reduction projects, saving company. Total energy costs in 2020
Cummins continues to use a
2020 and increase the by 14% — which negatively impacted $19 million each year, with an average were approximately $150 million or
facility investment plan approach.
portion of electricity the energy intensity metric. return on investment of 3.4 years. about 8% of Cummins’ net income. This approach includes a
comprehensive array of energy
Cummins uses derived A global campaign for high efficiency efficient and renewable energy
from renewable sources. LED lighting during the year produced technologies, such as compressed air
GOAL impressive results. About 85% of the optimization, test cell energy recovery,
2019
BASELINE YEAR: 2010 32% company’s light fixtures are now LED. on-site solar, LED lighting and
2018 31% advanced machine controls.
In 2016, the company pledged to have
2020
29% 90% of its facility GHG footprint, or Aggregated savings from energy
2017
27% 40 sites, certified to the ISO energy efficiency efforts total about
management standard 50001. By the $62 million per year. Cummins uses
2015 2016 25% tools and resources available from
end of 2020, Cummins had surpassed
ENERGY 24% 24% programs such as ISO 50001, the
that goal, reaching 45 sites. Between
INTENSITY 2010 and 2020, the company’s energy
international energy management
PROGRESS 2014
efficiency and renewable energy efforts
system standard, and the U.S.
Department of Energy’s Superior
Percentage reduction in 19% reduced Cummins’ GHG intensity Energy Performance program.
energy intensity (adjusted
by hours worked) compared by 41%.
to 2010 baseline year.
2020 CUMMINS SUSTAINABILITY PROGRESS REPORT 23You can also read
