HIGH Tech
HIGH Value
How innovation and technology
deliver value for our customers in order to makesustainable progress possible.

2012 Sustainability Report2012 Sustainability Report
HIGH Tech HIGH Value

Table of contents

3 Chairman’s Message

4	Our Approach

The sustainability principles and strategy that inform
our actions around the world

11 Our Views

Our positions on Energy & Climate, Growth & Trade andPeople & Planet

18 Our Community

Stories that highlight our commitment to worldwide
sustainable development

25 Features

Stories about how innovation and technology are delivering
customer value to make sustainable progress possible

41 Goals & Progress
60 Connections2

2012 Sustainability Report
HIGH Tech HIGH Value

Chairman’s Message
I can describe Caterpillar’s strategy in one word —customers. We wake up thinking about our customers
every day. What do they need? How can we add morevalue? What challenges do they face?
Douglas R. Oberhelman
Chairman and CEO

Of course each and every customer is unique, but there are a few needs
that our customers share across the board. Whether a small contractor
with a single machine, or a multinational mining company; whether
in Brazil or India; just about every customer talks to me about how
we can help them operate more efficiently. They want to movematerials quickly, safely and efficiently — in short, they want tooperate more sustainably.

our customers be more sustainable, or the need to be more sustainable
helps us become more innovative. Either way, it’s a good thing!
At Caterpillar, helping our customers operate in a more sustainable
manner is one of our biggest drivers of innovation. In 2012, we invested$2.5 billion in research and development.
Our approximately 10,000 engineers and technologists worked
on solutions involving natural gas and alternative fuels, advanced
hybrid technology, electronics to enable autonomy, and remote control
and advanced power trains to enable better fuel consumption,
responsiveness and traction control.

When our customers talk, we listen. When they have a problem big
or small, we are there to support them. But when our customers all
agree, when they have a common concern, we focus the full powerof the Caterpillar team to find solutions.
And the role technology plays is significant in finding those solutions.

All of these research themes have one thing in common — they are
aimed at helping our customers operate more efficiently, often withless impact on people and the environment. And they all fit in withthe three principles of sustainability we adopted in 2012.

You might be surprised to learn about all of the high-tech features inour products. Many of our large mining trucks can be customized todrive themselves, supervised from the comfort of a control room, andour dozers can be operated by remote control. Our internal combustion
process is more difficult to simulate than the process that powers thespace shuttle. Most of our machines and engines are designed to run
10,000 hours before overhaul — equivalent of 500,000 miles on yourcar. Our machines are designed to be rebuilt two or three times. We
have designed engines that meet each new tier of emissions standards,
the latest being Tier 4, which, in its final phase, will take particulatematter and NOx emissions to near-zero levels. This has been accomplished without sacrificing power or performance, and with a 5 to20 percent decrease in fuel consumption. Our dealers and customers
can watch many of their products working on their smartphones —Cat® Product Link™ gives them real-time data on product health,performance, uptime and fuel consumption. I could go on and on,
but you get the picture.

You’ll read more about our sustainability principles later in this report,
focusing on preventing waste, improving quality and developing bettersystems. You’ll see terrific examples of how these principles havebeen applied to improve the sustainability of our processes, products,
services and solutions. What I like about the principles is that they
are simple, yet effective, and they are relevant to all aspects of ouroperations, our supply chain and our customers’ needs, as well as
the environment and the communities in which we live and work.
When I look at our sustainability principles and our technology efforts,
it becomes clear we are making great strides in sustainability throughour innovation efforts. We aren’t trying to be flashy. We aren’t trying
to make headlines. We are simply working hard every day to help ourcustomers and our communities succeed.
Sincerely,

Being a world-class manufacturer requires excellence in innovation,
but we rarely innovate simply for the sake of making something new.
Instead, we use our technology to solve problems.
Sustainability and innovation at Caterpillar is a bit of a “chicken and theegg” dilemma. I don’t know which is first — whether innovation helps

Doug Oberhelman
Chairman and Chief Executive Officer of Caterpillar Inc.
3

2012 Sustainability Report
HIGH Tech HIGH Value

Our Approach

IN THIS SECTION
About This Report
Vision & Mission
Sustainability Principles
Legal Statements

For more than 85 years, Caterpillar Inc. has been making sustainable progress possible and driving
positive change on every continent. With 2012 sales and revenues of $65.875 billion, Caterpillar
is the world’s leading manufacturer of construction and mining equipment, diesel and natural gas
engines, industrial gas turbines and diesel-electric locomotives. The company also is a leading
services provider through Caterpillar Financial Services Corporation, Caterpillar Remanufacturing
Services and Progress Rail Services Corporation.
Caterpillar is a global leader, a worldwide enabler of sustainable progress. Caterpillar operates
hundreds of offices and facilities around the world and has more than 125,000 employees.
We serve customers in more than 180 countries. Caterpillar’s global presence, product breadthand financial strength enable us to win in today’s competitive marketplaces.

4

2012 Sustainability Report
HIGH Tech HIGH Value

our approach

About This Report
The need for sustainable development is rapidly becoming a priority
across the globe. Constraints associated with the availability andquality of energy, materials, water, land, food, education, health careand other resources affect everyone. We have focused this reporton innovation and technology breakthroughs that are improving thesustainability of these systems.
At Caterpillar, we believe sustainable progress is made possible bydeveloping better systems that maximize life cycle benefits, while also
minimizing the economic, social and environmental costs of ownership.
This is reflected in the sustainability principles we developed in 2012.
These principles and strategies are featured prominently throughout
this report, which carefully shows how we apply innovation andtechnology to improve the sustainability performance of Caterpillar
products, services, solutions and operations.
This report has been prepared by keeping two primary approaches
to sustainability practices in mind.

The innovation approach, emphasized by Caterpillar and otherforward-thinking companies, proactively gathers and uses data toidentify sustainability constraints and priorities. This information isused to drive the development and implementation of efficient methods,
innovative solutions and technology breakthroughs to create moresustainable systems, and in the development of performance-basedsustainability policies and regulations to promote innovation. Thisapproach is highlighted through this report’s feature stories that
describe how sustainable development is integrated into our day-today business operations.
The prescriptive approach, emphasized by many governmental andnongovernmental organizations, focuses on data collection, datareporting, transparency, development of standards and developmentof policies and regulations. Compliance and enforcement measures
are then developed and implemented that are intended to lead tomore sustainable systems. You will find evidence of this approachin the Goals & Progress section, where we report on Caterpillar’s
performance against our 2020 aspirational goals for operations andproducts, services and solutions.
Both approaches are important with respect to improving the qualityof our environment, communities and business performance. As
our sustainability journey progresses, our focus on innovation andtechnology will be paramount in order to fully achieve sustainable
development solutions that meet the needs of our enterprise,customers, communities and planet.

52012 Sustainability Report
HIGH Tech HIGH Value

our approach

Vision & Mission
Our vision is a world in which all people’s basic requirements — suchas shelter, clean water, sanitation, food and reliable power — arefulfilled in an environmentally sustainable way.

CRITICAL SUCCESS FACTORSOur mission is to enable economic growth through infrastructure andenergy development, and to provide solutions that support communities
and protect the planet.

Progress: We identify and share best practices to promote our employees’
awareness and understanding of sustainability. We continue to fostera corporate culture of transparency, disclosure and engagement.

Our strategy is to provide work environments, products, services
and solutions that make efficient use of the world’s natural resources
and reduce unnecessary impacts on communities, the environment
and the economy.

Operations. Be consistent with our sustainability principles andcontribute to 2020 aspirational sustainable development goals.

Culture. Create a culture of sustainability in all our business units
and in all our daily work.

We apply innovation and technology to improve the sustainability
performance of Caterpillar products, services, solutions and operations.
We believe sustainable progress is made possible by developing bettersystems that maximize life cycle benefits, while also minimizing the
economic, social and environmental costs of ownership, as reflectedin our sustainability principles.

Progress: The Caterpillar Production System provides the recipe for
efficiency and excellence in our facilities. We actively encourage
employees to conserve resources and be more efficient. Operating ina more efficient and sustainable manner will reduce impacts on people
and the environment, and help us and our customers save money.
Business Opportunities. Identify and pursue business growth
opportunities created by sustainable development.
Progress: We are actively embedding sustainability throughout our
Caterpillar brand portfolio, our new product development process andour technologies. Our business leaders continue to drive growth insales of products, services and solutions that help customers meettheir sustainability challenges. We utilize 6 Sigma methodologies tofocus our work and drive measurable benefits.
We will execute our strategy by working to meet our long-term aspirationalsustainable development goals. We set yearly targets where possible andare working on additional targets to help us measure our annual progress.

62012 Sustainability Report
HIGH Tech HIGH Value

our approach

Our Sustainability Principles & Strategy Ranking
communities and environmental resources are all valuable components
for a thriving Caterpillar enterprise.

In 2012, Caterpillar launched three sustainability principles and thestrategy ranking. The three core sustainability principles will be used
to drive our commitment to make sustainable progress possible. As
shown in the graphic below, these principles focus on preventing
waste, improving quality and developing better systems; and they
are relevant to everyone in the enterprise regardless of their role,
status or geographic location.

Preventing waste and improving quality measures provide the key
drivers for developing better systems that are inherently moresustainable. When Caterpillar brings people, materials, energy, waterand land into the various systems found throughout the enterprise,care must be taken to ensure that these resources are not harmed
or wasted. Keeping resources in the value chain through a circularflow of materials, energy and water is critical to maximizing totallife cycle benefits while minimizing the cost of ownership. This
leads to sustainable progress for communities, the environment
and the economy.

Most individuals and organizations consider preventing waste to be
an important strategy for competing in today’s markets. Improving theefficiency of products, processes, services and solutions not only
reduces cost, but also leads to environmental benefits associatedwith reduced materials, energy, water and land utilization. Caterpillar
recognizes that unnecessary impacts to people, communities andthe environment are also a form of waste. Consequently, preventing
waste is of paramount importance to improving sustainability.

Sustainability Strategies
The sustainability principles described above complement the five
key strategies described in the graphic on page 8. It is noteworthy
that the strategies described toward the top of this ranking tend tooffer more sustainability benefits than those described at the bottomof the ranking. Strategies associated with preventing waste andemissions through improved efficiency and quality measures are
preferred because they offer the most opportunities to enhance costcompetitiveness and reduce the potential for unnecessary impacts tocommunities and the environment in both the short and long term.

Improving quality by proactively implementing measures thatprevent waste is another key sustainability principle at Caterpillar.
Traditionally, this principle applies to the quality of the processes,
products, services, solutions and safety practices utilized throughout the Caterpillar enterprise. However, it also applies to the qualityof life for our employees, as well as the quality of the communities
and the environment in which Caterpillar operates. Healthy people,• Materials, energy, water and land
• Impacts to people, communities andthe environment

Prevent
Waste• Circular flow of materials and energy through the value chain• Maximum life cycle benefits and minimum cost of ownership• Sustained progress for economy, environment and community

Develop
Better
Systems

Improve
Quality• Safety, processes, products, services and solutions• Life, workforce, environment and community(continued)
7

2012 Sustainability Report
HIGH Tech HIGH Value

our approach

Our Sustainability Principles & Strategy Ranking (continued)
Sustainability Strategy Ranking

Remanufacture/rebuild options can preserve most of the embedded
energy and materials invested in the original production of equipment
and components. Reuse/recycle strategies also can be effective
measures for keeping valuable materials, energy and/or water byproducts in the Caterpillar value chain and out of costly waste streams.

Treatment/control options for waste and emissions can reduce
associated environmental impacts and may be necessary when more
efficient measures are not feasible. These options tend to be lessdesirable than waste avoidance or reuse/recycling options, because
most treatments and controls add significant costs and complexity tothe production and/or operation of products, services and solutions.
As a last resort, disposal/discharge of waste and/or emissions in
an appropriate and lawful manner may be considered acceptable.

8

2012 Sustainability Report
HIGH Tech HIGH Value

our approach

Roadmap Milestones
2009 	Formed Sustainability Council to drive increased revenues

2000 Became founding member of Diesel Technology Forum2001 Joined World Business Council for Sustainable Development
2002 Became lead corporate sponsor for Nature Conservancy’s Illinois

and foster dialogue on sustainability initiatives

	Announced remanufacturing joint venture in China with
Yuchai Machinery and opening of R&D center in China
Received U.S. EPA Clean Air Excellence Award for Cat® D7E

River Emiquon Preserve restoration and preservation project	Earned Leadership in Energy and Environmental Design (LEED)
Existing Building Gold Certification for Corporate Headquarters
and Caterpillar Financial Services Corporation Headquarters

2003 Set Vision Zero Safety Goal
Joined U.S. EPA Climate Leaders2010 Updated Worldwide Code of Conduct

Developed innovative battery materials technology	Acquired Electro-Motive Diesel, Inc., manufacturer ofdiesel-electric locomotives

	Supported the Tropical Forest Foundation program to help
deliver the first reduced-impact, logging-certified lumber in
the United States	Received Greenmark Gold Plus certification for Singapore
remanufacturing facility

2005 Published first Sustainability Report	Designated Sustainable Development as Enterprise Strategic
Area of Improvement	Earned LEED Gold certification for Suzhou, China, Medium
Wheel Loader/Motor Grader facility; Wuxi, China, R&D facility;
Tianjin, China, Asia Power Systems facility; and Washington,
Ill., Instrument Applications Center	Became lead corporate sponsor for Nature Conservancy’s
Great Rivers Project

2011	Acquired Bucyrus International, Inc., manufacturer of2006 	Led Dow Jones Sustainability World Index Industrial	Acquired MWM Holding GmbH, Germany-based manufacturerof natural gas reciprocating engines	Acquired Progress Rail Services, Inc., a provider of rail andtransit products and services, including remanufacture or
recycling of equipment.

