Ambition. Action.
Impact.
2022 Annual Report
2023 Notice and Proxy Statement
OUR PURPOSE
To boldly challenge what’s
possible for a sustainable world.
Dear Shareholders:
As a global climate
innovator, Trane
Technologies has clear
ambitions. But ambition
alone is not enough –
we take action every
day to enhance our
positive impact. In 2022,
we achieved another
year of top-quartile
financial performance,
while advancing our
bold sustainability
commitments.
PROPELLED BY OUR PURPOSE
From our Board of Directors to each
member of our global team, we
are propelled by our purpose to
boldly challenge what’s possible for
a sustainable world. That purpose
is at the core of our strategy and
drives our competitive advantage.
In 2022 we became one of the
first companies in the world to
have our 2050 net-zero carbon
emissions targets approved by the
Science-Based Targets initiative,
following previous approval of
our near-term 2030 targets. We
continue to relentlessly invest in
sustainable innovation, accelerating
decarbonization of buildings,
industry and the cold chain.
INNOVATING FOR CUSTOMERS
Customer demand for our
sustainable climate solutions is
strong and growing, as reflected
in record bookings of $17.5 billion,
organic revenue growth* of 15
percent, and unprecedented
backlog in 2022. Against a backdrop
of dynamic macro challenges, our
team continues to deliver leading
innovation, diversified products and
robust services, enabling resilience
and growth.
Our partnership with Neiman Marcus
Group is an example. We reviewed
their entire real estate portfolio to
develop a decarbonization roadmap,
beginning with the installation of
high-efficiency electric chillers
and sophisticated controls at their
flagship New York City Bergdorf
Goodman Store. The project
eliminates all direct natural gas
use at the landmark building,
setting an example on the path to a
net-zero future.
SUSTAINABILITY STRATEGY
DRIVES FINANCIAL
PERFORMANCE
The success of our sustainability
strategy shows in our continued
top-quartile financial performance
(among peers and the broader
industrials) for 2022. During the year,
we had record bookings, revenue
and operating margins, as well
as adjusted continuing earnings
per share*, which grew 21 percent
year-over-year. Since 2018, we have
delivered compound annual revenue
growth of 7 percent, adjusted
EBITDA margin expansion* of 220
basis points and powerful free cash
flow. We’ve continued our principled
and balanced capital deployment,
maintaining our high level of
*
These are non-GAAP financial measures. Reconciliation of non-GAAP financial measures can be found preceding the 2023 Notice
and Proxy Statement.
Trane Technologies / 2022 Annual Report
OUR LEADERSHIP PRINCIPLES
Work
today for a
sustainable
tomorrow
Keep
customers
at the heart
of all we do
Include and
uplift one
another
Make
better
happen
Dare to
do things
differently
Own our
actions and
decisions
Do what’s
right,
always
POSITIONED FOR A
SUSTAINABLE FUTURE
Our purpose-driven strategy,
strong customer demand, and
talented global team give me
confidence in our ability to continue
to lead in sustainability and deliver
differentiated financial performance
and shareholder returns over the
long-term. Our bold ambition drives
action and positive, lasting impact for
our team, customers, shareholders,
communities and the planet.
David S. Regnery
Chair and CEO
business reinvestment and returning
$1.8 billion to our shareholders in
2022 through dividends and share
repurchases. Since 2017, we have
delivered a total shareholder return
of 165%.
CREATING OPPORTUNITY
FOR ALL
Our uplifting culture is the driving
force behind our performance. We
continue to invest in ways to create
opportunity for all. For example, we
changed our tuition reimbursement
to tuition advancement, removing
barriers for those pursuing additional
technical certifications or college
degrees. Our commitment extends
into our communities, where we
are investing in the next generation
through our Sustainable Futures
program, including a new initiative
to bring STEM resources and
Trane Technologies volunteers
into classrooms to inspire future
sustainability champions
and innovators.
Trane Technologies / 2022 Annual Report
Our Vision of a Net-Zero Value Chain – End to End
We are taking action toward a future where our entire value chain is net-zero: from raw material production, to our own
operations, to how our products reduce emissions and eliminate the need for fossil fuel. Below are some examples of
our most recent actions and commitments. Learn more in our 2022 ESG Report: www.tranetechnologies.com/esg
Resource
Extraction
Processing
& Suppliers
Inbound
Logistics
Operations
Outbound
Logistics
Product Use
& Services
End of Life
Low-carbon steel
Waste reduction
We pledged to
procure 100% net-zero
steel by 2050. In 2022,
we announced 20%
of our annual steel
purchase as low-carbon,
expected to reduce
nearly 120,000 mtCO2e
by 2030.
Our Returnable
Packaging team
implemented
new projects
that will reduce
approximately 556
tons of solid waste
and 274 mtCO2e
annually.
Manufacturing site
decarbonization
At our facility in
Charmes, France,
a new electrified
Thermal Management
System is expected to
reduce 1,800 mtCO2e
annually.
Innovating for customers
Trane® partnered with Neiman
Marcus Group to decarbonize its
flagship NYC storefront with the
installation of electric chillers. The
project eliminates all direct natural
gas use at the building and puts
NMG at the forefront of energy
innovation, setting an example for
buildings across New York City on
the path to a net-zero future.
External Recognition & Rankings
Each year, we take bold steps to create a sustainable future and advance our 2030 Sustainability Commitments. We’re
honored and proud to share our awards and ratings for our industry-leading sustainability performance from some of the
world’s top organizations.
Dow Jones
Sustainability Indices
•
12th consecutive year on the
North America Index and 2nd
consecutive year on the
World Index
CDP A List 2022
• Climate score: A
• Water score: B
JUST 100
• Ranked 18th on the JUST 100 list
•
1st in the Building Materials
& Packaging industry
FT Europe’s
Climate Leaders
• 2nd consecutive year
Fortune World’s
Most Admired
•
10th consecutive year
From Fortune. ©2023 Fortune Media IP Limited. All rights reserved.
Used under license. Fortune and Fortune Media IP Limited are
not affiliated with, and do not endorse the products or services of
Trane Technologies.
Forbes World’s
Best Employers
• 2nd consecutive year
Trane Technologies / 2022 Annual Report
Ambition Meets Action
Progress toward our 2030 Sustainability Commitments
Gigaton Challenge
We’re reducing one gigaton – one billion metric tons – of carbon emissions from our customers’ footprint
Action
Impact
GREENHOUSE GAS EMISSIONS
Reduce customer carbon footprint by 1 gigaton
93 million metric tons of CO2e reduced from our customers’
carbon footprint since 2019
CIRCULARITY
Design systems for circularity
1,252 metric tons of CO2e avoided from returnable
packaging projects
Leading by Example
We’re reimagining our supply chain and operations to have a restorative impact on the environment
Action
Impact
GREENHOUSE GAS EMISSIONS
Achieve carbon neutral operations
129,506 metric tons of CO2e reduced from our operations*
31% reduction in operational emissions for Scope 1 and market-
based Scope 2*
REDUCE ABSOLUTE ENERGY USE
Achieve 10% absolute reduction in energy consumption
56% of electricity demand met with renewables in 2022
18% improvement in total energy efficiency*
*
compared to 2019 baseline.
Opportunity for All
Uplifting our people, culture and communities through an inclusive approach
Action
Impact
GENDER PARITY
Achieve gender parity in leadership roles
Increased women in senior leadership roles from 24.6% to 26.2%,
and women in management from 23.1% to 24.2%
In 2022, 5 of 13 members of Board of Directors were women
RACIAL AND ETHNIC DIVERSITY
Achieve workforce diversity reflective of our communities
Increased racially or ethnically diverse U.S. salaried employees
from 18.4% to 19.6%
COMMUNITY ENGAGEMENT
Invest $100 million in building sustainable futures
for under-represented students
$15.8+ million in total philanthropic giving in 2022
Committed to Net-Zero by 2050
Our 2030 commitments reflect the actions we are taking now to bend the curve on climate change, but our efforts won’t stop there.
Once we achieve our near-term targets, we will continue efforts to achieve our long-term goal of net-zero emissions by 2050. Our
approach is aligned with the latest guidance from the United Nations Framework Convention on Climate Change (UNFCC) and is
among the first corporate net-zero goals to be validated by SBTi among all sectors.
Learn more about our progress toward our 2030 Sustainability Commitments and our pathway to Net-Zero in our 2022 ESG
Report. www.tranetechnologies.com/esg
Trane Technologies / 2022 Annual Report
2022 Financial Performance
$17.5B
15%
Bookings
+5% Organic Growth*
+109% Book-to-Bill
91%
Free Cash Flow
Conversion*
Organic Revenue
Growth*
25.8%
Cash Flow Return
on Invested
Capital (CROIC)*
+10 bps
Adjusted EBITDA
Margin Expansion*
21%
Adjusted Continuing
EPS Growth*
$6.9B
Backlog
+27% vs. ‘21
+174% vs ‘19
$2.4B
Balanced Capital Deployment
[includes Dividends, Share
Repurchases, Acquisitions
and CapEx]
2022 Total Revenue
Track Record of Strong Financial Results
$15,992
($ in millions)
Revenue by Segment
Asia
8%
EMEA
13%
Revenue by Stream
Aftermarket
32%
Shareholder Returns
Revenue
(growth %)
Adjusted EBITDA
(margin %)
+7% CAGR
9%
7%
15%
11%
Americas
79%
(5%)
+220 bps
16.7% 16.8%
15.4%
15.2%
14.6%
$12.3
$13.1
$12.5
$14.1
$16.0
$1.8
$2.0
$1.9
$2.4
$2.7
$10
$1.5
2018
2019
2020
2021
2022
2018
2019
2020
2021
2022
Revenue ($B)
Organic Growth %
EBITDA ($B)
Margin %
Adjusted Continuing
Earnings Per Share
Cumulative Free Cash Flow
Since 2019
+15% CAGR
$7.36
$6.09
111% average
FCF as a % of Adj.
Net Earnings ‘19-’22
$6.1
$4.5
$3.1
Equipment
68%
$4.86
$4.46
$4.15
$4
$1.4
$1
2018
2019
2020
2021
2022
2019
2020
2021
2022
Adjusted Continuing EPS
Cumulative FCF ($B)
* 2018 not included because
FCF was not restated for
RMT transaction
l
e
u
a
V
x
e
d
n
I
$350
$250
$150
$50
165% 5-year Total Shareholder Return
• 3x the S&P 500
• 4x the S&P 500 Industrial Index(cid:31)
$100
$265 / 165%
Trane
Technologies
$157 / 57%
$142 / 42%
S&P 500
S&P 500
Industrials
Index
2017
2018
2019
2020
2021
2022
* These are non-GAAP financial measures. Reconciliation of non-GAAP financial measures can be found preceding the 2023 Notice and Proxy Statement.
Trane Technologies / 2022 Annual Report
Non-Financial Statements European
Union Directive
Introduction
The information below, and the policies and related content elsewhere in this report, describes the performance and
impact of Trane Technologies plc, a public limited company incorporated in Ireland in 2009, through the environmental,
social, human rights and business practices we work to uphold.
The European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups)
Regulations 2017 (S.I. 360/2017) (as amended) (the “2017 Regulations”) require us to disclose certain non-financial
information in the Directors’ Report (the “Irish Directors’ Report”) accompanying our Irish statutory financial statements.
For the purposes of the 2017 Regulations, the sections entitled Description of Business Model, Environmental Matters,
Employee Matters, Social Matters, Human Rights, and Anti-Corruption and AntiBribery set out below are incorporated by
reference into the Irish Directors’ Report.
Our 2022 Annual and ESG Reports also provide information that may be relevant to investors in assessing sustainability
commitments and achievements but, except as expressly provided above, the 2022 Annual and ESG Reports are not
incorporated by reference into the Irish Directors’ Report. Copies of the 2022 Annual Report and ESG Report can be
accessed at www.TraneTechnologies.com.
Description of Business Model
Trane Technologies is a global climate innovator that brings efficient and sustainable climate solutions to buildings,
homes and transportation through our strategic brands Trane® and Thermo King® and an innovative, environmentally
responsible portfolio of products and services, and connected intelligent controls.
In 2022, we generated revenue and free cash flow primarily through the design, manufacture, sale and service of a
diverse portfolio of innovative climate control products and services for Heating, Ventilation and Air Conditioning (HVAC),
transport refrigeration and custom refrigeration solutions. We accomplish this through relentless investment in customer-
driven product and service innovation to drive market outgrowth and generate powerful free cash flow. Growth is also a
result of increasing revenues from services, parts, controls, and rentals and we continue to focus on margin expansion
through pricing and improved productivity. Successful execution of these focus areas will allow us to maintain and grow
our position as a global climate innovator creating comfortable, sustainable, and efficient environments.
Environmental Matters
Approach Our commitment to sustainability extends to the environmental impacts of our people, operations, and
products and services. From the efficiency of our buildings to our progress in managing energy, water, and waste, we
are focused on reducing our impact on the environment and embedding sustainability throughout our businesses.
We engage with key stakeholders to identify the most material sustainability-related matters and metrics for operations
strategy as well as public disclosure. We also look at these material topics through the lens of a value chain assessment
that we perform. These commitments are embedded in an Environment, Health and Safety (EHS) Policy that defines our
stakeholders, our roles and responsibilities, and our goals and targets with respect to EHS matters and our Business
Partner Code of Conduct (BPCoC).
Due diligence processes We have a vital role to play in mitigating global climate change by reducing our environmental
impact. This responsibility begins by setting specific and measurable climate commitments and working to achieve
these goals. We engage in risk-based due diligence of our business partners and suppliers to ensure compliance
with international trade laws and regulations. Gathering adherence information also helps us continuously assess and
improve our human rights policies. Suppliers must have an effective environmental policy and conduct their operations
in a way that protects the environment. They must also obtain and keep current all required environmental permits and
meet all applicable environmental rules, regulations, and laws in the countries where they operate.
Trane Technologies / 2022 Annual Report
Policy outcomes/Key Performance Indicators Our global Sustainability Commitments are the foundation of our
efforts to increase energy efficiency and reduce the greenhouse gas emissions (GHG) related to our operations and
products. Our Center for Energy Efficiency and Sustainability (CEES) helps our customers and our company leverage
best practices in sustainability. It is a strategic business catalyst that helps us understand the benefits that sustainability
can have in growing our company and reducing our operational footprint, while helping increase the pace of sustainable
innovation. Our energy consumption from fuels and electricity totaled 3 billion kilojoules in 2022. Greenhouse gases emitted
indirectly through the use of electricity, and directly through the burning of fuels or emissions of refrigerants, totaled
355,289 metric tons of CO2e.
• Absolute energy consumption in 2022 – 3 billion kilojoules
• Absolute Scope 1 and 2 emissions in 2022 – 293,346 metric tons CO2e in 2022
Employee Matters
Approach As a global company that employs more than 37,000 people, we are committed to building a diverse,
inclusive, and uplifting workplace where everyone can bring their full, best self to work. We are committed to providing
a safe, secure environment that supports the health, well-being, safety, and productivity of our people. Investing in our
team members and creating a culture where they feel engaged and included is key to unleashing the power of their
innovation and creativity. This commitment to our employees is formalized through several policies designed to protect
the fundamental rights of people associated with our business and maintain overall integrity. These policies include: our
EHS Policy that addresses employee health and safety among other matters, a Global Human Rights Policy, U.S. Equal
Employment Opportunity Policy, and our Policy Prohibiting Harassment and/or Discrimination. All policies are made
available to our employees worldwide and affirm these commitments.
Due diligence processes We provide anti-harassment training to all salaried employees and ensure all policies are
clear and available to employees globally. Creating and sustaining a safety-focused, zero-incident culture is a priority.
We communicate our safety expectations through quarterly CEO town hall meetings and monthly EHS meetings at
the facility and service-organization levels. In addition, to support our commitments to advance diversity and inclusion,
we were the first in our industry to sign up for important business coalitions such as Paradigm for Parity (dedicated to
achieving gender parity in corporate leadership) and CEO Action for Diversity and inclusion (committed to advancing
diversity and inclusion at work). We are also a founding member of the OneTen Coalition, which is committed to training,
hiring, and advancing one million Black Americans over the next ten years.
Policy outcomes/Key Performance Indicators Consistently high annual employee engagement scores demonstrate
that we are cultivating an uplifting culture where our people are learning, thriving and expanding their capabilities.
We offer a range of learning experiences for managers and employees to enhance our culture of inclusion. Because
conversations about culture, diversity, and inclusion can be challenging, we encourage these conversations to facilitate
constructive discussions that can foster an uplifting and inclusive workplace. For example, our annual CEO Day of
Understanding ensures we share progress toward our diversity and inclusion goals, and our Bridging Connections series
helps us create authentic connections. Our Employee Resource Groups (ERGs) serve as a catalyst for our people to
appreciate the strength and value of our diverse workforce. In 2022, more than 13,000 people globally participated in ERG
events – a 20% increase compared to last year. In addition:
• 24.2 % of management positions were held by women
• 26.2 % of senior leadership positions were held by women
• 88 % of our people participated in the annual employee engagement survey
• near top quartile employee engagement score
Social Matters
Approach Through a variety of social sustainability initiatives, we seek to engage directly with the communities where our
associates live and work, which helps to create shared value and engage our worldwide team in the mission and purpose
of the company. Our commitment to social sustainability is also expressed through our supplier diversity program.
Trane Technologies / 2022 Annual Report
Our most prominent community initiatives include the Sustainable Futures program, which promotes increased learning
for underrepresented students by enhancing learning environments, accelerating student success and opening career
pathways. We are taking action on specific social and environmental imperatives that create shared value, result in
sustained customer and employee loyalty, and improve the communities where we have business operations. These
actions include increasing the representation of women and racially and ethnically diverse people in the fields of science,
technology, engineering and math, addressing nutrition and food waste reductions. Our supplier diversity program
embraces suppliers whose ownership is diverse, including racially and ethnically diverse people, women, veterans,
LGBTQ individuals or people with disabilities.
Due diligence processes We track employee and community engagement data including the hours and number of
volunteers who participate in community or sustainability initiatives. We use a 7-step strategic sourcing process that
includes a Supplier Diversity Matrix, which enables us to avoid using price as the primary driver for supplier selection.
Policy outcomes/Key Performance Indicators Implementing the Sustainable Futures program has contributed to our
community through associate participation in community sustainability initiatives, and an annual increase in the total
number of hours volunteered and the dollar value of philanthropic giving. And, our supplier diversity program continues to
drive economic growth for diverse-owned businesses.
• Added 113 new diverse suppliers, representing $ 13.2M in spending, in 2022
• $ 15.8M+ in total philanthropic giving
• 62,274 hours volunteered by employees globally
Human Rights approach We believe in fundamental standards that support our commitment to our employees, our
business partners, our customers and our communities. We have adopted a number of policies that support our
commitment to human rights.
Our Global Human Rights Policy aligns with basic working conditions and human rights concepts advanced by
international organizations such as the International Labor Organization and the United Nations. Our Modern Slavery and
Human Trafficking Statement outlines our commitment to taking steps to ensure that human trafficking and forced labor is
not taking place in our supply chain or business. Our BPCoC prohibits human trafficking, including forced or child labor.
Due diligence processes We engage in reasonable due diligence and screening of customers and distributors to
ensure compliance with laws that regulate international trade. We also established a Global Procurement Sustainability
Council to work with suppliers on improving conditions and addressing non-compliances. In 2022, we used our supplier
risk assessment process to review 299 suppliers for environmental impacts. Trane Technologies did not identify any
suppliers as having significant actual and potential negative environmental impacts.
Policy outcomes Our Global Human Rights Policy is communicated to employees through our Code of Conduct
training, which includes a course on anti-human trafficking.
Anti-Corruption and Anti-Bribery
Approach We are proud of our strong business ethics and sustainable business practices, and our Leadership
Principles. Our purpose, Code of Conduct and Leadership Principles are core to how we operate and serve customers.
Our BPCoC applies to all entities doing business with us and communicates our expectations that our business partners
will practice the highest legal, moral and ethical standards when conducting our affairs.
Due diligence processes Business partners and service providers are risk-rated and vetted with higher risk third parties
undergoing enhanced compliance due diligence. We leverage the services of a third-party vendor to research issues
from thousands of global public records databases.
Policy outcomes Salaried employees receive role-based, online compliance training every year. In 2022, 100% of U.S.
salaried employees received anti-corruption training.
