Environmental

Environmental Progress
UTC is committed to continual improvement of EH&S performance. In 2004 we again exceeded our annual goals for all of our major environmental metrics, which are all normalized for revenue. Air emissions were down 27 percent compared to 2003, and we have achieved a 58 percent reduction since 1999. Both recycled and non-recycled waste decreased in 2004: 11 percent less recycled waste than in 2003 and 25 percent less non-recycled. Both categories of solid waste are on pace to meet our 2006 reduction goals.
   Our energy and water use decreased significantly last year. Our total energy use per dollar of revenue was down 9 percent compared to 2003 and water use per dollar of revenue declined by 19 percent. In both categories we have already exceeded our original goals set in 1997.

Improving Product Performance
The use of many of our products contributes to greenhouse gas emissions, but through UTC’s design for environment, health and safety programs we are exploring ways to increase efficiency and reduce emissions. A recent success of these programs is the Hamilton Sundstrand systems in the new Boeing 787, which contribute to this aircraft’s 20 percent fuel efficiency gain over current-generation equipment. Carrier is leading the air conditioning industry in meeting the new increase in U.S. residential energy efficiency standards. As a result, Carrier residential air conditioning systems shipped in the United States after January 2006 will be 30 percent more energy efficient than today’s federal standard.

Awarding Outstanding Performance
In 1995 UTC established the Robert F. Daniell Award to recognize outstanding environment, health and safety performance within our company. The most recent winner, announced in 2004, is Otis India for a hundredfold EH&S performance improvement over 10 years.
   Otis India’s achievements included a reduction in accidents from 359 in 1993 to 3 in 2003, no hazardous waste production since 2001, and a significant reduction in waste overall.
   Otis India also created “My Safety,” an education program for employees and their families. The program has helped teach employees to recognize job safety as fundamental to their well-being and to the welfare of their families.

Achieving Competitive Excellence
The efficiency of our operations and the quality of our products have a direct impact on our environmental performance. Achieving Competitive Excellence (ACE) is UTC’s proprietary internal discipline of continuous operational scrutiny, and an important resource for environment, health and safety improvement. It simplifies procedure, magnifies efficiency and replaces the limits of quality control with the discipline of quality creation. ACE ensures world-class quality in products and processes and relentlessly focuses on increasing efficiency and reducing waste, helping to support our environmental commitments as well as sustaining our performance model. ACE implementation across the world involves all employees and touches all of our manufacturing, business and supporting processes that deliver customer value.

Nonprofit Partnerships
UTC is a founding member of the Pew Center on Global Climate Change and the U.S. Green Building Council. We also recently joined the World Business Council for Sustainable Development. In 2004, Global Green USA — an affiliate of the Green Cross environmental organization founded by President Mikhail Gorbachev — awarded us the Corporate Design Award for our Sustainable Cities environmental grant and volunteer effort, which is representative of our commitment to the highest environmental standards.
  UTC Chairman and CEO George David (left) with President Mikhail Gorbachev at the 2004 Global Green USA Awards Dinner. UTC received the 2004 Corporate Design Award for the Sustainable Cities program.


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