	Launched first Annual Chairman’s Sustainability Awards

	Updated Worldwide Code of Conduct

high-productivity mining equipment

Engineering Sector

2012	Introduced Cat 336E H Hybrid Excavator®

	Introduced 966K XE Wheel Loader with advanced powertrain

	Acted as co-leading corporate sponsor of the World
Resources Institute Center for Transport and theEnvironment EMBARQ project	Acquired Medina Valley Co-Gen facility in Mossville, Ill.,providing alternative power to the Technical Center andMossville Engine Center2007 	Became founding partner of Energy Technologies Institute in	Launched Caterpillar sustainability principles to drive
continued awareness and promotion of sustainable
progress across the enterprise

the United Kingdom

2008 	Awarded first U.S. EPA International Combined Heat and2020 	Achieve enterprise goals in the areas of workplace andPower Award to customer in China

	Introduced Cat® D7E Electric Drive Track-Type Tractor

product safety, energy efficiency, greenhouse gas emissions,water consumption, materials efficiency, waste reduction
and LEED building criteria

	Introduced electric drive mining trucks

9

2012 Sustainability Report
HIGH Tech HIGH Value

our approach

Forward-Looking Statements
and Trademark Information
Certain statements in this 2012 Sustainability Report relate to future
events and expectations and are forward-looking statements within themeaning of the Private Securities Litigation Reform Act of 1995. Words
such as “believe,” “estimate,” “will be,” “will,” “would,” “expect,”“anticipate,” “plan,” “project,” “intend,” “could,” “should” or othersimilar words or expressions often identify forward-looking statements.
All statements other than statements of historical fact are forward-looking
statements, including, without limitation, statements regarding ouroutlook, projections, forecasts or trend descriptions. These statements
do not guarantee future performance, and we do not undertake to update
our forward-looking statements.
Caterpillar’s actual results may differ materially from those described or
implied in our forward-looking statements based on a number of factors,
including, but not limited to: (i) global economic conditions and economic
conditions in the industries and markets we serve; (ii) government
monetary or fiscal policies and infrastructure spending; (iii) commodity
or component price increases, fluctuations in demand for our products,
or limited availability of raw materials and component products, including
steel; (iv) our and our customers’, dealers’ and suppliers’ ability to accessand manage liquidity; (v) political and economic risks and instability,
including national or international conflicts and civil unrest; (vi) our and
Cat Financial’s ability to: maintain credit ratings, avoid material increases
in borrowing costs, and access capital markets; (vii) the financial
condition and credit worthiness of Cat Financial’s customers; (viii) changes
in interest rates or market liquidity; (ix) changes in financial services
regulation; (x) inability to realize expected benefits from acquisitions,
including ERA Mining Machinery Limited, and divestitures, including
the divestiture of the Bucyrus International, Inc. distribution business to
our independent dealers; (xi) international trade and investment policies;

10(xii) market acceptance of our products and services; (xiii) changes in thecompetitive environment, including market share, pricing and geographic
and product mix of sales; (xiv) successful implementation of capacity
expansion projects, cost reduction initiatives and efficiency or productivity
initiatives, including the Caterpillar Production System; (xv) inventory
management decisions and sourcing practices of our dealers or original
equipment manufacturers; (xvi) compliance with environmental laws andregulations; (xvii) alleged or actual violations of trade or anti-corruption
laws and regulations; (xviii) additional tax expense or exposure; (xix)currency fluctuations; (xx) our or Cat Financial’s compliance with financial
covenants; (xxi) increased pension plan funding obligations; (xxii) union
disputes or other labor matters; (xxiii) significant legal proceedings,
claims, lawsuits or investigations; (xxiv) compliance requirements imposed
if carbon emissions legislation and/or regulations are adopted; (xxv)changes in accounting standards; (xxvi) failure or breach of information
technology security; (xxvii) adverse effects of natural disasters; and(xxviii) other factors described in more detail under “Item 1A. Risk Factors”
in our Form 10-K filed with the SEC on February 19, 2013 for the year
ended December 31, 2012. This filing is available on our website atwww.caterpillar.com/secfilings.
CAT, CATERPILLAR, their respective logos, “Caterpillar Yellow” and the
POWER EDGE trade dress, as well as corporate and product identity
used herein, are trademarks of Caterpillar and may not be used without
permission. Cat and Caterpillar are registered trademarks of Caterpillar
Inc., 100 N.E. Adams, Peoria IL 61629.
© 2013 CATERPILLAR PUBLIC RELEASE All Rights Reserved.
Printed in the U.S.A.

2012 Sustainability Report
HIGH Tech HIGH ValueOur Views

IN THIS SECTION
Energy & Climate
Energy Poverty
Climate Policies
Operating in a CarbonConstrained World
Growth & trade
Advocating Free and Open Markets
Harmonizing Global Standards
Infrastructure
Infrastructure Innovationand Support

Caterpillar is a global company. With more than 500 locations worldwide and more than half ofour sales outside the United States, we serve customers around the world. We understand that
there are many different governmental forms and economic and political philosophies globally.
We acknowledge and respect the diversity of social customs and cultural traditions in the countries
in which we operate. And, we maintain the flexibility to adapt our business practices to them —to the extent that we can do so in keeping with Our Values in Action. In certain areas, however,
our positions are clear and long standing. These areas include Energy & Climate, Growth & Tradeand People & Planet.

People & Planet
SafetyEnvironment
Supporting Human Rights
Opposing Bribery & Corruption
Corporate Governance
Code of Conduct11

2012 Sustainability Report
HIGH Tech HIGH Value

our Views

Energy & Climate
Overview• When regulation is necessary, Caterpillar supports regulatory
structures that provide a competitive, technology-neutral and levelplaying field in which Caterpillar and our customers can operate.
• C aterpillar supports the development and use of strategies andtechnologies to increase energy efficiency and reduce emissions.

Caterpillar has a fundamental interest in, and understanding of,energy as a global energy consumer and industrial manufacturer,
as well as a major manufacturer of energy conversion and power
generation products. We are one of the world’s leading technology
suppliers to various energy markets and leverage our technology
and innovation to meet the world’s growing energy needs.

ENERGY POVERTY
Nearly 1.3 billion people, close to one-fifth of the global population, do
not have any access to electricity. Lack of access to modern energy
services hinders economic and social development, making it moredifficult to provide for needed water purification, sanitation andeducation. Today, the technology and natural resources exist to rapidly
expand energy access, but the challenge is how to accomplish thisin an effective and efficient manner.

THE CHALLENGE
Energy is a key requirement for sustainable progress and development
around the world. As a result, energy consumption is rising rapidly,
driven by worldwide population growth, swiftly developing economies, improving global living standards and the burgeoning use ofever more energy-dependent technologies. Global demand for energy
is expected to increase significantly over the next 20 years.

One of the biggest differences between a developing nation and adeveloped nation is access to energy. We support and are committed
to increasing that access, helping economies grow and reducing energy
poverty where it hits the hardest.

OUR POSITIONS• Energy sources need to be developed and used in an environmentally
responsible and sustainable manner.
• There is no one single solution to providing abundant, reliable, secure,clean and reasonably priced energy on a global basis. Political andindustry leadership is required to forge consensus and a commitment
to providing energy and related infrastructure that address economic
development, stability and environmental impacts.
• Caterpillar supports market-based, cost-efficient energy solutions
to help meet the world’s growing energy demands.
• Access to affordable and dependable energy resources is criticalfor energy security, economic prosperity and growing economies.
Caterpillar supports balanced and comprehensive energy policies
that include the responsible development and utilization of allenergy resources, including traditional sources of energy andexpanded utilization of alternative energy technologies.

Since energy is a key requirement for development, we focus ourtalents on reducing emissions while increasing energy access inorder for that development to be sustainable. Caterpillar does thisevery day by leveraging technology to create more efficient power
generation solutions. With distributed generation solutions utilizing
diesel and natural gas engines as well as alternative fuels, Caterpillar
is positioned to get power where it needs to be.
Further, Caterpillar-built equipment helps meet the demands of themining and resources industries to get raw materials where theyneed to be in order to create increased access to power. Coal is an
important fuel — both today and for the future. Coal is available in
the quantity, volumes and geographic locations needed to satisfy the(continued)
12

2012 Sustainability Report
HIGH Tech HIGH Value

our Views

Energy & Climate (continued)
world’s energy needs. All energy sources play a role in the solution
to the world’s energy challenges, and coal will be a significant partof that solution since it is abundantly available and has the scale tomeet the primary energy needs of the world’s rising population and
expected economic growth over the next several decades.

OPERATING IN A CARBON-CONSTRAINED WORLD
Caterpillar believes in the importance of providing energy-efficient
products and technologies for our customers and our facilities, aswell as advocating for policy solutions that are both environmentallyand economically sustainable. We work with policymakers on
developing economy-wide emissions reduction programs in the
United States that work in conjunction with international efforts
to reduce greenhouse gas emissions.

Studies show that using coal to produce energy creates 70 percent
fewer of certain key emissions today (from a particulate matter (PM),oxides of nitrogen (NOx), sulfur dioxide (SO2) and mercury perspective),than just a couple of decades ago. New coal-fired power plants are
15 to 45 percent more efficient than the oldest ones still in operation
today around the world. Carbon capture and sequestration technologies that can remove most of the CO2 emissions associated with coal
are being developed today. Efforts are needed to commercialize thistechnology around the globe as part of a path for low carbon-emittingenergy. This energy can help the largest populations that don’t haveaccess to reliable energy today.

Many countries already control greenhouse gas emissions, and morejurisdictions are evaluating plans to do so. Just as business cannot
operate efficiently under 50 different sets of state standards in the
United States, business will struggle with vastly differing approaches
to emissions reduction around the world. That is why we’ll continue
to advocate for a comprehensive international approach that encompasses emissions reduction commitments from all major economies.
We realize that we cannot reduce carbon emissions in isolation.
Rather, we must look at the issue with an eye toward energy security,
energy availability, technology, price and global competitiveness.

Energy diversification — such as new nuclear buildouts, new natural
gas reserves, plus renewable energy sources like wind, photovoltaic,
tidal and others — will contribute to an energy portfolio that helps
eliminate energy poverty, raise standards of living and propel economic
growth with less impact on the environment. Natural gas production,for example, has increased 13 percent from 2006 through 2011,
resulting in economic growth for many communities with recoverable
reserves. Products capable of using alternative or blended fuels arealso increasingly available. Eliminating energy poverty is a visionthat can be achieved.

Innovation will be key to developing new energy sources, and we willcontinue to call for policies that encourage innovation to improve
the performance of existing energy resources — particularly coal,oil and natural gas. We cannot afford to overlook any solution.
Despite the divergent proposals under discussion worldwide — fromcarbon caps and carbon taxes to strict emissions control regulation —we all agree that technology plays a key role in any successful
strategic approach to emissions reduction. The private sector musttake the lead in developing and deploying technology solutions to
reduce greenhouse gas emissions. Regulatory structures should
provide a competitive, technology-neutral and level playing field.
We believe we should not disparage any solution that hasn’t been
fully developed.

CLIMATE Policies
More and more governmental and intergovernmental organizations
are implementing mechanisms in an attempt to reduce greenhousegas emissions. We support intelligent, responsible public policies
addressing climate and energy issues and are:• Investing in emissions-reduction technologies that are importantto our customers and represent significant areas of opportunity
for our business.
• C ommitting to the development and deployment of advanced
technologies that reduce greenhouse gas emissions.
• Supporting policies and mechanisms that harness the marketplace
to drive innovation, mobilize investment and allow technologies
to be shared.
• Encouraging the coordination of domestic and international
programs to maximize the use of flexible, proven mechanisms
to reduce emissions.

Ultimately, unilateral action to reduce greenhouse gas emissions will
not be successful. We need national policies that integrate wellinto a global system of emissions reduction initiatives. The mostimmediate and measurable benefits can occur through energyefficiency improvements and corresponding greenhouse gas emissions
reductions. We support legislation that is both environmentally effective
and economically sustainable. And we encourage a constructive
dialogue and a proactive approach to providing energy safely, efficiently
and affordably to the billions of people who inhabit our planet.
It’s a tall order — but one that is critical to the future of business.

Through these activities, Caterpillar will continue making contributions
to efforts designed to reduce greenhouse gas emissions.
13

2012 Sustainability Report
HIGH Tech HIGH Value

our Views

Growth & Trade
ADVOCATING FREE AND OPEN MARKETSCaterpillar will continue to promote policies that reduce trade andinvestment barriers. At the same time, we will continue to speak out
against protectionist policies. We believe that developed countries
should adopt policies that allow the benefits of the global economy
to be extended to developing countries. Caterpillar also recognizes
humanitarian and developmental assistance is necessary to fightdisease, improve living conditions, combat corruption and provide theknowledge to drive economic growth and trade in many of the world’s
poorest countries. We support the goals of initiatives aimed at increasing economic growth and reducing poverty in developing countries.

Caterpillar has long believed that the pursuit of business excellenceand profit in a climate of free enterprise, free trade and unencumberedcompetition is the best means for efficient development and distributionof goods and services. Further, we believe such international exchange
promotes better understanding across borders and cultures, leading
to a more peaceful world. The enormous rise in post-World War II
gross domestic product and living standards in countries participating
significantly in international commerce has demonstrated such
benefits. In contrast, countries that have been isolated as a resultof lack of infrastructure, protectionist policies, conflict or economic
sanctions have not enjoyed these advantages.

HARMONIZING GLOBAL STANDARDSOn an international level, Caterpillar is actively involved in developing
International Standards Organization (ISO) criteria and chairs thecommittee that develops industry consensus standards for earthmoving equipment, including standards for visibility, rollover protection
structures, braking and sustainability. Our global standards andregulations team works closely with these organizations to enhancemachine safety standards worldwide. Caterpillar provides input
to regulatory agencies to help ensure the smooth introduction of
new technologies.

The economic growth brought about by international trade is essential
for poverty reduction, but it comes with challenges. Chief among
them is the need to balance economic, environmental and social
policies in support of sustainable development. When this happens,sustainable development can become a shared objective and provide
a common frame of reference that allows environmental and trade
policymakers to engage stakeholders, analyze issues and evaluate
policy more efficiently.
Caterpillar has a long history of advocacy for free trade. Our support
comes not from the perspective of any one country, but from a global
context. We believe that companies compete best in a free tradeenvironment. When trade barriers are removed, we can better meetour global customer needs and grow more efficiently. Our suppliers
benefit through satisfying our global sourcing requirements more
efficiently. Our employees benefit from a higher standard of living
as they have access to more product choices at lower prices. Free
trade also allows us to provide more and better job opportunities
because open markets lead to improved competitiveness.

Caterpillar regularly makes its management and technical expertiseavailable to regulatory bodies in advisory roles and provides technicalassistance as new product standards are developed. These activities
include participation and leadership roles in organizations such as theISO; membership in governmental and nongovernmental delegations
to international bodies such as the International Maritime Organization;
participation in formal European Union industry expertise panels; andparticipation in federal advisory committees chartered under the
U.S. Environmental Protection Agency.
(continued)
14

2012 Sustainability Report
HIGH Tech HIGH Value

our Views

Growth & Trade (continued)
INFRASTRUCTURE

INFRASTRUCTURE INNOVATION AND SUPPORTFrom growth economies where new infrastructure is required, todeveloped areas where aging networks need improvement, Caterpillar
supports investment in transportation, energy, telecommunications,and waste and water treatment infrastructure as a key enabler ofsustainable development, economic growth, competitiveness andlong-term job creation.

The Caterpillar Foundation is supporting the World Resources Institute(WRI) to catalyze the development of smart cities, which promote
infrastructure development that is economically and environmentally
efficient and serves as a model for sustainable development. The
development of blueprints for smart cities in China, India and Brazil is
intended to provide practical solutions for urbanization throughout theworld. Read more about this initiative in the Sustainable Urbanization
section of this report.

In order to promote growth, competitiveness and the general
well-being of their citizens, governments have a responsibility tomaintain appropriate levels of productive investment in infrastructure
while providing a level playing field for private investors and suppliers.
Leveraging private investment can bring additional sources of funding
when supported by fair and predictable policies to maximize thecertainty and timeliness of financial returns. Growth-enhancing
public investments, however, cannot be fully delegated to the private
sector; and public financing should continue to comprise the bulk of
infrastructure investment. Governments can influence the affordabilityof infrastructure through the facilitation of permitting, the reduction ofadministrative burden and the simplification of related requirements.
The government role for infrastructure financing is based on nationalneed, including urbanization, commerce and trade policy, travel,emergency preparedness, defense and global competitiveness.

Caterpillar supports communities planning for natural disastermitigation and those who are unfortunately impacted by disasterevents. From the San Francisco, Calif., earthquake in 1906 when aHolt Steam Traction Engine #37 was used in cleanup efforts, to more
recent events throughout the world, emergency Cat® generator sets
and non-road equipment have been used in the wake of disasters tosave lives and property. In addition, Cat® equipment powers systems
for prevention or mitigation of disasters, such as storm surge gatesand pumping systems.

15

2012 Sustainability Report
HIGH Tech HIGH Value

our Views

People & Planet
SAFETY

Further, we establish and adhere to environmentally compliant policies
and practices in product design, engineering and manufacturing in allof our facilities worldwide. Caterpillar’s Environment, Health & Safety
Assurance framework helps ensure that we comply with applicablelaws and regulations. Successfully identifying and managing
environmental issues helps protect the environment we all live
in and makes good business sense.

We are dedicated to the safety of everyone at Caterpillar, including
our extended team of employees, contractors, dealers, suppliers andcustomers. Our commitment to safety begins with the engineering ofour products and manufacturing processes, and extends to operator
training, job site solutions and the workplace cultures that impact
the way we work.

