A COMMITMENT
TO CONTINUOUS
IMPROVEMENT

ENVIRONMENTAL, HEALTH & SAFETY AT LINCOLN ELECTRIC

EH&S OVERVIEW

At Lincoln Electric, we are committed to operational excellence and the continuous improvement of the health and safety of our employees, customers and neighbors, as well as preserving the integrity of our environment. This commitment is supported by senior management, a global EH&S system, and is considered the individual and collective responsibility of all Lincoln Electric employees.

EH&S DIRECTIVE & FRAMEWORK

We ensure compliance and the continuous improvement of the environmental performance of our products and operations through our global EH&S system. Our system is guided by the Corporate EH&S Policy and global directives that establish consistent guidelines for the management, measurement and reporting of environmental, health and safety activities across Lincoln Electric’s global platform.

SAFETY

Safety is a priority at Lincoln Electric and the organization focuses its efforts on a rigorous program that emphasizes safety, health and wellness through stringent safety standards, Company-led programs and employee engagement in behavior-based safety and wellness committees. Safety extends beyond our facilities with our active engagement in safety and health standard development committees at key industry organizations such as the American Welding Society and various International Standards Organization (ISO) committees to ensure best practices for our employees and end users.

ENVIRONMENTAL MANAGEMENT SYSTEM

Lincoln Electric utilizes the ISO 14001 framework as an environmental management system to identify, implement and measure improvements in resource efficiency, waste reduction and resulting cost savings. In 2017, 74% of Lincoln Electric’s applicable facilities were ISO 14001 certified and we anticipate achieving 100% certification by 2020. In addition, certain facilities are in the early stages of adopting the ISO 50001 standard as an energy management system to reduce energy use and costs, as well as greenhouse gas emissions. Lincoln Electric Canada was first in our industry to be certified to this standard in 2013.

ASSESSMENT & COMPLIANCE

Local EH&S initiatives address each facility’s continuous improvement opportunities and support consolidated EH&S goals. A corporate EH&S organization provides oversight and global coordination of best practices, ISO implementation support, and assessment of facility compliance with regional regulatory standards, EH&S Global Directives and Corporate policies. This team reports to the General Counsel and provides quarterly reporting to the executive management team. Results are further audited and reported to the Board of Directors as part of Lincoln’s enterprise risk management review of operational risk to ensure the highest level of focus by the organization.

AWARDS & RECOGNITION

Recognizing achievements and rewarding best practices reinforces our culture of continuous improvement. Awards are given for a variety of EH&S’ related achievements, including sustainability, safety, and attaining one million hours without a safety incident (DART case). In addition, the “Chairman’s Award for EH&S Excellence” distinguishes facilities who exemplify best-in-class EH&S performance using criteria that includes ISO 14001 certification, a safety DART rate below the Company average, and that fosters a culture of EH&S continuous improvement as a core operating value.


DEDICATED TO THE WELL-BEING OF OUR TEAM, CUSTOMERS & NEIGHBORS

We place our highest priority on protecting individuals from injury and our foremost responsibility begins with the health and safety of our employees worldwide. We follow a rigorous health and safety program that adheres to best practices to ensure our manufacturing operations, related processes, and products do not negatively impact the health and welfare of our employees, customers and neighbors.


Our safety and wellness program includes:


  • Regional industrial hygiene program standards that exceed local requirements.
  • Extensive auditing, measurement, and process redesign to enhance safety.
  • Employee led behavior-based safety committees help identify safety issues and promote safety awareness.
  • Thousands of annual preventative health screenings and evaluations to identify impact from occupational activities.
  • Wellness Committees organize sport and fitness activities, competitions, nutrition programs, and health fairs.

Achieving an Injury-Free Workplace

2020 Goal: Improve Safety by Reducing DART Incidents by 75%

(Days Away, Restrictions & Transfers (DART) incidents per 100 equivalent workers)



  • Our ultimate long-term goal is zero DART incidents.
  • 2017 vs. 2016 performance: This year we experienced improvement across the organization. These results were achieved through increased near miss reporting and incident investigation, behavior-based safety initiatives, a focus on observations and interventions, and process and equipment improvements.
  • In 2017, 52% of our facilities achieved zero DART incidents (vs. 37.2% in the prior year).
  • We are focused on achieving and sustaining our 2020 safety goal by selectively implementing a safety management system such as ISO 45001 to augment the systems we utilize today, of which 14.6% of our manufacturing facilities are third-party certified OHSAS 18001. Additionally, we will be enhancing workplace ergonomics, manufacturing work centers and further leveraging 5S principles.
  • New acquisition facilities (i.e. Air Liquide Welding) are not included in the data as they are not integrated into Lincoln Electric’s EH&S program at this time.

