2010 Sustainability Report - Cummins.com

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Addressing climate change in our facilities The Company’s efforts to address climate change continue to expand. We have reduced Cummins’ carbon footprint through initiatives like the Unplugged Challenge, the Energy Champions program and the Envolved employee engagement campaign (see story on page 44). The Company’s Environmental Management System is making the Unplugged Challenge, an effort to reduce power consumption at Cummins facilities during holiday shutdowns, sustainable year round. Through training and steps to control processes, the goal is to make reducing electricity consumption part of our everyday lives. Meanwhile, Cummins’ facilities in the United Kingdom have worked hard to comply with the Carbon Reduction Commitment Energy Efficiency program, legislation designed to reduce energy use in businesses. From wastewater reduction to waterless bathroom fixtures, Cummins facilities met the challenge of water conservation over the past year. Annual water use reductions from specific water projects exceeded 47 million gallons – that’s the equivalent of a glass of water for over 725 million people. Better performance tools A key part of Cummins’ environmental initiatives is improving the Company’s ability to measure its performance at the facility level on environmental issues. In 2009, the Company implemented a new data collection/tracking system that made the gathering and public reporting of performance data for Cummins locations easier and more accurate. The system has better tools for data and trend analysis for all of the environmental data tracked so Cummins has an even better understanding of its environmental performance at all levels of the Company. ‘Print Smart’ reduces paper use Savings are up and the number of printed pages is down across Cummins thanks to a 2009 initiative the Company calls Print Smart. The program, now in its second generation, globally refreshes the Company’s printing devices. Cummins is well on its way to printing 36 million fewer pages than last year – a projected annual savings of $2 million. Under Print Smart II, employees have to confirm their intent to print at the printer by entering a code. This step gives them one more chance to decide if they really need a printed copy. Since color copies cost three times as much as black and white, Cummins has also achieved significant savings – an average of $1.5 million a year – by limiting both the number of color printers and which employees can print in color. Printing out a 30-page presentation that isn’t used doesn’t seem like a big deal until the cost is multiplied by thousands of users. By printing 36 million fewer pages annually, Cummins is predicting a greenhouse gas avoidance of 605 metric tons, which could generate an additional $7,400 in energy savings. With the completion of Print Smart ll, Cummins is saving both money and close to 4,000 trees per year. 20 Cummins Inc. Sustainability Report 2010
Challenges ahead: The environment Inherent in our commitment to the environment is our commitment to continuous improvement. Here are some of the key environmental challenges facing the Company: Regulations and global compliance: Cummins is planning for greenhouse gas regulation, both in its products and facilities. The Company has developed extensive technology road maps to meet various possible reduction deadlines for its products. As nations address emissions and regulate air pollutants, fuel efficiency and greenhouse gas emissions from our products, we must understand and comply fully with these regulations. Our challenge is to improve our global emissions compliance processes – from the point when a regulation is considered to when we design and make a product and then the sales and service of that product in the market. Products and supply chain: The Company’s new products must be environmentally friendly. We are constantly reviewing “green” product ideas that take advantage of our technological leadership. Cummins also plans to expand our efforts to do more low-carbon manufacturing, an area of currently untapped potential. We are also stepping up our efforts to “green” our supply chain. One project under way in 2010 will recommend a method and tools to evaluate the carbon footprint of Cummins extended supply chain, while another will recommend an overall strategy to reduce that footprint. Energy: The good news is there are many efforts going on around the globe, but we could do better at making sure they are leveraging, not duplicating, efforts and knowledge. An umbrella Six Sigma project will look at ways to coordinate global efforts in facilities, supply chain, products and processes. GHG reduction gets incrementally more difficult after meeting initial targets. The Company has embedded energy efficiency as a focus area within its global Environmental Management System to ensure that these efforts become sustainable parts of how we work every day. Cummins employee Mike Garrett looks for potential energy savings as part of the Company’s Energy Champions program. The low and no-cost improvements uncovered by Energy Champions and Leaders are critical to energy efficiency efforts going forward. Environment 21
Page 1 and 2: Cummins Inc. Sustainability Report
Page 3 and 4: Who we are Vision Making people’s
Page 5 and 6: Table of contents This year’s Sus
Page 7 and 8: To address the global challenges we
Page 9 and 10: Environment 9,000 tons of CO 2 emis
Page 11 and 12: The Cummins Operating System The Cu
Page 13 and 14: Clessie Cummins was known for his b
Page 15 and 16: Social issues, diversity and people
Page 17 and 18: The university’s emphasis on educ
Page 19 and 20: Cummins is a major participant in t
Page 21: Chairman and CEO Tim Solso (fourth
Page 25 and 26: Global on-highway standards 4.5 4.0
Page 27 and 28: Remanufacturing Cummins products Re
Page 29 and 30: Non-road useful life emissions tota
Page 31 and 32: ReCon plant opens in India Cummins
Page 33 and 34: Partnering with others Our own prod
Page 35 and 36: Environmental objectives and target
Page 37 and 38: 25% Percent change in revenue Since
Page 39 and 40: Cummins and climate change Here are
Page 41 and 42: Cummins accepted into U.K. Carbon T
Page 43 and 44: In December 2009, Cummins became a
Page 45 and 46: Combined heat and power 45% 85% ene
Page 47 and 48: India campus wins Chairman’s Awar
Page 49 and 50: Inside a classroom at Cummins Colle
Page 51 and 52: Partnering with Purdue, Rose Hulman
Page 53 and 54: Indiana Gov. Mitch Daniels (left) a
Page 55 and 56: Challenges ahead: Governance and Ri
Page 57 and 58: Robert J. Bernhard Vice President f
Page 59 and 60: Dr. Franklin Chang-Diaz Title: Chai
Page 61 and 62: Cummins started an Internet-based c
Page 63 and 64: Flu outbreak puts pandemic plan int
Page 65 and 66: Cummins has been working with Ithem
Page 67 and 68: Employees from the Dongfeng Cummins
Page 69 and 70: Challenges ahead: Corporate respons
Page 71 and 72: Audit Committee Chairman Marsha Hu
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A generator set operating on vegeta
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Lokesh Agrawal, Customer Interface
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Cummins employees regularly visit P
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Other Environmental Challenge grant
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GRANTEE ORGANIZATION COMMUNITY GRAN
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GRANTEE ORGANIZATION COMMUNITY GRAN
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Mary Kate (left), can only move her
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The Cummins Power Generation Plant
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“Satisfaction has increased withi
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Create a workplace population with
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Cummins’ definition of diversity
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Taking diversity to the next level
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Council plays key role The Diversit
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Smaller diverse suppliers can play
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Cummins workforce Here’s a quick
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President and COO Tom Linebarger sp
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The investment is paying off. Becau
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Pat Ward, Vice President - Chief Fi
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Six Sigma delivers for Cummins Ten
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Our new strategic principle Cummins
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Components Sales: $2.4 billion EBIT
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Production Notes Design and writing
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