Supporting Human Rights

Caterpillar’s Global Health & Safety team plays a key role in providing
expertise and support to Caterpillar operations worldwide. Caterpillar
Safety Services supports enterprise facilities, dealers, suppliers andcustomers by leveraging cultural assessment tools, guiding continuous
improvement processes and delivering a wealth of free, industryspecific safety resources through safety.cat.com. This site provides
access to a wide range of interactive online training courses forsafety, health and the environment — in full support of our vision:
Safely home. Everyone. Every day.™ Read about our most recent
progress in Operational Safety and Product Safety in the Goals &Progress section of this report.

We believe that Our Values in Action — Caterpillar’s Worldwide
Code of Conduct, effectively articulates our long-standing support
for, and commitment to, human rights and the dignity of all people.
Caterpillar values teamwork with our employees, dealers, suppliers
and other stakeholders. We seek suppliers and business allies who
also demonstrate strong values and ethical principles. We avoid
those who violate the law or fail to comply with the sound businesspractices we promote.
We feel strongly that Our Values in Action creates a work environmentthat recognizes the rights of our employees around the globe. While
we respect the messages laid out in other voluntary conventions,frameworks and standards that offer direction on how to promote therights and freedoms of people, including those brought forward by theUnited Nations, we do not see the need to become signatories. Our
employees and management receive regular training and participate
in annual assessments to ensure that they are aware of and able toapply the principles contained in Our Values in Action. We also maintain internal reporting mechanisms to hold employees and management
accountable for failing to comply with Our Values in Action.

Environment
We design products and services that help people and communities
as they strive to create better lives for themselves. As the global
population continues to grow, pressure on the availability of natural
resources may also grow, and the need for our products and services
as enablers of sustainable development becomes even more important.
Caterpillar delivers products, services and solutions that provide
sustainable value to our customers through fuel efficiency andproductivity. Additionally, sustainable value extends to the repair,rebuild, remanufacture or upgrade of existing equipment. Our research
portfolio is customer-focused, striving to continuously improve productperformance, reliability, durability, sustainability, fuel economy
and emissions.

(continued)
16

2012 Sustainability Report
HIGH Tech HIGH Value

our Views

People & Planet (continued)
OPPOSING BRIBERY AND CORRUPTION

Code of Conduct

Caterpillar believes fair competition based on quality, innovation andoverall value is fundamental to free enterprise and economic growth.
Bribery and corruption can have serious social, environmental andeconomic consequences — impeding trade, competition, investment
and economic growth, and limiting a nation’s ability to reduce poverty
and improve standards of living. In some areas of the world where
Caterpillar does business, bribery and corruption are significant issues.
As a result, we strongly advocate and enforce anticorruption policies
throughout our company.

Our Values in Action — Caterpillar’s Worldwide Code of Conduct, firstpublished in 1974 and updated most recently in 2010 in conjunction
with our corporate strategy update, defines what we stand for andbelieve in, documenting the uncompromisingly high ethical standards
our company has upheld since its founding in 1925. The Code of
Conduct helps Caterpillar employees put the values and principles
expressed within into action every day by providing detailed guidanceon the behaviors and actions that support our values of Integrity,
Excellence, Teamwork and Commitment.
http://www.caterpillar.com/company/strategy/code-of-conduct

Corporate Governance
Caterpillar’s corporate governance is designed to serve the interestsof stockholders with the highest standards of responsibility, integrity
and commitment to compliance with applicable laws. These standards
are developed and implemented by our Board of Directors andglobal management team, who oversee the company’s performanceand governance policies.
http://www.caterpillar.com/company/governance17

2012 Sustainability Report
HIGH Tech HIGH ValueOur Community

IN THIS SECTION
Sustainable Urbanization
Economic Development
Job training
Safety training
Wildlife Preservation

As a global company and engaged corporate citizen, Caterpillar takes seriously its responsibility togive back to the communities around the world in which it operates. Through strategic collaborations,
we seek to leverage our unique strengths to make contributions that support our commitment tosustainable development. The Caterpillar Foundation, which has invested more than $550 million
worldwide since its inception in 1952, allows us to enhance our community involvement withinvestments that support our sustainability efforts. In addition, we collaborate across our value
chain to develop programs that provide job training and increase workplace safety.

Greener Communities18

2012 Sustainability Report
HIGH Tech HIGH Value

our COMMUNITY

Making Sustainable Urbanization Possible“At Caterpillar, we always ask ourselves, ‘What do our customers need?
What does the world need?’ WRI asks those same questions about thecommunities it serves, and truly delivers some amazing results.”

Doug Oberhelman,
Caterpillar chairman and CEO and member of WRI board of directors
More than half of the world population lives in cities today. This
continuing trend of urbanization poses substantial environmental
and societal challenges.

The smart cities initiative has three phases. The blueprint phase will
identify key steps toward addressing climate, water, land use andmobility challenges. The second phase moves from blueprint to action
by kicking off large, high-profile demonstration projects that address
one or more of the key challenges. In the third phase, WRI will target
decision-makers in other emerging cities with communications thathighlight the benefits of following new, smarter paths to urban growth.

In an effort to develop solutions to these challenges, the Caterpillar
Foundation invested $3 million during 2012 in a World Resources
Institute (WRI) project to promote the development of sustainable
cities in China, India and Brazil. Through this smart cities initiative,
WRI will partner with up to five cities on strategies to increaseenergy efficiency, curb greenhouse gas emissions, and improvewater quality, urban mobility and land use.

“At Caterpillar, we always ask ourselves, ‘What do our customers
need? What does the world need?’ WRI asks those same questions
about the communities it serves, and truly delivers some amazing
results,” said Doug Oberhelman, Caterpillar chairman and CEO andmember of WRI board of directors.

Specific project goals include solutions that will reach one billion
people with new public transportation options; avoid 617,000 metrictons of CO2 emissions in the transportation area; reduce nitrogen,phosphorus and ammonia water pollution by 15 percent; and provide
more reliable energy to 11 million industrial, corporate and residential
consumers. In total, the Caterpillar Foundation expects to support
this project with $12.5 million over five years.

WRI puts ideas into action, working globally with governments, businessand civil society to build transformative solutions that protect theearth and improve people’s lives. Their mission dovetails with theCaterpillar Foundation’s mission to enable economic growth throughinfrastructure and energy development, and to provide solutions that
protect people and preserve the planet.

“People worldwide need solutions to respond to today’s urban
challenges. WRI is working with partners to ensure that cities indeveloping countries provide economic growth, environmental
sustainability and social benefits. We are deeply grateful toCaterpillar for their generous support and collaboration in pursuitof these goals,” said Manish Bapna, WRI managing director.

The Caterpillar Foundation makes sustainable progress possible inour communities in the areas of basic human needs, disaster relief,
education and environmental programs. The Foundation has invested
more than $550 million worldwide since its inception in 1952.

19

2012 Sustainability Report
HIGH Tech HIGH Value

our COMMUNITY

Financing Brings Opportunity to Africa“Our customers not only want us to provide them with the equipment, butalso to be able to offer them integrated equipment purchasing solutions.”
	Loutfy Mansour,
CEO of Mantrac Unatrac Group
Economic development is welcome in any part of the world, but
especially in emerging economies. In these areas, financing new
business is often a struggle due to a lack of lending institutions
or lending policies. That’s where Caterpillar Financial Services
Corporation (Cat Financial) comes in.

“Our aim is to support the dealer network in the sale of Cat®
equipment by providing a dedicated, professional financial service,
which will reinforce the Cat brand through the active marketingof Cat Financial-branded products and services,” said Ben Kruger,
Standard Bank Deputy Group chief executive.

Cat Financial and Standard Bank, Africa’s largest banking group, arecollaborating to provide equipment financing to Caterpillar customers
in Ghana, Kenya, Nigeria and Tanzania countries covered by the
Mantrac Unatrac Group of Cat® dealerships.

After the initial rollout, plans are to extend services and products,
and the opportunities they bring, into Uganda and Sierra Leone.

While there is an existing banking culture in these locations, asset
financing is not as common. “Our customers not only want us toprovide them with the equipment, but also to be able to offer them
integrated equipment purchasing solutions,” Loutfy Mansour, CEOof Mantrac Unatrac Group, explained. “This collaboration will makethis possible for our clients.”
Standard Bank’s on-the-ground banking operations in Africa are staffedby expert teams who are familiar with local business conditions andregulations, ensuring that Caterpillar customers receive the highest
quality of service. Cat Financial brings valuable equipment knowledge
and remarketing mechanisms to the table to complete the relationship.
Caterpillar customers benefit from this unique combination ofCaterpillar marketing initiatives, flexible deal structures andaffordable financing options.
20

2012 Sustainability Report
HIGH Tech HIGH Value

our COMMUNITY

Ensuring Good People for Good Jobs
“This program is designed to cover those key areas that a skilled operator
should know in addition to running the machine — working safely, taking careof the equipment, taking care of the environment and how to work mostefficiently and productively.”

Michael Duncan,
Caterpillar Forest Products industry manager

Local economies always need good jobs, and local employers always
need qualified candidates. To help this combination become reality
in Greenville, N.C., Caterpillar Forest Products, Cat® dealer Gregory
Poole Equipment and Pitt Community College have joined forces todevelop top-notch logging-equipment operators.

A similar philosophy is behind another Caterpillar training initiative
under way in North Carolina. Last summer, 17 high school students were
inducted into the first class of the Caterpillar Youth Apprenticeship
Program in Sanford, N.C., where our Building Construction Products
Division has a manufacturing facility. This two-year training
program for welders prepares students for entry into the adultapprenticeship program and potential employment at our plant
upon high school graduation.

Pitt created a 12-week course to train logging-equipment operators
who, upon graduation, are certified by the North Carolina Associationof Professional Loggers as entry-level logging-equipment operators. To
support the course, Caterpillar Forest Products donated $1.25 million
in equipment to the program, including a Cat® 525C Skidder, a Cat® 573
Wheel Feller Buncher and a Cat® 559 DS Loader package, while Gregory
Poole is maintaining the equipment. Pitt’s first class graduated insummer 2012, with several of the graduates finding jobs immediately
upon graduating.

Upon completion of the program, students will receive a welding
certificate from Central Carolina Community College. In addition, they
will have completed the 80-hour Caterpillar Accelerated Training Program,which is a necessary credit toward an adult apprenticeship.
Both the Greenville and Sanford programs demonstrate innovative
approaches to developing skilled labor to fill jobs, an ongoing challenge
for our customers and the industries they serve. It’s a win-win process
for all involved — technical career skills and well-trained individuals
who can do the jobs Caterpillar and our customers require.

“Traditionally, equipment operators have learned on the job, which
can leave gaps in what they need to know to be a good operator andsteward of the environment,” explained Michael Duncan, Caterpillar
Forest Products industry manager. “We are supporting this program
because it is designed to cover those key areas that a skilled operator
should know in addition to running the machine — working safely,
taking care of the equipment, taking care of the environment andworking most efficiently and productively.”21

2012 Sustainability Report
HIGH Tech HIGH Value

our COMMUNITY

Safety Leadership Training for Today’s Workplace“In 2008, S.T.A.R.T. ™ was rolled out as the foundation of our Wagner

Safety Culture. Every year since, we have seen a reduction in our TRIR
(total recordable incident rate) and a decrease in severity of injuries.”
Curt Siroky,
Environmental Health and Safety manager Wagner Equipment

More than one million U.S. workplace injuries required people to missdays from work in 2011, according to the Bureau of Labor Statistics.
Such statistics make increasing workplace safety essential for thebottom line of business, but more importantly for the safety of ouremployees. In 2012, Caterpillar Safety Services rolled out an
update to the successful Supervisor Training in Accident Reduction
Techniques, or S.T.A.R.T.™, program to help safety management
teams reduce incidents and develop a culture of safety in contemporary
work environments.

In 2012, Wagner Equipment revised its company values to include
safety as one of the six values from which all decisions are made.
“S.T.A.R.T. was the foundation on which all of this was built,” adds
Siroky. The end result is a safer working environment for everyone
and a positive impact on the bottom line.
In December 2012, Wagner hosted a S.T.A.R.T. Workshop in its Aurora,
Colo., training center that allowed representatives from several
companies in a variety of industries to learn how the program candrive positive, sustainable change in any organization committed
to safety excellence.

“In 2008, S.T.A.R.T. was rolled out as the foundation of our Wagner
Safety Culture,” explains Curt Siroky, Environmental Health and Safety
manager at Cat® dealer Wagner Equipment. “Every year since, wehave seen a reduction in our TRIR (total recordable incident rate)
and a decrease in severity of injuries.”
S.T.A.R.T. provides an innovative formula for business success thatelevates safety so that it is valued as deeply as productivity andquality. The training program explains why safety accountability
works, how a positive safety culture impacts the bottom line andwhat supervisors can do to make a difference. In addition, the updated
program details the value of an integrated safety culture that demands
and rewards participation across a company, from the top floor to
the shop floor.

22

2012 Sustainability Report
HIGH Tech HIGH Value

our COMMUNITY

Helping Small Animals in a Big Way Down Under®

“This is a great example of Cat equipment being deployed in a verypractical way to halt and reverse the extinction crisis.”

	Atticus Fleming,
Chief Executive of the Australian Wildlife Conservancy
The same Cat® equipment that makes massive infrastructure projects,
such as bridges, highways and hydroelectric dams possible also is contributing to the survival of some of the world’s most vulnerable creatures.

“This is a great example of Cat equipment being deployed in a verypractical way to halt and reverse the extinction crisis,” Atticus Fleming,
Chief Executive of the AWC, said.

In Australia, one of the key factors driving the decline of small,indigenous mammals is habitat destruction by feral herbivores suchas donkeys, cattle, buffalo, horses and pigs. These larger animals
trample vegetation and the habitats of smaller, native mammals,
destroying their food sources and making them easy prey for otheranimals. As the number of feral animals grows and their range
increases, the population of smaller, native mammals falls. In fact,
Australia has one of the highest mammal extinction rates in theworld, according to the Australian Wildlife Conservancy (AWC).

The AWC has successfully used this strategy before to establish
smaller feral herbivore-free areas. At a site half the size of Wongalara,
the number of small mammals doubled soon after feral herbivores
were excluded. Previous success makes the AWC hopeful about thisnew project, which is viewed as particularly important to the native
animal population. The Wongalara location is near Kakadu National
Park, which has seen a 75 percent decline in its small mammal
population over the last decade. Within weeks of completing the
Wongalara fence, 1,000 feral herbivores were removed from the
new feral herbivore-free zone, a significant step in the recovery of
the area and the rebirth of Australia’s small, native mammals.

In an effort to revive the population of small native mammals, such as theendangered northern quoll and bandicoot, the AWC is deploying
Cat equipment — including a 140G Motor Grader, a D6H Track-Type
Tractor and a 950 Wheel Loader — to establish the largest feral
herbivore-free area on mainland Australia. For this significant conservation effort, the AWC fenced more than 250,000 acres (100,000
hectares) of the Wongalara Wildlife Sanctuary in the remote Top End
of Australia to keep the feral herbivores out and create the environment
native mammals need to thrive. Cat equipment cleared the way forthe 105 miles (165 kilometers) of fencing that encloses the feral
herbivore-free area of tropical woodlands and wetlands. This equipment
will continue to be used to maintain the fencing and fence line track,and to establish and maintain firebreaks across the area.
23

2012 Sustainability Report
HIGH Tech HIGH Value

our COMMUNITY

Trees on the MoveHow do you safely move something that stands 56 feet tall, 100 feetwide and weighs 518,000 pounds? Simple, you use Cat® equipment.
That is exactly what Hess Landscape turned to when asked by officials
in League City, Texas, to move a 100-year-old Ghirardi Compton Oaktree to make way for road widening. Hess successfully employed Cat®
track-type tractors and Cat® excavators to maneuver this enormous,
beloved piece of the town’s history. Looking like something thatcrawled off a sci-fi movie set, the Cat® equipment gently moved
the tree 1,500 feet to its new home at WaterSmart Park, a water
conservation education park, where the tree is thriving.
On the other side of the world, Caterpillar is also helping trees thrive.
China’s Caterpillar Forest project began on World Earth Day 2011, when
Caterpillar China employees and volunteers planted 45,000 trees on
106 acres (43 hectares) of land just north of Beijing.
World Earth Day 2012 saw smaller Caterpillar forests spring up across
China as Caterpillar Suzhou Co., Ltd. (CSCL), Caterpillar Wuxi andAsia Power Systems (APS) joined Caterpillar China to support thissustainability initiative. More than 350 employees and guests of
CSCL and Caterpillar Wuxi planted 2,800 trees around Taihu Lake,
while the APS team worked with volunteers from Jinnan Middle
School to plant 1,000 trees in Tianjin. The Caterpillar China teamcontinued to support the Caterpillar Forest project, planting 1,600
trees in Yanqing County with help from Caterpillar Beijing and the
China Environmental Protection Foundation.