Trane Technologies / 2022 Annual Report
Reconciliation of GAAP to NON-GAAP
ADJUSTED EBITDA
($ IN MILLIONS)
UNAUDITED
Total Company
Net revenues
Operating Income
Restructuring/Other
Adjusted Operating Income
Depreciation and Amortization (1)
Other Income/(Expense), net
Adjusted EBITDA
For the year ended
December 31, 2022
For the year ended
December 31, 2021
As Reported
Margin
As Reported
Margin
$15,991.7
$ 2,418.9
(39.8)
$ 2,379.1
323.2
(8.3)
$ 2,694.0
15.1%
(0.2%)
14.9%
2.0%
(0.1%)
16.8%
$ 14,136.4
$ 2,023.3
45.5
$ 2,068.8
299.4
(4.5)
$ 2,363.7
14.3%
0.3%
14.6%
2.1%
–%
16.7%
(1) Depreciation and Amortization excludes $0.4M of acquisition backlog amortization which has been accounted for in the
Restructuring/Other line
ADJUSTED EBITDA / NET EARNINGS RECONCILIATION
($ IN MILLIONS)
UNAUDITED
Total Company
Adjusted EBITDA
Less: items to reconcile adjusted EBITDA to net earnings attributable to
Trane Technologies plc
Depreciation and Amortization (2)
Interest expense
Provision for income taxes
Restructuring
Transformation costs
M&A transaction costs
Non-cash adjustments for contingent consideration
Acquisition inventory step-up and backlog amortization
Insurance settlement on property claim
Settlement charge for retired executive
Charges related to certain entities deconsolidated under Chapter 11
Gain on release of a pension indemnification liability
Discontinued operations, net of tax
Net earnings from continuing operations attributable to
noncontrolling interests
Net earnings attributable to Trane Technologies plc
Year ended
December 31, 2022
Year ended
December 31, 2021
$ 2,694.0
$ 2,363.7
(323.2)
(223.5)
(375.9)
(20.7)
(5.8)
(3.6)
46.9
(1.2)
25.0
(15.8)
–
–
(21.5)
(18.2)
(299.4)
(233.7)
(333.5)
(27.0)
(16.7)
(1.8)
–
–
–
–
(7.2)
12.8
(20.6)
(13.2)
$ 1,756.5
$ 1,423.4
(2) Depreciation and Amortization excludes acquisition backlog amortization of $0.4M which has been included in the acquisition
inventory step-up and backlog amortization line
Trane Technologies / 2022 Annual Report
FREE CASH FLOW
($ IN MILLIONS)
UNAUDITED
Cash flow provided by continuing operating activities
Capital expenditures
Cash payments for restructuring
Transformation costs paid
QSF funding (continuing operations component)
Compensation related payment to a retired executive
Insurance settlement on property claim in Q3 2022
Free cash flow
Adjusted earnings from continuing operations attributable to
Trane Technologies plc
Year Ended
December 31, 2022
Year ended
December 31, 2021
$ 1,698.7
(291.8)
17.9
9.6
91.8
64.3
(25.0)
$ 1,565.5
$ 1,728.5
$ 1,594.4
(223.0)
38.1
21.4
–
–
–
$ 1,430.9
$ 1,474.8
Free cash flow as a percent of adjusted net earnings
91%
97%
Trane Technologies / 2022 Annual Report
RECONCILIATION OF GAAP TO NON-GAAP
($ IN MILLIONS, EXCEPT
PER SHARE AMOUNTS)
For the year ended December 31, 2022
For the year ended December 31, 2021
Net revenues
$
15,991.7 $
– $
15,991.7
$
14,136.4 $
– $
14,136.4
As Reported
Adjustments
As Adjusted
As Reported
Adjustments
As Adjusted
Operating income
Operating margin
Earnings from continuing
operations before
income taxes
Provision for income
taxes
2,418.9
15.1%
2,172.1
(39.8)
(a,b,c,d,e,f,g)
(24.8)
(a,b,c,d,e,f,g)
2,379.1
2,023.3
45.5 (c,d,e)
2,068.8
14.9%
2,147.3
14.3%
1,790.7
39.9(c,d,e,h,i)
14.6%
1,830.6
(375.9)
(24.7) (j,k)
(400.6)
(333.5)
(9.1) (k)
(342.6)
Tax rate
17.3%
18.7%
18.6%
18.7%
Earnings from continuing
operations attributable to
Trane Technologies plc
Diluted earnings
per common share
continuing operations
Diluted weighted average
number of common
shares outstanding
Detail of Adjustments:
(a) Insurance settlement
on property claim in
Q3 2022 (COGS)
(b) Non-cash adjustment
for contingent
consideration (SG&A)
(c) Restructuring costs
(COGS & SG&A)
(d)Transformation costs
(SG&A)
(e) M&A transaction costs
(SG&A)
(f) Acquisition inventory
step-up and backlog
amortization (COGS &
SG&A)
(g) Settlement charge
for retired executive
(SG&A & OIOE)
$
1,778.0 $
(49.5) (l) $
1,728.5
$
1,444.0 $
30.8 (l) $
1,474.8
$
7.57 $
(0.21) $
7.36
$
5.96 $
0.13 $
6.09
234.9
–
234.9
242.3
(25.0)
(46.9)
20.7
5.8
3.6
1.2
15.8
242.3
–
–
–
27.0
16.7
1.8
–
–
Trane Technologies / 2022 Annual Report
RECONCILIATION OF GAAP TO NON-GAAP
($ IN MILLIONS, EXCEPT
PER SHARE AMOUNTS)
For the year ended December 31, 2022
For the year ended December 31, 2021
As Reported
Adjustments
As Adjusted
As Reported
Adjustments
As Adjusted
(h) Charges related
to certain entities
deconsolidated under
chapter 11
(i) Gain on release
of a pension
indemnification liability
(j) U.S. discrete non-cash
tax benefit
(k) Tax impact of
adjustments
(a,b,c,d,e,f,g,h,i)
(l)
Impact of adjustments
on earnings from
continuing operations
attributable to Trane
Technologies plc
Pre-tax impact of adjustments on cost of
goods sold
Pre-tax impact of adjustments on selling
& administrative expenses
Pre-tax impact of adjustments on
operating income
Pre-tax impact of adjustments on
other, net
Pre-tax impact of adjustments on
earnings from continuing operations
–
–
(33.3)
8.6
7.2
(12.8)
–
(9.1)
$
(49.5)
$
30.8
(11.8)
(28.0)
(39.8)
15.0
7.5
38.0
45.5
(5.6)
$
(24.8)
$
39.9
The Company reports its financial results in accordance with generally accepted accounting principles in the United
States (GAAP).
This supplemental schedule provides non-GAAP financial information and a quantitative reconciliation of the difference
between the non-GAAP financial measures and the financial measures calculated and reported in accordance with GAAP.
The non-GAAP financial measures should be considered supplemental to, not a substitute for or superior to, financial
measures calculated in accordance with GAAP. They have limitations in that they do not reflect all of the costs associated
with the operations of our businesses as determined in accordance with GAAP. In addition, these measures may not be
comparable to non-GAAP financial measures reported by other companies.
As a result, one should not consider these measures in isolation or as a substitute for our results reported under GAAP.
We compensate for these limitations by analyzing results on a GAAP basis as well as a non-GAAP basis, prominently
disclosing GAAP results and providing reconciliations from GAAP results to non-GAAP results.
Trane Technologies / 2022 Annual Report
*Non-GAAP measures definitions
Adjusted operating income in 2022 is defined as GAAP operating income adjusted for restructuring costs,
transformation costs, merger and acquisition related costs, non-cash adjustments for contingent consideration, a
settlement charge for a compensation related payment to a retired executive, and an insurance settlement on a property
claim in Q3 2022. Adjusted operating income in 2021 is defined as GAAP operating income adjusted for restructuring
costs, transformation costs and merger and acquisition related costs.
Adjusted operating income margin is defined as the ratio of adjusted operating income divided by net revenues.
Adjusted earnings from continuing operations attributable to Trane Technologies plc (Adjusted net earnings) in 2022 is
defined as GAAP earnings from continuing operations attributable to Trane Technologies plc adjusted for net of tax impacts
of restructuring costs, transformation costs, merger and acquisition related costs, non-cash adjustments for contingent
consideration, a settlement charge for a retired executive, an insurance settlement on a property claim in Q3 2022, and a U.S.
discrete non-cash tax adjustment. Adjusted net earnings in 2021 is defined as GAAP earnings from continuing operations
attributable to Trane Technologies plc adjusted for net of tax impacts of restructuring costs, transformation costs, merger
and acquisition related costs, charges related to certain entities deconsolidated under Chapter 11 and gain on release of
a pension indemnification liability.
Adjusted continuing EPS in 2022 is defined as GAAP continuing EPS adjusted for net of tax impacts of restructuring
costs, transformation costs, merger and acquisition related costs, non-cash adjustments for contingent consideration,
a settlement charge for a retired executive, an insurance settlement on a property claim in Q3 2022, and a U.S. discrete
non-cash tax adjustment. Adjusted continuing EPS in 2021 is defined as GAAP continuing EPS adjusted for net of tax
impacts of restructuring costs, transformation costs, merger and acquisition related costs, charges related to certain
entities deconsolidated under Chapter 11 and gain on release of a pension indemnification liability.
Adjusted EBITDA in 2022 is defined as adjusted operating income adjusted for depreciation and amortization expense,
other income / (expense), net, and a settlement charge for a retired executive. Adjusted EBITDA in 2021 is defined as
adjusted operating income adjusted for depreciation and amortization expense, other income / (expense), net, charges
related to certain entities deconsolidated under Chapter 11 and gain on release of a pension indemnification liability.
Adjusted EBITDA margin is defined as the ratio of adjusted EBITDA divided by net revenues.
Adjusted effective tax rate for 2022 is defined as the ratio of income tax expense adjusted for the net tax effect of
adjustments for restructuring costs, transformation costs, merger and acquisition related costs, non-cash adjustments
for contingent consideration, settlement charge for a retired executive, an insurance settlement in Q3 2022 on a property
claim, and a U.S. discrete non-cash tax adjustment divided by adjusted net earnings. Adjusted effective tax rate for
2021 is defined as the ratio of income tax expense adjusted for the net tax effect of adjustments for restructuring costs,
transformation costs, merger and acquisition related costs, charges related to certain entities deconsolidated under
Chapter 11 and gain on release of a pension indemnification liability divided by adjusted net earnings. This measure
allows for a direct comparison of the effective tax rate between periods.
Free cash flow in 2022 is defined as net cash provided by (used in) continuing operating activities adjusted for capital
expenditures, cash payments for restructuring costs, transformation costs, the continuing operations component of
the qualified settlement fund (QSF) funding, a payout for a retired executive, and an insurance settlement in Q3 2022
on a property claim. Free cash flow in 2021 is defined as net cash provided by (used in) continuing operating activities
adjusted for capital expenditures, cash payments for restructuring costs and transformation costs.
Cash Flow Return on Invested Capital (CROIC) is defined as Free Cash Flow divided by gross fixed assets (Property,
Plant & Equipment) plus Working Capital (Accounts and Notes Receivable plus Inventory less Accounts and Notes Payable).
CROIC is calculated in accordance with GAAP, subject to adjustments for unusual, infrequent, and nonrecurring items.
Organic bookings are defined as reported orders in the current period adjusted for the impact of currency
and acquisitions.
Organic revenue is defined as GAAP net revenues adjusted for the impact of currency and acquisitions.
Please refer to the reconciliation tables included in our historical press releases and other information available on our
website for additional information relating to historical non-GAAP measures.
Trane Technologies / 2022 Annual Report
2023
Notice and
Proxy Statement
EXECUTIVE COMPENSATION
Outstanding Equity Awards at December 31, 2022
Option Awards
Stock Awards
Number of
Securities
Underlying
Number of
Securities
Underlying
Options
(#)
Unexercised
Unexercised
Option
Options
Exercise
Option
Have Not
Have Not
Rights That Have
That Have Not
Number
of Shares
Market
Value of
Equity Incentive
Equity Incentive
Plan Awards:
Plan Awards: Market
or Units of
Shares or
Number of
or Payout Value of
Stock
Units of
Unearned Shares,
Unearned Shares,
That
Stock That
Units or Other
Units or Other Rights
Vested
(#)(c)
Vested
($)(d)
Not Vested
(#)(e)
Vested
($)(d)
Name
Exercisable(a)
Unexercisable(a)
($)
Date(b)
D. S. Regnery
2/3/2015
2/10/2016
Grant
Date
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
7/1/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
8/1/2019
3/9/2020
2/8/2021
2/1/2022
17,585
29,450
22,497
43,778
48,091
25,964
8,772
6,478
—
8,025
13,591
17,975
6,747
23,687
23,640
22,810
14,979
4,639
—
1,926
4,182
5,992
3,374
—
15,813
7,190
2,227
—
(#)
Price
Expiration
— 52.28 2/2/2025
— 38.99 2/9/2026
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
—
—
—
—
12,982 105.28 3/8/2030
2,059 346,097
17,544 148.98 2/7/2031
3,491 586,802
12,956 186.20 6/30/2031
2,578 433,336
55,726 167.18 1/31/2032
11,964 2,011,029
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
8,988 105.28 3/8/2030
1,425 239,528
13,496 148.98 2/7/2031
2,686 451,490
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
7,490 105.28 3/8/2030
1,188 199,691
9,279 148.98 2/7/2031
1,846 310,294
10,449 167.18 1/31/2032
2,244 377,194
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
2,996 105.28 3/8/2030
475
79,843
6,748 148.98 2/7/2031
1,343 225,745
9,753 167.18 1/31/2032
2,094 351,980
— 94.91 7/31/2029
—
—
3,595 105.28 3/8/2030
4,454 148.98 2/7/2031
570
95,811
887 149,096
5,486 167.18 1/31/2032
1,178 198,010
—
17,415 167.18 1/31/2032
3,739 628,489
—
—
—
—
—
12,349
8,727
9,130
23,927
—
—
8,549
6,713
7,477
—
—
—
7,124
5,035
4,487
—
—
2,375
3,357
4,188
—
2,280
1,611
2,244
—
—
—
—
—
—
—
—
—
—
—
—
2,075,743
1,466,921
1,534,662
4,021,889
1,437,001
1,128,388
1,256,809
1,197,473
846,333
754,220
399,214
564,278
703,961
—
383,245
270,793
377,194
These columns represent stock option awards. These awards generally become exercisable in three equal annual installments beginning on the first anniversary after the
date of grant, subject to continued employment or retirement.
All options granted to the NEOs expire on the tenth anniversary (less one day) of the grant date.
This column represents unvested RSUs. RSUs generally become vested in three equal annual installments beginning on the first anniversary after the date of grant,
subject to continued employment or retirement.
The market value was computed based on $168.09, the closing market price of the Company’s ordinary shares on the NYSE at December 30, 2022.
This column represents the target number of unvested and unearned PSUs. PSUs vest upon the completion of a three-year performance period. The actual number of
shares an NEO will receive, if any, is subject to achievement of the performance goals as certified by the Human Resources and Compensation Committee, and
continued employment.
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
(a)
(b)
(c)
(d)
(e)
64
A Letter from Our Board of Directors
Notice of 2023 Annual General Meeting
Dear Fellow Shareholders:
As the Trane Technologies Board of Directors, we believe that bold ambition drives action, impact and results. In 2022, our Company achieved
another year of top-quartile financial performance, while advancing our bold sustainability commitments.
Megatrends like decarbonization, electrification and indoor environmental quality continue to intensify, driving increased demand for our
innovative products and services. In 2022, given our leading innovation, strong customer focus and talented team, Trane Technologies
delivered organic revenue growth of 15%, adjusted earnings per share growth of 21% and powerful free cash flow.
With a sharp focus on Environmental, Social and Governance (“ESG”) matters, we also continued to make meaningful progress towards our
2030 Sustainability Commitments:
• We’re helping our customers advance their own sustainability goals, while contributing to our Gigaton Challenge, which aims to reduce
our customers’ emissions by one billion metric tons of carbon emissions (CO2e) through our products and services by 2030.
• Across our global footprint, we lead by example, leveraging our own technology to ensure healthy, efficient and sustainable operations.
Throughout 2022, our operations teams worked to solve for global supply chain disruptions and reduce operational emissions while
meeting high levels of customer demand. We are on pace to achieve carbon neutral operations by 2030 and have pledged to reach net-
zero greenhouse gas emissions across our value chain by 2050.
• Trane Technologies also continues to focus on creating opportunity for all, underpinned by an uplifting, inclusive and engaging culture.
This past year, we saw continued progress towards gender parity in senior leadership and workforce diversity reflective of our
communities. To ensure leadership accountability, approximately 2,600 Company leaders now have their compensation tied to financial
results, as well as the Company’s ambitious social and environmental sustainability goals.
As a Board of Directors, we continued to hone our governance practices and oversight of the Company’s strategy, sustainability and workforce
priorities, leadership compensation and succession plans. We maintain a balanced focus across our key stakeholders, including employees,
customers, shareholders and communities. We are committed to ensuring that the Company’s purpose and strategy help to build resilience,
drive meaningful environmental and social change and achieve differentiated, long-term financial results for shareholders.
We are proud of Trane Technologies’ strong financial performance and leadership in environmental and social sustainability. We embrace the
opportunity as a climate innovator to boldly transform our industry and create a more sustainable world.
Sincerely,
KIRK E. ARNOLD
ANN C. BERZIN
APRIL MILLER BOISE
JOHN BRUTON
JARED L. COHON
GARY D. FORSEE
MARK R. GEORGE
JOHN A. HAYES
LINDA P. HUDSON
MYLES P. LEE
DAVID S. REGNERY
MELISSA N. SCHAEFFER
JOHN P. SURMA
TONY L. WHITE
of Shareholders
Voting Items
Proposals To Be Voted
1. To elect 11 directors for a period of one year
FOR each director
Page 15
nominee
Date and Time
June 1, 2023 (Thursday)
2. To consider an advisory vote on whether an
FOR one year
Page 23
2:30 p.m. local time
Board Vote
For Further
Recommendation
Details
advisory vote on executive compensation
should be held every one, two or three years
3. To give advisory approval of the compensation
FOR
Page 24
of the Company’s Named Executive Officers
Location
4. To approve the appointment of
FOR
Page 24
Adare Manor Hotel
PricewaterhouseCoopers LLP as independent
auditors of the Company and authorize the
Audit Committee of the Board of Directors to
set the auditors’ remuneration
of the Company to issue shares
of the Company to issue shares for cash
without first offering shares to existing
shareholders (Special Resolution)
5. To renew the existing authority of the directors
FOR
Page 26
General Meeting.
6. To renew the existing authority of the directors
FOR
Page 27
7. To determine the price range at which the
FOR
Page 28
Company can re-allot shares that it holds as
treasury shares (Special Resolution)
Shareholders will also conduct such other business properly brought before the meeting.
By Order of the Board of Directors,
Meeting.
How to Vote
Adare, County Limerick Ireland
See “Information Concerning Voting and
Solicitation” of the Proxy Statement for further
information on participating in the Annual
Who Can Vote
Only shareholders of record as of the close of
business on April 6, 2023 are entitled to receive
notice of and to vote at the Annual General
Whether or not you plan to attend the meeting,
please provide your proxy by either using the
Internet or telephone as further explained in the
accompanying Proxy Statement or filling in,
signing, dating, and promptly mailing a proxy
card.
By Telephone
In the U.S. or Canada, you can vote your shares
by submitting your proxy toll-free by calling
1-800-690-6903.
EVAN M. TURTZ
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
Attending the Meeting
If you are a shareholder who is entitled to attend and vote, then you are entitled to
appoint a proxy or proxies to attend and vote on your behalf. A proxy is not required to
be a shareholder in the Company. If you wish to appoint as proxy any person other than
the individuals specified on the proxy card, please contact the Company Secretary at our
registered office.
Important Notice regarding the availability of proxy materials for the Annual
General Meeting of Shareholders to be held on June 1, 2023.
The Annual Report and Proxy Statement are available at www.proxyvote.com.
The Notice of Internet Availability of Proxy Materials or this Notice of 2023 Annual General
Meeting of Shareholders, the Proxy Statement and the Annual Report are first being
mailed to shareholders on or about April 21, 2023.
By Internet
You can vote your shares online at
www.proxyvote.com.
2024 Annual Meeting
December 22, 2023
March 1, 2024
Deadline for shareholder proposals for inclusion in the Proxy Statement:
Deadline for business proposals and nominations for director:
By Mail
You can vote by mail by marking, dating, and
signing your proxy card or voting instruction form
and returning it in the postage-paid envelope.
2023 Proxy Statement
1
2
A Letter from Our Board of Directors
Dear Fellow Shareholders:
As the Trane Technologies Board of Directors, we believe that bold ambition drives action, impact and results. In 2022, our Company achieved
another year of top-quartile financial performance, while advancing our bold sustainability commitments.
Megatrends like decarbonization, electrification and indoor environmental quality continue to intensify, driving increased demand for our
innovative products and services. In 2022, given our leading innovation, strong customer focus and talented team, Trane Technologies
delivered organic revenue growth of 15%, adjusted earnings per share growth of 21% and powerful free cash flow.
With a sharp focus on Environmental, Social and Governance (“ESG”) matters, we also continued to make meaningful progress towards our
2030 Sustainability Commitments:
• We’re helping our customers advance their own sustainability goals, while contributing to our Gigaton Challenge, which aims to reduce
our customers’ emissions by one billion metric tons of carbon emissions (CO2e) through our products and services by 2030.
• Across our global footprint, we lead by example, leveraging our own technology to ensure healthy, efficient and sustainable operations.