The DART rate (Days Away, Restrictions & Transfers incidents per 100 equivalent workers) is used as the primary safety metric at Lincoln Electric as it is recognized by OSHA in the U.S. and by regional and international regulatory agencies. DART data reflects performance across all Lincoln Electric manufacturing facilities worldwide, including acquisitions after their first year with the organization.


BEHAVIOR-BASED SAFETY PROGRAMS

While we maintain safety programs across all facilities, the majority of our global manufacturing and hourly workforce are also represented by an employee-led, peer-to-peer behavior-based safety (BBS) organization that educates and enforces safe work habits and behaviors to prevent injury and reduce workplace risk. BBS was initiated in 2000 with the “WELD Committee” at our Cleveland, Ohio campus, and local BBS organizations have expanded across our global footprint and engage workers at all levels to generate awareness, education and training on workplace EH&S issues. In China, the adoption of a peer-to-peer BBS program reduced lost work day incidents by 400% over a 3 year period and led to additional safety improvements—exemplifying the positive impact of a BBS program.


SUPPORTING CUSTOMER COMPLIANCE

Lincoln Electric prioritizes customer and end user safety through a commitment to product safety standards and investment in systems to ensure proactive, comprehensive communication of global product hazards and compliance with global harmonization standards for the classification and labeling of chemicals (GHS). These investments are made in anticipation of regulatory changes and are often implemented ahead of mandated adoption dates to support our customers’ compliance requirements, which depend on the quality of GHS information provided by their supply chain to ensure health and safety in their workplace.


RESPONSIVE TECHNICAL EH&S SUPPORT

We leverage our technical EH&S expertise to advise customers on the continuous improvement of operational processes and procedures to address product safety concerns and compliance issues. We are an industry leader in providing fume analysis and welding application expertise to assist in improving customers’ fabrication processes to protect the health and well-being of their employees. Additionally, we field EH&S regulatory inquiries, provide educational seminars and webinars on regulatory changes that may affect customers, and utilize in-house technical research and laboratory testing for detailed, customized projects.



Greenhouse Gas (GHG) Emissions by Year

(Absolute metric tons CO2e)


Reduce Greenhouse Gas (GHG) Emissions

2020 Goal: Reduce GHG Emissions by 15%


  • 2017 vs. 2016 performance: Steady year-over-year emissions reflects improved efficiency as productive hours increased in 2017. This improvement reflects continued adoption of alternate energy sources and efficiencies achieved in various manufacturing processes and procedures.
  • New acquisition facilities (i.e. Air Liquide Welding) are not included in the data as they are not integrated into Lincoln Electric’s EH&S program at this time.
  • Scope 1 emission levels were significantly reduced in 2011 and are now nominal (0.2%) at Lincoln Electric following the elimination of coal used in our manufacturing facilities in China and the conversion of our forklifts to propane and electric power.
  • To achieve our 2020 goal, the Company will focus on improving our carbon footprint through Scope 2 GHG reductions. Key activities include our continued investment in LED lighting, skylights and renewable energy sources, achieving improved energy efficiency and reducing VOCs and hazardous materials in our manufacturing processes.

GHG data reflects the use of energy including electricity, natural gas, coal, fuel oil and LPG and represents data from all Lincoln Electric manufacturing facilities worldwide, including acquisitions after their first year with the organization. The data reflects 2006 IPCC Guidelines for National Greenhouse Gas Inventory and includes Scope 1 and 2 Emissions for Manufacturing Industries and Construction and standards from the Environmental Protection Agency (EPA). Scope 1 emissions are produced from the burning of fossil fuels on Lincoln Electric property (e.g., heating buildings by burning oil or natural gas, organic gases) or from different operations directly related to the process; Scope 2 emissions are associated with the electricity that Lincoln Electric facilities purchase from other third parties.

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Reducing Greenhouse Gas Emissions

In an effort to reduce energy consumption, Lincoln Electric Mexicana installed 10 hybrid air conditioning systems throughout their facility in late-2015 to reduce energy intensity and lower greenhouse gas emissions.

Reducing Greenhouse Gas Emissions

To minimize natural gas use and reduce greenhouse gas emissions, our Mexico City facility designed a lower temperature drying oven process for the manufacture of electrodes (filler metals). The new process reduces energy consumption by 26% and reduces greenhouse gas emissions.