24

2012 Sustainability Report
HIGH Tech HIGH Value

Features

IN THIS SECTION
Product Development
Natural Gas
Operational Efficiency
Remanufacturing

This year, our Sustainability Report features stories about how our products and solutions help
create customer value. Innovation at Caterpillar is driven by our customers’ needs to operate more
efficiently, improve the bottom line and meet their own sustainability goals. Our significant
technology investments lead to products that help customers lower their owning and operating
costs, while increasing energy efficiency, lowering emissions, reducing waste and enhancing
safety. In the process, we help our customers to make sustainable progress possible.

NEw wheel Loader
Hybrid Excavator
Caterpillar Technology and
Job Site Solutions
Coal Mine Methane
more sustainable Mining
infrastructure development252012 Sustainability Report
HIGH Tech HIGH Value

Features

Product Development
Several new computer simulations have been critical to this effort.
A new combustion simulation, for example, enables engineers to
study the complete combustion system and analyze alternative
combustion schemes to discover the lowest possible emissions at
the best possible fuel consumption and service interval. Similarly, afull machine simulation includes all major machine systems, a soilinteraction model and an operator model. Engineers use this program
to simulate work cycles, enabling structural durability and performance
analysis over a range of operations.

Insight Before Iron
Engineers love to solve problems. Developing new products andtechnologies presents a unique set of problems that can only besolved by trial, error and physics. Engineers analyze design ideas
using complex equations that seek to prove that, when built in iron,the design will do precisely what the engineer intends it to do.
Before the age of sophisticated virtual design tools, engineers wereforced to build numerous, often expensive, prototypes, test them, make
improvements and then repeat the process. Now, engineers arebuilding, analyzing and even allowing operators to drive prototypes
virtually, all before an iron model is ever constructed. The result ishigher-quality design, reduced environmental impact from the design
process and more productive engineers.

A key element of these simulations is immersive visualization,
which provides a full-scale, three-dimensional virtual environment.
In this environment, product teams can interact with product andmanufacturing process designs in order to assess product quality,
operator comfort, manufacturability and serviceability before
prototype designs are finalized.

“Physics-based modeling is changing the landscape of productdevelopment at Caterpillar. The amount of iron and the time required
to develop a product are substantially reduced, while the number ofdesigns we are able to explore affordably has exploded. The result
is a more efficient, sustainable product development process that
explores alternatives on a computer, not in iron,” Dave Damerell,Engineering Services Support manager, said.

Virtual product development at Caterpillar has become so robust thatthe development of the K-series large wheel loaders eliminated ironprototype testing completely, using only simulation, analysis and pilot
machines to test product and manufacturing design integrity. This
innovation reduced the development time of the new wheel loaders
by one-and-a-half years over the typical introduction timeline, while
improving machine performance. The new K-series offers improved
fuel efficiency for lower customer operating costs and improved
reliability, durability and serviceability for minimized downtime.
“Virtual product development has proven to be an essential tool forthe large wheel loader product team to achieve our aggressive cost,quality and timeline requirements,” said Kurt Norris, product manager.

Nowhere has the value of virtual product development at Caterpillar
been demonstrated more effectively than in the design and manufactureof products that meet stringent non-road diesel emissions standards.
This eight-year development program, involving more than 300 products
and 14 engine platforms, is the largest in Caterpillar’s history.

(continued)
26

2012 Sustainability Report
HIGH Tech HIGH Value

Product Development (continued)
As the K-series wheel loaders demonstrate, virtual product development
technology translates directly into customer value. Most importantly,
better product performance with optimized systems helps lead tolower customer owning and operating costs, increased efficiency
and reduced material waste.

APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

Develop
Better
Systems

Improve
Quality27

Through the virtual product development
process, we are DEVELOPING BETTERSYSTEMS that result in higher-quality design,
reduced environmental impact from the design
process and more productive engineers. We
are PREVENTING WASTE associated withconstructing multiple prototypes.

2012 Sustainability Report
HIGH Tech HIGH Value

FeaturesNatural Gas
Focusing on Natural Gas

In addition, because many Caterpillar customers are in other markets
where power density and engine response are the primary purchasing
considerations, Caterpillar is introducing an entire lineup of dual-fuelreciprocating engines and retrofit kits. In late 2012, retrofit kits using
Caterpillar’s patent pending Dynamic Gas Blending technology began
to ship to oil and gas customers. The Dynamic Gas Blending kit automatically adjusts to changes in incoming fuel quality and pressure,allowing engines to run on a wide variety of fuels, from associated
gas to liquefied natural gas (LNG), to maximize gas substitution.

Numbers — big numbers — underscore the potential of natural gas
in today’s energy-hungry world. China’s annual output of shale (natural)
gas is expected to jump from near zero currently to 6.5 billion cubic
meters by 2015 and at least 10 times that by 2020. The U.S. has morethan doubled its estimate of recoverable shale gas to 827 trillion cubicfeet. Such abundant supply is prompting many of our customers tomake the switch from diesel to natural gas, which enables them torealize fuel cost savings from 30 to 50 percent. The environmental
benefits are significant as well. Natural gas is the cleanest burningof conventional fossil fuels, producing fewer pollutants per unit ofenergy than coal or oil.

To support our mobile equipment customers, Caterpillar announced
an agreement with Westport Innovations in 2012. This relationshipallows us to combine Westport High Pressure Direct Injection technology with Caterpillar strengths in engine and non-road equipment
development and Electro-Motive Diesel (EMD) locomotive expertise toaccelerate natural gas technology into mining trucks and locomotives.

“Caterpillar is focusing on natural gas. A natural gas option is goodfor our customers and, therefore, we are investing in the products
and support that they need to be successful. These are not shortterm decisions. The investments required are significant, including
the allocation of deep expertise from around the Energy & Power
Systems businesses at Caterpillar,” declared Joel Feucht, generalmanager for gas engines at Large Power Systems Division.

Customers visiting the 2012 Caterpillar MINExpo exhibit got a preview
of some of the plans for our first LNG-powered mining trucks andlocomotives. These included three large mining trucks — the Cat®
793, 795 and 797 — as well as locomotives from EMD, a Caterpillar
subsidiary that builds diesel-electric locomotives. Both the trucks
and the locomotives are in the first stages of development withcommercial launch expected by 2017.

With a firm understanding of the value that natural gas can bring to ourcustomers, Caterpillar is moving aggressively to support their growinginterest in this alternative fuel. Many of our Solar™ turbines are alreadypowered with natural gas. In 2011, we acquired MWM, a leading
global supplier of natural gas and alternative-fuel engines. Thisacquisition strengthened our position in the traditional reciprocal
engine segment, where the primary buying criteria is fuel efficiency.

(continued)
28

2012 Sustainability Report
HIGH Tech HIGH Value

Natural Gas (continued)
In addition, Caterpillar and EMD are developing retrofit solutions toconvert existing mining trucks and locomotives to natural gas.

APPLYING OUR SUSTAINABILITY PRINCIPLES

The abundance of natural gas is expected to be a game changer inhigh-horsepower equipment and a significant opportunity for ourcustomers to realize improved efficiencies and more sustainable
solutions. “We believe that our product lineup must be comprehensive
so we can bring customer value that will drive competitiveness,
improve their environmental footprint and save them money,” says
Joel Feucht. Our natural gas initiatives undertaken so far, as wellas ongoing product development, will help make our customers’transition into the natural gas era a successful one.

Prevent
Waste

Develop
Better
Systems

Improve
Quality29

Caterpillar natural gas products provide ourcustomers with opportunity to increase energy
diversification, which helps IMPROVE QUALITY oflife and communities through raised standards ofliving and economic growth for many communities
with recoverable natural gas reserves. Natural
gas fuel PREVENTS WASTE by producing fewer
pollutants per unit of energy than coal or oil.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Operational Efficiency
Innovating to Reach our Goals

one of Caterpillar’s key facilities for developing marine, petroleum,
electric power, locomotive and industrial power systems, celebrates
its 30th anniversary.

It can be argued that the most difficult type of innovation involves
bringing new ideas to existing processes. Caterpillar engineers
have done just that. In two recent instances, though vastly different
situations, both innovations deliver improved efficiencies andsustainability benefits.

Material efficiency is the primary benefit of new thinking at our Franklin,Ind., remanufacturing facility. Caterpillar takes near end-of-life partsand restores them to original engineering specifications throughremanufacturing, an advanced form of recycling. The conventional
process for remanufacturing the cylinder bore wall on an engine
cylinder block had been to oversize the bore and then install new,oversized pistons and rings. But, engineers have had to reduce thewall thickness of the cylinder bores in order to meet new emissions
and fuel-efficiency requirements. As a result, the conventional
process is no longer viable.

Our Electric Power and Large Power Systems Division engineering
teams at the Caterpillar Lafayette Engine Center (LEC) in Lafayette, Ind.,
must operate preproduction generator sets for tens of thousands ofhours in order to prove durability and reliability. This endurance testingprocess generates energy, which until recently was released as waste
heat through load banks without a viable infrastructure to harness
it. New thinking by our engineers at the engine center has led to aprocess that not only captures the energy, but also uses it to power
the facility itself.

A new innovative process, known as Plasma Transferred Wire Arc(PTWA) spray, solves the problem by applying a spray coating to thecylinder wall to return the bore to original equipment specifications.
In addition, the spray-welded metal coating of the PTWA process
also creates a more durable wear surface, as well as producing amore fuel-efficient engine. At the current production rate, PTWA
prevents more than 5 million pounds of iron from entering the scrap
process each year.

The new Endurance Facility is producing up to 6.5 MW of the 9.0 MWof baseload power required to operate LEC, which offsets annual
electric utility purchases by up to $3.5 million. The natural gas andultra low sulfur diesel fueled generator sets maintain low nitrous
oxide and carbon monoxide emissions that surpass all federal andlocal requirements, thanks to specialized catalytic exhaust aftertreatment systems. The generated power produces about half of the
carbon emissions and one-third of the nitrous oxide emissions ofelectricity from the utility grid, generated by coal-fired power plants.
“Our products are known for their reliability and durability. Engine
and generator set testing in our new Endurance Facility combines thecreation of customer value with energy production for our manufacturing facility in a more sustainable and cost-effective way,” says
Frank Starke, Gas and Petroleum product manager, Large Power
Systems Division. This innovative power program comes as LEC,APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

Develop
Better
Systems

Improve
Quality

30

Innovations at two Indiana facilities are
PREVENTING WASTE of energy andmaterials. The PTWA spray process is also
IMPROVING QUALITY of product parts
through improved durability.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Remanufacturing
Making Good Use of Old Iron
paints used in oil field applications and is currently exploring laser
cleaning for high tolerance gas turbine shaft cleaning.

How do you eliminate the need for 15,000 tons of new steel plus
the accompanying 18,000 tons of CO2 involved in the production of
the steel? Make good use of old steel. This is the concept behind
our businesses that focus on remanufacturing, rebuilding andrepowering existing Cat® products. Our remanufacturing businessallows us to keep thousands of tons of material from landfills, while
offering our customers the needed upgrades to minimize their total
cost of ownership.

Also, consider the case of one of our North American customers andits several hundred locomotives. The customer has worked with
Progress Rail Services and Electro-Motive Diesel, both wholly owned
subsidiaries of Caterpillar, to reconfigure up to 500 locomotives thatdate back to the 1950s. This project will eliminate the need for morethan 13,600 metric tons of steel for new locomotives and theassociated generation of more than 16,300 metric tons of CO2
emissions. The repowered locomotives will meet the latest emissions
regulations and run on B5 biodiesel, while maintaining the characterof locomotives from a bygone era.

Cat Reman is a driving force in minimizing customer operating costs.
The services ensure that parts otherwise destined for the scrap yard
can be reused — an important step toward our goal of zero waste.
Caterpillar takes near end-of-life parts and restores them to original
engineering specifications through remanufacturing, an advanced formof recycling. This makes both economic and environmental sense
because it reduces waste and consumption of raw materials andprovides a lower cost to the customer. Through remanufacturing,
Caterpillar makes one of the greatest contributions to sustainable
development — keeping nonrenewable resources in circulation for
multiple lifetimes.

A similar Progress Rail project is under way with another North
American customer to repower 16 locomotives that service the ports
of Long Beach and Los Angeles, Calif. A new Cat® 3512C HD engine
and a custom-made diesel particulate filter will allow the repowered
locomotives to reduce emissions of particulate matter (PM) by around
90 percent, an important consideration in the Los Angeles area.

Cat Reman continues to implement new technologies to theremanufacturing process, as evidenced in the use of laser light forcleaning. Laser cleaning is a cost-effective process that removes
contaminants such as paint, rust, carbon and gasket, without the needfor chemicals or media in most applications, and reduces hazardous
waste generation. It incorporates a filtration system that extracts
and filters all dusts, fumes and gases, improving the operator’s work
environment. Laser cleaning is also unique in that it removes all
contaminants without affecting the original material below. Cat
Reman has used laser cleaning to clean special chemical-resistantIn our heavy equipment business, a new solution allows customers
to upgrade their D11R engine system to newer performance andemissions standards using a convenient kit along with a new orremanufactured D11T engine. The fuel savings and reported soundlevel improvements are just a few of the operational and service
benefits for the customer, and the resulting emissions reductions canexceed 40 total tons per year of CO2, carbon monoxide (CO), oxides
of nitrogen (NOx) and PM. “Flow meters were used on customer sites
to measure fuel consumption in side-by-side, real-world tests andconfirmed roughly 10 percent savings. Consistency with newer model(continued)
31

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Remanufacturing (continued)
capability. The retrofit engines also have the capability of consuming
dry field gas, while maintaining the original certified diesel engine
emission levels. Cat® Dynamic Gas Blending reduces diesel fuelconsumption and storage, which reduces the number of fuel delivery
trucks on the road.

production parts is often cited as another reason for upgrading,”
said Jeffrey Jacobs, business development manager Caterpillar
Emissions Solutions.
We also have developed new dynamic gas-blending retrofit kits to
upgrade existing diesel engines. The dynamic gas-blending systemallows an engine to run on natural gas and diesel simultaneously.
Designed for use with existing land-drilling rig controls and multigenerator set control systems, the gas-blending kit automatically
optimizes the amount of diesel being substituted with natural gas
by up to 70 percent, while maintaining diesel performance, existing
service intervals and component life.

During 2013, Dynamic Gas Blending technology will extend to avariety of machine, marine and petroleum applications.
Whether remanufacturing components, repowering engines orrebuilding equipment, these Caterpillar businesses continue tooffer customers a highly cost-effective means to realize more
efficient, more sustainable solutions.

“This is a completely integrated solution that continuously adjusts
to varying fuel quality and requires no retesting. It allows the engine
to run at maximum substitution while maintaining a high level ofreliability and durability,” explained Sam Ternes, Caterpillar Global
Petroleum engineering specialist.

APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

In addition to fuel flexibility, there are other benefits of these retrofit
kits. The retrofit kits incorporate flame arresters to protect the engine
and offer bolt-on component installation, full warranty coverage, easeof order with one part number for the kit and exceptional life withgenuine parts. The upgraded engines use ADEM™ A4 and EMCP 4.4
controls, which improve display performance and troubleshooting

Develop
Better
Systems

Improve
Quality32

Our remanufacturing businesses exemplify theprinciple of DEVELOPING BETTER SYSTEMS
by creating a circular flow of energy and materials
throughout the value chain and maximizing life
cycle benefits. Remanufacturing PREVENTSWASTE through its reuse of materials andthe accompanying resource savings.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Wheel Loader
Working Smarter to Increase Efficiency

implements or the cooling fan. At the same time, lower working engine
speeds result in reduced heat loads and lower sound levels than had
been previously attainable in a wheel loader application. Other
energy savings are realized during aggressive digging, when thecontinuously variable transmission consumes approximately half
the energy of a conventional transmission.

Wheel loaders are among the hardest-working, most versatile machines
in the world. They load a variety of materials, from aggregate to timber,on worksites throughout the world. Furthermore, they are used in avariety of applications — from snow removal and waste applications
to stockpiling and truck loading. With a list of tasks that goes on andon, a wheel loader that is more efficient and more sustainable candeliver an exceptional level of value for our customers.

Beyond its energy-saving features, the 966K XE also simplifies
operator technique while enhancing safety. The integrated advanced
powertrain means there are just two pedals — Stop and Go — thatallow the operator to concentrate on bucket fill and digging without
having to manually shift gears. In addition, when the operator is fillingor digging, the machine automatically reduces speed while maintaining
full power, again without the need to downshift.

This is the thought behind our new 966K XE Wheel Loader that is
equipped with an advanced powertrain system engineered to deliver
efficiency. The first powertrain of its kind in the wheel loader segment,
the 966K XE offers industry-leading fuel efficiency, with up to 25 percent
savings per machine and related CO2 emissions reductions, comparedto the standard 966K.

A low-effort electro-hydraulic joystick steering system permits operators
to work in a comfortable, ergonomically neutral position. The joystickalso is designed to mimic the machine’s articulation angle, provide
for improved steering control at higher speeds, offer greater visibility
and reduce operator fatigue, all of which increase safety.

Energy efficiencies are derived from an integrated continuously variabletransmission system with a hydraulic pump and motor variator unit.
This system allows for a smooth and continuous gear ratio change
between engine speed and machine speed, which in turn enables
the engine to run at a more efficient operating range, independent ofmachine ground speed. The key advances are delivered throughsystems integration and power balance of engine, powertrain andimplement systems to provide quick response, acceleration andpower, while significantly improving fuel efficiency.

By keeping our focus on our customers and their needs, we continue
to deliver innovative technology in the versatile machines they needto get so many jobs done — safely, efficiently and sustainably.
APPLYING OUR SUSTAINABILITY PRINCIPLESA Cat® C9.3 ACERT™ Diesel Engine delivers a peak net horsepower
rating of 220kW (290 hp), while meeting EU Stage IIIB emissions
standards and providing an efficient burn. “This is a machine withnever-ending power and low fuel consumption. The machine does
exactly what I want,” says Manfred Rehberg, of Kern & Co. KBI.

Prevent
Waste

Develop
Better
Systems

Improve
Quality

The engine achieves additional efficiency benefits during deceleration,
when machine momentum can be recovered as free energy to power
33

The 966K XE Wheel Loader helps PREVENTWASTE through increased fuel efficiency,
improves quality through optimal
performance and helps customers to develop
BETTER SYSTEMS for their job site.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Hybrid Excavator
A Thousand Energy-Saving Opportunities

customer while reducing its emissions from fuel combustion. Likethe 336E, the 336E H is built to be fully remanufacturable and canoperate on either ultra-low sulfur diesel (ULSD) fuel with 15 ppm ofsulfur or less or up to 20 percent biodiesel fuel blended with ULSD. In
addition, the 336E H is quieter than the predecessor 336D, increasing
comfort for the operator and the communities in which it operates.

In a typical quarry, an excavator may repeat the same movement
thousands of times daily, which can represent thousands of energysaving opportunities. Each time an excavator slows or stops, kinetic
energy is lost during braking. Caterpillar engineers realized that if
they could capture that energy, store it temporarily and redeploy itupon swing acceleration, the result would help customers gain greater
fuel efficiency and cost savings. Our engineers have done just thatwith the revolutionary new Cat® 336E H Hybrid Excavator.

This is only the beginning. Through a grant from the California Energy
Commission, Caterpillar is continuing to develop the next generationof hydraulic hybrids, including two pilot machines currently being
evaluated by customers. Leveraging this technology across othermodels and products will drive further progress toward our 2020
aspirational goal to reduce customer greenhouse gas emissions
by 20 percent.

The new 336E H Hybrid Excavator uses up to 25 percent less fuel perhour than the standard 336E and up to 50 percent less fuel per tonof material moved than the predecessor 336D, without sacrificing
performance. “We found an approach that will save our customers
money by lowering their owning and operating costs as well as theircarbon footprints,” explains Randy Peterson, advanced technology
development manager, Advanced Component and System Division.

“Caterpillar has an extraordinary team of people working on hybrid
technology solutions for the next generation of Cat® hydraulicexcavators,” notes Ken Gray, global product manager for large
hydraulic excavators for Caterpillar’s Excavation Division. “They areamong the very best and brightest minds, and they are listening very
closely to our customers. It’s exciting for me to see their enthusiasm
for this project and the quality product they have developed in the336E H, and we’re just getting started.”

The new 336E H hydraulic hybrid has technology developed byCaterpillar that includes more than 300 filed patents. It is the latest ina family of excavators that has become the industry standard in general,
quarry and heavy construction applications since its introduction in
1994. Caterpillar introduced the 336E excavator in 2010 to meet Tier 4Interim and EU Stage IIIB emissions standards. The 336E featured morehorsepower, fuel efficiency, lift capability and digging force than its
predecessor, and added automatic aftertreatment regeneration.

APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

The 336E H takes fuel efficiency to an even higher level through threetechnologies that 1) conserve fuel using engine power management,2) optimize performance using restriction management via thepatented Cat® Adaptive Control System (ACS) valve and 3) reuse
captured energy via the hydraulic hybrid swing system. The net
result is a machine that lowers owning and operating costs for theDevelop
Better
Systems

Improve
Quality34

The ability of the 336E H to conserve fuel andreduce emissions PREVENTS WASTE, resulting
in lower owning and operating costs. The
336E H helps customers to develop
BETTER SYSTEMS for their job site.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Caterpillar Technology and Job Site Solutions
Technology To Manage Big Better

The second tool, Product Link™, provides operators, service personnel
and managers information on vital machine functions as detectedby sensors integrated into the machine. Product Link™ improves
availability, component life and production efficiency while reducing
both repair cost and the risk of a catastrophic failure.

On large jobs such as road construction sites and quarries, a fleet
of machines stands out as the most visible equipment, but it is not
the only important equipment. Often what can’t be seen is key tocompleting a job most efficiently, on time and on budget.

At the Cemex Lyons limestone quarry in Lyons, Colo., our Job Site
Solutions (JSS) team proved that good things come in packages bothlarge and small. The JSS team was challenged to increase overall
fleet efficiency, reduce costs and increase productivity with a fleet
designed to meet more challenging environmental regulations, notably
dust emission limitations. Caterpillar and our dealer Wagner
Equipment Co. worked with Cemex to design a site-specific fleet
and management services support system. The system includes
capabilities from five key areas: equipment management, production
optimization, safety, sustainability and financial design. Using all thetools in the JSS toolbox and integrating the tools’ application into
customer operations, the team was able to improve managementof truck payloads, haul roads and idle time, resulting in significantly
increased productivity (30 percent or greater). In addition, the JSS
team improved Cemex’s bottom-line results in the safety andsustainability of the site by lowering dust emissions and increasingfuel efficiency.

Certainly that was the case in Texas, where everything’s bigger,
including the size of road construction projects. But if you’re Kiewit,
the firm leading the $1 billion Dallas-Fort Worth Connector project,
you’re looking for ways to manage resources most effectively. With
the help of Caterpillar’s technology solutions — the unseen tools at
this job site — Kiewit was able to streamline equipment-operating
costs and expects to ultimately finish the complex project in just three
years, a year earlier than anticipated.
The project involves 8.4 miles of busy highway construction andmore than 60 pieces of Cat® equipment. Kiewit credits effective
communication with completing this massive project early and on
budget. Cat® technologies such as Compaction Control and Product
Link™ communicated important information to operators andsupervisors in real time, allowing them to manage the projectin the most efficient way possible.
Compaction Control helps eliminate onsite guesswork by providing
information to the operator that helps them understand the state of
the materials being compacted, whether it is an indication of soil
stiffness or the temperature of an asphalt mat. This technology
ensures that the stiffness and strength parameters called for inpavement designs are met. Compaction Control also enables theoperator to see results in real time and focus on areas that needadditional compaction, while bypassing areas that meet specifications,improving compaction quality and jobsite efficiency.

“The collaborative nature of the JSS approach is unique because
it’s about working with the onsite team for better results, not tosimply replace what they do. The JSS process uses the collective
expertise of all parties to innovate together. The result is improved
operational efficiency, improved environmental sustainability at thesite and an improved financial outcome for the customer,” explains
Craig Olmstead, Job Site Solutions manager.

(continued)35

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Caterpillar Technology and Job Site Solutions (continued)
Our JSS teams have a range of customizable tools to use when theycollaborate with customers to deliver site-specific fleet management
solutions. JSS is currently managing 20-plus projects throughout theUnited States in applications such as Quarry & Aggregate, Industrial
Sites, Distribution Centers, Regional Mining and Agriculture Feedlots.

APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

In each case, the opportunity to improve sustainability performancethrough reduced energy consumption, lowered costs, increased
operational efficiency and optimized productivity is significant thanks tothe collaboration of the management teams of the customer, dealer
and JSS. This collaborative approach that leverages the latest
advancements in technologies and Caterpillar Production Systemprinciples is redefining how customers improve their bottom-line
results and make an even bigger impact with their customers.

Develop
Better
Systems

Improve
Quality

36

From delivering improved safety toconserving fuel to moving less material,
our technology solutions and Job Site
Solutions are examples of how we are
DEVELOPING BETTER SYSTEMS
that are inherently more sustainable.
JSS IMPROVES QUALITY throughoptimization of our products, services
and solutions and PREVENTS WASTE
on the job site.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Coal Mine Methane
Converting Emissions Into Energy
In the city of Jincheng, in China’s Shanxi province, the air was oncegray and tasted of sulfur dioxide, and the streets were empty of people.
Today, families enjoy being outdoors in the city square. Chen Jifeng
not only appreciates the changes in Jincheng’s environment, butalso is proud of the work that his own company is doing today.
Chen is a production manager at the Jincheng Anthracite Mining
Group’s Sihe Gas Power Plant, the world’s largest coal mine methane(CMM) power plant. Coal mining has long been the driving force
behind Shanxi’s economic development. CMM emissions, released
during mining activity, are a major target for greenhouse gas emissionsreduction efforts. In the past, CMM has been treated as waste anddischarged directly into the atmosphere. Capture and reuse of CMM
reduces impacts to both the local and global environment.
Until recently the technology to capture and convert CMM to energy
did not exist. Cat® G3520C Gas Power Generators have helped tosolve that problem by providing the means to turn CMM waste into
energy and reduce greenhouse gases.

“Our power plant is the world’s first coal mine methane project
under the Clean Development Program,” said Chen. The program,established under the United Nations Framework Convention on
Climate Change, offers an opportunity to earn carbon credits byinvesting in projects in developing countries that reduce greenhousegas emissions. “Over the seven years during which it can generatecredits, this plant will reduce emissions worth more than $140 million,”
Chen proudly notes.
Since 2006, the Jincheng group has been working with Caterpillar totransform the Sihe plant, along with two affiliated plants. In an effort
to upgrade the existing gas generating functions, the plant added
another six Cat® G3520C Gas Power Generators recently, increasing
power-generation efficiency by approximately 70 percent.
Today, the total installed capacity of the group’s Cat® gas power
generator sets is 189MW. Jincheng is working toward the goal ofbuilding the world’s largest gas power generation cluster. In doing
so, the company and its employees will have the satisfaction of not
only generating emissions-reduction credits, but also providing
energy for the region.
APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

Develop
Better
Systems

Improve
Quality

37

Cat® gas power generators PREVENTWASTE by capturing coal mine methane
emissions and reusing the emissions as avaluable power source. This IMPROVESQUALITY of the work environment for themining employees.

2012 Sustainability Report
HIGH Tech HIGH Value

FeaturesMore Sustainable Mining
The New Look of Mining

already on site and will be included on any future 793F orders. To keep
dust away from residents, Cat® trucks fitted with dust suppression
systems are used on site at all times.

At a time when population growth and urbanization are increasing
the demand for mined minerals, mining companies are innovating to
make their activities more sustainable than ever. A great example canbe found in Malartic, Quebec, where Osisko Mining Corporation has
made environmental sustainability and community engagement theirpriorities. Osisko’s Canadian Malartic mine is one of the largest open-pit
gold mines in Canada. The mine’s size and its location at the edge ofthe town of Malartic have posed unique developmental challenges,
many of which have been overcome in collaboration with residents.

Furthermore, Osisko addressed water conservation by creating a new
pond that will collect rain and snow melt for ore processing. “We’ve
managed to maximize water utilization in a way to minimize the needfor external sources. As far as water is concerned, we are very
sensitive to maintain a high level of recirculation to minimize impact
on outside environment,” Denis Cimon, vice president of technicalservices for Osisko Mining Corporation, explains.
Osisko’s commitment to incorporating innovation and technology into
its processes for a more efficient and sustainable mine is evident evenin the company tagline: A Fresh Outlook on Mining. “We wanted tochange the image of mining here,” says Cimon.

C A N A D A

In a town where the unemployment rate previously stood at 40 percent,
the Canadian Malartic mine is also delivering much-needed economic
benefits. The project created 650 new jobs for its mine along with new
suppliers established in this community of 3,700 residents. More than
1,000 indirect jobs were created, as well as the implementation of a
local economic development policy that is increasing the number andsuccess of small businesses in the area. The Canadian Malartic mine
has emerged as a case study in more sustainable mining.

Q u e b e c

Malartic

For example, to accommodate the mine’s development, a neighborhoodof more than 200 houses and five institutions, plus the infrastructure
to support them, has been relocated and rebuilt using much of thedemolished material. Additional demolished material has been
recycled to construct a 49-foot-high (15-meter) landscaped ridge
between the mine and town to visually shield mining operations
and help decrease noise.

APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

Develop
Better
Systems

Improve
Quality

To further reduce noise levels, Caterpillar developed an extra-quiet
package that has been retrofitted to Osisko’s original 793F trucks
38

Caterpillar innovations, such as reducing noiselevels from truck operations and reducing dust
generation, are helping Canadian Malartic mine
implement more sustainable mining processes,
IMPROVING QUALITY of life for both theemployees and community.

2012 Sustainability Report
HIGH Tech HIGH Value

Features

Infrastructure Development
Improving Infrastructure, Improving Lives

On the other side of the globe, Geostroy has deployed Cat® equipmentin the development of the Zagorskaya power station in Russia. The
power station, located 62 miles (100 km) from Moscow, is unique in
Russia. As a hydro-accumulating power station, it pumps water froma lower reservoir to a higher holding pond when extra electricity isavailable. When more power is needed, the water streams back to
the lower reservoir through a turbine to generate electricity. This typeof power station also offers the ability to smooth the peak energy load
during the day by supplying electricity to the grid. The Zagorskaya
power station also absorbs surplus electricity from a thermal power
station as well as nuclear power stations to avoid voltage overages.