Throughout 2022, our operations teams worked to solve for global supply chain disruptions and reduce operational emissions while
meeting high levels of customer demand. We are on pace to achieve carbon neutral operations by 2030 and have pledged to reach net-
zero greenhouse gas emissions across our value chain by 2050.
• Trane Technologies also continues to focus on creating opportunity for all, underpinned by an uplifting, inclusive and engaging culture.
This past year, we saw continued progress towards gender parity in senior leadership and workforce diversity reflective of our
communities. To ensure leadership accountability, approximately 2,600 Company leaders now have their compensation tied to financial
results, as well as the Company’s ambitious social and environmental sustainability goals.
As a Board of Directors, we continued to hone our governance practices and oversight of the Company’s strategy, sustainability and workforce
priorities, leadership compensation and succession plans. We maintain a balanced focus across our key stakeholders, including employees,
customers, shareholders and communities. We are committed to ensuring that the Company’s purpose and strategy help to build resilience,
drive meaningful environmental and social change and achieve differentiated, long-term financial results for shareholders.
We are proud of Trane Technologies’ strong financial performance and leadership in environmental and social sustainability. We embrace the
opportunity as a climate innovator to boldly transform our industry and create a more sustainable world.
Sincerely,
KIRK E. ARNOLD
ANN C. BERZIN
APRIL MILLER BOISE
JOHN BRUTON
JARED L. COHON
GARY D. FORSEE
MARK R. GEORGE
JOHN A. HAYES
LINDA P. HUDSON
MYLES P. LEE
DAVID S. REGNERY
MELISSA N. SCHAEFFER
JOHN P. SURMA
TONY L. WHITE
Notice of 2023 Annual General Meeting
of Shareholders
Voting Items
Board Vote
Recommendation
FOR each director
nominee
FOR one year
For Further
Details
Page 15
Page 23
Date and Time
June 1, 2023 (Thursday)
2:30 p.m. local time
Proposals To Be Voted
1. To elect 11 directors for a period of one year
2. To consider an advisory vote on whether an
advisory vote on executive compensation
should be held every one, two or three years
3. To give advisory approval of the compensation
of the Company’s Named Executive Officers
4. To approve the appointment of
PricewaterhouseCoopers LLP as independent
auditors of the Company and authorize the
Audit Committee of the Board of Directors to
set the auditors’ remuneration
FOR
FOR
5. To renew the existing authority of the directors
FOR
of the Company to issue shares
6. To renew the existing authority of the directors
of the Company to issue shares for cash
without first offering shares to existing
shareholders (Special Resolution)
FOR
Page 24
Page 24
Page 26
Page 27
7. To determine the price range at which the
FOR
Page 28
Company can re-allot shares that it holds as
treasury shares (Special Resolution)
Shareholders will also conduct such other business properly brought before the meeting.
By Order of the Board of Directors,
EVAN M. TURTZ
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
Attending the Meeting
If you are a shareholder who is entitled to attend and vote, then you are entitled to
appoint a proxy or proxies to attend and vote on your behalf. A proxy is not required to
be a shareholder in the Company. If you wish to appoint as proxy any person other than
the individuals specified on the proxy card, please contact the Company Secretary at our
registered office.
Important Notice regarding the availability of proxy materials for the Annual
General Meeting of Shareholders to be held on June 1, 2023.
The Annual Report and Proxy Statement are available at www.proxyvote.com.
Location
Adare Manor Hotel
Adare, County Limerick Ireland
See “Information Concerning Voting and
Solicitation” of the Proxy Statement for further
information on participating in the Annual
General Meeting.
Who Can Vote
Only shareholders of record as of the close of
business on April 6, 2023 are entitled to receive
notice of and to vote at the Annual General
Meeting.
How to Vote
Whether or not you plan to attend the meeting,
please provide your proxy by either using the
Internet or telephone as further explained in the
accompanying Proxy Statement or filling in,
signing, dating, and promptly mailing a proxy
card.
By Telephone
In the U.S. or Canada, you can vote your shares
by submitting your proxy toll-free by calling
1-800-690-6903.
The Notice of Internet Availability of Proxy Materials or this Notice of 2023 Annual General
Meeting of Shareholders, the Proxy Statement and the Annual Report are first being
mailed to shareholders on or about April 21, 2023.
By Internet
You can vote your shares online at
www.proxyvote.com.
2024 Annual Meeting
Deadline for shareholder proposals for inclusion in the Proxy Statement:
December 22, 2023
Deadline for business proposals and nominations for director:
March 1, 2024
By Mail
You can vote by mail by marking, dating, and
signing your proxy card or voting instruction form
and returning it in the postage-paid envelope.
2023 Proxy Statement
1
2
Table of Contents
A Letter from Our Board of Directors
Notice of 2023 Annual General Meeting
of Shareholders
Trane Technologies 2022 Performance Highlights
Proxy Voting Roadmap
Proposals Requiring Your Vote
Item 1. Election of Directors
Item 2. Advisory Vote on Frequency of Advisory Vote on
Executive Compensation
Item 3. Advisory Approval of the Compensation of Our
Named Executive Officers
Item 4. Approval of Appointment of
Independent Auditors
Item 5. Renewal of the Directors’ Existing Authority to
Issue Shares
Item 6. Renewal of the Directors’ Existing Authority to
Issue Shares for Cash Without First Offering Shares to
Existing Shareholders
Item 7. Determine the Price at which the Company Can
Re-Allot Shares Held as Treasury Shares
Corporate Governance
Corporate Governance Guidelines
Role of the Board of Directors
Board Responsibilities
Board Leadership Structure
Board Risk Oversight
Director Compensation and Share Ownership
Board Committees
Board Diversity
Board Advisors
Executive Sessions
Board and Board Committee Performance Evaluation
Director Orientation and Education
Director Retirement
Director Independence
Communications with Directors
Management Succession Planning
Code of Conduct
Anti-Hedging Policy and Other Restrictions
Investor Outreach
Sustainability
Committees of the Board and Attendance
Human Resources and Compensation Committee
Interlocks and Insider Participation
1
2
4
8
15
15
23
24
24
26
27
28
29
29
29
29
29
31
33
33
33
33
33
33
33
34
34
34
34
35
35
35
35
36
40
Compensation of Directors
Director Compensation
Share Ownership Requirement
2022 Director Compensation
Compensation Discussion and Analysis
I. Executive Summary
II. Compensation Philosophy and Design Principles
III. Analysis to Support the Determination of Target Total
Direct Compensation
IV. Role of the Committee, Independent Advisor and
Committee Actions
V. Compensation Program Descriptions and Compensation
Decisions
VI. Other Compensation and Tax Matters
Human Resources and Compensation
Committee Report
Executive Compensation
Summary Compensation Table
2022 Grants of Plan-Based Awards
Outstanding Equity Awards at December 31, 2022
2022 Option Exercises and Stock Vested
2022 Pension Benefits
2022 Nonqualified Deferred Compensation
Post-Employment Benefits
2022 Post-Employment Benefits Table
CEO Pay Ratio
Pay Versus Performance
Equity Compensation Plan Information
Information Concerning Voting and Solicitation
Security Ownership of Certain Beneficial Owners
and Management
Certain Relationships and Related Person
Transactions
Shareholder Proposals and Nominations
Householding
Appendix A
41
41
42
42
44
44
48
49
50
51
56
59
60
60
62
64
65
65
67
68
71
72
72
75
76
79
81
82
83
84
2023 Proxy Statement
3
4
2022 PERFORMANCE HIGHLIGHTS
Trane Technologies 2022 Performance Highlights
FINANCIAL PERFORMANCE HIGHLIGHTS
3-Year Adjusted Cash Flow
Return on Invested Capital
(CROIC) (2020–2022)(a)
29.0%
Ranks at the 80th percentile of the
companies in the S&P 500 Industrials Index
3-Year Total Shareholder
Return (TSR)
(2020-2022)(a)
57.17%
Ranks at the 78th percentile
of the companies in the S&P 500
Industrials Index
Annual Revenue
$15.992
BILLION
Increase of 13% from 2021
Adjusted EBITDA(a)
$2.694
BILLION
Increase of 14% from 2021
Free Cash Flow(a)
$1.566
BILLION
Increase of 9.4% from 2021
The three core financial metrics laid out
above are further modified (up to +/-20%)
by our achievement relative to
our equally-weighted environmental &
social objectives—ESG Modifier
(a) We report our financial results in our Annual Report on Form 10-K and our quarterly reports on Form 10-Q in accordance with United States generally accepted
accounting principles (“GAAP”). Our financial results described above for Adjusted EBITDA and Free Cash Flow have been adjusted to exclude the impact of certain
items as shown in Appendix A to this Proxy Statement. These metrics and the related performance targets and results are relevant only to our executive compensation
program and should not be used or applied in other contexts. For a description of how the metrics above are calculated from our GAAP financial statements, please see
“Annual Incentive Matrix (‘AIM’)” with respect to AIM payments and “Long-Term Incentive Program (‘LTI’) – 2020 - 2022 Performance Share Units Payout” with respect
to Performance Share Program (“PSP”) awards.
Item 3. Advisory Approval of the Compensation of Our
V. Compensation Program Descriptions and Compensation
Item 5. Renewal of the Directors’ Existing Authority to
Committee Report
Table of Contents
A Letter from Our Board of Directors
Notice of 2023 Annual General Meeting
of Shareholders
Trane Technologies 2022 Performance Highlights
Proxy Voting Roadmap
Proposals Requiring Your Vote
Item 1. Election of Directors
Item 2. Advisory Vote on Frequency of Advisory Vote on
Executive Compensation
Named Executive Officers
Item 4. Approval of Appointment of
Independent Auditors
Issue Shares
Item 6. Renewal of the Directors’ Existing Authority to
Issue Shares for Cash Without First Offering Shares to
Existing Shareholders
Item 7. Determine the Price at which the Company Can
Re-Allot Shares Held as Treasury Shares
Corporate Governance
Corporate Governance Guidelines
Role of the Board of Directors
Board Responsibilities
Board Leadership Structure
Board Risk Oversight
Director Compensation and Share Ownership
Board Committees
Board Diversity
Board Advisors
Executive Sessions
Director Orientation and Education
Director Retirement
Director Independence
Communications with Directors
Management Succession Planning
Code of Conduct
Anti-Hedging Policy and Other Restrictions
Investor Outreach
Sustainability
Committees of the Board and Attendance
Human Resources and Compensation Committee
Interlocks and Insider Participation
1
2
4
8
15
15
23
24
24
26
27
28
29
29
29
29
29
31
33
33
33
33
33
33
33
34
34
34
34
35
35
35
35
36
40
Board and Board Committee Performance Evaluation
Transactions
Compensation of Directors
Director Compensation
Share Ownership Requirement
2022 Director Compensation
Compensation Discussion and Analysis
I. Executive Summary
II. Compensation Philosophy and Design Principles
III. Analysis to Support the Determination of Target Total
IV. Role of the Committee, Independent Advisor and
Direct Compensation
Committee Actions
Decisions
VI. Other Compensation and Tax Matters
Human Resources and Compensation
Executive Compensation
Summary Compensation Table
2022 Grants of Plan-Based Awards
Outstanding Equity Awards at December 31, 2022
2022 Option Exercises and Stock Vested
2022 Pension Benefits
2022 Nonqualified Deferred Compensation
Post-Employment Benefits
2022 Post-Employment Benefits Table
CEO Pay Ratio
Pay Versus Performance
Equity Compensation Plan Information
Information Concerning Voting and Solicitation
Security Ownership of Certain Beneficial Owners
and Management
Certain Relationships and Related Person
Shareholder Proposals and Nominations
Householding
Appendix A
41
41
42
42
44
44
48
49
50
51
56
59
60
60
62
64
65
65
67
68
71
72
72
75
76
79
81
82
83
84
2022 PERFORMANCE HIGHLIGHTS
Trane Technologies 2022 Performance Highlights
FINANCIAL PERFORMANCE HIGHLIGHTS
3-Year Adjusted Cash Flow
Return on Invested Capital
(CROIC) (2020–2022)(a)
29.0%
Ranks at the 80th percentile of the
companies in the S&P 500 Industrials Index
3-Year Total Shareholder
Return (TSR)
(2020-2022)(a)
57.17%
Ranks at the 78th percentile
of the companies in the S&P 500
Industrials Index
Annual Revenue
$15.992
BILLION
Increase of 13% from 2021
Adjusted EBITDA(a)
$2.694
BILLION
Increase of 14% from 2021
Free Cash Flow(a)
$1.566
BILLION
Increase of 9.4% from 2021
The three core financial metrics laid out
above are further modified (up to +/-20%)
by our achievement relative to
our equally-weighted environmental &
social objectives—ESG Modifier
(a) We report our financial results in our Annual Report on Form 10-K and our quarterly reports on Form 10-Q in accordance with United States generally accepted
accounting principles (“GAAP”). Our financial results described above for Adjusted EBITDA and Free Cash Flow have been adjusted to exclude the impact of certain
items as shown in Appendix A to this Proxy Statement. These metrics and the related performance targets and results are relevant only to our executive compensation
program and should not be used or applied in other contexts. For a description of how the metrics above are calculated from our GAAP financial statements, please see
“Annual Incentive Matrix (‘AIM’)” with respect to AIM payments and “Long-Term Incentive Program (‘LTI’) – 2020 - 2022 Performance Share Units Payout” with respect
to Performance Share Program (“PSP”) awards.
2023 Proxy Statement
3
4
2022 PERFORMANCE HIGHLIGHTS
2022 PERFORMANCE HIGHLIGHTS
Environmental
ESG PERFORMANCE HIGHLIGHTS
• First in our industry, and one of the first 11 companies worldwide, to have our net zero carbon emissions targets approved by the
Science Based Targets initiative (“SBTi”), a coalition of the Carbon Disclosure Project, the United Nations Global Compact, World
Resources Institute and the World Wide Fund for Nature
• Pledged to procure, specify or stock 50% net-zero steel by 2030 and 100% net-zero steel by 2050 as a member of SteelZero.
Announced contracts to purchase low-carbon steel to further reduce the carbon emissions throughout the Company’s supply
chain
Sustainability at Trane Technologies
At Trane Technologies, sustainability is core to who we are. Our commitment extends to the environmental and social impacts of our
operations, products and services, and workplace.
We take action every day to achieve the bold ambitions we have set for our Company and the world. We track progress toward our 2030
Sustainability Commitments through a series of comprehensive ESG indicators. Below is an overview of our progress toward our
commitments.
• Named to S&P Dow Jones Sustainability World Index for second consecutive year and North America Index for 12th consecutive
THE GIGATON CHALLENGE
LEADING BY EXAMPLE
OPPORTUNITY FOR ALL
year
• Recognized for corporate environmental transparency by the Climate Disclosure Project, securing a place on its annual A-list, one
of 283 companies out of 15,000
• Began an initiative to accelerate the decarbonization of our facilities by 25% by the year 2025 and to achieve our carbon-neutral
operations goal early
Social
• Continued broad approach to Human Capital Management across engagement, development, diversity and inclusion:
• Maintained strong employee engagement with year-over-year improvement in our employee engagement score
• Our Employee Value Proposition (“EVP”), which connects team members to our Company’s purpose, strategies and
leadership principles, is representative of our entire employee population, inclusive of every role in the organization
• Through Trane Technologies University, we provide our team members with comprehensive learning and development
solutions designed to support them as they grow in their careers
• Launched The Inclusive Culture Learning Experience to all people leaders
• Supported employee well-being with the launch of a mental health hub and improvements to certain local paid time off
programs
• Shifted our tuition support approach from offering tuition reimbursement to offering tuition advancement
• Ranked 18th on the 2023 JUST 100 list, named first in the Building Materials & Construction industry and ranked as the best
company in industry for communities and workers. Recognized as one of America’s Most JUST Companies for the sixth
consecutive year
• Received wide recognition as an employer of choice:
• Forbes World’s Best Employers 2022, second consecutive year
• Disability Equality Index (“DEI”), top scorer (100%)
• Great Place to Work® (Belgium, Ireland, USA)
• Fortune World’s Most Admired Companies 2022, 11th consecutive year
• Fortune Best Workplaces in Manufacturing and Production 2022, top ten
• Military Times 2022 Best for Vets Employers List
• Expanded Sustainable Futures, our corporate citizenship strategy, through a partnership with Discovery Education to provide
needs and execute on the Company’s bold business goals.
STEM and sustainability tools to teachers in at-risk districts
• Continued Operation Possible, our innovation initiative to source social and environmental impact ideas from employees. Our
ideas were put into practice to fight food loss by developing a cooling cart for street vendors
Governance
• Developed compliance controls for ESG metrics and process to be maintained quarterly and annually
• Completed non-financial materiality assessment refresh
• Conducted Task Force on Climate-related Financial Disclosures (“TCFD”) Climate Scenario Analysis to identify risks and
opportunities
• Continued to reinforce leadership accountability for 2030 Commitments with ESG modifier for annual incentive program for
executives and senior leaders, with progress towards greenhouse gas reduction and diverse representation
• Conducted ESG training with the Board with a focus on sustainability disclosure and emerging regulatory requirements
• Continued to develop next generation of talent and conducted ongoing leadership succession planning sessions with the Board
For more information regarding our Company’s commitment to leadership in ESG matters and our achievements in these areas, please also see our 2022 Annual Report to
Shareholders included in these proxy materials and our ESG Report available on our website located at www.tranetechnologies.com/ESG. Our 2022 ESG Report is
expected to be available on or around April 26, 2023.
2023 Proxy Statement
5
6
We’re reducing one gigaton – one billion
We’re reimagining our supply chain and
We’re creating new possibilities and a
metric tons – of carbon emissions
operations to have a restorative impact
better world for our people and our
(CO2e) from our customers’ footprint by
on the environment, while meeting
communities through a focus on
2030.
How We’re Doing It
customer needs.
How We’re Doing It
We’re innovating clean technologies,
We’re working to achieve carbon
advancing energy-efficiency and healthy
neutral operations, zero waste disposed
of in landfills, net positive water use in
We’ve committed to achieving
water-stressed areas and reduce
absolute energy use by 10 percent.
Our Progress since 2019
metric tons of CO2e reduced from our
customers’ carbon footprint equivalent
stressed regions
total reduction in water use in water-
Our Progress in 2022
engagement, diversity and inclusion
and by creating sustainable futures for
our communities.
How We’re Doing It
workforce diversity reflective of our
communities, gender parity in
leadership roles and create pathways
to STEM education and rewarding
careers.
26.2%
leadership roles
1.6 point increase of women in senior
$15.8+ million
in total philanthropic giving
spaces, reducing global food loss,
designing systems for circularity and
transitioning to next-generation
refrigerants.
Our Progress since 2019
93 million
to the CO2e of
10.3 billion
gallons of gasoline consumed
22%
31%
operations
reduction in emissions from our own
Trane Technologies continues to put the health, safety and well-being of our people first, while making sure that we serve our customers’
UPLIFTING OUR PEOPLE AND COMMUNITIES
As a purpose-driven organization, we believe in taking steps to bring our purpose to life for our people and our communities. We integrate
wellness into our culture through a portfolio of benefits that support physical, social, emotional, and financial well-being so that team members
can uplift others, make an impact and thrive at work, at home, and in their communities.
• Supported employee well-being by:
• Improving our Global Wellness Platform to provide access to mindfulness, resiliency and nutrition programming
• Acted to support our people and their families, including providing relief during extended COVID-19 lockdowns in China. Support
packages were delivered to employees’ homes during the lockdown period
• Continued to define how we work with a focus on balancing in-person teaming and collaboration with flexibility
• Provided grants to 860 employees experiencing personal financial hardship through the Helping Hand employee relief fund, totaling
$940,000 and launched our first Immediate Response Program to provide faster access to disaster relief funding for more than 700
employees impacted by Hurricane Fiona in Puerto Rico
• Launched Purple Teams around the world to enhance community engagement and employee volunteerism, more than doubling our
volunteer hours
ESG PERFORMANCE HIGHLIGHTS
Sustainability at Trane Technologies
2022 PERFORMANCE HIGHLIGHTS
2022 PERFORMANCE HIGHLIGHTS
• First in our industry, and one of the first 11 companies worldwide, to have our net zero carbon emissions targets approved by the
Science Based Targets initiative (“SBTi”), a coalition of the Carbon Disclosure Project, the United Nations Global Compact, World
Resources Institute and the World Wide Fund for Nature
• Pledged to procure, specify or stock 50% net-zero steel by 2030 and 100% net-zero steel by 2050 as a member of SteelZero.
Announced contracts to purchase low-carbon steel to further reduce the carbon emissions throughout the Company’s supply
At Trane Technologies, sustainability is core to who we are. Our commitment extends to the environmental and social impacts of our
operations, products and services, and workplace.
We take action every day to achieve the bold ambitions we have set for our Company and the world. We track progress toward our 2030
Sustainability Commitments through a series of comprehensive ESG indicators. Below is an overview of our progress toward our
commitments.
