Caterpillar knows a lot about the earth, having spent more than a century building machines that dig it up, clear it away or move it around. The Deerfield, Ill.-based heavy equipment manufacturer has had plenty of time to develop ideas on how to protect the earth, whether through better stewardship of natural resources or reduced greenhouse gas emissions. Caterpillar has earned high marks for its work in these areas, joining other big corporations in a worldwide effort to battle climate change.
Such concerns were not on the public’s radar when Caterpillar first opened for business. The company traces its roots to the 19th century, when, as its website notes, “horses powered infrastructure and agriculture.” Caterpillar co-founders Benjamin Holt and C.L. Best figured there was a more efficient way to do things, so they created machines designed to streamline farming and construction. Holt invented a steam tractor in 1890. A few years later he invented the precursor to the modern bulldozer – the machine that was said to crawl “like a big Caterpillar.”
You probably know the rest of the story. Caterpillar kept building bigger and stronger machines in the ensuing decades, and today ranks as the world’s leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. It posted nearly $54 billion in 2019 revenue and is No. 62 on the Fortune 500.
Caterpillar has also become an industry leader in adopting a more eco-friendly business model, and recently earned a No. 19 ranking in The Wall Street Journal’s list of the top sustainably managed companies. In its 2019 Sustainability Report, Caterpillar noted that 27% of its sales from products, services, and solutions demonstrated an improved sustainability benefit over prior offerings. The company’s 2020 sustainability goals include the following:
- Reduce energy intensity by 50% from 2006
- Reduce GHG emissions intensity by 50% from 2006
- Use alternative/renewable sources to meet 20% of its energy needs
- Reduce water consumption intensity by 50% from 2006
- Reduce by-product materials intensity by 50% from 2006
- Design new facilities to meet Leadership in Energy and Environmental Design (LEED) or comparable green building criteria
Caterpillar’s energy management program is an especially important part of its overall strategy to lower its carbon footprint. The company manages hundreds of facilities around the world that require tons of energy to operate. To help lower the energy needs of these facilities, Caterpillar has worked to improve energy efficiency, invested in alternative and renewable power generation sources, implemented water conservation projects, and managed waste through remanufacturing, rebuilding, reuse and recycling.
Renewable energy has been a big focus of late. In addition to buying renewable energy certificates and installing solar panels, Caterpillar has adopted energy-efficient combined heat and power (CHP) systems to power several of its manufacturing plants. In 2019, 35.5% of its electrical energy came from renewable or alternative sources. The company’s absolute GHG emissions fell by 20% from 2018 to 2019 and declined by 41% from 2006 to 2019.
Raw materials are another important focus. An estimated 1.8 million of Caterpillar’s construction machines are active worldwide, and as the company notes in its sustainability report: “What goes into these machines matters.” Because they matter, Caterpillar looks to responsibly source raw materials used to build its machines.
The company also tries to keep those materials in circulation for as long as possible through its remanufacturing and rebuild businesses, which offer numerous sustainability benefits. Caterpillar recycles millions of pounds of end-of-life iron every year and turns much of it into rebuilt products. This reduces waste and minimizes the need for raw materials, energy, and water to produce new parts. The company’s goal was to grow remanufacturing and rebuild business sales by 20% from 2013 to 2020.
Caterpillar doesn’t only look to make a difference through more sustainable operations. It has a broad philanthropic program as well, most of which is overseen by The Caterpillar Foundation. One of the foundation’s goals is to help 50 million people worldwide rise out of poverty through investments in basic human needs, education, and the environment. A key focus of its environmental strategy is to help spread the word about the world’s water crisis and how to solve it.
Two years ago Caterpillar, in partnership with Ducks Unlimited, The Nature Conservancy, Water.org, and other organizations, launched the Value of Water campaign to raise awareness about the value of water and its impact on health, education, and economics. The campaign’s goals include bringing clean water to rural communities in Africa through the construction of new wells and innovative pipe systems; restoring critical wetland habitats that provide flood protection and water filtration; reducing river pollution in the U.S.; strengthening the health of vital rivers; and delivering running water to homes in Africa, Asia, and South America through microcredit loans.
The Caterpillar Foundation also has been involved in the United Nations’ Girl Up Campaign and International Day of the Girl, which is observed every Oct. 11. The mission here is to promote the rights and opportunities of girls across the globe and highlight the challenges they face in terms of getting easier access to education and economic opportunity.
More recently, the foundation worked in partnership with the Red Cross to help communities impacted by Hurricane Laura. This effort included sending 600 trained disaster workers to Louisiana and Texas and positioning shelter and relief supplies along the Gulf Coast.