Reducing Greenhouse Gas Emissions

To increase energy from renewable sources and reduce energy consumption overall, Lincoln Electric India installed a 100 kilowatt rooftop solar array and replaced metal halide lighting systems with all LED lighting in the shop floor and outdoor areas.

Revisiting Processes to Reduce Greenhouse Gas Emissions

The engineers in Lincoln Electric Manufactura (Torreon, Mexico) partnered with the local university on a six-sigma project to reduce gas consumption in the “powder painting” and “transformer varnishing” processes. Upon completion of a detailed study, several efficiency improvements were initiated. These included reducing oven temperatures and cycle times, redesigning product hangers to increase piece count per cycle, and upgrading oven components to allow for better piece monitoring during the baking process. Updated work instructions communicated the changes to personnel. The project resulted in a significant reduction of natural gas usage.

Improving Insulation to Reduce Greenhouse Gas Emissions

A thermal image of the calcination kiln at Lincoln Electric France found the exterior surface temperature to be 400 degrees Celsius A project was undertaken to improve the insulation of the kiln The result was a 300 degree reduction in surface temperature resulting in a reduction in energy and greenhouse gas consumption.

Reusing equipment heat for building use

An auxiliary building at the ISAF facility in Storo, Italy is heated to prevent snow from accumulating on the canvas roof. The building had been heated using a diesel oil boiler, which can be costly and produce excessive emissions. The facility eliminated the boiler by capturing heat emissions from a nearby compressor, and blowing the heat into the building. This process eliminated the need for the boiler and reduced diesel energy usage by 1000 liters, and reduced carbon dioxide emissions of 2,650 kilograms.


Energy Intensity by Year

(Gigajoules per hour worked)


Reduce Energy Intensity

2020 Goal: Reduce Energy Intensity by 30%


  • 2017 vs. 2016 performance: We achieved a 4.6% improvement in year-over-year energy intensity. The improvement reflects a broad program that includes: the combined adoption of renewable energy sources such as wind, geothermal and solar; the utilization of skylights and more efficient lighting; and more energy-efficient manufacturing processes.
  • New acquisition facilities (i.e. Air Liquide Welding) are not included in the data as they are not integrated into Lincoln Electric’s EH&S program at this time.
  • Reducing energy use is a key focus as energy represents the second largest input cost in our operation. To achieve our 2020 goal, we will continue implementing facility efficiency projects, replacing inefficient equipment systems and modifying manufacturing processes to reduce energy usage.

Energy data reflects electricity, natural gas, coal, fuel oil and LPG consumed across all Lincoln Electric manufacturing facilities, including acquisitions after their first year with the organization. Energy intensity is measured as gigajoules used per hour worked.

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Reducing Energy Consumption

To address rising electrical energy costs and reduce the energy intensity and greenhouse gases associated with our Mason, Ohio Harris Products Group facility, the team installed:

  • energy monitoring and control technology for HVAC, make up air units, and on plant chillers,
  • variable frequency drives on cooling tower fans and cooling loop pump motors to better manage energy use, and
  • connected their equipment to transformers and meters to monitor and evaluate performance.

Reducing Energy Consumption

Roof exhaust systems are regularly used to provide fresh air exchanges in factories and to cool employees during hot summer months—especially in facilities located in areas with variable climates where summers can be hot. In China, a Lincoln Electric facility achieved equivalent exhaust and cooling benefits by replacing electrically-powered exhaust fans with a natural draft system designed to reduce energy use.

Increasing Equipment Efficiency to Reduce Energy Consumption

To reduce energy consumption, our Mexico City facility initiated a project to replace low (85%) efficiency motors with premium (92.4%) efficiency motors. The motor changeover resulted in an energy savings of over 70,000 kilowatt-hours per year.

Reducing Energy Consumption by Targeted Diagnostics

Compressed air is one of the largest consumers of energy at Lincoln Electric and is being targeted across our platform. Lincoln Electric subsidiaries, Tennessee Rand and Lincoln Electric Bester (Poland), have begun to use ultrasonic leak detectors to identify maintenance repairs necessary in their pneumatic lines. Facilities such as The Harris Products Group's Gainesville, Georgia operation have begun replacing inefficient piston-type air compressors with quieter and highly efficient screw-type air compressors. These moves have resulted in notable reductions in energy use.