• Named to S&P Dow Jones Sustainability World Index for second consecutive year and North America Index for 12th consecutive
THE GIGATON CHALLENGE
LEADING BY EXAMPLE
OPPORTUNITY FOR ALL
Environmental
chain
year
• Recognized for corporate environmental transparency by the Climate Disclosure Project, securing a place on its annual A-list, one
• Began an initiative to accelerate the decarbonization of our facilities by 25% by the year 2025 and to achieve our carbon-neutral
of 283 companies out of 15,000
operations goal early
Social
• Continued broad approach to Human Capital Management across engagement, development, diversity and inclusion:
• Maintained strong employee engagement with year-over-year improvement in our employee engagement score
• Our Employee Value Proposition (“EVP”), which connects team members to our Company’s purpose, strategies and
leadership principles, is representative of our entire employee population, inclusive of every role in the organization
• Through Trane Technologies University, we provide our team members with comprehensive learning and development
solutions designed to support them as they grow in their careers
• Launched The Inclusive Culture Learning Experience to all people leaders
• Supported employee well-being with the launch of a mental health hub and improvements to certain local paid time off
programs
• Shifted our tuition support approach from offering tuition reimbursement to offering tuition advancement
• Ranked 18th on the 2023 JUST 100 list, named first in the Building Materials & Construction industry and ranked as the best
company in industry for communities and workers. Recognized as one of America’s Most JUST Companies for the sixth
consecutive year
• Received wide recognition as an employer of choice:
• Forbes World’s Best Employers 2022, second consecutive year
• Disability Equality Index (“DEI”), top scorer (100%)
• Great Place to Work® (Belgium, Ireland, USA)
• Fortune World’s Most Admired Companies 2022, 11th consecutive year
• Fortune Best Workplaces in Manufacturing and Production 2022, top ten
• Military Times 2022 Best for Vets Employers List
• Expanded Sustainable Futures, our corporate citizenship strategy, through a partnership with Discovery Education to provide
STEM and sustainability tools to teachers in at-risk districts
• Continued Operation Possible, our innovation initiative to source social and environmental impact ideas from employees. Our
ideas were put into practice to fight food loss by developing a cooling cart for street vendors
Governance
opportunities
• Developed compliance controls for ESG metrics and process to be maintained quarterly and annually
• Completed non-financial materiality assessment refresh
• Conducted Task Force on Climate-related Financial Disclosures (“TCFD”) Climate Scenario Analysis to identify risks and
• Continued to reinforce leadership accountability for 2030 Commitments with ESG modifier for annual incentive program for
executives and senior leaders, with progress towards greenhouse gas reduction and diverse representation
• Conducted ESG training with the Board with a focus on sustainability disclosure and emerging regulatory requirements
• Continued to develop next generation of talent and conducted ongoing leadership succession planning sessions with the Board
For more information regarding our Company’s commitment to leadership in ESG matters and our achievements in these areas, please also see our 2022 Annual Report to
Shareholders included in these proxy materials and our ESG Report available on our website located at www.tranetechnologies.com/ESG. Our 2022 ESG Report is
expected to be available on or around April 26, 2023.
We’re reducing one gigaton – one billion
metric tons – of carbon emissions
(CO2e) from our customers’ footprint by
2030.
We’re reimagining our supply chain and
operations to have a restorative impact
on the environment, while meeting
customer needs.
How We’re Doing It
How We’re Doing It
We’re innovating clean technologies,
advancing energy-efficiency and healthy
spaces, reducing global food loss,
designing systems for circularity and
transitioning to next-generation
refrigerants.
Our Progress since 2019
93 million
metric tons of CO2e reduced from our
customers’ carbon footprint equivalent
to the CO2e of
10.3 billion
gallons of gasoline consumed
We’re working to achieve carbon
neutral operations, zero waste disposed
of in landfills, net positive water use in
water-stressed areas and reduce
absolute energy use by 10 percent.
Our Progress since 2019
22%
total reduction in water use in water-
stressed regions
31%
reduction in emissions from our own
operations
We’re creating new possibilities and a
better world for our people and our
communities through a focus on
engagement, diversity and inclusion
and by creating sustainable futures for
our communities.
How We’re Doing It
We’ve committed to achieving
workforce diversity reflective of our
communities, gender parity in
leadership roles and create pathways
to STEM education and rewarding
careers.
Our Progress in 2022
26.2%
1.6 point increase of women in senior
leadership roles
$15.8+ million
in total philanthropic giving
Trane Technologies continues to put the health, safety and well-being of our people first, while making sure that we serve our customers’
needs and execute on the Company’s bold business goals.
UPLIFTING OUR PEOPLE AND COMMUNITIES
As a purpose-driven organization, we believe in taking steps to bring our purpose to life for our people and our communities. We integrate
wellness into our culture through a portfolio of benefits that support physical, social, emotional, and financial well-being so that team members
can uplift others, make an impact and thrive at work, at home, and in their communities.
• Supported employee well-being by:
• Improving our Global Wellness Platform to provide access to mindfulness, resiliency and nutrition programming
• Acted to support our people and their families, including providing relief during extended COVID-19 lockdowns in China. Support
packages were delivered to employees’ homes during the lockdown period
• Continued to define how we work with a focus on balancing in-person teaming and collaboration with flexibility
• Provided grants to 860 employees experiencing personal financial hardship through the Helping Hand employee relief fund, totaling
$940,000 and launched our first Immediate Response Program to provide faster access to disaster relief funding for more than 700
employees impacted by Hurricane Fiona in Puerto Rico
• Launched Purple Teams around the world to enhance community engagement and employee volunteerism, more than doubling our
volunteer hours
2023 Proxy Statement
5
6
2022 PERFORMANCE HIGHLIGHTS
• Hosted our second annual Global Diversity & Inclusion Summit, expanded our PRIDE: LGBT + Allies Employee Network and our Women’s
Employee Network (“WEN”) to Europe, the Middle East and Africa (“EMEA”) and celebrated the 10-year anniversary of our Black Employee
Network (“BEN”)
INNOVATING TO SERVE CUSTOMERS
We’re leading our industry and solving our customers’ big sustainability challenges by relentlessly investing in efficient and sustainable
innovation to provide heating and cooling to people around the world.
• Continued to proactively manage inventory and supply amid global supply chain disruptions
• Invested $211M(a) in sustainability-driven R&D centered on product and system-level improvements, such as increasing energy efficiency,
developing and implementing low-global warming potential (“low-GWP”) refrigerants, reducing material content in products and designing
products for circularity
• Continued to help customers move away from fossil fuel consumption through the electrification of products throughout our portfolio
• Trane® launched CITY Advantage, a line of compact scroll water-cooled chillers and water-source heat pumps for commercial use with
a low-GWP refrigerant. The CITY Advantage line helps customers move away from fossil fuel-based technologies and achieve an 11%
better Seasonal Energy Efficiency Ratio (“SEER”) in cooling mode and up to 5% better Seasonal Coefficient of Performance (“SCOP”) in
pure heating mode
• Thermo King completed 2,500 hours of testing of its evolveTM electric trailer with several U.S. retailers. The battery-powered, all-electric
trailer delivered excellent performance and significantly reduced customers’ emissions by reducing diesel use in the mobile refrigeration
process
• Continued to provide resources and offerings to K-12 schools to help them create healthy spaces for education and guidance on stimulus
funding for investments in indoor environmental quality
• Acquired AL-KO Air Technology, with a reputation for sustainable solutions, innovation and quality. AL-KO Air Technology is a natural
extension of our focus on healthy and efficient buildings
(a) Our Research and Development Costs, as disclosed in our Annual Report on Form 10-K, were $211.2 million for 2022.
AWARDS AND AFFILIATIONS
A
F
8
2023 Proxy Statement
7
Proxy Voting Roadmap
This summary highlights information contained elsewhere in this Proxy Statement. For more complete information about these topics, please
review Trane Technologies plc’s Annual Report on Form 10-K and the entire Proxy Statement.
ITEM
Election of Directors
• 10 out of 11 Director nominees are independent.
1
• The Board of Directors is nominating five female directors, one Black director
and one non-U.S. director out of a total of 11 directors.
• The tenure and experience of our directors is varied, which brings varying
perspectives to our Board functionality.
The Board of Directors
recommends a vote FOR
the directors nominated
for election.
See page 15 for further
information
Director
Age
since
Independent Other Current Public Boards
A H S
F
T
E
63
2018
YES
• Ingersoll Rand Inc.
• Thomson Reuters
71
2001
YES
• Exelon Corporation
Executive Vice President and Chief Legal Officer of Intel
54
2020
YES
73
2007
YES
• Ingersoll Rand Inc.
Director Nominees
Name/Occupation
Kirk E. Arnold
Executive in Residence of General Catalyst
Former Chief Executive Officer, Data Intensity
Former Chairman and CEO of Financial Guaranty
Ann C. Berzin
Insurance Company
April Miller Boise
Corporation
Gary D. Forsee
Former President of University of Missouri System and
Former Chairman of the Board and Chief Executive Officer
of Sprint Nextel Corporation
Mark R. George
Executive Vice President and Chief Financial Officer of
Norfolk Southern Corporation
Chairman and former President and CEO of Ball Corporation
John A. Hayes
Linda P. Hudson
Founder and Former Chairman and CEO of The Cardea
Group and Former President and CEO of BAE Systems, Inc.
Myles P. Lee
Former Director and CEO of CRH plc
David S. Regnery
Chair and Chief Executive Officer
Melissa N. Schaeffer
Senior Vice President and Chief Financial Officer of
Air Products and Chemicals, Inc.
Former Chairman and CEO of United States Steel
John P. Surma
Corporation
• Kohler Co.
• Bank of America
• TPI Composites, Inc.
56
2022
YES
57
72
69
60
43
2023
2015
2015
2021
2022
YES
YES
YES
NO
YES
68
2013
YES
Trane Technologies
Committees
M M
M
M C
M M
M M
M M
M M
M
M
C
C
M
M
M
M
M
M
M
C
• Marathon Petroleum Corporation
• MPLX LP (a publicly traded
subsidiary of Marathon
Petroleum Corporation)
• Public Service Enterprise Group
M
M
Audit Committee
Human Resources and Compensation
Committee (Chair to be selected)
Committee
Sustainability, Corporate Governance and Nominating
C Chair
Finance Committee
Technology and Innovation Committee
Executive Committee
M Member
H
T
S
E
(Chair to be selected)
• Hosted our second annual Global Diversity & Inclusion Summit, expanded our PRIDE: LGBT + Allies Employee Network and our Women’s
Employee Network (“WEN”) to Europe, the Middle East and Africa (“EMEA”) and celebrated the 10-year anniversary of our Black Employee
Proxy Voting Roadmap
2022 PERFORMANCE HIGHLIGHTS
Network (“BEN”)
INNOVATING TO SERVE CUSTOMERS
We’re leading our industry and solving our customers’ big sustainability challenges by relentlessly investing in efficient and sustainable
innovation to provide heating and cooling to people around the world.
• Continued to proactively manage inventory and supply amid global supply chain disruptions
• Invested $211M(a) in sustainability-driven R&D centered on product and system-level improvements, such as increasing energy efficiency,
developing and implementing low-global warming potential (“low-GWP”) refrigerants, reducing material content in products and designing
products for circularity
• Continued to help customers move away from fossil fuel consumption through the electrification of products throughout our portfolio
• Trane® launched CITY Advantage, a line of compact scroll water-cooled chillers and water-source heat pumps for commercial use with
a low-GWP refrigerant. The CITY Advantage line helps customers move away from fossil fuel-based technologies and achieve an 11%
better Seasonal Energy Efficiency Ratio (“SEER”) in cooling mode and up to 5% better Seasonal Coefficient of Performance (“SCOP”) in
• Thermo King completed 2,500 hours of testing of its evolveTM electric trailer with several U.S. retailers. The battery-powered, all-electric
trailer delivered excellent performance and significantly reduced customers’ emissions by reducing diesel use in the mobile refrigeration
pure heating mode
process
• Continued to provide resources and offerings to K-12 schools to help them create healthy spaces for education and guidance on stimulus
funding for investments in indoor environmental quality
extension of our focus on healthy and efficient buildings
• Acquired AL-KO Air Technology, with a reputation for sustainable solutions, innovation and quality. AL-KO Air Technology is a natural
(a) Our Research and Development Costs, as disclosed in our Annual Report on Form 10-K, were $211.2 million for 2022.
AWARDS AND AFFILIATIONS
This summary highlights information contained elsewhere in this Proxy Statement. For more complete information about these topics, please
review Trane Technologies plc’s Annual Report on Form 10-K and the entire Proxy Statement.
ITEM
1
Election of Directors
• 10 out of 11 Director nominees are independent.
• The Board of Directors is nominating five female directors, one Black director
and one non-U.S. director out of a total of 11 directors.
• The tenure and experience of our directors is varied, which brings varying
perspectives to our Board functionality.
The Board of Directors
recommends a vote FOR
the directors nominated
for election.
See page 15 for further
information
Director Nominees
Name/Occupation
Kirk E. Arnold
Executive in Residence of General Catalyst
Former Chief Executive Officer, Data Intensity
Ann C. Berzin
Former Chairman and CEO of Financial Guaranty
Insurance Company
April Miller Boise
Executive Vice President and Chief Legal Officer of Intel
Corporation
Gary D. Forsee
Former President of University of Missouri System and
Former Chairman of the Board and Chief Executive Officer
of Sprint Nextel Corporation
Mark R. George
Executive Vice President and Chief Financial Officer of
Norfolk Southern Corporation
John A. Hayes
Chairman (through April 26, 2023) and Former President and
CEO of Ball Corporation
Linda P. Hudson
Founder and Former Chairman and CEO of The Cardea
Group and Former President and CEO of BAE Systems, Inc.
Myles P. Lee
Former Director and CEO of CRH plc
David S. Regnery
Chair and Chief Executive Officer
Melissa N. Schaeffer
Senior Vice President and Chief Financial Officer of
Air Products and Chemicals, Inc.
John P. Surma
Former Chairman and CEO of United States Steel
Corporation
Director
since
Independent Other Current Public Boards
A H S
F
T
E
Trane Technologies
Committees
2018
YES
• Ingersoll Rand Inc.
• Thomson Reuters
M M
M
Age
63
71
2001
YES
• Exelon Corporation
54
2020
YES
73
2007
YES
• Ingersoll Rand Inc.
56
2022
YES
57
2023
YES
• Kohler Co.
72
2015
YES
• Bank of America
• TPI Composites, Inc.
69
60
43
2015
2021
2022
YES
NO
YES
68
2013
YES
• Marathon Petroleum Corporation
• MPLX LP (a publicly traded
subsidiary of Marathon
Petroleum Corporation)
• Public Service Enterprise Group
M
M
M
M
C
M
C
M
M C
M M
M M
M M
M M
M
M
M
C
M
M
A
F
8
2023 Proxy Statement
7
Audit Committee
Finance Committee
H
T
Human Resources and Compensation
Committee (Chair to be selected)
Technology and Innovation Committee
(Chair to be selected)
S
E
Sustainability, Corporate Governance and Nominating
C Chair
Committee
Executive Committee
M Member
d
l
o
n
r
A
n
i
z
r
e
B
e
e
s
r
o
F
e
g
r
o
e
G
s
e
y
a
H
n
o
s
d
u
H
e
e
L
y
r
e
n
g
e
R
r
e
f
f
e
a
h
c
S
a
m
r
u
S
e
s
i
o
B
r
e
l
l
i
M
Board Diversity
PROXY VOTING ROADMAP
PROXY VOTING ROADMAP
BOARD SKILLS AND EXPERIENCE
One of the three pillars of our 2030 Sustainability Commitments is Opportunity for All. We create new possibilities and a better world for our
people and our communities. Oversight of our diversity and inclusion strategy begins with our Board of Directors. Our Human Resources and
Compensation Committee regularly reviews diversity and inclusion and other human capital management matters. This commitment to diversity
and inclusion extends to our Board of Directors. We know that diverse teams are more innovative and collaborative, capable of solving
problems and best positioned to realize a better world for future generations. We believe that diversity of our Board contributes to our long-
term strategy and business model.
The Company’s policy on Board diversity relates to the selection of nominees for the Board of Directors. In selecting a nominee for the Board,
the Sustainability, Corporate Governance and Nominating Committee considers the skills, expertise and background that would complement
the existing Board and ensure that its members are of sufficiently diverse and independent backgrounds, recognizing that the Company’s
businesses and operations are diverse and global in nature. The Board intends to continue to select diverse candidates and considers gender
diversity and racial and ethnic diversity in each board member search that it conducts. The Board of Directors is nominating five female
directors (Ms. Arnold, Ms. Berzin, Ms. Miller Boise, Ms. Hudson and Ms. Schaeffer), one Black director (Ms. Miller Boise) and one international
director who is an Irish citizen (Mr. Lee) out of a total of 11 directors. In addition, the tenure and experience of our directors is diverse, which
brings varying perspectives to our Board functionality.
GENDER
RACE AND ETHNICITY
NATIONALITY
BOARD SIZE AND
INDEPENDENCE
45%
9%
9%
10 out of 11 Director
Nominees are
Independent
Female Directors
Racially and Ethnically
Diverse Directors
International
Representation
$
Financial Expert
$
$
$
$
Finance/Capital Allocation
Global Experience
Technology/Engineering
Marketing/Digital
Services
Human Resources/Compensation
IT/Cybersecurity/Data Management
!
Risk Management/Mitigation
ESG/Sustainability
Chair/CEO/Business Head
Industrial/Manufacturing
Academia/Education
Government/Public Policy
$
Financial Services
S
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I
K
S
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C
N
E
I
R
E
P
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For more information regarding our diversity and inclusion strategy, goals and metrics for our Company generally, please see our ESG Report
located on our website at www.tranetechnologies.com/ESG and our “Human Capital Management” disclosure in our Annual Report on Form
10-K for the fiscal year ended December 31, 2022.
2023 Proxy Statement
9
10
PROXY VOTING ROADMAP
PROXY VOTING ROADMAP
BOARD SKILLS AND EXPERIENCE
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r
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$
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diversity and racial and ethnic diversity in each board member search that it conducts. The Board of Directors is nominating five female
Technology/Engineering
Board Diversity
One of the three pillars of our 2030 Sustainability Commitments is Opportunity for All. We create new possibilities and a better world for our
people and our communities. Oversight of our diversity and inclusion strategy begins with our Board of Directors. Our Human Resources and
Compensation Committee regularly reviews diversity and inclusion and other human capital management matters. This commitment to diversity
and inclusion extends to our Board of Directors. We know that diverse teams are more innovative and collaborative, capable of solving
problems and best positioned to realize a better world for future generations. We believe that diversity of our Board contributes to our long-
term strategy and business model.
The Company’s policy on Board diversity relates to the selection of nominees for the Board of Directors. In selecting a nominee for the Board,
the Sustainability, Corporate Governance and Nominating Committee considers the skills, expertise and background that would complement
the existing Board and ensure that its members are of sufficiently diverse and independent backgrounds, recognizing that the Company’s
businesses and operations are diverse and global in nature. The Board intends to continue to select diverse candidates and considers gender
directors (Ms. Arnold, Ms. Berzin, Ms. Miller Boise, Ms. Hudson and Ms. Schaeffer), one Black director (Ms. Miller Boise) and one international
director who is an Irish citizen (Mr. Lee) out of a total of 11 directors. In addition, the tenure and experience of our directors is diverse, which
brings varying perspectives to our Board functionality.
GENDER
RACE AND ETHNICITY
NATIONALITY
BOARD SIZE AND
INDEPENDENCE
45%
9%
9%
10 out of 11 Director
Nominees are
Independent
Female Directors
Racially and Ethnically
Diverse Directors
International
Representation
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!
Risk Management/Mitigation
ESG/Sustainability
Chair/CEO/Business Head
Industrial/Manufacturing
Academia/Education
Government/Public Policy
$
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For more information regarding our diversity and inclusion strategy, goals and metrics for our Company generally, please see our ESG Report
located on our website at www.tranetechnologies.com/ESG and our “Human Capital Management” disclosure in our Annual Report on Form
10-K for the fiscal year ended December 31, 2022.
2023 Proxy Statement
9
10
PROXY VOTING ROADMAP
PROXY VOTING ROADMAP
Director Nomination Process
The Sustainability, Corporate Governance and Nominating Committee identifies individuals qualified to become directors and recommends the
candidates for all directorships.
1 BOARD COMPOSITION ASSESSMENT
The Sustainability, Corporate Governance and Nominating Committee reviews the composition of the full Board to identify the
qualifications and areas of expertise needed to further enhance the composition of the Board.
2 BOARD RECOMMENDATION
The Sustainability, Corporate Governance and Nominating Committee makes recommendations to the Board concerning the
appropriate size and needs of the Board including recommendations based on reviews of diversity and the Board’s skill and
experience matrix.