Sustainable infrastructure development drives local economies,
improves standards of living and does so in a way that balances
environmental considerations. Caterpillar supports sustainableinfrastructure projects around the world with products and services
that facilitate efficiency.
One such project is the La Yesca hydroelectric dam in Mexico. The
second-tallest concrete face, hydroelectric dam in the world andlargest in Latin America sits on the border of Jalisco and Nayarit.
Completed in 2012 by Empresas ICA, S.A.B. de C.V. (ICA), therenewable-energy dam has the capacity to generate enough energy
to meet roughly 50 percent of the electricity demand for the city of
Guadalajara. In addition, the project has generated more than 10,000
jobs in the area, helping to improve residents’ quality of life.

Cat® dealer Zeppelin Russland is providing equipment and services
needed for this project, including Eco Operator TrainingSM to ensure
Geostroy employees operate equipment more efficiently and with lessfuel consumption. In addition, Cat® Product Link™ monitors, manages
and optimizes fuel consumption, workload and equipment healthat the site.

Cat® dealer Tracsa supplied approximately 150 Cat® machines,
including medium tractors, large excavators, large wheel loaders
and articulated trucks, in addition to crushers and other necessary
equipment. Caterpillar Financial Services Corporation and Cat®
dealer Tracsa supported the project through leasing and customer
service agreements for all Cat® machines for the duration of
the project, maintaining high levels of Cat® fleet availability
and contributing to the project’s success.

39

2012 Sustainability Report
HIGH Tech HIGH Value

Infrastructure Development (continued)
In ports and on beaches around the world, Great Lakes Dredge &Dock Co. (GLDD) relies on Cat® equipment to operate the largest
dredging company in North America. GLDD uses Cat® engines anddozers for infrastructure projects, such as channel and harbor
maintenance or deepening, to provide safe access for ships in andout of a port facility. Their work also includes beach renourishment
to protect people, homes and property from the sea during hightides and hurricanes. They rehabilitate damaged wetlands andother aquatic habitats.

APPLYING OUR SUSTAINABILITY PRINCIPLESPrevent
Waste

Develop
Better
Systems

Improve
Quality“For us to compete in this global marketplace, our equipment must be
reliable, cost efficient to purchase, operate and maintain, and comply
with the required emissions standards of the U.S. Environmental
Protection Agency or International Maritime Organization,” Carl Pfeil,
senior project engineer of GLDD, explained. “Caterpillar meets andexceeds all of these requirements.”

40

Infrastructure projects are essential to
IMPROVING QUALITY of life around the world
by DEVELOPING BETTER SYSTEMS, such astransportation, energy, water management andsanitation. At these project job sites, our machines
are often PREVENTING WASTE through fuelefficiency and material handling optimization.

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

Goals & Progress

Caterpillar has set aspirational, long-term goals for its operations as well as its products, services and solutions. We believe these standards affirm
our determination to lead our industry to a more sustainable future. (Baseline 2006)

2020 Goals for Operations

25%
Reduce recordable workplace
injury rate to 0.6 and lost-timecase rate due to injury to 0.15.

25%

Increase energy efficiency
by 25%.

Reduce absolute greenhousegas emissions from existing
facilities by 25%.

20%
Use alternative/renewablesources to meet 20% of ourenergy needs.

LEED
Eliminate waste by reducing
waste generation and reusing
or recycling all that remains.

Hold water consumption flat.

Design all new construction
to meet Leadership in Energy
and Environmental Design(LEED) or comparable green
building criteria.

2020 Goals for Products, Services & Solutions

Provide leadership in thesafety of people in, on andaround our products.

20%

20%

20%

Reduce customer greenhousegas emissions by 20%.

Increase customer energy
efficiency by 20%.

Increase customer materials
efficiency by 20%.

41

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

operational goal
Reduce recordable workplace injury rate to 0.6 and lost-time case rate due to injury to 0.15.

Health &Safetyoverview
Vision Zero is our commitment to creating a zero-injury workplace. We continue to maintaina strong focus on personal safety and strive for zero injuries.
For Caterpillar facilities as of December 2012, the year-end performance results showed
41 percent of our facilities reached zero recordable injuries and 65 percent of our facilities
reached zero lost-time injuries.
It’s not about the metrics, but about our people!

Performance Summary

1.02 Recordable Injury Frequency (RIF)

0.30 Lost-Time Case Frequency (LTCFR)(Recordable injuries per 200,000 hours worked)(Lost-time injuries per 200,000 hours worked)

6.06

2003

2.90

1.17

1.18

1.03

1.02

2009

2010

2011

2012

2003

We have improved our Recordable Injury Frequency rateby 83 percent from our 2003 baseline year and 1 percent
from our last reporting period.

<1%

0.36

0.35

0.28

0.30

2009

2010

2011

2012

We have improved our Lost-Time Case Frequency Rate by
90 percent from our 2003 baseline year. Our 2012 LTCFR
increased 7 percent from 2011. Through continued emphasisof our EHS Assurance program and global risk assessment
initiative, we will continue to implement improvements in
2013, striving to maintain progress toward Vision Zero.

In 2008, Caterpillar launched a global risk assessment initiative that has resulted
in the reduction of thousands of high-risk work elements to medium or low risk.
In 2012, facilities continued their focus on safety and ergonomic risk reduction by
establishing baselines for new or modified jobs. Our focus on ergonomics has
driven continued reduction in ergonomic-related injuries. By year-end 2012, lessthan 1 percent of all job elements assessed remained high-risk jobs.

42

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

Health and Safety
Progress Highlights

MAPLETON’S SAFETY CULTURE EVOLUTIONSAFER FIXTURES FOR A SAFER FACILITY

Since the early 2000s, Caterpillar’s Cast Metals Organization had worked tolower its recordable injury frequency (RIF). However, from 2006 to 2010, theaverage RIF had remained essentially flat and one of the highest in the company.
In late 2010, facility management created the Safety Leadership Team to drivechange throughout the foundry.

A new process has reduced assembly time and improved safety in our facility in
Elkader, Iowa. A project team created a safer and faster positioning process
for the production and welding of large u-blade and bracket assemblies. The
team decided to place the assemblies in a positioner that would hold themfor the welds. An unused turn fixture was recruited, and a saddle was created
for the u-blade to sit in when placed in the fixture. A second turn fixture wasadapted to hold the bracket assembly. This significantly decreased the needfor overhead cranes and improved employee ergonomics.

Facility management set an ambitious goal to reduce RIF. Managers developed
a Safety Action Plan to improve safety accountability, address injury trends,
engage and recognize employees, and build a safety culture of hazard
recognition. In just 20 months, the foundry improved its RIF nearly 50 percent.
In addition, significant economic benefits, including a nearly 25 percent
reduction in workers’ compensation costs, have accrued.

A time study was done once the fixtures were complete, and employees weretrained on their use. Before the project, u-blade assembly took five hours andbracket assembly took two hours. Once the new system was in place, u-blade
assembly time dropped to 1.5 hours and bracket assembly to 0.5 hours. In
addition, the fixtures are easier and safer for employees to use.

THE PSYCHOLOGY OF SAFETY CULTURE
Psychology students from a local university have helped reduce the number ofsafety incidents at Caterpillar Mexico’s Integrated Manufacturing Operations
facility in Santa Catarina. The recordable injury frequency (RIF) rate had fallen
nearly 91 percent from 2004 to 2010 due to a series of safety initiatives instituted
at the facility. When progress plateaued, the Ergonomics, Health and Safety
Department commissioned a University of Monterrey research project to identify
and address psychological factors involved in occupational injuries.

SAFER AND MORE PRODUCTIVE IN INDIA
A new four-stage assembly process at the backhoe assembly plant in Thiruvallur,
India, uses dedicated hoist cranes at each stage, plus ergonomically designed
fixtures and steps, to reduce operator fatigue and increase safety, while increasing productivity. The result is a reduction in the job risk score from 76 to 24
and an ability to reach a goal of 20 assemblies per single shift, a significant
increase from the previous average of three per shift.

Based on the students’ recommendations, the facility instituted programs tobring employees together as a cohesive unit, and training to help employees
recognize unsafe behaviors. By the end of 2012, the RIF rate had dropped
another 21 percent.

EMERGENCY SYSTEM MAKES WORKING ALONE SAFER
In the engine block washing cabin at Caterpillar’s Kiel Engine Center in Germany,
work has been optimized so that it requires only one person. This optimization,
however, created a potential risk, as there were no video cameras or other
employees to monitor the safety of the worker. The safety team concluded
that a personal emergency signal system was the solution. The employee now
wears a device that triggers an alarm after a period of time has elapsed withno movement or if a certain angle of inclination is exceeded. The alarm center
can identify the exact location and send an immediate response.

43

2012 Sustainability Report
HIGH Tech HIGH Value

25%

EnergyEfficiency

GoAls & Progress

operational goal
Increase energy efficiency by 25 percent.
overview
Energy efficiency is a continually evolving field, and we are currently evaluating this metricagainst other standards and best practices. We continue to launch individual projects as they
are identified by our enterprise energy management team through research and analysis.
Performance Summaryof revenue/absolute
2,262 Dollars
gigajoules energy use(Baseline: 2006)

2,063
1,489 1,557

1,654

2006

2010

2009

2011

2,262

2012

The 2012 result exceeds our 2020 aspirational goal by 22 percent.

Note: Data does not include facilities acquired after June 1, 2011, Caterpillar Japan Ltd — Direct Dealer operations,or Electro-Motive Diesel (EMD) operations.
Previously reported data has been restated due to:a) acquisitions,b) data updates realized from improved accuracy,c) divestitures.

44

2012 Sustainability Report
HIGH Tech HIGH Value

25%

GoAls & Progress

Energy Efficiency
Progress Highlights

MODERNIZATION SAVES ENERGY IN EAST PEORIA

CCMC REDUCES GREENHOUSE GAS EMISSIONS

A $200 million modernization of the track-type tractor undercarriage components
facility in East Peoria, Ill., is expected to increase production levels by nearly
30 percent from prior levels. The multiphase upgrade began in 2011, and isalready generating environmental benefits. The new full-link machining system
has reduced electrical power consumption by more than 60 percent, while
better mist collection systems have reduced air particulate emissions by morethan 80 percent.

A project team at Caterpillar China Machinery Components (CCMC) in Wuxi,
China, set a goal to reduce energy, water and steam use at the plant in order tobring down costs and reduce greenhouse gas emissions. The team’s suggestions
included upgrading air compressors and switching from metal halide to LED
lamps in the plant. These two projects have provided a total reduction of
approximately 200 metric tons of CO2e annually. Other actions taken by theteam include the reuse of water in the paint line, which helps reduce water
use by 14,400 cubic meters annually, and the reuse of condensate water forthe paint line and the wash station, which saves 3,400 cubic meters of steam
each year.

REDUCING POWER CONSUMPTION IN PETERBOROUGH
A compressor retrofit at our Perkins engine factory in England is generatingenergy and cost savings. Rather than purchasing a new compressor to supply
compressed air for site processes, an old compressor has been retrofitted witha heat recovery option. The retrofit has brought the compressor back into working
order, and reduced power consumption by recovering and reusing waste heatto warm engine wash water. The heating system, installed in November 2011,
has realized cost savings of approximately £57,000 and gas savings of morethan 1,890,000 kWh, while improving the reliability of the wash tanks.

Improving Energy Efficiency in Corinth
Reducing energy consumption is a continuous goal at Caterpillar’s Cardinal
Drive facility in Corinth, Miss. Beginning in 2009, the facility initiated amultiphase project to reduce electricity consumption and associated greenhousegas (GHG) emissions. By reducing the power used for heating, ventilation andair conditioning (HVAC) systems and changing to more energy-efficient lighting,the facility reduced electricity consumption by approximately one-third andreduced GHG emissions by approximately 5,700 metric tons of CO2e. In 2012,
the facility started a compressed air efficiency project and began replicating
the lighting project at other Caterpillar facilities. As a result of the HVAC
system improvements, the facility was recognized by the state of Mississippi
for outstanding achievement in energy-efficiency and energy management.
The project benefits also extended to the community as proceeds from the saleof unnecessary lighting equipment were donated to charity on behalf of theemployees in Corinth.

45

2012 Sustainability Report
HIGH Tech HIGH Value

25%

GHG Emissions

GoAls & Progress

operational goal
Reduce absolute greenhouse gas emissions from existing facilities by 25 percent.
overview
The 2012 result is 5.3 percent better than our 2012 target of 2.65 absolute million metric tonsof CO2e, continuing progress toward our 2020 aspirational goal of 25 percent reduction ofabsolute greenhouse gas emissions from existing facilities. The 2012 gains were achieved
through key energy efficiency/GHG reduction projects, which included lighting upgrades,
energy load monitoring and metering, and employee training for energy reductions.
Performance Summary

million metric tons
2.51 Absoluteof CO e2
(Baseline: 2006)

2.91

2.62

2.72

2010

2011

2.51

2.13

2006

2009

2012

The 2012 absolute GHG emissions were 14 percent improved,
relative to the established baseline year of 2006, and 5.3 percent
better than our 2012 target.

Note: Data does not include facilities acquired after June 1, 2011, Caterpillar Japan Ltd — Direct Dealer operations,or Electro-Motive Diesel (EMD) operations.
Previously reported data has been restated due to:a) acquisitions,b) data updates realized from improved accuracy,c) divestitures.

46

2012 Sustainability Report
HIGH Tech HIGH Value

25%

GoAls & Progress

GHG Emissions
Progress Highlights

NEW CONTROLS REDUCE ELECTRICITY USAGE

SKYLIGHTS DELIVER ENERGY REDUCTION AND COST SAVINGS

To bring down electricity usage, which accounts for 90 percent of the greenhousegas emissions at the manufacturing facility in Nuevo Laredo, Mexico, newthermostat and lighting controls have been installed to coordinate with theplant’s work schedule. Lighting locations were also studied and updated tomaximize the skylight benefits of the facility. The new controls reduce electricity
usage by more than 3,660,000 kWh and costs by nearly $442,000 annually
across three buildings, which equates to a reduction in approximately 1,600
metric tons of CO2e.

The Monterrey, Mexico, Integrated Manufacturing Operations Division plant has
installed skylights to reduce energy use and save money. The installation has
resulted in a reduction of 440 metric tons of CO2e and a cost savings of approximately $336,000 annually, while delivering the appropriate amount of light using
installed photocells to adjust light levels for the plant’s production processes.

USING OUTSIDE AIR TO KEEP DATA COOL
Caterpillar’s main data center has improved greenhouse gas emissions by
about 2,500 metric tons of CO2e annually, the equivalent of removing nearly
500 cars from roads. This has been achieved by efficiency improvements tothe building’s air conditioning system, which runs continuously. Improvements
include an automation system that uses more efficient motors for the existing
air handlers and equipment that takes advantage of outside air to cool theoffice during cooler months. In addition, a waterside economizer uses a heatexchanger and outside air in cold months to make chilled water to cool theinside air. Finally, an efficient chilled water plant creates the cold water
necessary to keep the data center and office spaces at suitable temperaturesin warmer months.

47

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

20%

operational goal
Use alternative/renewable sources to meet 20 percent of our energy needs.

Alternative/
Renewable
Energyoverview
We continue to make progress toward achieving our 2020 aspirational goal of 20 percent
alternative/renewable energy. In 2012, 18.2 percent of our energy consumption was produced
from renewable sources. These gains were achieved through facilities installing renewableenergy sources such as biogas and photovoltaics, as well as the purchase of renewable energy
certificates. In 2012, Caterpillar defined alternative energy sources and began defining the
calculation methodology.