Reclaiming Heat to Reduce Energy Consumption

The Harris Products Group facility in Poland employs an industrial heat recovery system for their paint baking operations. The air-to-air exchanger system captures heat from exhaust air and recirculates the heat back into the process. This reduces the amount of heating necessary for cold intake air, and in turn, provides measurable energy savings.

Air Compressor Smart Controllers

Air compressors at the Harris Products Group Dzierzoniow, Poland facility were maintained at shop pressure at all times, which resulted in excessive energy use, as air compressors are major consumers of energy. The facility installed a programmable controller on two compressors, which set operating pressure to a schedule. In the year after installation, the facility reduced energy usage by 7.2%, or 627 megawatt-hours, and reduced carbon dioxide emissions by 232,000 kilograms.


Percent of Metric Tons of All Waste and Metals Recycled and Re-Used


Reduce Waste through Increased Recycling and Re-Use

2020 Goal: Increase Percent of All Waste and Metals Recycled and Re-Used to 70%


  • 2017 vs. 2016 performance: We incurred a 400 basis point improvement year-over-year in our recycling/re-use rate from enhanced programs in a number of facilities in our International Welding segment. For waste that is qualified for recycling or re-use, we achieved a 93.9% recycle/re-use rate as compared with 93.2% in the prior year period.
  • We prioritize a “reduce, re-use, and recycle” approach ahead of disposal as we view waste as a resource. Since 2005, we have reduced 62% of our hazardous waste primarily through the elimination of solvents in coatings and in our manufacturing processes and by increasing the proportion of re-used materials in our products.
  • We aspire to achieve zero waste and focus on initiatives that divert waste from landfills by working with regulators to increase recycling and the beneficial re-use of materials currently not accepted in the recycling stream. This includes expanding the use of our waste as a feedstock by third parties and increasing the capture and re-use of our chemicals in our manufacturing processes with new collection and chemical handling systems.
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Reducing Percent to Landfill

Certain consumable manufacturing processes require a plating bath solution, which has a limited useful life and is a challenge to recycle or re-use due to local regulations. As a result, used plating bath solutions are treated to create a waste byproduct which is ultimately sent to landfill. To reduce this waste and extend the life of the plating solution, Lincoln Electric engineers in France initiated a new decanting and filtration process which now extends the life of the solution, has reduced waste generation from the process, has lowered processing costs by 75%, and has eliminated 50% of the material sent to landfill.

Reducing Percent to Landfill

Our Venezuela engineering team worked to identify ways to recover chemical mixes used in the consumable manufacturing process to reduce our disposal rates to landfills. Following a three-year development process, the team successfully redesigned product formulations, handling techniques and storage procedures to significantly improve our manufacturing and waste metrics. In 2015, waste generation rates were reduced by 80% and the modifications improved product quality and also reduced raw material requirements.

Reducing Waste

Engineers from our Lincoln Electric Poland facility recognized a large opportunity for waste reduction and recycling when handling rejected stick electrodes. They designed a deskinning machine that removes flux coating from rods, allowing both the de-skinned rods and flux coating to be fully recovered and reused in the process. The previous recovery system employed a chemical wash system and was not applicable for certain types of electrodes. The new deskinning process produces zero waste and is applicable for all stick electrodes.

Conserving Rainwater

In an effort to conserve water and reduce dependency on municipal water sources, Lincoln Electric Mexicana installed a 300,000 liter water retention cistern. The tank is filled with stormwater collected from the facility’s roof and parking lot, which is filtered through a vortex separator. The water collected into the tank is used to feed the facility’s new fire protection system and other plant services, such as cooling towers and gas scrubbers.

Waste elimination of aerosol cans

In the molding area of Lincoln Electric Maquinas (Torreon, Mexico), three different spray-on products are regularly used. These three products have been applied using aerosol spray cans, resulting in 480 aerosol cans disposed of each year. A study was initiated to identify a method of applying the products with less waste generation. The facility implemented a method, which applied bulk chemicals using spray guns powered by compressed air. The use of readily available compressed air eliminated the use of flammable aerosol propellants. As a result, a hazardous waste stream was eliminated, and the facility’s waste & greenhouse gas footprint was reduced.

BEYOND
ENERGY

In 2011, Lincoln Electric installed the largest known urban wind tower in North America capable of producing 2.5 megawatts of electrical energy, or approximately 10% of the Cleveland campus’ requirements. The project represents the Company’s commitment to integrating renewable energy sources into its manufacturing processes. Even more importantly, it stands as a symbol of Lincoln Electric’s commitment to the wind tower fabrication industry—showcasing the unique benefits our products and welding solutions offer to this prominent business segment.

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