3 IDENTIFICATION OF CANDIDATES
The Sustainability, Corporate Governance and Nominating Committee, with the assistance of management, identifies candidates with
the desired qualifications. The Board has used a third-party search firm for all searches conducted in the past six years and has
included a diverse slate of candidates from a gender, racial and ethnic diversity perspective. The Board intends to continue to
consider diverse candidates including from a gender diversity and racial and ethnic diversity perspective for each available board seat
in each board member search that it conducts.
In considering candidates, the Sustainability, Corporate Governance and Nominating Committee will consider all factors it deems
appropriate, including breadth of experience, understanding of business and financial issues, ability to exercise sound judgment,
diversity, leadership, and achievements and experience in matters affecting business and industry. The Sustainability, Corporate
Governance and Nominating Committee considers the entirety of each candidate’s credentials and believes that at a minimum each
nominee should satisfy the following criteria: highest character and integrity, experience and understanding of strategy and policy-
setting, sufficient time to devote to Board matters, and no conflict of interest that would interfere with performance as a director.
Shareholders may recommend candidates for consideration for Board membership by sending recommendations to the
Sustainability, Corporate Governance and Nominating Committee, in care of the Secretary of the Company. Candidates
recommended by shareholders are evaluated in the same manner as director candidates identified by any other means.
Corporate Governance Highlights
The Company upholds the highest standards of corporate governance including:
• Substantial majority of independent director
• Annual Board and committee self-assessments
nominees (10 of 11)
• Annual election of directors
• Majority vote for directors
• Lead Independent Director
• Executive sessions of non-management directors
• Continuing director education
• Meaningful executive and director stock ownership guidelines
Company’s short-term and long-term performance goals.
• Board oversight of enterprise-wide sustainability program
• Board oversight of risk management
and strategy
• Succession planning at all management levels,
including for Board Members and Chair and Chief Executive Officer
2
3
ITEM
Advisory Vote on Frequency of Advisory
Vote on Executive Compensation
The Board of Directors
recommends a vote FOR
“Every One Year”.
• We are asking you to consider an advisory vote on whether an advisory vote
on executive compensation should be held every one, two or three years.
ITEM
Advisory Approval of the Compensation of
Our Named Executive Officers
• Our Human Resources and Compensation Committee has adopted executive
compensation programs with a strong link between pay and achievement of
short and long-term Company goals.
• Shareholders voted 92% in favor of the Company’s Advisory Approval of the
Compensation of our Named Executive Officers (“NEOs”) at our 2022 Annual
General Meeting.
See page 23 for further
information
The Board of Directors
recommends a vote FOR
this item.
See page 24 for further
information
Executive Compensation Highlights
The Human Resources and Compensation Committee (the “Committee”) is guided by executive compensation principles that shape the
executive compensation programs that the Committee adopts to execute on the Company’s strategies and goals.
Executive Compensation Principles
Our executive compensation programs are based on the following principles:
(i) business strategy alignment
(iii) shareholder alignment
(v)
internal parity
(ii) pay for performance
(iv) mix of short and long-term incentives
(vi) market competitiveness
Executive Compensation Program Overview
The Committee has adopted executive compensation programs with a strong link between pay and performance and the achievement of
short-term and long-term Company goals. The primary components of the executive compensation programs are base salary, Annual Incentive
Matrix (“AIM”) and long-term incentives (“LTI”). The Committee places significant emphasis on variable compensation (AIM and LTI) so that a
substantial percentage of the five NEOs’ target total direct compensation (“TDC”) is contingent on the successful achievement of the
Pay for Performance
A strong pay for performance culture is paramount to our success and encourages behavior that promotes long-term value creation for our
shareholders. Accordingly, each executive’s TDC is strongly tied to Company, business and individual performance against set goals. Within
our AIM Program, Company and business performance are measured against pre-established financial, operational and strategic objectives,
and modified by an Environmental, Social and Governance (“ESG”) goal, which are all set by the Committee. Individual performance is
measured against pre-established individual goals, inclusive of a personal sustainability commitment, as well as demonstrated leadership
competencies and behaviors consistent with our leadership principles. Additionally, a portion of the executive’s LTI award is earned based on
Company cash flow return on invested capital (“CROIC”) and total shareholder return (“TSR”) relative to companies in the Standard & Poor’s
(“S&P”) 500 Industrials Index. In 2022, greater than 89% of our Chair and Chief Executive Officer’s TDC was performance-based and 76% of
our other NEOs’ average TDC was performance-based compensation, which is dependent on our Company’s performance.
2023 Proxy Statement
11
12
PROXY VOTING ROADMAP
PROXY VOTING ROADMAP
Director Nomination Process
The Sustainability, Corporate Governance and Nominating Committee identifies individuals qualified to become directors and recommends the
candidates for all directorships.
1 BOARD COMPOSITION ASSESSMENT
The Sustainability, Corporate Governance and Nominating Committee reviews the composition of the full Board to identify the
qualifications and areas of expertise needed to further enhance the composition of the Board.
The Sustainability, Corporate Governance and Nominating Committee makes recommendations to the Board concerning the
appropriate size and needs of the Board including recommendations based on reviews of diversity and the Board’s skill and
2 BOARD RECOMMENDATION
experience matrix.
3 IDENTIFICATION OF CANDIDATES
The Sustainability, Corporate Governance and Nominating Committee, with the assistance of management, identifies candidates with
the desired qualifications. The Board has used a third-party search firm for all searches conducted in the past six years and has
included a diverse slate of candidates from a gender, racial and ethnic diversity perspective. The Board intends to continue to
consider diverse candidates including from a gender diversity and racial and ethnic diversity perspective for each available board seat
in each board member search that it conducts.
In considering candidates, the Sustainability, Corporate Governance and Nominating Committee will consider all factors it deems
appropriate, including breadth of experience, understanding of business and financial issues, ability to exercise sound judgment,
diversity, leadership, and achievements and experience in matters affecting business and industry. The Sustainability, Corporate
Governance and Nominating Committee considers the entirety of each candidate’s credentials and believes that at a minimum each
nominee should satisfy the following criteria: highest character and integrity, experience and understanding of strategy and policy-
setting, sufficient time to devote to Board matters, and no conflict of interest that would interfere with performance as a director.
Shareholders may recommend candidates for consideration for Board membership by sending recommendations to the
Sustainability, Corporate Governance and Nominating Committee, in care of the Secretary of the Company. Candidates
recommended by shareholders are evaluated in the same manner as director candidates identified by any other means.
Corporate Governance Highlights
The Company upholds the highest standards of corporate governance including:
• Substantial majority of independent director
• Annual Board and committee self-assessments
nominees (10 of 11)
• Annual election of directors
• Majority vote for directors
• Lead Independent Director
• Executive sessions of non-management directors
• Continuing director education
• Meaningful executive and director stock ownership guidelines
• Board oversight of enterprise-wide sustainability program
• Board oversight of risk management
and strategy
• Succession planning at all management levels,
including for Board Members and Chair and Chief Executive Officer
ITEM
2
ITEM
3
Advisory Vote on Frequency of Advisory
Vote on Executive Compensation
The Board of Directors
recommends a vote FOR
“Every One Year”.
• We are asking you to consider an advisory vote on whether an advisory vote
on executive compensation should be held every one, two or three years.
See page 23 for further
information
Advisory Approval of the Compensation of
Our Named Executive Officers
The Board of Directors
recommends a vote FOR
this item.
• Our Human Resources and Compensation Committee has adopted executive
compensation programs with a strong link between pay and achievement of
short and long-term Company goals.
• Shareholders voted 92% in favor of the Company’s Advisory Approval of the
Compensation of our Named Executive Officers (“NEOs”) at our 2022 Annual
General Meeting.
See page 24 for further
information
Executive Compensation Highlights
The Human Resources and Compensation Committee (the “Committee”) is guided by executive compensation principles that shape the
executive compensation programs that the Committee adopts to execute on the Company’s strategies and goals.
Executive Compensation Principles
Our executive compensation programs are based on the following principles:
(i) business strategy alignment
(iii) shareholder alignment
(v)
internal parity
(ii) pay for performance
(iv) mix of short and long-term incentives
(vi) market competitiveness
Executive Compensation Program Overview
The Committee has adopted executive compensation programs with a strong link between pay and performance and the achievement of
short-term and long-term Company goals. The primary components of the executive compensation programs are base salary, Annual Incentive
Matrix (“AIM”) and long-term incentives (“LTI”). The Committee places significant emphasis on variable compensation (AIM and LTI) so that a
substantial percentage of the five NEOs’ target total direct compensation (“TDC”) is contingent on the successful achievement of the
Company’s short-term and long-term performance goals.
Pay for Performance
A strong pay for performance culture is paramount to our success and encourages behavior that promotes long-term value creation for our
shareholders. Accordingly, each executive’s TDC is strongly tied to Company, business and individual performance against set goals. Within
our AIM Program, Company and business performance are measured against pre-established financial, operational and strategic objectives,
and modified by an Environmental, Social and Governance (“ESG”) goal, which are all set by the Committee. Individual performance is
measured against pre-established individual goals, inclusive of a personal sustainability commitment, as well as demonstrated leadership
competencies and behaviors consistent with our leadership principles. Additionally, a portion of the executive’s LTI award is earned based on
Company cash flow return on invested capital (“CROIC”) and total shareholder return (“TSR”) relative to companies in the Standard & Poor’s
(“S&P”) 500 Industrials Index. In 2022, greater than 89% of our Chair and Chief Executive Officer’s TDC was performance-based and 76% of
our other NEOs’ average TDC was performance-based compensation, which is dependent on our Company’s performance.
2023 Proxy Statement
11
12
2022 Executive Compensation
The table below shows the 2022 compensation for our Chief Executive Officer (“CEO”) and other Named Executive Officers (“NEOs”), as
required to be reported in the Summary Compensation Table pursuant to U.S. Securities and Exchange Commission (“SEC”) rules. Please see
the notes accompanying the Summary Compensation Table for further information.
Summary Compensation Table
PROXY VOTING ROADMAP
PROXY VOTING ROADMAP
Salary
($)
Bonus
($)
Year
2022 1,237,500 — 6,082,088 2,000,006
Stock
Awards
($)
Option
Awards
($)
Non-Equity
Incentive Plan
Compensation
($)
3,029,377
All Other
Compensation
($)
Total
($)
421,224 12,770,195
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)
—
2022 762,500 — 1,900,662 625,024
1,252,143
—
172,830 4,713,159
2022 633,750 — 1,140,634 375,015
799,021
—
103,565 3,051,985
2022 593,750 — 1,064,548 350,035
616,891
—
91,407 2,716,631
2022 581,875 — 579,764 196,893
711,903
—
104,907 2,175,342
Name and
Principal Position
D. S. Regnery
Chair and Chief
Executive Officer
C. J. Kuehn
Executive Vice President
and Chief Financial Officer
P. A. Camuti
Executive Vice President
and Chief Technology
and Sustainability Officer
E. M. Turtz
Senior Vice President
and General Counsel
R. D. Pittard
Executive Vice President
Supply Chain, Engineering and
Information Technology
See the “Compensation Discussion and Analysis” section for more information about our Committee’s executive compensation principles, the
programs the Committee has adopted and the decisions the Committee made during 2022.
2023 Proxy Statement
13
14
ITEM
Approval of Appointment of
Independent Auditors
The Board of Directors
recommends a vote FOR
this item.
4
5
6
• The Audit Committee engages in an annual evaluation of the qualifications,
performance and independence of PricewaterhouseCoopers LLP (“PwC”).
• Both by virtue of its familiarity with the Company’s affairs and its professional
competencies and resources, PwC is considered best qualified to perform this
important function.
• The Audit Committee and the Board believe that the continued retention of
PwC to serve as our independent auditor is in the best interests of the
Company and its investors.
ITEM
Renewal of the Directors’ Existing Authority
to Issue Shares
• The Board of Directors’ authority to issue shares under Irish law is
fundamental to our business.
• Granting the Board this authority is a routine matter for public companies
incorporated in Ireland.
ITEM
Renewal of the Directors’ Existing Authority
to Issue Shares for Cash without First
Offering Shares to Existing Shareholders
• The Board of Directors’ authority to issue shares for cash without first
offering shares to existing shareholders is fundamental to our business.
• Granting the Board this authority is a routine matter for public companies
incorporated in Ireland.
least 75% of the votes cast.
• As required under Irish law, this proposal requires the affirmative vote of at
See page 24 for further
information
The Board of Directors
recommends a vote FOR
this item.
See page 26 for further
information
The Board of Directors
recommends a vote FOR
this item.
See page 27 for further
information
ITEM
Determine the Price at which the Company
Can Reallot Shares Held as Treasury
The Board of Directors
recommends a vote FOR
this item.
7
Shares
• From time to time the Company may acquire ordinary shares and hold them
as treasury shares.
held in treasury.
• The Company may reallot such treasury shares, and under Irish law, our
shareholders must authorize the price range at which we may reallot shares
• As required under Irish law, this proposal requires the affirmative vote of at
least 75% of the votes cast.
See page 28 for further
information
2022 Executive Compensation
The table below shows the 2022 compensation for our Chief Executive Officer (“CEO”) and other Named Executive Officers (“NEOs”), as
required to be reported in the Summary Compensation Table pursuant to U.S. Securities and Exchange Commission (“SEC”) rules. Please see
the notes accompanying the Summary Compensation Table for further information.
Summary Compensation Table
Change in
Pension
Value and
Nonqualified
Deferred
Non-Equity
Salary
Bonus
Awards
Awards
Compensation
Earnings
Compensation
Stock
Option
Incentive Plan
Compensation
All Other
Year
($)
($)
($)
($)
($)
2022 1,237,500 — 6,082,088 2,000,006
3,029,377
($)
—
($)
Total
($)
421,224 12,770,195
2022 762,500 — 1,900,662 625,024
1,252,143
—
172,830 4,713,159
2022 633,750 — 1,140,634 375,015
799,021
—
103,565 3,051,985
2022 593,750 — 1,064,548 350,035
616,891
—
91,407 2,716,631
2022 581,875 — 579,764 196,893
711,903
—
104,907 2,175,342
Name and
Principal Position
D. S. Regnery
Chair and Chief
Executive Officer
C. J. Kuehn
Executive Vice President
and Chief Financial Officer
P. A. Camuti
Executive Vice President
and Chief Technology
and Sustainability Officer
E. M. Turtz
Senior Vice President
and General Counsel
R. D. Pittard
Executive Vice President
Supply Chain, Engineering and
Information Technology
See the “Compensation Discussion and Analysis” section for more information about our Committee’s executive compensation principles, the
programs the Committee has adopted and the decisions the Committee made during 2022.
PROXY VOTING ROADMAP
PROXY VOTING ROADMAP
ITEM
4
ITEM
5
ITEM
6
ITEM
7
Approval of Appointment of
Independent Auditors
The Board of Directors
recommends a vote FOR
this item.
• The Audit Committee engages in an annual evaluation of the qualifications,
performance and independence of PricewaterhouseCoopers LLP (“PwC”).
• Both by virtue of its familiarity with the Company’s affairs and its professional
competencies and resources, PwC is considered best qualified to perform this
important function.
• The Audit Committee and the Board believe that the continued retention of
PwC to serve as our independent auditor is in the best interests of the
Company and its investors.
See page 24 for further
information
Renewal of the Directors’ Existing Authority
to Issue Shares
The Board of Directors
recommends a vote FOR
this item.
• The Board of Directors’ authority to issue shares under Irish law is
fundamental to our business.
• Granting the Board this authority is a routine matter for public companies
incorporated in Ireland.
Renewal of the Directors’ Existing Authority
to Issue Shares for Cash without First
Offering Shares to Existing Shareholders
• The Board of Directors’ authority to issue shares for cash without first
offering shares to existing shareholders is fundamental to our business.
• Granting the Board this authority is a routine matter for public companies
incorporated in Ireland.
See page 26 for further
information
The Board of Directors
recommends a vote FOR
this item.
• As required under Irish law, this proposal requires the affirmative vote of at
least 75% of the votes cast.
See page 27 for further
information
Determine the Price at which the Company
Can Reallot Shares Held as Treasury
Shares
• From time to time the Company may acquire ordinary shares and hold them
as treasury shares.
• The Company may reallot such treasury shares, and under Irish law, our
shareholders must authorize the price range at which we may reallot shares
held in treasury.
• As required under Irish law, this proposal requires the affirmative vote of at
least 75% of the votes cast.
The Board of Directors
recommends a vote FOR
this item.
See page 28 for further
information
2023 Proxy Statement
13
14
Proposals Requiring Your Vote
In this Proxy Statement, “Trane Technologies,” the “Company,” “we,” “us” and “our” refer to Trane Technologies plc, an Irish public limited
company. This Proxy Statement and the enclosed proxy card, or the Notice of Internet Availability of Proxy Materials, are first being mailed to
shareholders of record as of April 6, 2023 (the “Record Date”) on or about April 21, 2023.
PROPOSALS REQUIRING YOUR VOTE
ITEM
Election of Directors
1
1
The Company uses a majority of votes cast standard for the election of directors. A
majority of the votes cast means that the number of votes cast “for” a director
nominee must exceed the number of votes cast “against” that director nominee.
Each director of the Company is being nominated for election for a one-year term
beginning at the end of the 2023 Annual General Meeting of Shareholders to be held
on June 1, 2023 (the “Annual General Meeting”) and expiring at the end of the 2024
Annual General Meeting of Shareholders. Under our Articles of Association, if a
director is not re-elected in a director election, the director shall retire at the close or
adjournment of the Annual General Meeting. Our Corporate Governance Guidelines
provide for the retirement of directors after reaching the retirement age of 75. In
2022, an exception was made to allow Mr. Bruton and Mr. White to remain
members of the Board of Directors to provide continuity after the Company’s CEO
succession. They, along with Mr. Cohon, who turned age 75 prior to the 2023
Annual General Meeting, are retiring at the 2023 Annual General Meeting in
accordance with our Corporate Governance Guidelines.
Nominees for Director
The Board of
Directors
recommends a
vote FOR the
directors
nominated for
election listed
below.
Ann C. Berzin
Independent Director
Age 71
Director since 2001
Committees
Audit
Finance (Chair)
Executive
• Chairman and Chief Executive Officer of Financial Guaranty Insurance Company (insurer of municipal
bonds and structured finance obligations), a subsidiary of General Electric Capital Corporation, from
Principal Occupation
1992 to 2001.
Current Public Directorships
• Exelon Corporation
• None
Public Directorships Held in the Past Five Years
• Member of University of Chicago College
Other Activities
Advisory Council
• Director of Baltimore Gas & Electric Company
Skills and Experience
$ Financial
Expert
Finance/Capital
$
$
Allocation
Global
Experience
Risk Management/
!
Mitigation
$
$
$
Chair/CEO/
Business Head
Financial Services
Nominee Highlights
Ms. Berzin’s extensive experience in finance at a global diversified industrial firm and her expertise in
complex investment and financial products and services bring critical insight to the Company’s financial
affairs, including its borrowings, capitalization and liquidity. In addition, Ms. Berzin’s relationships
across the global financial community strengthen the Company’s access to capital markets. Her board
memberships provide deep understanding of trends in the energy sector, which presents ongoing
opportunities and challenges for the Company.
Kirk E. Arnold
Independent Director
Age 63
Director since 2018
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and Nominating
Technology and Innovation
Principal Occupation
• Executive in Residence of General Catalyst, a venture capital firm backing entrepreneurs, from
September 2018 to Present.
• Chief Executive Officer of Data Intensity from 2013 to 2017.
Public Directorships Held in the Past Five Years
• None
Current Public Directorships
• Ingersoll Rand Inc. (IR)
• Thomson Reuters (TRI)
Other Activities
• Director of The Predictive Index
• Director of Baypath University
• Director of UP Education Network
• Director of HousecallPro
Skills and Experience
Technology/
Engineering
!
!
Risk Management/
Mitigation
Marketing/
Digital
ESG /
Sustainability
Services
IT/Cybersecurity/
Data Management
Chair/CEO/
Business Head
Academia/
Education
Nominee Highlights
Ms. Arnold’s vast experience in technology and service leadership brings critical insight into the
Company’s operations, digital analytics and technologies. Ms. Arnold has served in executive positions
throughout the technology industry including as COO at Avid, a technology provider to the media
industry, and CEO and President of Keane, Inc., then a publicly traded billion-dollar global services
provider. Ms. Arnold has also held senior leadership roles at Computer Sciences Corporation, Fidelity
Investments and IBM. Ms. Arnold’s active participation in the technology and business community
provides the Company ongoing insight into digital marketing and technology related issues.
2023 Proxy Statement
15
16
Proposals Requiring Your Vote
In this Proxy Statement, “Trane Technologies,” the “Company,” “we,” “us” and “our” refer to Trane Technologies plc, an Irish public limited
company. This Proxy Statement and the enclosed proxy card, or the Notice of Internet Availability of Proxy Materials, are first being mailed to
shareholders of record as of April 6, 2023 (the “Record Date”) on or about April 21, 2023.