Performance Summary

18.2

Percent alternative/
renewable energy(Renewable electrical energy use/total
electrical energy use) x 100

18.2
13.8

2010

14.8

2011

2012

The 2012 result indicates good progress toward achieving our 2020
aspirational goal. Data currently includes only renewable energy.
Alternative energy will be included in the future.
Renewable Energy: Caterpillar defines renewable energy as energy resourcesthat are naturally replenishing over a short period of time and virtuallyinexhaustible. Power generation examples include wind, solar, hydro,
geothermal, tidal, wave, biomass and anaerobic digestion.
Alternative Energy: Caterpillar defines alternative energy as any source ofusable energy that offers substantial environmental benefits compared to theconventional sources of energy that it replaces. Power generation examples
include renewable sources listed above, plus landfill gas, coal mine andabandoned mine methane, combined heat and power (cogen, trigen andquadgen), coal with carbon sequestration and localized power generation.
Transportation fuel examples include renewable sources listed above, plus
pure methanol, ethanol blends of 85 percent or more with gasoline, purenatural gas, natural gas blends of 85 percent or more with diesel fuel, liquid
fuels domestically produced from natural gas (compressed natural gas,liquefied natural gas and gas to liquid fuels), propane, coal-derived liquid
fuels, hydrogen and electricity.
Note: Data does not include facilities acquired after June 1, 2011, Caterpillar Japan Ltd — Direct Dealer operations,or Electro-Motive Diesel (EMD) operations.

48

2012 Sustainability Report
HIGH Tech HIGH Value

20%

GoAls & Progress

Alternative/Renewable Energy
Progress Highlights

Investment in COGENERATION in illinois
Caterpillar’s Global Purchasing Division acquired the 51.5 MW cogeneration
plant adjoining the Mossville, Ill., Caterpillar campus in 2012. Cogeneration isan energy-efficient means of producing multiple output streams from a single
fuel source, in this case, electricity, steam and chilled water from natural gas.
For Caterpillar, the plant acquisition:• Reduces Caterpillar’s reported annual greenhouse gas emissions by aminimum of 12,000 metric tons CO2e by utilizing the cogeneration plant
to meet the Mossville campus energy needs as compared to purchasing
electricity from the grid.
• Allows Caterpillar to proactively manage its cost structure, by eliminating
a long-term utility power purchase agreement, and allowing for revenue
generation through the sale of excess electricity to the regional power grid.
• Utilizes Caterpillar’s own products, three Solar™ Turbines Titan 130 natural
gas-fired generator sets, to produce electricity and steam.

49

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

operational goal
Eliminate waste by reducing waste generation and reusing or recycling all that remains.

Waste

overview
We continue to make gains in this effort, and in 2012 we incorporated scrap metal into ourenterprise recycling totals (as well as our historical metrics – shown in the performancesummary). With the heavy reliance of Caterpillar on steel and castings, and the relativevalue of metal scrap in the market place, it is vital that metal is strategically managed as animportant asset to the company and not as a waste. In 2012, 154 facilities were recycling at
90 percent or greater. We also continue to strive to reduce the generation of by-productmaterials as much as possible and, for the remainder, to continue to find types of beneficial
reuse (such as waste to energy) or recycling.
Performance Summary

95 Percent recycled

Absolute pounds recycled waste/absolute
pounds total waste x 100(Baseline: 2006)

85

2006

91

94

95

95

2009

2010

2011

2012

The 2012 result is 11 percent above our 2012 target. Caterpillar
employees continue to embrace recycling efforts on a global basis.
Our recycling metric includes metals recycled and energy recovery
from waste to energy incineration, as well as biological conversion
processes. We continue to look for opportunities to further
increase our by-product material efficiency.

Note: Data does not include facilities acquired after June 1, 2011, Caterpillar Japan Ltd — Direct Dealer operations,or Electro-Motive Diesel (EMD) operations.
Previously reported data has been restated due to:a) acquisitions,b) data updates realized from improved accuracy,c) divestitures.

50

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

Waste

Progress Highlights

PACKAGING SWITCH SAVES RESOURCESOIL RECLAMATION IN ILLINOIS

Caterpillar Suzhou Co. Ltd. (CSCL) in China has switched from wooden packaging
to reusable containers for shipping transmissions and axles to reduce packaging
waste and freight costs. In addition, the new containers meet higher safety
standards and offer better content protection. The new packaging saved$1.56 million, reduced wood usage by 1,000 metric tons per year and saved
more than 4,800 hours in operations time from reduced handling.

Two Caterpillar facilities have found ways to reclaim oil, delivering cost savingsand environmental benefits. The Advanced Components & Systems Division
facility in Joliet, Ill., collects more than 33,000 gallons (125,000 liters) of waste
oil from assembly lines and testing stands. Previously, the oil was treatedas waste or partially collected to be sold to a waste oil vendor for less than
10 percent of its original price. Through new processes, the oil is collected,
filtered, treated and reused in-house, resulting in an annual savings of about$202,000 and a significant positive environmental impact.

REVAMPED SCRAP RECYCLING IN Piracicaba

Similarly, a project team at the Integrated Manufacturing Operations Division
facility in East Peoria, Ill., has developed a system to optimize the oil extracted
from the plant waste oil stream, clarify it to a high quality and sell it for morethan was realized previously from lesser-quality oil. Over the course of 14 months,
the new process nearly tripled the return of the previous process.

A team at Caterpillar Brasil Ltd. (CBL) in Piracicaba, Brazil, has improved its
recycling index through a number of improvements to its scrap disposal program.
The name of the recycling area has been changed to Byproduct Central to better
identify it as an area for materials that can be a source of revenue. The teamalso has found a new receiver for scrap, consolidated and organized the area
where recyclables are stored, and identified additional materials that can berecycled rather than thrown away. At the end of 2012, the facility’s recycling
index was 98.13 percent, on its way to a goal of 100 percent by 2020.

EMD UPGRADES CLEANING PROCESSThe Electro-Motive Diesel facility in LaGrange, Ill., has replaced a diesel
engine cylinder liner cleaning process that used molten caustic salt and large
amounts of electricity, natural gas and water with a new process that uses anautomated mild alkaline wash and stainless steel shot blast to clean the liners.
The new process delivers an annual savings of about 124,000 kWh of electricity,
20.5 billion BTUs of natural gas and 5,236,000 gallons (19,820 cubic meters)of water. In addition, the reduction in electricity and natural gas usage decreases
CO2e emissions by 1,290 tons (1,150 metric tons), and the project keeps 34,900 lbs.
(15,800 kg) of waste from the landfill and about $190,000 each year.

51

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

operational goal
Hold water consumption flat.

Water
Consumption

overview
We continue to move forward with water-reduction efforts through alternative treatment
technologies, water recycling studies and employee awareness training on water management.
Performance Summary

4.86 Absolute billion gallons used
(Baseline: 2006)

5.85

2006

4.92

4.79

2009

2010

5.16

2011

4.86

2012

The 2012 result is 17 percent better than our 2020 aspirational
goal to hold water consumption flat to our established baseline
year of 2006.

Note: Data does not include facilities acquired after June 1, 2011, Caterpillar Japan Ltd — Direct Dealer operations,or Electro-Motive Diesel (EMD) operations.
Previously reported data has been restated due to:a) acquisitions,b) data updates realized from improved accuracy,c) divestitures.

52

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

Water Consumption
Progress Highlights

TECHNICAL CENTER TURNS WATER USE AROUNDUPGRADING SAVES WATER AND CUTS EMISSIONSOur Technical Center in Mossville, Ill., has implemented cooling tower efficiency
improvements that have resulted in more than 100 million gallons (380,000
cubic meters) of water recycled annually, delivering a 30 percent reduction inprocess cooling water consumption. Another project focused on process watersoftener rebuilds and control strategy enhancements saved an additional
35 million gallons (130,000 cubic meters) of water per year. These and otherupgrades have resulted in a 58 percent improvement in water consumption
over the baseline year of 2008.

In China, our Xuzhou hydraulic excavator facility has responded to water
shortages by installing a greywater recycling system, which provides 100 cubic
meters of greywater per day for hydraulic excavator washing, painting,landscaping and more. In the first year of use, Caterpillar Xuzhou reduced
its freshwater consumption by 25,900 cubic meters.
The facility has also upgraded its paint line to solve problems with capacity,
high water consumption and excess emissions. Through careful planning, thenew painting line has increased paint capacity from 50 to 80 units per day, water
use has been cut 75 percent and volatile organic compound (VOC) emissions
have been reduced 31 percent.

UK PAINT PLANT RECYCLES WATER
A team at Caterpillar’s Building Construction Products in Desford, England,has developed a wastewater recycling program that recycles water from thedeionized water tank in the paint plant pretreatment area, allowing that water
to be reused. The introduction of the deionized wastewater recycling system
reduces water demand, plant costs and environmental impact. In two years,
water usage has dropped 33 percent and more efficiencies are expected.

Upgrade delivers more efficient EFFLUENT DISCHARGE
The Caterpillar India facility in Thiruvallur, India, is undergoing a rapidtransformation toward increasing production capacity. To help increase capacity,
the facility installed an effluent treatment plant (ETP) that treats 100 percentof the effluents generated by the painting processes at the facility. In addition,
the ETP provides for the recycling and reuse of more than 6.5 million gallons(25,000 cubic meters) of water each year and a 38 percent annual reduction in
freshwater use.

REDUCTION OF WATER CONSUMPTION IN FRANCEThe undercarriage and parts production facility in Grenoble, France, uses
groundwater for many cooling purposes in production. Beginning in 2011, thefacility conducted a program to reduce the groundwater consumption for cooling
purposes. The facility identified and fixed all water leaks and invested inclosed-loop cooling systems with heat exchangers that use much less water.
In 2012, the facility used 35,000 cubic meters less than the annual amount ofgroundwater permitted by the city as a result of this initiative.

53

2012 Sustainability Report
HIGH Tech HIGH ValueLEED

Leadership in Energy
and Environmental
Design

GoAls & Progress

operational goal
Design all new construction to meet Leadership in Energy and Environmental Design (LEED)or comparable green building criteria.
overview
The collection of buildings or projects below represents varying degrees of certification or
certifiable status attained in accordance with either the U.S. Green Building Council’s New
Construction, Existing Buildings, or Commercial Interiors certification processes or comparable
green building criteria.
The buildings/projects consist of new construction and existing buildings.

Performance Summary
In 2012, the following Caterpillar facilities received certification in accordance with the U.S. Green Building Council’s LEED-NC (Leadership in
Energy and Environmental Design — New Construction) certification process or comparable criteria:
SILVER — Winston-Salem, N.C., Axle Manufacturing Facility
SILVER — Clayton, Ohio, Cat Logistics Distribution Center
Certifiable — Xuzhou, China, Building K

Progress Highlights
LEED GOLD WUXI, CHINA, R&D CENTER EXPANDS

include external sunshades, automatic daylight controls, architectural glazing
design for increased daylighting, enthalpy wheels to recover heat energy anda heat recovery chiller. Water conservation features include water-efficientlandscaping design through local and native plantings, a rainwater harvesting
system and low-flow plumbing fixtures. These energy-saving features reduceenergy use by as much as 45 percent for a typical building of its size, whilewater-saving programs reduce interior water usage by about 46 percent.

The Caterpillar Wuxi Research & Development Center (CRDC Wuxi), one of the
few R&D centers in China to achieve LEED Gold certification, incorporated further
sustainable features in 2011 and 2012. These included enhanced refrigerant
management, a high-reflectance roof, 75 percent of the space using daylighting
and non-toxic paints and carpet. These measures saved 34 million gallons(130,000 cubic meters) of water, reduced electricity consumption by 2.05 million
kWh and reduced waste by 88,000 pounds (40,000 kg) in 2012. CRDC Wuxi has
consistently demonstrated its strong leadership in sustainable development
throughout facility design, construction and operations, which not only benefits
the environment but also the enterprise. CRDC Wuxi received awards from theWuxi government, including the “Enterprise Strategic Footprint Development
Award” and the “Outstanding Leadership in Top Talent Attraction Award,” ranking
first among 76 Global Fortune 500 companies and more than 2,000 othercompanies that have operations in Wuxi. In 2012, CRDC Wuxi was recognizedby Jiangsu province government as the best R&D center in the province for its
leadership in innovation and sustainability.

ACHIEVED LEED SILVER IN WINSTON-SALEM, N.C.
Caterpillar’s new 850,000-square-foot (79,000 square meters) truck-axle
manufacturing facility in Winston-Salem, North Carolina, achieved LEED Silver
certification, earning the distinction of the largest LEED Silver-certified
manufacturing facility in North Carolina. During building construction, therecycle and reuse of building materials whenever possible led to 90 percent of
all construction waste being diverted from local landfills. The source of building
construction materials was considered resulting in 34 percent recycled material
content being used and 51 percent of materials sourced from within 500 milesof the project. Environmental features in the facility include geothermal wells
for heating and cooling, rooftop solar panels, motion sensing lighting controls,
daylight harvesting skylights and foam insulation. The facility protected, restoredor created a total of 40 acres of habitat, which is also used to filter stormwaterrunoff. As a result of these and other features, the facility uses 12 percent lessenergy and 45 percent less potable water than buildings of a similar size.

PURSUING LEED GOLD AT CATERPILLAR VISITORs CENTER
The Caterpillar Visitors Center, which opened in Peoria, Ill., in 2012, has applied
to receive LEED Gold certification from the U.S. Green Building Council. The
building features solar panels that provide about 10 percent of the center’s
projected annual energy use, while reducing greenhouse gas emissions
approximately 80 metric tons per year. Other energy conservation features54

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

ProductS, Services & Solutions Goal
Provide leadership in the safety of people in, on and around our products.

Customer
Health & Safety

overview
Caterpillar offers a suite of safety services to customers either individually or as part of a
Fleet Management Services agreement and remains committed to expanding the availabilityof safety information and materials.

performance summary
Operator and jobsite health and safety is promoted at safety.cat.com to help our customers use our products safely and improve their safety
performance. This dedicated website includes safety culture solutions that offer assessments, coaching and training to develop a stronger
safety culture.

Progress Highlights
MOTOR GRADER ACCESS SYSTEM IMPROVES SAFETY

NEW ROLLER OFFERS SAFETY AND INCREASED PRODUCTIVITY

The new Cat® 16M Motor Grader access system option consists of a wrap-around
access platform, tandem walkway with guardrails, primary foldable ladder andsecondary emergency cab egress ladder. The access system provides a safe andsturdy surface for accessing the operator station, servicing the motor grader andwindow washing with reduced risk of slips, trips or falls.

The new Cat® CW34 Pneumatic Roller offers operator comfort, safety and visibility
in an extremely productive machine. The new console design, standard sliding
station and full floor-to-ceiling glass in the cab enable the operator to easily viewwheel edges, while an LCD display and push button controls simplify operation.
The ability to coast delivers lower sound levels, further increasing comfort anddecreasing noise pollution.

SUPPORTING SAFETY IN A NEW INDUSTRYHAZARDOUS LOCATION SOLUTIONS

Caterpillar Safety Services has taken the lead in designing a training program
tailored to the wind power industry’s unique set of work circumstances — the
top of tall turbines — and its often-isolated locations. Working with windindustry leaders, Caterpillar has created a customized program that leverages
successful leadership training methods and allows anyone with a commitment
to elevating safety performance to learn and share the elements necessary fora positive, sustainable safety culture.

Cat® C15 ACERT™ engines for use in hazardous locations save oil and gas
industry customers time and money by reducing project complexity anddecreasing certification-related risks. The engines and solutions are primarily
used for offshore blending, cementing, nitrogen pumping and coiled tubing
applications where personnel and rig safety are critical. In addition, various
explosion-proof solutions are available for most of the petroleum product line.

