Johnson Controls, a global leader for smart, healthy, and sustainable buildings, today released its 2023 Sustainability Report, marking milestones on the path to achieving net zero in buildings around the world. Johnson Controls reports accelerated progress both in its own sustainability journey and in the reduction of customer emissions.

"Climate change is a key defining theme of this century. We have seven years to cut global emissions nearly in half to reach net zero by 2050 and limit global warming to 1.5 degrees Celsius. With almost 40% of those emissions coming from buildings, the consensus among global leaders is that there will be no net zero without decarbonizing buildings," said George Oliver, chairman and CEO of Johnson Controls. "The good news is, we have the technology, financing, partnerships, and people to turn buildings from one of the greatest challenges into one of the biggest and quickest solutions toward net zero."

A 2022 International Energy Agency (IEA) emissions report showed that 86% of emission reductions in Europe last year came from building improvements. Heat pumps played a major role, with a 38% increase in heat pump sales. Globally, the IEA says emissions were kept to below a 1% rise, much lower than predicted, thanks in significant measure to unprecedented growth in energy-efficient equipment, heat pumps, renewable energy and electric vehicles.

Johnson Controls is creating and deploying technology – the smart building trifecta of energy-efficient equipment, clean electrification and systemic digitalization – to accelerate its own net zero journey. The company has already reduced absolute Scope 1 and 2 emissions by 42%, or more than 455,000 metric tons, on the way to its 2030 Science Based Target initiative (SBTi) target of 55%. The company is ahead, too, on reducing absolute Scope 3 customer emissions, achieving a reduction of 14%, or more than 18 million metric tons, on the way to its 2030 SBTi target of 16%.

"To help lead the way to a net zero future, we have committed to ambitious sustainability goals," said Katie McGinty, vice president and chief sustainability and external relations officer at Johnson Controls. "The numbers show that our smart building technologies and as-a-service financing and partnership models are having tremendous impact in cutting energy, emissions, and cost in our own operations and for our customers. We can accelerate climate progress and advance business objectives at the same time – just in time for the action the planet needs now!"

Driving climate progress is a significant factor in the company's growth and vitality, and Johnson Controls continues to innovate, investing 90% of R&D into new sustainability-related technologies in fiscal year 2022. The company also is addressing hard-to-abate steel production and embodied carbon. Over 70% of Johnson Controls steel purchases in the United States and 45% globally are from recycled scrap materials, (Recycled steel has up to 80% less embodied carbon than primary steel).

In addition, the company has stepped up to mobilize financing and meet the capital constraints faced by so many companies today, by introducing "Net Zero as a Service." This partnership model delivers on key performance objectives for customers – from energy, emissions, and cost reductions to healthy, smart workspaces – without upfront capital costs. "Net Zero as a Service" redefines risk by guaranteeing energy savings and paying project costs out of the savings. Since January 2000, Johnson Controls' innovative financing structures have helped partners and customers avoid over 37 million metric tons of emissions, and they are set to save partners over $7.8 billion in energy and operational costs over their project terms.

For its ESG work with customers and in its own operations, Johnson Controls has been ranked as one of the World's Most Ethical Companies for 16 years. The company earned a platinum rating from EcoVadis, a top ESG rating from Sustainalytics, and was distinguished as a climate leader by the CDP, Corporate Knights, and the Financial Times. The company received an AAA rating from the MSCI and was named to the Clean200 for its high proportion of sustainable revenues. Johnson Controls was honored as one of the 100 Best Corporate Citizens for the 17th year by 3BL, and was named to Fortune's Change the World list.

Johnson Controls attributes its global sustainability leadership to a 100,000-strong team, from the C-suite to the front line and factories. Compensation for the executive committee is tied to sustainability and diversity performance goals. Employees volunteered over 45,800 hours in 2022, 86% of which supported UN Sustainable Development Goals. The company is also investing in the rising generation of diverse, sustainable leaders through a wide range of scholarship, training, and internship programs.