Principal Occupation
• Chairman and Chief Executive Officer of Financial Guaranty Insurance Company (insurer of municipal
bonds and structured finance obligations), a subsidiary of General Electric Capital Corporation, from
1992 to 2001.
Current Public Directorships
• Exelon Corporation
Public Directorships Held in the Past Five Years
• None
PROPOSALS REQUIRING YOUR VOTE
ITEM
Election of Directors
1
1
The Company uses a majority of votes cast standard for the election of directors. A
majority of the votes cast means that the number of votes cast “for” a director
nominee must exceed the number of votes cast “against” that director nominee.
Each director of the Company is being nominated for election for a one-year term
beginning at the end of the 2023 Annual General Meeting of Shareholders to be held
on June 1, 2023 (the “Annual General Meeting”) and expiring at the end of the 2024
Annual General Meeting of Shareholders. Under our Articles of Association, if a
director is not re-elected in a director election, the director shall retire at the close or
adjournment of the Annual General Meeting. Our Corporate Governance Guidelines
provide for the retirement of directors after reaching the retirement age of 75. In
2022, an exception was made to allow Mr. Bruton and Mr. White to remain
members of the Board of Directors to provide continuity after the Company’s CEO
succession. They, along with Mr. Cohon, who turned age 75 prior to the 2023
Annual General Meeting, are retiring at the 2023 Annual General Meeting in
accordance with our Corporate Governance Guidelines.
Nominees for Director
The Board of
Directors
recommends a
vote FOR the
directors
nominated for
election listed
below.
Ann C. Berzin
Independent Director
Age 71
Director since 2001
Committees
Audit
Finance (Chair)
Executive
Other Activities
• Member of University of Chicago College
Advisory Council
• Director of Baltimore Gas & Electric Company
Skills and Experience
$ Financial
Expert
Chair/CEO/
Business Head
$
$
$
$
$
Finance/Capital
Allocation
Financial Services
Global
Experience
!
Risk Management/
Mitigation
Nominee Highlights
Ms. Berzin’s extensive experience in finance at a global diversified industrial firm and her expertise in
complex investment and financial products and services bring critical insight to the Company’s financial
affairs, including its borrowings, capitalization and liquidity. In addition, Ms. Berzin’s relationships
across the global financial community strengthen the Company’s access to capital markets. Her board
memberships provide deep understanding of trends in the energy sector, which presents ongoing
opportunities and challenges for the Company.
Principal Occupation
• Executive in Residence of General Catalyst, a venture capital firm backing entrepreneurs, from
September 2018 to Present.
• Chief Executive Officer of Data Intensity from 2013 to 2017.
Current Public Directorships
Public Directorships Held in the Past Five Years
• Ingersoll Rand Inc. (IR)
• Thomson Reuters (TRI)
• None
Kirk E. Arnold
Independent Director
Age 63
Director since 2018
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and Nominating
Technology and Innovation
Other Activities
• Director of The Predictive Index
• Director of Baypath University
• Director of UP Education Network
• Director of HousecallPro
Skills and Experience
Technology/
Engineering
Risk Management/
!
!
Mitigation
Nominee Highlights
Marketing/
Services
IT/Cybersecurity/
Data Management
Digital
ESG /
Sustainability
Chair/CEO/
Business Head
Academia/
Education
Ms. Arnold’s vast experience in technology and service leadership brings critical insight into the
Company’s operations, digital analytics and technologies. Ms. Arnold has served in executive positions
throughout the technology industry including as COO at Avid, a technology provider to the media
industry, and CEO and President of Keane, Inc., then a publicly traded billion-dollar global services
provider. Ms. Arnold has also held senior leadership roles at Computer Sciences Corporation, Fidelity
Investments and IBM. Ms. Arnold’s active participation in the technology and business community
provides the Company ongoing insight into digital marketing and technology related issues.
2023 Proxy Statement
15
16
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
Principal Occupation
• Executive Vice President and Chief Legal Officer of Intel Corporation from July 2022 to Present.
• Executive Vice President and Chief Legal Officer of Eaton Corporation plc from
January 2020 to June 2022.
• Senior Vice President, General Counsel / Chief Legal Officer of Meritor, Inc. from
August 2016 to December 2019.
Current Public Directorships
• None
Public Directorships Held in the Past Five Years
• Federal Home Loan Bank, Cincinnati
April Miller Boise
Independent Director
Age 54
Director since 2020
Committees
Audit
Finance
Other Activities
• Trustee, Cleveland Clinic
• Director, City Club of Cleveland
• Trustee, George W. Codrington Charitable
Foundation
• Trustee, Assembly for the Arts
• Trustee, College Now Greater Cleveland
Skills and Experience
Global
Experience
ESG /
Sustainability
Human Resources/
Compensation
IT/Cybersecurity/
Data Management
!
!
Risk Management/
Mitigation
Industrial/
Manufacturing
Government/
Public Policy
Nominee Highlights
Ms. Miller Boise adds valuable perspective as we execute our climate-focused strategy and expand
our global leadership in sustainability. She brings extensive experience in business strategy, strategic
transactions and international growth, in addition to her deep background in corporate governance and
inclusive talent management. In particular, Ms. Miller Boise’s experience working with companies in
relevant industries across the global manufacturing arena including semiconductors, automotive,
electrical products and services and commercial transportation, brings relevant insight regarding the
manufacturing industry and dynamic end markets around the world.
Principal Occupation
• President, University of Missouri System from 2007 to 2011.
• Chairman of the Board (from 2006 to 2007) and Chief Executive Officer (from 2005 to 2007) of Sprint
Nextel Corporation (a telecommunications company).
Current Public Directorships
• Ingersoll Rand Inc. (IR)
Public Directorships Held in the Past Five Years
• DST Systems Inc.
• Evergy, Inc.
Gary D. Forsee
Lead Independent Director
Other Activities
• Director, Kansas City Police Foundation
Skills and Experience
Age 73
Director since 2007
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and
Nominating (Chair)
Executive
Compensation
Academia/
Education
Nominee Highlights
$ Financial Expert
Global Experience
Services
Human Resources/
Risk Management/
ESG /
!
Mitigation
Chair/CEO/
Business Head
Technology/
Engineering
Sustainability
Technology and Innovation
In addition to his broad operational and financial expertise, Mr. Forsee’s experience as chairman and
chief executive officer with one of the largest U.S. firms in the global telecommunications industry offers
a deep understanding of the challenges and opportunities within markets experiencing significant
technology-driven change. His role as president of a major university system provides insight into the
Company’s talent development initiatives, which remain a critical enabler of the Company’s long-term
success. Mr. Forsee’s experience serving on the board of an energy services utility also benefits the
Company as it seeks to achieve more energy-efficient operations and customer solutions.
2023 Proxy Statement
17
18
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
Principal Occupation
• Executive Vice President and Chief Legal Officer of Intel Corporation from July 2022 to Present.
• Executive Vice President and Chief Legal Officer of Eaton Corporation plc from
• Senior Vice President, General Counsel / Chief Legal Officer of Meritor, Inc. from
January 2020 to June 2022.
August 2016 to December 2019.
Current Public Directorships
Public Directorships Held in the Past Five Years
• None
• Federal Home Loan Bank, Cincinnati
April Miller Boise
Independent Director
Age 54
Director since 2020
Committees
Audit
Finance
Other Activities
• Trustee, Cleveland Clinic
• Director, City Club of Cleveland
• Trustee, George W. Codrington Charitable
Foundation
• Trustee, Assembly for the Arts
• Trustee, College Now Greater Cleveland
Skills and Experience
Global
Experience
Human Resources/
Compensation
IT/Cybersecurity/
Data Management
!
!
Risk Management/
Mitigation
ESG /
Industrial/
Sustainability
Manufacturing
Government/
Public Policy
Nominee Highlights
Ms. Miller Boise adds valuable perspective as we execute our climate-focused strategy and expand
our global leadership in sustainability. She brings extensive experience in business strategy, strategic
transactions and international growth, in addition to her deep background in corporate governance and
inclusive talent management. In particular, Ms. Miller Boise’s experience working with companies in
relevant industries across the global manufacturing arena including semiconductors, automotive,
electrical products and services and commercial transportation, brings relevant insight regarding the
manufacturing industry and dynamic end markets around the world.
Gary D. Forsee
Lead Independent Director
Age 73
Director since 2007
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and
Nominating (Chair)
Executive
Technology and Innovation
Principal Occupation
• President, University of Missouri System from 2007 to 2011.
• Chairman of the Board (from 2006 to 2007) and Chief Executive Officer (from 2005 to 2007) of Sprint
Nextel Corporation (a telecommunications company).
Current Public Directorships
• Ingersoll Rand Inc. (IR)
Public Directorships Held in the Past Five Years
• DST Systems Inc.
• Evergy, Inc.
Other Activities
• Director, Kansas City Police Foundation
Skills and Experience
$ Financial Expert
Global Experience
Human Resources/
Compensation
!
Risk Management/
Mitigation
Academia/
Education
Technology/
Engineering
ESG /
Sustainability
Services
Chair/CEO/
Business Head
Nominee Highlights
In addition to his broad operational and financial expertise, Mr. Forsee’s experience as chairman and
chief executive officer with one of the largest U.S. firms in the global telecommunications industry offers
a deep understanding of the challenges and opportunities within markets experiencing significant
technology-driven change. His role as president of a major university system provides insight into the
Company’s talent development initiatives, which remain a critical enabler of the Company’s long-term
success. Mr. Forsee’s experience serving on the board of an energy services utility also benefits the
Company as it seeks to achieve more energy-efficient operations and customer solutions.
2023 Proxy Statement
17
18
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
Mark R. George
Independent Director
Age 56
Director since 2022
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and Nominating
John A. Hayes
Independent Director
Age 57
Director since 2023
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and Nominating
Principal Occupation
• Executive Vice President and Chief Financial Officer of Norfolk Southern Corporation from 2019
to Present.
• Vice President and Chief Financial Officer of Carrier Global Corporation (a United Technologies Corporation
business) in 2019.
• Vice President and Chief Financial Officer of Otis Worldwide Corporation (a United Technologies Corporation
business) from 2015 to 2019.
Current Public Directorships
• None
Public Directorships Held in the Past Five Years
• None
Other Activities
• None
Skills and Experience
$ Financial Expert
$
$
$
$
$
$
$
$
$
Finance/Capital
Allocation
Global
Experience
Services
Human Resources/
Compensation
IT/Cybersecurity/
Data Management
!
!
Risk Management/
Mitigation
ESG /
Sustainability
Industrial/
Manufacturing
Nominee Highlights
Mr. George brings 33 years of diverse and international financial management and leadership
experience to our Company. He has deep experience in business development, joint venture
partnerships, board of director interactions, as well as investor communications/interface. During his
tenure with Raytheon Technologies Corporation, formerly United Technologies Corporation (“UTC”),
Mr. George held positions of increasing responsibility in finance, treasury, planning and analysis and
information technology for several of UTC’s former businesses in the United States and Asia, including
as vice president finance and chief financial officer at Otis Worldwide Corporation and Carrier Global
Corporation. The Company will benefit from Mr. George’s industry and global insights, which contribute
to the Company’s achieving continued financial success, meeting our business goals, and furthering
our sustainable climate initiatives.
Principal Occupation
•
Chairman, Ball Corporation (from 2013 to April 26, 2023) and Chief Executive Officer (from 2011 to
2022).
Current Public Directorships
Public Directorships Held in the Past Five Years
• None
• None
Other Activities
• Director, Kohler Co.
Skills and Experience
$
Financial Expert
$
$
$
$
Finance/Capital
Allocation
Global
Experience
Human Resources/
Compensation
ESG /
Sustainability
Chair/CEO/
Business Head
Industrial/
Manufacturing
Nominee Highlights
Mr. Hayes brings more than 30 years of leadership experience in global, industrial markets. He is
retiring effective April 26, 2023 from his role as chairman of Ball Corporation, a supplier of aluminum
packaging solutions as well as aerospace and other technologies and services. He has served as
chairman since 2013 and chief executive officer from 2011 to April 2022. During his tenure as CEO, he
led multiple acquisitions and strategic transactions as the corporation’s revenues doubled and its
market capitalization increased sixfold. The Company will benefit from Mr. Hayes’s significant
experience leading a global corporation.
Linda P. Hudson
Independent Director
Age 72
Director since 2015
Committees
Human Resources
and Compensation
Sustainability, Corporate
Governance and Nominating
Technology and Innovation
Myles P. Lee
Independent Director
Age 69
Director since 2015
Committees
Audit
Finance
Principal Occupation
• Founder and Former Chairman and Chief Executive Officer of The Cardea Group, a business
management consulting firm she founded in 2014 and sold in 2020.
• Former President and Chief Executive Officer of BAE Systems, Inc. from 2009 to 2014.
Public Directorships Held in the Past Five Years
• The Southern Company
Current Directorships
• Bank of America Corporation (BAC)
• TPI Composites, Inc. (TPIC)
Other Activities
• Director, University of Florida Foundation Inc.
• Director, University of Florida Engineering
Leadership Institute
Skills and Experience
$ Financial Expert
Global Experience
Technology/
Engineering
IT/Cybersecurity/
Data Management
Risk Management/
ESG /
Mitigation
Sustainability
!
$
Financial Services
Human
Resources/
Compensation
Chair/CEO/
Business Head
Industrial/
Manufacturing
Nominee Highlights
Ms. Hudson’s prior role as President and CEO of BAE Systems and her extensive experience in
the defense and engineering sectors provide the Company with strong operational insight and
understanding of matters crucial to the Company’s business. Prior to becoming CEO of BAE
Systems, Ms. Hudson was president of BAE Systems’ Land & Armaments operating group, the
world’s largest military vehicle and equipment business. A member of the National Academy of
Engineering, Ms. Hudson is a recognized authority on industrial, manufacturing and operational
systems. In addition, Ms. Hudson has broad experience in strategic planning and risk management
• Director (from 2003 to 2013) and Chief Executive Officer (from 2009 to 2013) of CRH plc.
Current Public Directorships
Public Directorships Held in the Past Five Years
• Babcock International Group plc
• UDG Healthcare plc
in complex business environments.
Principal Occupation
• None
Other Activities
• Director, St. Vincent’s Healthcare
Group Limited
Skills and Experience
$ Financial Expert
Finance/Capital
$
$
$
$
Allocation
Global
Experience
Risk Management/
!
Mitigation
Chair/CEO/
Business Head
Industrial/
Manufacturing
Nominee Highlights
Mr. Lee’s experience as the former head of the largest public or private company in Ireland provides
strategic and practical judgment to critical elements of the Company’s growth and productivity
strategies, expertise in Irish governance matters and significant insight into the building and
construction sector. In addition, Mr. Lee’s previous service as Finance Director and General Manager
of Finance of CRH plc and in a professional accountancy practice provides valuable financial expertise
to the Company.
2023 Proxy Statement
19
20
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
• Executive Vice President and Chief Financial Officer of Norfolk Southern Corporation from 2019
• Vice President and Chief Financial Officer of Carrier Global Corporation (a United Technologies Corporation
• Vice President and Chief Financial Officer of Otis Worldwide Corporation (a United Technologies Corporation
Current Public Directorships
Public Directorships Held in the Past Five Years
• None
Principal Occupation
to Present.
business) in 2019.
business) from 2015 to 2019.
• None
Other Activities
• None
Skills and Experience
Mark R. George
Independent Director
Age 56
Director since 2022
Committees
Human Resources and
Compensation
$ Financial Expert
$
Finance/Capital
$
$
$
$
$
$
$
$
Allocation
Global
Experience
Services
Sustainability, Corporate
Governance and Nominating
Human Resources/
Compensation
IT/Cybersecurity/
Data Management
!
!
Mitigation
Risk Management/
ESG /
Sustainability
Principal Occupation
• Founder and Former Chairman and Chief Executive Officer of The Cardea Group, a business
management consulting firm she founded in 2014 and sold in 2020.
• Former President and Chief Executive Officer of BAE Systems, Inc. from 2009 to 2014.
Current Directorships
• Bank of America Corporation (BAC)
• TPI Composites, Inc. (TPIC)
Other Activities
Public Directorships Held in the Past Five Years
• The Southern Company
Linda P. Hudson
Independent Director
Age 72
Director since 2015
Committees
Human Resources
and Compensation
Sustainability, Corporate
Governance and Nominating
Technology and Innovation
• Director, University of Florida Foundation Inc.
• Director, University of Florida Engineering
Leadership Institute
Skills and Experience
$ Financial Expert
Global Experience
IT/Cybersecurity/
Data Management
Industrial/
Manufacturing
Risk Management/
Mitigation
Financial Services
!
$
Technology/
Engineering
ESG /
Sustainability
Human
Resources/
Compensation
Chair/CEO/
Business Head
Nominee Highlights
Ms. Hudson’s prior role as President and CEO of BAE Systems and her extensive experience in
the defense and engineering sectors provide the Company with strong operational insight and
understanding of matters crucial to the Company’s business. Prior to becoming CEO of BAE
Systems, Ms. Hudson was president of BAE Systems’ Land & Armaments operating group, the
world’s largest military vehicle and equipment business. A member of the National Academy of
Engineering, Ms. Hudson is a recognized authority on industrial, manufacturing and operational
systems. In addition, Ms. Hudson has broad experience in strategic planning and risk management
in complex business environments.
Principal Occupation
• Director (from 2003 to 2013) and Chief Executive Officer (from 2009 to 2013) of CRH plc.
Current Public Directorships
• None
Other Activities
• Director, St. Vincent’s Healthcare
Group Limited
Public Directorships Held in the Past Five Years
• Babcock International Group plc
• UDG Healthcare plc
Skills and Experience
$ Financial Expert
$
$
$
$
Finance/Capital
Allocation
Global
Experience
!
Risk Management/
Mitigation
Chair/CEO/
Business Head
Industrial/
Manufacturing
Nominee Highlights
Mr. Lee’s experience as the former head of the largest public or private company in Ireland provides
strategic and practical judgment to critical elements of the Company’s growth and productivity
strategies, expertise in Irish governance matters and significant insight into the building and
construction sector. In addition, Mr. Lee’s previous service as Finance Director and General Manager
of Finance of CRH plc and in a professional accountancy practice provides valuable financial expertise
to the Company.
Myles P. Lee
Independent Director
Age 69
Director since 2015
Committees
Audit
Finance
2023 Proxy Statement
19
20
Mr. George brings 33 years of diverse and international financial management and leadership
experience to our Company. He has deep experience in business development, joint venture
partnerships, board of director interactions, as well as investor communications/interface. During his
tenure with Raytheon Technologies Corporation, formerly United Technologies Corporation (“UTC”),
Mr. George held positions of increasing responsibility in finance, treasury, planning and analysis and
information technology for several of UTC’s former businesses in the United States and Asia, including
as vice president finance and chief financial officer at Otis Worldwide Corporation and Carrier Global
Corporation. The Company will benefit from Mr. George’s industry and global insights, which contribute
to the Company’s achieving continued financial success, meeting our business goals, and furthering
our sustainable climate initiatives.
• Chairman, Ball Corporation (from 2013 to April 26, 2023) and former Chief Executive Officer (from
Current Public Directorships
Public Directorships Held in the Past Five Years
• None
Industrial/
Manufacturing
Nominee Highlights
Principal Occupation
2011 to 2022).
• None
Other Activities
• Director, Kohler Co.
Skills and Experience
$
Financial Expert
Finance/Capital
$
$
$
$
Allocation
ESG /
Sustainability
Chair/CEO/
Business Head
Global
Experience
Industrial/
Manufacturing
Human Resources/
Compensation
Nominee Highlights
Mr. Hayes brings more than 30 years of leadership experience in global, industrial markets. He is
retiring effective April 26, 2023 from his role as chairman of Ball Corporation, a supplier of aluminum
packaging solutions as well as aerospace and other technologies and services. He has served as
chairman since 2013 and chief executive officer from 2011 to April 2022. During his tenure as CEO, he
led multiple acquisitions and strategic transactions as the corporation’s revenues doubled and its
market capitalization increased sixfold. The Company will benefit from Mr. Hayes’s significant
experience leading a global corporation.
John A. Hayes
Independent Director
Age 57
Director since 2023
Committees
Human Resources and
Compensation
Sustainability, Corporate
Governance and Nominating
John P. Surma
Independent Director
Age 68
Director since 2013
Committees
Audit (Chair)
Finance
Executive
Principal Occupation
• Chairman (from 2006 to 2013) and Chief Executive Officer (from 2004 to 2013) of United States Steel
Corporation (a steel manufacturing company).
Current Public Directorships
Public Directorships Held in the Past Five Years
• Marathon Petroleum Corporation (MPC)
• Concho Resources Inc.
• MPLX LP (a publicly traded subsidiary of
Marathon Petroleum Corporation)* (MPLX)
• Public Service Enterprise Group (PEG)
* MPLX GP LLC is a Master Limited Partnership and is a consolidated subsidiary of Marathon
Petroleum Corporation, which holds >50% of its voting units. We view Mr. Surma’s service on the
MPLX board as an extension of his service on the Marathon Petroleum Corporation board for
purposes of assessing the level of outside public board commitments.