PROXIMITY AWARENESS DELIVERS MINE SAFETY
Proximity Awareness, part of the Cat® MineStar™ System, delivers a newlevel of mine safety by providing information to equipment operators and mineadministrators about the environment surrounding mobile equipment. Global
Navigation Satellite System receivers and data radios on site equipment
continually report machine positions to each other and to a central office,allowing every operator to know the real-time position of all other reporting
machines. Proximity Awareness uses this information to define a machine body,
create avoidance areas within and around the machine, and provide a warning
if a collision is anticipated.

55

2012 Sustainability Report
HIGH Tech HIGH Value

20%

Customer
GHG Emissions

GoAls & Progress

Products, Services & Solutions Goal
Reduce customer greenhouse gas emissions by 20 percent.
overview
We want to help our customers achieve their emission reduction goals, too. Their needs
provide potentially valuable business opportunities for us.

performance summary
Customers are demanding greater fuel efficiency and using our technology to help them reduce GHG emissions.
Progress Highlights
MOTOR GRADERS DELIVER EFFICIENCY AND PERFORMANCEDIESEL GENERATOR SET offers reduced fuel consumption

The Cat® M series 2 motor graders, equipped with an ACERT™ engine and Cat
Clean Emissions Module, deliver the performance and efficiency customers
demand, while meeting EU Stage IIIB and Tier 4 Interim emissions standards.
Integrated machine systems and technologies improve productivity for greater
accuracy, lower fuel use and reduced machine wear. Decreases in fuelconsumption result in a decrease of combustion of carbon, reducing greenhousegases. The cab design assures excellent visibility to the work area and twoelectrohydraulic joysticks deliver enhanced operator comfort and efficiency.

The Cat® C175-16 Diesel Generator Set is certified to meet Tier 4 Interim emissions
standards, delivering reduced fuel consumption and lower emissions in acompact footprint. The C175-16 includes the Cat® Clean Emissions Module,
which is an aftertreatment system designed to reduce oxides of nitrogen,hydrocarbons and particulate matter.

New FUEL-EFFICIENT TRACTORSNew Cat® D6T, D7E and D8T Track-Type Tractors deliver the productivity, reliability
and durability of their predecessors while reducing emissions and fuel consumption.
Total machine fuel-efficiency improvements of 2 to 12 percent decrease carbon
emissions and customer fuel cost. Compared to previous models, the new machines
reduce particulate matter by 90 percent and oxides of nitrogen by 50 percent.

56

2012 Sustainability Report
HIGH Tech HIGH Value

20%

Customer
Energy Efficiency

GoAls & Progress

Products, Services & Solutions Goal
Increase customer efficiency by 20 percent.
overview
Efficiency gains will vary by product, application and segment. We continue to work with our
product groups and customers to define further efficiencies.

performance summary
We collaborate with our dealers to deliver highly customized and site-specific solutions that result in optimized use of our equipment and an
improved bottom line for our customers. We offer training to our customer operators on how to use our products more efficiently.

Progress Highlights
PERFECT PAIR FOR FUEL-EFFICIENT MINING

NEW ENGINES OFFER IMPROVED FUEL EFFICIENCY

The next generation 992K Wheel Loader and the 777G Off-Highway Truck areperfectly matched for efficient mining with the safety features and operator
comfort customers need. As a system, these two machines conserve resources
by burning less fuel, resulting in reduced emissions and cost savings forcustomers. In addition, 98 percent of the 992K is recyclable or reusable atthe end of life.

New C4.4 and C6.6 engines, designed to meet Tier 4 Interim and EU Stage IIIB
emission standards, deliver improved fuel efficiency and reduced emissions,while also lowering the cost of ownership through increased productivity. They
operate at reduced noise levels, increasing operator comfort and decreasing
noise pollution. The engines also were developed using virtual product technology,
which reduced emissions and energy used during development.

57

2012 Sustainability Report
HIGH Tech HIGH Value

20%

Customer
Materials
Efficiency

GoAls & Progress

Products, Services & Solutions Goal
Increase customer materials efficiency by 20 percent.
overview
Remanufactured, rebuilt and certified used parts provide cost savings to our customers andhelp us achieve our goal of using materials more efficiently. Retrofits and upgrades provide
significant customer benefits through the avoidance of obsolescence of older generation parts.

performance summary
We work to enable our customers to conserve and reuse resources.

Progress Highlights
COMPUTER AIDED EARTHMOVING FOR LANDFILL EFFICIENCYDURABLE EMD SD70ACE LOCOMOTIVE DESIGNED FOR REBUILD

Caterpillar’s Computer Aided Earthmoving System (CAES) enables there-engineering of landfill site planning and production processes from themachine cab. CAES is available on compactors and track-type tractors for use inlandfills. When installed on a compactor, the system indicates to the operator
when effective compaction has been achieved. Operators of track-type tractors
receive real-time grade and slope information to better utilize cover soil, minimize
airspace consumption and work more efficiently with the site plan to reduce
costs. CAES also allows the identification of site-specific storage areas formaterials such as hazardous waste, medical, industrial, organic and others.

The advanced technologies of the Electro-Motive Diesel (EMD) SD70ACe
locomotive provide safety, reliability and sustainability solutions for mining
operations and delivery of minerals to market. Safety features include thecrashworthy QuietCab, which is compatible with all cab signaling and safetysystems. Simplified maintenance processes, a longer maintenance interval,
advanced diagnostics and remote monitoring capabilities increase reliability.
The fuel-efficient machine delivers more than 600 ton-miles per gallon(230 tonne-kilometers per liter). This durable machine is in a line of locomotives
that last 40 years or more, and can be rebuilt reusing 80 percent of the corecomponents to extend locomotive life.

REDUCE WASTES WITH NEW HYDO™ ADVANCED OILSIMPROVED PERFORMANCE FROM A NEW FELLING HEAD

Caterpillar has recently introduced a new class of hydraulic oils, HYDO™
Advanced SAE 10 and SAE 30 fluids. These advanced fluids are designed frompremium additives and higher-quality base oils for optimal protection andperformance of all Caterpillar machine hydraulic systems. These new oils
extend the drain interval to 6,000 hours, two to three times the previous
drain interval. Cat® HYDO Advanced fluids reduce owning and operating
costs, increase uptime, reduce oil consumption and disposal costs andextend the life of machine components.

Improvements to the performance and durability of the HF201B Felling Headmake it an ideal match for use with Cat® track feller bunchers. The fellinghead’s weight has been reduced by 900 pounds (408 kg) and redistributed toextend head life and reduce operator fatigue. Simplified hydraulic plumbing
allows for easier hose maintenance and decreases the opportunity for leaks.
The grab and accumulator arms have been redesigned with single cylinders,
reducing hydraulic flow demand on the carrier by 40 percent and adding to
the head’s durability.

LONGWALL SHEARER DELIVERS HIGH PRODUCTION
The Cat® EL3000 Longwall Shearer mines mid-to-high seams with a highproduction capacity of more than 5,500 tons (5,000 metric tons) per hour.
Features such as advanced automation and monitoring, along with the easily
upgraded design, deliver long machine life while allowing customers to takeadvantage of the latest performance-enhancing updates.

58

2012 Sustainability Report
HIGH Tech HIGH Value

GoAls & Progress

Performance At-A-Glance
WORKPLACE SAFETY
Recordable Injury Frequency (RIF)

Lost-Time Case Frequency Rate (LTCFR)

1.66

0.48

(Recordable injuries per 200,000 hours worked)

1.17(Lost-time injuries per 200,000 hours worked)

0.36

1.18
1.03

1. Data does not include facilities acquired after June 1, 2011, Caterpillar Japan Ltd —Direct Dealer operations or Electro-Motive Diesel (EMD) operations.

0.35

1.02

0.28

0.30

2. Data prior to 2012 has been restated due to a) acquisitions, b) data updates realized from
improved accuracy, c) divestitures.
3. Based only on renewable energy. Alternative energy will be included in the future.
4. Data does not include Progress Rail or EMD operations.
5. Data does not include Progress Rail, EMD or Solar operations.

2008

2009

2010

2011

2012

2008

2009

2010

2011

2012

environmental impact 1, 2
Absolute GHG(Absolute million metric tons of CO2e)(Baseline: 2006)

Percent Recycled(Absolute pounds recycled waste/absolute pounds total waste) x 100

2.95
2.62

91

2.72

91

94

95

95

Water Use

Percent Alternate/
Renewable Sources 3(Absolute billion gallons used)(Baseline: 2006)

5.51

2.51

4.92

4.79

5.16

(Renewable electrical energy use/total
electrical energy use) x 100

2009

13.8

2010

2011

2012

2008

2009

2010

2011

2012

2008

2009

2010

2011

2012

REMANUFACTURING (REMAN) 2, 5
Reman Business Growth(Percent revenue increase over 2001 base)(Actual end-of-life returns/eligible
returns) x 100
205

193

93

91

2,262
2,063

2010

1,772

14.8

1,557

2011

2012

2008

Cat® Certified Rebuild 4

Reman End-of-Life“Take Back” Percent

94

95

Reman End-of-Life“Take Back” by Weight(Millions of pounds of end-of-lifematerial received)

94

161
142

160

Cat® Certified Rebuild
Business Growth(Percent revenue increase over 2001 base)

171

998

1,017

2011

2012

134
122

134

607
104

2008

2009

2010

2011

2012

2008

2009

2010

2011

2012

2008

2009

2010

2011

59

(Dollars of revenue/absolute
gigajoules energy use)
(Baseline: 2006)

18.2
4.86

2.13

2008

Energy Efficiency

2012

385

388

2008

2009

2010

2009

1,654

2010

2011

2012

2012 Sustainability Report
HIGH Tech HIGH Value

Connections

External Advisors & Comments
Our thanks to the advisory council of experts who provided their comments on Caterpillar’s sustainability progress. Inclusion below indicates
they provided feedback; it does not indicate they endorse the contents of the report. Comments below are advisory in nature and do notnecessarily reflect corporate policy.
LUKE DANIELSON
Sustainable Development Strategies GroupTHOMAS LOVEJOY
Biodiversity Chair, Heinz Center for Science,
Economics and the Environment“Looking ahead, there will be a need for extensive ecologicalrestoration to conserve biodiversity, bring back ecosystem services
and draw carbon dioxide out of the atmosphere to incorporate into
ecosystems. Cat® machines are already being used for such purposes and will be needed even more widely.”

BRUCE M. EVERETT
Professor, The Fletcher School, Tufts University
BRADLEY GOOGINS
Professor, Carroll School of Management; Former Director, Centerfor Corporate Citizenship, Boston College“Caterpillar, like all global companies today, faces a world of relentlesschange, incredible technological breakthroughs and ferocious
competition, all of which call for an equal dose of innovation. It is only
through continuous adaptation and the leading edge of innovationthat business today can compete and contribute to a sustainable
world. Leading companies that are approaching sustainability as avalue driver are rediscovering that innovation, the unique asset core
to any company, can be strategically transferred and adapted tosocial and environmental issues, bringing a potent new force forgood to business and society.”

MARK B. MILSTEIN
Professor and Director, Center for Sustainable Global Enterprise,
Cornell University
WILLIAM R. MOOMAWProfessor and Director, Center for International Environment andResource Policy, The Fletcher School, Tufts University
KEVIN SWEENEY
Center for Responsible Business, Haas School of Business,
University of California, Berkeley“Caterpillar assumes its heavy machines will be rebuilt two or
three times over their lifetime — they embrace the notion at thedesign stage. This is exactly how we should be thinking about
production. It applies to apparel, household items and, especially,
heavy machinery.”

STEPHANIE HANFORD-HASS
President, Connectivity Consulting, LLC“Kudos to Caterpillar for focusing on innovation and technology as
a key driver for sustainability. Moving beyond efficiency, toward
significant progress, demands applied creativity in both the ways weview our challenges, as well as the ways we aspire to tackle them.
Innovation, to me, has many facets, namely technological, behavioral
and environmental. I hope that when Caterpillar approaches its
sustainability challenges, it seeks to secure its place in the market
by focusing not only on today’s challenges but on those that its
customers and future customers will have for many years to come.”

WILLIAM A. WALLACE
Past President and Member of the Governing Board, Engineers
Without Borders — USA
DURWOOD ZAELKE
President, Institute for Governance & Sustainable Development;
Director, International Network for Environmental Complianceand Enforcement

STUART L. HART
S.C. Johnson Chair in Sustainable Global Enterprise,Johnson Graduate School of Management, Cornell University“While not flashy, Caterpillar, through its focused and concerted
efforts to create more eco-efficient, safe and productive machinery,has raised the world bar when it comes to construction and new
infrastructure development.”60

2012 Sustainability Report
HIGH Tech HIGH Value

Connections

Our Affiliations
Dow Jones Sustainability Indexes
Included since 2000; sector leader 2006-2007-2008-2010
sustainability-index.com

Tropical Forest Foundation
Caterpillar became a founding member of the Tropical Forest
Foundation in 1990. The Tropical Forest Foundation works toadvance environmental stewardship, economic prosperity andsocial responsibility through sustainable forest management.
tropicalforestfoundation.org

Asia-Pacific Partnership on Clean Development and Climate
Solar Turbines is a task force member for the Asia-Pacific Partnershipon Clean Development and Climate, an innovative effort to accelerate
the development and deployment of clean energy technologies.
asiapacificpartnership.org

U.S. Green Building Council
Caterpillar is a member of the U.S. Green Building Council, a nonprofit
community of leaders working to make cost-efficient and energy-savingbuildings available to everyone within a generation.
usgbc.org

Business Council for Sustainable Energy
Solar Turbines is a member of the Board of Directors of the BusinessCouncil for Sustainable Energy, which promotes clean energy
technologies as solutions to economic, environmental andnational security challenges.
bcse.org

Woody Biomass Coalition
Caterpillar is a member of the Woody Biomass Coalition, which
provides advocacy, education, information and outreach to public
and private entities to promote research, development and funding
for sustainable woody biomass utilization and markets in the U.S.
woodybiomass.net

Business Roundtable
Caterpillar is a member of the Business Roundtable, which supports
sustainable development through its member companies in addressing
a vast range of environmental, social and economic issues to help
ensure a sustainable future.
businessroundtable.org

World Business Council for Sustainable Development (WBCSD)
Caterpillar is a member of the World Business Council for Sustainable
Development, a CEO-led, global association of some 200 companies
dealing exclusively with business and sustainable development.
wbcsd.org

Diesel Technology Forum
Caterpillar is a member of the Diesel Technology Forum, a leading
resource and educator on the importance and unique value of diesel
engines, fuels, equipment and emissions control technology.
dieselforum.org

World Food Programme
Through the Caterpillar Foundation, Caterpillar collaborates with theWorld Food Programme, the world’s largest humanitarian agency, tofight hunger worldwide, delivering food wherever and whenever it
is needed most.
wfp.org

Energy Technologies Institute
Caterpillar is a member of the Energy Technologies Institute, aU.K.-based public-private organization focused on projects that create
affordable, reliable, clean energy for heat, power and transport.
energytechnologies.co.uk

World Resources Institute
Caterpillar’s Chairman and CEO is a member of the Board of Directorsof the World Resources Institute, an environmental think tank that
goes beyond research to find practical ways to protect the earth
and improve people’s lives. The Caterpillar Foundation is supporting the World Resources Institute to catalyze the development ofsmart cities, which promote infrastructure development that is
economically and environmentally efficient and serves as a model
for sustainable development.
wri.org

The Nature Conservancy
Caterpillar has an active role on the International Leadership Council
and, through the Caterpillar Foundation, became the lead corporate
donor in the Great Rivers Partnership Project in 2005.
nature.org
Opportunity International
Through the Caterpillar Foundation, Caterpillar collaborates with
Opportunity International to provide microfinance loans, savings,
insurance and training to over four million people working their
way out of poverty in the developing world.
opportunity.org

61