Codifying our Commitment to Social Responsibility
November 1, 2019
An intern commutes to her summer job by train. Soon-to-be parents purchase a hybrid minivan in anticipation of their new arrival. A first-time home buyer looks for a house powered by renewable energy.
Consumers are increasingly aware of their impact on the world around them and choose to do business with companies that are, too. Social responsibility also influences how people decide where to work, where investors choose to invest, and the innovation, environmental sustainability and community involvement programs that companies choose to pursue.
John Timken, chairman of the board, says what’s now called corporate social responsibility (CSR) amounts to simple common sense. “It’s how we’ve always done business,” he says. “To us, it’s about doing the right thing.”
Timken’s 2018 CSR report codifies that common-sense approach, measuring the company against widely accepted practices and benchmarks, including the GRI Standards for sustainability reporting. The report provides a benchmark for measuring future progress in social accountability to employees, the environment and communities in which Timken operates.
“This report represents who we are and how we do business,” says Rich Kyle, Timken president and CEO. “We invest in our communities, we are for the environment, we treat people with respect, and we take great pride in doing things the right way.”
Shelly Chadwick, Timken’s vice president and chief accounting officer, points to the fact that Timken has been named one of the World’s Most Ethical Companies nine times by the Ethisphere Institute. “This report formalizes our CSR commitment and tells the story of how our organization interacts with the world socially and environmentally,” she says. “It reveals that we are a company concerned about more than just the numbers.”
A safe, respectful workplace
The core of any company’s commitment to CSR is how it treats its own people. At Timken that can be summed up in one word: Respect.
“We treat employees respectfully and that starts with keeping them safe,” says Rick Boyer, vice president of operations. “We want our people to walk out of work in the same condition as when they walked in.”
That goal is taken seriously throughout the organization. Employees in manufacturing plants serve as local safety observers, recommending safer, more ergonomic ways for colleagues to perform their jobs. Globally, the corporate Environmental, Health and Safety (EHS) group assesses and audits facilities to ensure they conform with ISO occupational health and safety standards.
In the rare case where a lost-time accident occurs, the local management team performs a deep-dive analysis to uncover the root cause and take action to prevent any reoccurrence. “We review these reports at all levels of management, up to the CEO, who takes an active role in critiquing the corrective actions,” Boyer says. As a result, Timken consistently places within the top quartile for lowest injury rates among U.S. metal manufacturing employers.
While employee safety is a #1 priority at Timken, the company also invests in employees and embraces the diversity of its workforce. The benefits for any company that does so are mutual. Employees are more engaged when they feel included, valued and rewarded. And employers are able to keep great employees who bring a variety of perspectives to the table.
Protecting the planet
Timken is a mainstay in many industries where bearings and power transmission products have significant impacts on the sustainability of an operation. Timken solutions reduce energy and fuel consumption in traditional applications like commercial vehicles, helping customers reduce their carbon footprints. The influence of Timken innovation on the viability of renewable energy sources like wind and solar is also on the rise—with Timken being the preferred bearing development provider for the world’s largest wind turbines, and Cone Drive by Timken being a leading supplier of solar tracker drives for the world’s largest operational solar thermal power plants.
Within its own operations, Timken focuses on four key areas of environmental stewardship: energy; air emissions; waste management; and spill prevention, control and countermeasures.
“Operating sustainably comes from the marriage of corporate commitment and associate engagement,” Boyer says. “Corporate EHS sets parameters within these four categories for all our facilities based on ISO environmental management standards, and global employees are encouraged to innovate and act.”
And they do. In just one example, employees at the Timken bearing manufacturing facility in Chennai, India, reduced the plant’s carbon footprint by 1.5 million kg per year by installing a 1.28 megawatt solar array on its roof. Solutions like these conserve energy and limit the environmental impacts of manufacturing on local communities.
Investing in our communities
Respecting nature in the places where it makes products is just one aspect of Timken’s community commitment. The company’s charitable giving started in 1922 with donations to United Way—an organization the company still supports today. As Timken has grown globally, so have its efforts to give back in all the communities where it operates. Last year, Timken awarded $1.5 million to support non-profits in the U.S. alone through The Timken Company Charitable and Education Fund (the Timken Fund), which is entirely funded by The Timken Company. Since the inception of the Timken Scholarship Program in 1957, the Timken Fund also has awarded more than $23 million in college scholarships as of 2018.
Timken giving is influenced and driven by employees because, as community residents, they know best about the needs and priorities of their own neighborhoods. In the U.S., Timken employees donate thousands of volunteer hours supporting personal charities and company-sponsored events focused on improving local access to resources for basic needs, education and economic prosperity. In addition, the company’s U.S. Matching Gift Program provides a dollar-for-dollar match, up to $2,000 per employee annually, to eligible charitable organizations championed by employees.
Even in countries where governments mandate corporate giving, Timken employees play a role in making decisions about where corporate contributions go. In 2018, employees in India chose to allocate funds toward improving medical and educational resources in disadvantaged communities. In Brazil, employees chose to support a children’s cancer hospital.
Taking our responsibilities seriously
Earlier this year at the Company’s Annual Meeting, John Timken talked to shareholders about the Timken management team’s “expert stewardship” and “incomparable integrity”.
“As we continue to grow, we remain committed to making the world a better place through our products, services and actions,” he said. “We conduct our business with unwavering ethics and integrity and embrace a strong spirit of social responsibility.”
One doesn’t need to look very far to find examples. At the direction of President and CEO Rich Kyle and the Timken Board of Directors, in 2019 the company created a cross-functional CSR steering committee to monitor and evaluate CSR activities, formalize a CSR program, and recommend ongoing strategies.
The committee is accountable to the Timken executive leadership team and the Board of Directors—a Board that is comprised of 27 percent women and recently received a “winning” designation by 2020 Women on Boards, which is focused on increasing the percentage of women on U.S. company boards.
As Timken leadership converts social responsibility philosophies into action, the company continues to attract employees with similarly strong convictions. It’s a combination that makes ethics and integrity something that is woven into the tapestry of the company rather than being a top-down directive.
For Chadwick, who is charged with minding the company’s numbers, financial support of the initiatives in the CSR report is an essential line item. “There is a cost to investing in our people, communities and environment,” she says. “But I join other Timken leaders in the belief that it is outweighed by the value of maintaining our reputation as a place where people want to work, investors want to invest, and customers and communities feel good about their association with us.”