• Chair and Director, University of Pittsburgh
• Former Director and Chair, Federal Reserve Bank
• Former Director and Former Chair, National Safety
Other Activities
Medical Center
of Cleveland
Council
• Member Emeritus and Former Chair, Allegheny
Skills and Experience
$ Financial Expert
Finance/Capital
$
$
$
$
Allocation
Global
Experience
Services
Risk Management/
ESG /
!
Mitigation
Sustainability
Chair/CEO/
Business Head
Industrial/
Manufacturing
Government/Public
Policy
Nominee Highlights
Mr. Surma’s experience as the former chairman and chief executive officer of a large industrial
company provides significant and direct expertise across all aspects of the Company’s operational and
financial affairs. In particular, Mr. Surma’s financial experience, having previously served as the chief
financial officer of United States Steel Corporation and as a partner of the audit firm
PricewaterhouseCoopers LLP, provides the Board with valuable insight into financial reporting and
accounting oversight of a public company. Mr. Surma’s board memberships and other activities
provide the Board an understanding of developments in the energy sector as the Company seeks to
develop more energy-efficient operations and insight into national and international business and trade
policy that could impact the Company.
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
David S. Regnery
Chair and Chief Executive
Officer
Age 60
Director since 2021
Committees
Executive (Chair)
Principal Occupation
• Chair of the Board of Directors since January 1, 2022.
• Chief Executive Officer of the Company since July 1, 2021.
Current Public Directorships
• None
Public Directorships Held in the Past Five Years
• None
Other Activities
• Member, Alliance of CEO Climate Leaders for
the World Economic Forum
Skills and Experience
$ Financial Expert
$
$
$
$
$
$
$
$
$
Finance/Capital
Allocation
Global
Experience
Services
!
!
Risk Management/
Mitigation
ESG /
Sustainability
Chair/CEO/
Business Head
Industrial/
Manufacturing
Nominee Highlights
Mr. Regnery has been with the Company for his entire career. He was appointed CEO in July 2021 and
named chair of the Company’s board of directors in January 2022. Previously, Mr. Regnery served as
the Company’s president and chief operating officer, with direct responsibility for its three regional
reportable segments and full portfolio of businesses, as well as mission-critical company operations
including supply chain, engineering and information technology. Throughout his tenure, Mr. Regnery
has led the majority of the Company’s businesses around the world, including Commercial HVAC and
Transport Refrigeration. As president of the Commercial HVAC business, Mr. Regnery led the launch of
the Company’s successful EcoWise™ portfolio of products, designed to lower environmental impact
through high efficiency operation and low-GWP refrigerants. Under Mr. Regnery’s leadership, Trane
Technologies has sharpened its strategy as an industry leader in climate solutions with a singular
purpose – to boldly challenge what’s possible for a sustainable world.
Principal Occupation
• Senior Vice President and Chief Financial Officer of Air Products and Chemicals, Inc. (2021 to
present), Senior Vice President, Finance and Global Engineering, Americas, Middle East & India (2020
to 2021) and Vice President and Chief Audit Executive (2016 to 2020) of Air Products and Chemicals,
Inc.
Current Public Directorships
• None
Public Directorships Held in the Past Five Years
• None
Melissa N. Schaeffer
Independent Director
Other Activities
• None
Age 43
Director since 2022
Committees
Audit
Finance
Skills and Experience
$
Financial Expert
$
$
$
$
Finance/Capital
Allocation
!
Risk Management/
Mitigation
ESG /
Sustainability
Nominee Highlights
Ms. Schaeffer has been a finance leader in the industrial sector for more than 20 years. She has deep
international, M&A and audit/risk management experience. Over her career, she has held positions in
global finance, compliance, accounting and risk management. In her current role, she is responsible for
controller, accounting, treasury, tax, audit, investor relations and shared business functions. Ms.
Schaeffer’s leadership skills and international business experience are of great value for the Company’s
global financial, risk management and sustainability strategies.
2023 Proxy Statement
21
22
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
Chair and Chief Executive
Skills and Experience
David S. Regnery
Officer
Age 60
Director since 2021
Committees
Executive (Chair)
Current Public Directorships
Public Directorships Held in the Past Five Years
Principal Occupation
• Chair of the Board of Directors since January 1, 2022.
• Chief Executive Officer of the Company since July 1, 2021.
• None
Other Activities
• Member, Alliance of CEO Climate Leaders for
the World Economic Forum
• None
$ Financial Expert
$
Finance/Capital
$
$
$
$
$
$
$
$
Allocation
Global
Experience
Services
Risk Management/
ESG /
!
!
Mitigation
Sustainability
Chair/CEO/
Business Head
Industrial/
Manufacturing
Nominee Highlights
Mr. Regnery has been with the Company for his entire career. He was appointed CEO in July 2021 and
named chair of the Company’s board of directors in January 2022. Previously, Mr. Regnery served as
the Company’s president and chief operating officer, with direct responsibility for its three regional
reportable segments and full portfolio of businesses, as well as mission-critical company operations
including supply chain, engineering and information technology. Throughout his tenure, Mr. Regnery
has led the majority of the Company’s businesses around the world, including Commercial HVAC and
Transport Refrigeration. As president of the Commercial HVAC business, Mr. Regnery led the launch of
the Company’s successful EcoWise™ portfolio of products, designed to lower environmental impact
through high efficiency operation and low-GWP refrigerants. Under Mr. Regnery’s leadership, Trane
Technologies has sharpened its strategy as an industry leader in climate solutions with a singular
purpose – to boldly challenge what’s possible for a sustainable world.
Principal Occupation
• Senior Vice President and Chief Financial Officer of Air Products and Chemicals, Inc. (2021 to
present), Senior Vice President, Finance and Global Engineering, Americas, Middle East & India (2020
to 2021) and Vice President and Chief Audit Executive (2016 to 2020) of Air Products and Chemicals,
Inc.
• None
Current Public Directorships
Public Directorships Held in the Past Five Years
• None
Melissa N. Schaeffer
Independent Director
Other Activities
• None
Skills and Experience
Age 43
Director since 2022
Committees
Audit
Finance
$
Financial Expert
Finance/Capital
Risk Management/
ESG /
$
$
$
$
Allocation
!
Mitigation
Sustainability
Nominee Highlights
Ms. Schaeffer has been a finance leader in the industrial sector for more than 20 years. She has deep
international, M&A and audit/risk management experience. Over her career, she has held positions in
global finance, compliance, accounting and risk management. In her current role, she is responsible for
controller, accounting, treasury, tax, audit, investor relations and shared business functions. Ms.
Schaeffer’s leadership skills and international business experience are of great value for the Company’s
global financial, risk management and sustainability strategies.
John P. Surma
Independent Director
Age 68
Director since 2013
Committees
Audit (Chair)
Finance
Executive
Principal Occupation
• Chairman (from 2006 to 2013) and Chief Executive Officer (from 2004 to 2013) of United States Steel
Corporation (a steel manufacturing company).
Current Public Directorships
• Marathon Petroleum Corporation (MPC)
• MPLX LP (a publicly traded subsidiary of
Marathon Petroleum Corporation)* (MPLX)
• Public Service Enterprise Group (PEG)
Public Directorships Held in the Past Five Years
• Concho Resources Inc.
* MPLX GP LLC is a Master Limited Partnership and is a consolidated subsidiary of Marathon
Petroleum Corporation, which holds >50% of its voting units. We view Mr. Surma’s service on the
MPLX board as an extension of his service on the Marathon Petroleum Corporation board for
purposes of assessing the level of outside public board commitments.
Other Activities
• Chair and Director, University of Pittsburgh
Medical Center
• Former Director and Chair, Federal Reserve Bank
of Cleveland
• Former Director and Former Chair, National Safety
Council
• Member Emeritus and Former Chair, Allegheny
Skills and Experience
$ Financial Expert
$
$
$
$
Finance/Capital
Allocation
Global
Experience
Services
!
Risk Management/
Mitigation
ESG /
Sustainability
Chair/CEO/
Business Head
Industrial/
Manufacturing
Government/Public
Policy
Nominee Highlights
Mr. Surma’s experience as the former chairman and chief executive officer of a large industrial
company provides significant and direct expertise across all aspects of the Company’s operational and
financial affairs. In particular, Mr. Surma’s financial experience, having previously served as the chief
financial officer of United States Steel Corporation and as a partner of the audit firm
PricewaterhouseCoopers LLP, provides the Board with valuable insight into financial reporting and
accounting oversight of a public company. Mr. Surma’s board memberships and other activities
provide the Board an understanding of developments in the energy sector as the Company seeks to
develop more energy-efficient operations and insight into national and international business and trade
policy that could impact the Company.
2023 Proxy Statement
21
22
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
ITEM
2
2
Advisory Vote on Frequency of
Advisory Vote on Executive
Compensation
The Board of Directors recommends
a vote FOR an annual advisory vote
on executive compensation
ITEM
Advisory Approval of the
Compensation of Our Named
Executive Officers
3
The Board of Directors recommends
a vote FOR advisory approval of the
compensation of our NEOs as
disclosed in the “Compensation
Discussion and Analysis,” the
compensation tables, and the related
disclosure contained in this
Proxy Statement.
The Company is presenting the following proposal, which gives you as a shareholder the opportunity to inform the Company as to how often
you wish the Company to include a “Say-on-Pay” proposal, consistent with Item 3 below, in our Proxy Statement. Under the following
proposal, shareholders may vote to have the “Say-on-Pay” vote every year, every two years or every three years. This proposal is required to
be provided to shareholders once every six years pursuant to Section 14A of the Securities Exchange Act of 1934. While our Board of
Directors intends to carefully consider the shareholder vote resulting from the proposal, the final vote will not be binding on us and is advisory in
nature.
“RESOLVED, that the shareholders wish the Company to include an advisory vote on compensation of the Company’s Named Executive
Officers pursuant to Section 14A of the Securities Exchange Act every:
Compensation of the Company’s NEOs.
• one year
• two years; or
• three years.”
The Company believes that “Say-on-Pay” votes should be conducted every year so that shareholders may annually express their views on the
Company’s executive compensation program. The Human Resources and Compensation Committee of the Board of Directors, which
administers the Company’s executive compensation program, values the opinions expressed by the Company’s shareholders in these votes
and will continue to consider the outcome of these votes in making its decisions on executive compensation.
The Board of Directors recommends that shareholders vote to hold “Say-on-Pay” votes EVERY ONE YEAR (as opposed to every two years or
every three years).
The Company is presenting the following proposal, commonly known as a “Say-on-Pay” proposal, which gives you as a shareholder the
opportunity to endorse or not endorse our compensation program for NEOs by voting for or against the following resolution:
“RESOLVED, that the shareholders approve the compensation of the Company’s NEOs, as disclosed in the “Compensation Discussion and
Analysis”, the compensation tables, and the related disclosure contained in the Company’s Proxy Statement.”
While our Board of Directors intends to carefully consider the shareholder vote resulting from this proposal, the final vote will not be binding on
us and is advisory in nature. At our 2022 Annual General Meeting, shareholders voted 92% in favor of the Company’s Advisory Approval of the
In considering your vote, please be advised that our compensation program for NEOs is guided by our design principles, as described in the
“Compensation Discussion and Analysis” section of this Proxy Statement:
(i) business strategy alignment
(iii) shareholder alignment
(v)
internal parity
(ii) pay for performance
(iv) mix of short and long-term incentives
(vi) market competitiveness
By following these design principles, we believe that our compensation program for NEOs is strongly aligned with the long-term interests of
our shareholders.
ITEM
Approval of Appointment of
Independent Auditors
4
The Board of Directors recommends
a vote FOR the proposal to approve
the appointment of PwC as
independent auditors of the
Company and to authorize the Audit
Committee of the Board of Directors
to set the auditors’ remuneration.
The Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the independent external audit firm
retained to audit the Company’s financial statements and internal controls over financial reporting. In executing its responsibilities, the Audit
Committee engages in an annual evaluation of the qualifications, performance and independence of PricewaterhouseCoopers LLP (“PwC”). In
assessing independence, the Committee reviews the fees paid, including those related to non-audit services. The Audit Committee has sole
authority to approve all engagement fees to be paid to PwC. The Audit Committee regularly meets with the lead audit partner without members
of management present, and in executive session with only the Audit Committee members present, which provides the opportunity for
continuous assessment of the firm’s effectiveness and independence and for consideration of rotating audit firms.
In addition, as part of its normal cadence, the Audit Committee considers whether there should be a regular rotation of the independent
auditors. The Audit Committee ensures that the mandated rotation of PwC’s lead engagement partner occurs routinely, and the Audit
Committee and its Chairman are directly involved in the selection of PwC’s lead engagement partner.
The Audit Committee has recommended that shareholders approve the appointment of PwC as our independent auditors for the fiscal year
ending December 31, 2023 and authorize the Audit Committee of our Board of Directors to set the independent auditors’ remuneration.
PwC has been acting continuously as our independent auditors for over one hundred years and, both by virtue of its familiarity with the
Company’s affairs and its professional competencies and resources, is considered best qualified to perform this important function. The Audit
Committee and the Board believe that the continued retention of PwC to serve as our independent auditors is in the best interests of the
Company and its investors.
Representatives of PwC will be present at the Annual General Meeting and will be available to respond to appropriate questions. They will have
an opportunity to make a statement if they so desire.
2023 Proxy Statement
23
24
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
ITEM
Advisory Vote on Frequency of
Advisory Vote on Executive
Compensation
2
2
The Board of Directors recommends
a vote FOR an annual advisory vote
on executive compensation
ITEM
3
Advisory Approval of the
Compensation of Our Named
Executive Officers
The Board of Directors recommends
a vote FOR advisory approval of the
compensation of our NEOs as
disclosed in the “Compensation
Discussion and Analysis,” the
compensation tables, and the related
disclosure contained in this
Proxy Statement.
The Company is presenting the following proposal, which gives you as a shareholder the opportunity to inform the Company as to how often
you wish the Company to include a “Say-on-Pay” proposal, consistent with Item 3 below, in our Proxy Statement. Under the following
proposal, shareholders may vote to have the “Say-on-Pay” vote every year, every two years or every three years. This proposal is required to
be provided to shareholders once every six years pursuant to Section 14A of the Securities Exchange Act of 1934. While our Board of
Directors intends to carefully consider the shareholder vote resulting from the proposal, the final vote will not be binding on us and is advisory in
“RESOLVED, that the shareholders wish the Company to include an advisory vote on compensation of the Company’s Named Executive
Officers pursuant to Section 14A of the Securities Exchange Act every:
nature.
• one year
• two years; or
• three years.”
The Company believes that “Say-on-Pay” votes should be conducted every year so that shareholders may annually express their views on the
Company’s executive compensation program. The Human Resources and Compensation Committee of the Board of Directors, which
administers the Company’s executive compensation program, values the opinions expressed by the Company’s shareholders in these votes
and will continue to consider the outcome of these votes in making its decisions on executive compensation.
The Board of Directors recommends that shareholders vote to hold “Say-on-Pay” votes EVERY ONE YEAR (as opposed to every two years or
every three years).
The Company is presenting the following proposal, commonly known as a “Say-on-Pay” proposal, which gives you as a shareholder the
opportunity to endorse or not endorse our compensation program for NEOs by voting for or against the following resolution:
“RESOLVED, that the shareholders approve the compensation of the Company’s NEOs, as disclosed in the “Compensation Discussion and
Analysis”, the compensation tables, and the related disclosure contained in the Company’s Proxy Statement.”
While our Board of Directors intends to carefully consider the shareholder vote resulting from this proposal, the final vote will not be binding on
us and is advisory in nature. At our 2022 Annual General Meeting, shareholders voted 92% in favor of the Company’s Advisory Approval of the
Compensation of the Company’s NEOs.
In considering your vote, please be advised that our compensation program for NEOs is guided by our design principles, as described in the
“Compensation Discussion and Analysis” section of this Proxy Statement:
(i) business strategy alignment
(iii) shareholder alignment
(v)
internal parity
(ii) pay for performance
(iv) mix of short and long-term incentives
(vi) market competitiveness
By following these design principles, we believe that our compensation program for NEOs is strongly aligned with the long-term interests of
our shareholders.
Approval of Appointment of
Independent Auditors
ITEM
4
The Board of Directors recommends
a vote FOR the proposal to approve
the appointment of PwC as
independent auditors of the
Company and to authorize the Audit
Committee of the Board of Directors
to set the auditors’ remuneration.
The Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the independent external audit firm
retained to audit the Company’s financial statements and internal controls over financial reporting. In executing its responsibilities, the Audit
Committee engages in an annual evaluation of the qualifications, performance and independence of PricewaterhouseCoopers LLP (“PwC”). In
assessing independence, the Committee reviews the fees paid, including those related to non-audit services. The Audit Committee has sole
authority to approve all engagement fees to be paid to PwC. The Audit Committee regularly meets with the lead audit partner without members
of management present, and in executive session with only the Audit Committee members present, which provides the opportunity for
continuous assessment of the firm’s effectiveness and independence and for consideration of rotating audit firms.
In addition, as part of its normal cadence, the Audit Committee considers whether there should be a regular rotation of the independent
auditors. The Audit Committee ensures that the mandated rotation of PwC’s lead engagement partner occurs routinely, and the Audit
Committee and its Chairman are directly involved in the selection of PwC’s lead engagement partner.
The Audit Committee has recommended that shareholders approve the appointment of PwC as our independent auditors for the fiscal year
ending December 31, 2023 and authorize the Audit Committee of our Board of Directors to set the independent auditors’ remuneration.
PwC has been acting continuously as our independent auditors for over one hundred years and, both by virtue of its familiarity with the
Company’s affairs and its professional competencies and resources, is considered best qualified to perform this important function. The Audit
Committee and the Board believe that the continued retention of PwC to serve as our independent auditors is in the best interests of the
Company and its investors.
Representatives of PwC will be present at the Annual General Meeting and will be available to respond to appropriate questions. They will have
an opportunity to make a statement if they so desire.
2023 Proxy Statement
23
24
Audit Committee Report
Fees of the Independent Auditors
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
While management has the primary responsibility for the financial statements and the financial reporting process, including the system of
internal controls, the Audit Committee reviews the Company’s audited financial statements and financial reporting process on behalf of the
Board of Directors. The independent auditors are responsible for performing an independent audit of the Company’s consolidated financial
statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) (the “PCAOB”) and to issue a
report thereon. The Audit Committee monitors those processes. In this context, the Audit Committee has met and held discussions with
management and the independent auditors regarding the fair and complete presentation of the Company’s results. The Audit Committee has
discussed significant accounting policies applied by the Company in its financial statements, as well as alternative treatments. Management
has represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with United
States generally accepted accounting principles, and the Audit Committee has reviewed and discussed the consolidated financial statements
with management and the independent auditors. The Audit Committee also discussed with the independent auditors the matters required to
be discussed by Auditing Standard No. 1301, “Communications with Audit Committees” issued by the PCAOB.
In addition, the Audit Committee has received and reviewed the written disclosures and the letter from PwC required by the PCAOB regarding
PwC’s communications with the Audit Committee concerning independence and discussed with PwC the auditors’ independence from the
Company and its management in connection with the matters stated therein. The Audit Committee also considered whether the independent
auditors’ provision of non-audit services to the Company is compatible with the auditors’ independence. The Audit Committee has concluded
that the independent auditors are independent from the Company and its management.
The Audit Committee discussed with the Company’s internal and independent auditors the overall scope and plans for their respective audits.
The Audit Committee meets separately with the internal and independent auditors, with and without management present, to discuss the
results of their examinations, the evaluations of the Company’s internal controls and the overall quality of the Company’s financial reporting.
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors, and the Board
has approved, that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2022 (“2022 Form 10-K”), for filing with the Securities and Exchange Commission (the “SEC”). The Audit Committee has
selected PwC, subject to shareholder approval, as the Company’s independent auditors for the fiscal year ending December 31, 2023.
AUDIT COMMITTEE
John P. Surma (Chair)
Ann C. Berzin
April Miller Boise
John Bruton
Myles P. Lee
Melissa N. Schaeffer
The following table shows the fees paid or accrued by the Company for audit and other services provided by PwC for the fiscal years ended
December 31, 2022 and 2021:
2022
($)
2021
($)
9,930,000 9,545,000
332,000
77,000
1,707,000 1,835,000
16,000
14,000
11,985,000 11,471,000
Audit Fees(a)
Audit-Related Fees(b)
Tax Fees(c)
All Other Fees(d)
Total
(a)
(b)
(c)
(d)
documents filed with the SEC.
employee benefit plan audits.
Audit Fees for the fiscal years ended December 31, 2022 and 2021, respectively, were for professional services rendered for the audits of the Company’s annual
consolidated financial statements and its internal controls over financial reporting, including quarterly reviews, statutory audits, issuance of consents and review of
Audit-Related Fees for the fiscal year ended December 31, 2022 consist of assurance services that are related to performing the audit and review of certain financial
statements including employee benefit plan audits and Service Organization Control 2 (“SOC 2”) readiness pre-assessment and attestation reporting. Audit-Related Fees
for the fiscal year ended December 31, 2021 consist of assurance services that are related to performing the audit and review of certain financial statements including
Tax Fees for the fiscal years ended December 31, 2022 and 2021, respectively, include consulting and compliance services in the U.S. and non-U.S. locations.
All Other Fees for the fiscal years ended December 31, 2022 and 2021 include license fees for accounting and tax research tools and other software licenses.
The Audit Committee has adopted policies and procedures which require that the Audit Committee pre-approve all non-audit services that may
be provided to the Company by its independent auditors. The policy: (i) provides for pre-approval of an annual budget for each type of service;
(ii) requires Audit Committee approval of specific projects if not included in the approved budget; and (iii) requires Audit Committee approval if
the forecast of expenditures exceeds the approved budget on any type of service. The Audit Committee pre-approved all of the services
described under Audit-Related Fees, Tax Fees and All Other Fees. The Audit Committee has determined that the provision of all such non-
audit services is compatible with maintaining the independence of PwC.
ITEM
Renewal of the Directors’
Existing Authority to
Issue Shares
5
The Board of Directors recommends
that you vote FOR renewing the
Directors’ authority to issue shares.
Under Irish law, directors of an Irish public limited company must have authority from its shareholders to issue any shares, including shares
which are part of the Company’s authorized but unissued share capital. Our shareholders provided the Directors with this authorization at our
2022 Annual General Meeting on June 2, 2022 for a period of 18 months. Because this share authorization period will expire in December
2023, we are presenting this proposal to renew the Directors’ authority to issue our authorized shares on the terms set forth below.
We are seeking approval to authorize our Board of Directors to issue up to 20% of our issued ordinary share capital as of April 6, 2023 (the
latest practicable date before this Proxy Statement), for a period expiring 18 months from the passing of this resolution, unless renewed, varied
or revoked.
Granting the Board of Directors this authority is a routine matter for public companies incorporated in Ireland and is consistent with Irish market
practice. This authority is fundamental to our business and enables us to issue shares, including in connection with our equity compensation
plans (where required) and, if applicable, funding acquisitions and raising capital. We are not asking you to approve an increase in our
authorized share capital or to approve a specific issuance of shares. Instead, approval of this proposal will only grant the Board of Directors the
authority to issue shares that are already authorized under our articles of association upon the terms below. In addition, we note that, because
we are a NYSE-listed company, our shareholders continue to benefit from the protections afforded to them under the rules and regulations of
the NYSE and the SEC, including those rules that limit our ability to issue shares in specified circumstances. Furthermore, we note that this
authorization is required as a matter of Irish law and is not otherwise required for other non-Irish companies listed on the NYSE with whom we
compete. Renewal of the Directors’ existing authority to issue shares is fully consistent with NYSE rules and listing standards and with U.S.
capital markets practice and governance standards.
2023 Proxy Statement
25
26
Audit Committee Report
Fees of the Independent Auditors
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
While management has the primary responsibility for the financial statements and the financial reporting process, including the system of
internal controls, the Audit Committee reviews the Company’s audited financial statements and financial reporting process on behalf of the
Board of Directors. The independent auditors are responsible for performing an independent audit of the Company’s consolidated financial
statements in accordance with the standards of the Public Company Accounting Oversight Board (United States) (the “PCAOB”) and to issue a
report thereon. The Audit Committee monitors those processes. In this context, the Audit Committee has met and held discussions with
management and the independent auditors regarding the fair and complete presentation of the Company’s results. The Audit Committee has
discussed significant accounting policies applied by the Company in its financial statements, as well as alternative treatments. Management
has represented to the Audit Committee that the Company’s consolidated financial statements were prepared in accordance with United
States generally accepted accounting principles, and the Audit Committee has reviewed and discussed the consolidated financial statements
with management and the independent auditors. The Audit Committee also discussed with the independent auditors the matters required to
be discussed by Auditing Standard No. 1301, “Communications with Audit Committees” issued by the PCAOB.
In addition, the Audit Committee has received and reviewed the written disclosures and the letter from PwC required by the PCAOB regarding
PwC’s communications with the Audit Committee concerning independence and discussed with PwC the auditors’ independence from the
Company and its management in connection with the matters stated therein. The Audit Committee also considered whether the independent
auditors’ provision of non-audit services to the Company is compatible with the auditors’ independence. The Audit Committee has concluded
that the independent auditors are independent from the Company and its management.
The Audit Committee discussed with the Company’s internal and independent auditors the overall scope and plans for their respective audits.
The Audit Committee meets separately with the internal and independent auditors, with and without management present, to discuss the
results of their examinations, the evaluations of the Company’s internal controls and the overall quality of the Company’s financial reporting.
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors, and the Board
has approved, that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2022 (“2022 Form 10-K”), for filing with the Securities and Exchange Commission (the “SEC”). The Audit Committee has
selected PwC, subject to shareholder approval, as the Company’s independent auditors for the fiscal year ending December 31, 2023.
AUDIT COMMITTEE
John P. Surma (Chair)
Ann C. Berzin
April Miller Boise
John Bruton
Myles P. Lee
Melissa N. Schaeffer
The following table shows the fees paid or accrued by the Company for audit and other services provided by PwC for the fiscal years ended
December 31, 2022 and 2021:
Audit Fees(a)
Audit-Related Fees(b)
Tax Fees(c)
All Other Fees(d)
Total
2022
($)
2021
($)
9,930,000 9,545,000
332,000
77,000
1,707,000 1,835,000
16,000
14,000
11,985,000 11,471,000
(a)
(b)
(c)
(d)
Audit Fees for the fiscal years ended December 31, 2022 and 2021, respectively, were for professional services rendered for the audits of the Company’s annual
consolidated financial statements and its internal controls over financial reporting, including quarterly reviews, statutory audits, issuance of consents and review of
documents filed with the SEC.
Audit-Related Fees for the fiscal year ended December 31, 2022 consist of assurance services that are related to performing the audit and review of certain financial
statements including employee benefit plan audits and Service Organization Control 2 (“SOC 2”) readiness pre-assessment and attestation reporting. Audit-Related Fees
for the fiscal year ended December 31, 2021 consist of assurance services that are related to performing the audit and review of certain financial statements including
employee benefit plan audits.
Tax Fees for the fiscal years ended December 31, 2022 and 2021, respectively, include consulting and compliance services in the U.S. and non-U.S. locations.
All Other Fees for the fiscal years ended December 31, 2022 and 2021 include license fees for accounting and tax research tools and other software licenses.
The Audit Committee has adopted policies and procedures which require that the Audit Committee pre-approve all non-audit services that may
be provided to the Company by its independent auditors. The policy: (i) provides for pre-approval of an annual budget for each type of service;
(ii) requires Audit Committee approval of specific projects if not included in the approved budget; and (iii) requires Audit Committee approval if
the forecast of expenditures exceeds the approved budget on any type of service. The Audit Committee pre-approved all of the services
described under Audit-Related Fees, Tax Fees and All Other Fees. The Audit Committee has determined that the provision of all such non-
audit services is compatible with maintaining the independence of PwC.
ITEM
5
Renewal of the Directors’
Existing Authority to
Issue Shares
The Board of Directors recommends
that you vote FOR renewing the
Directors’ authority to issue shares.
Under Irish law, directors of an Irish public limited company must have authority from its shareholders to issue any shares, including shares
which are part of the Company’s authorized but unissued share capital. Our shareholders provided the Directors with this authorization at our
2022 Annual General Meeting on June 2, 2022 for a period of 18 months. Because this share authorization period will expire in December
2023, we are presenting this proposal to renew the Directors’ authority to issue our authorized shares on the terms set forth below.
We are seeking approval to authorize our Board of Directors to issue up to 20% of our issued ordinary share capital as of April 6, 2023 (the
latest practicable date before this Proxy Statement), for a period expiring 18 months from the passing of this resolution, unless renewed, varied
or revoked.
Granting the Board of Directors this authority is a routine matter for public companies incorporated in Ireland and is consistent with Irish market
practice. This authority is fundamental to our business and enables us to issue shares, including in connection with our equity compensation
plans (where required) and, if applicable, funding acquisitions and raising capital. We are not asking you to approve an increase in our
authorized share capital or to approve a specific issuance of shares. Instead, approval of this proposal will only grant the Board of Directors the
authority to issue shares that are already authorized under our articles of association upon the terms below. In addition, we note that, because
we are a NYSE-listed company, our shareholders continue to benefit from the protections afforded to them under the rules and regulations of
the NYSE and the SEC, including those rules that limit our ability to issue shares in specified circumstances. Furthermore, we note that this
authorization is required as a matter of Irish law and is not otherwise required for other non-Irish companies listed on the NYSE with whom we
compete. Renewal of the Directors’ existing authority to issue shares is fully consistent with NYSE rules and listing standards and with U.S.
capital markets practice and governance standards.
2023 Proxy Statement
25
26
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
As required under Irish law, the resolution in respect of this proposal is an ordinary resolution that requires the affirmative vote of a simple
majority of the votes cast.
The text of this resolution is as follows:
“That the Directors be and are hereby generally and unconditionally authorized with effect from the passing of this resolution to exercise all
powers of the Company to allot relevant securities (within the meaning of Section 1021 of the Companies Act 2014) up to an aggregate
nominal amount of $50,509,033 (50,509,033 shares) (being equivalent to approximately 20% of the aggregate nominal value of the issued
ordinary share capital of the Company as of April 6, 2023 (the latest practicable date before this Proxy Statement)), and the authority conferred
by this resolution shall expire 18 months from the passing of this resolution, unless previously renewed, varied or revoked; provided that the
Company may make an offer or agreement before the expiry of this authority, which would or might require any such securities to be allotted
after this authority has expired, and in that case, the Directors may allot relevant securities in pursuance of any such offer or agreement as if the
authority conferred hereby had not expired.”
ITEM
6
6
Renewal of the Directors’ Existing
Authority to Issue Shares for Cash
Without First Offering Shares to
Existing Shareholders
The Board of Directors recommends
that you vote FOR renewing the
Directors’ authority to issue shares for
cash without first offering shares to
existing shareholders.
Under Irish law, unless otherwise authorized, when an Irish public limited company issues shares for cash, it is required first to offer those
shares on the same or more favorable terms to existing shareholders of the Company on a pro-rata basis (commonly referred to as the
statutory pre-emption right). Our shareholders provided the Directors with this authorization at our 2022 Annual General Meeting on June 2,
2022 for a period of 18 months. Because this share authorization period will expire in December 2023, we are presenting this proposal to
renew the Directors’ authority to opt-out of the pre-emption right on the terms set forth below.
We are seeking approval to authorize our Board of Directors to opt out of the statutory pre-emption rights provision in the event of (1) the
issuance of shares for cash in connection with any rights issue and (2) any other issuance of shares for cash, if the issuance is limited to up
to 20% of our issued ordinary share capital as of April 6, 2023 (the latest practicable date before this Proxy Statement), for a period expiring
18 months from the passing of this resolution, unless renewed, varied or revoked.
Granting the Board of Directors this authority is a routine matter for public companies incorporated in Ireland and is consistent with Irish market
practice. Similar to the authorization sought for Item 5, this authority is fundamental to our business and enables us to issue shares under our
equity compensation plans (where required) and, if applicable, will facilitate our ability to fund acquisitions and otherwise raise capital. We are
not asking you to approve an increase in our authorized share capital. Instead, approval of this proposal will only grant the Board of Directors
the authority to issue shares in the manner already permitted under our articles of association upon the terms below. Without this authorization,
in each case where we issue shares for cash, we would first have to offer those shares on the same or more favorable terms to all of our
existing shareholders. This requirement could undermine the operation of our compensation plans and cause delays in the completion of
acquisitions and capital raising for our business. Furthermore, we note that this authorization is required as a matter of Irish law and is not
otherwise required for other non-Irish companies listed on the NYSE with whom we compete. Renewal of the Directors’ existing authorization
to opt out of the statutory pre-emption rights as described above is fully consistent with NYSE rules and listing standards and with U.S. capital
markets practice and governance standards.
As required under Irish law, the resolution in respect of this proposal is a special resolution that requires the affirmative vote of at least 75% of
the votes cast.
The text of the resolution in respect of this proposal is as follows:
“As a special resolution, that, subject to the passing of the resolution in respect of Item 5 as set out above and with effect from the passing
of this resolution, the Directors be and are hereby empowered pursuant to Section 1023 of the Companies Act 2014 to allot equity
securities (as defined in Section 1023 of that Act) for cash, pursuant to the authority conferred by Item 6 as if subsection (1) of Section
1022 did not apply to any such allotment, provided that this power shall be limited to:
a.
the allotment of equity securities in connection with a rights issue in favor of the holders of ordinary shares (including rights to subscribe
for, or convert into, ordinary shares) where the equity securities respectively attributable to the interests of such holders are proportional
(as nearly as may be) to the respective numbers of ordinary shares held by them (but subject to such exclusions or other arrangements
as the Directors may deem necessary or expedient to deal with fractional entitlements that would otherwise arise, or with legal or
practical problems under the laws of, or the requirements of any recognized regulatory body or any stock exchange in, any territory, or
otherwise); and
2023 Proxy Statement
27
28
b.
the allotment (otherwise than pursuant to sub-paragraph (a) above) of equity securities up to an aggregate nominal value of
$50,509,033 (50,509,033 shares) (being equivalent to approximately 20% of the aggregate nominal value of the issued ordinary share
capital of the Company as of April 6, 2023 (the latest practicable date before this Proxy Statement)) and the authority conferred by this
resolution shall expire 18 months from the passing of this resolution, unless previously renewed, varied or revoked; provided that the
Company may make an offer or agreement before the expiry of this authority, which would or might require any such securities to be
allotted after this authority has expired, and in that case, the Directors may allot equity securities in pursuance of any such offer or
agreement as if the authority conferred hereby had not expired.”
ITEM
Determine the Price at which the
Company Can Reallot Shares Held
7
as Treasury Shares
The Board of Directors recommends
that shareholders vote FOR the
proposal to determine the price at
which the Company can re-allot
shares held as treasury shares.
Our open-market share repurchases (redemptions) and other share buyback activities may result in ordinary shares being acquired and held by
the Company as treasury shares. We may reissue treasury shares that we acquire through our various share buyback activities including in
connection with our executive compensation program and our director programs.
Under Irish law, our shareholders must authorize the price range at which we may reallot any shares held in treasury. In this proposal, that price
range is expressed as a minimum and maximum percentage of the closing market price of our ordinary shares on the NYSE the day preceding
the day on which the relevant share is reallotted. Under Irish law, this authorization expires 18 months after its passing unless renewed.
The authority being sought from shareholders provides that the minimum and maximum prices at which an ordinary share held in treasury may
be reallotted are 95% and 120%, respectively, of the closing market price of the ordinary shares on the NYSE the day preceding the day on
which the relevant share is re-issued, except as described below with respect to obligations under employee share schemes, which may be at
a minimum price of nominal value. Any reallotment of treasury shares will be at price levels that the Board considers in the best interests of our
As required under Irish law, the resolution in respect of this proposal is a special resolution that requires the affirmative vote of at least 75% of
The text of the resolution in respect of this proposal is as follows:
“As a special resolution, that the reallotment price range at which any treasury shares held by the Company may be reallotted shall be as
the maximum price at which such treasury share may be re-allotted shall be an amount equal to 120% of the “market price”; and
the minimum price at which a treasury share may be re-allotted shall be the nominal value of the share where such a share is required
to satisfy an obligation under an employee share scheme or any option schemes operated by the Company or, in all other cases, an
amount equal to 95% of the “market price”; and
c.
for the purposes of this resolution, the “market price” shall mean the closing market price of the ordinary shares on the NYSE the day
preceding the day on which the relevant share is re-allotted.
FURTHER, that this authority to re-allot treasury shares shall expire at 18 months from the date of the passing of this resolution unless
previously varied or renewed in accordance with the provisions of Sections 109 and 1078 of the Companies Act 2014.”
shareholders.
the votes cast.
follows:
a.
b.
PROPOSALS REQUIRING YOUR VOTE
PROPOSALS REQUIRING YOUR VOTE
As required under Irish law, the resolution in respect of this proposal is an ordinary resolution that requires the affirmative vote of a simple
majority of the votes cast.
The text of this resolution is as follows:
“That the Directors be and are hereby generally and unconditionally authorized with effect from the passing of this resolution to exercise all
powers of the Company to allot relevant securities (within the meaning of Section 1021 of the Companies Act 2014) up to an aggregate
nominal amount of $50,509,033 (50,509,033 shares) (being equivalent to approximately 20% of the aggregate nominal value of the issued
ordinary share capital of the Company as of April 6, 2023 (the latest practicable date before this Proxy Statement)), and the authority conferred
by this resolution shall expire 18 months from the passing of this resolution, unless previously renewed, varied or revoked; provided that the
Company may make an offer or agreement before the expiry of this authority, which would or might require any such securities to be allotted
after this authority has expired, and in that case, the Directors may allot relevant securities in pursuance of any such offer or agreement as if the
authority conferred hereby had not expired.”
ITEM
Renewal of the Directors’ Existing
6
6
Authority to Issue Shares for Cash
Without First Offering Shares to
Existing Shareholders
The Board of Directors recommends
that you vote FOR renewing the
Directors’ authority to issue shares for
cash without first offering shares to
existing shareholders.
Under Irish law, unless otherwise authorized, when an Irish public limited company issues shares for cash, it is required first to offer those
shares on the same or more favorable terms to existing shareholders of the Company on a pro-rata basis (commonly referred to as the
statutory pre-emption right). Our shareholders provided the Directors with this authorization at our 2022 Annual General Meeting on June 2,
2022 for a period of 18 months. Because this share authorization period will expire in December 2023, we are presenting this proposal to
renew the Directors’ authority to opt-out of the pre-emption right on the terms set forth below.
We are seeking approval to authorize our Board of Directors to opt out of the statutory pre-emption rights provision in the event of (1) the
issuance of shares for cash in connection with any rights issue and (2) any other issuance of shares for cash, if the issuance is limited to up
to 20% of our issued ordinary share capital as of April 6, 2023 (the latest practicable date before this Proxy Statement), for a period expiring
18 months from the passing of this resolution, unless renewed, varied or revoked.
Granting the Board of Directors this authority is a routine matter for public companies incorporated in Ireland and is consistent with Irish market
practice. Similar to the authorization sought for Item 5, this authority is fundamental to our business and enables us to issue shares under our
equity compensation plans (where required) and, if applicable, will facilitate our ability to fund acquisitions and otherwise raise capital. We are
not asking you to approve an increase in our authorized share capital. Instead, approval of this proposal will only grant the Board of Directors
the authority to issue shares in the manner already permitted under our articles of association upon the terms below. Without this authorization,
in each case where we issue shares for cash, we would first have to offer those shares on the same or more favorable terms to all of our
existing shareholders. This requirement could undermine the operation of our compensation plans and cause delays in the completion of
acquisitions and capital raising for our business. Furthermore, we note that this authorization is required as a matter of Irish law and is not
otherwise required for other non-Irish companies listed on the NYSE with whom we compete. Renewal of the Directors’ existing authorization
to opt out of the statutory pre-emption rights as described above is fully consistent with NYSE rules and listing standards and with U.S. capital
markets practice and governance standards.
As required under Irish law, the resolution in respect of this proposal is a special resolution that requires the affirmative vote of at least 75% of
the votes cast.
The text of the resolution in respect of this proposal is as follows:
“As a special resolution, that, subject to the passing of the resolution in respect of Item 5 as set out above and with effect from the passing
of this resolution, the Directors be and are hereby empowered pursuant to Section 1023 of the Companies Act 2014 to allot equity
securities (as defined in Section 1023 of that Act) for cash, pursuant to the authority conferred by Item 6 as if subsection (1) of Section
1022 did not apply to any such allotment, provided that this power shall be limited to:
a.
the allotment of equity securities in connection with a rights issue in favor of the holders of ordinary shares (including rights to subscribe
for, or convert into, ordinary shares) where the equity securities respectively attributable to the interests of such holders are proportional
(as nearly as may be) to the respective numbers of ordinary shares held by them (but subject to such exclusions or other arrangements
as the Directors may deem necessary or expedient to deal with fractional entitlements that would otherwise arise, or with legal or
practical problems under the laws of, or the requirements of any recognized regulatory body or any stock exchange in, any territory, or
otherwise); and
b.
the allotment (otherwise than pursuant to sub-paragraph (a) above) of equity securities up to an aggregate nominal value of
$50,509,033 (50,509,033 shares) (being equivalent to approximately 20% of the aggregate nominal value of the issued ordinary share
capital of the Company as of April 6, 2023 (the latest practicable date before this Proxy Statement)) and the authority conferred by this
resolution shall expire 18 months from the passing of this resolution, unless previously renewed, varied or revoked; provided that the
Company may make an offer or agreement before the expiry of this authority, which would or might require any such securities to be
allotted after this authority has expired, and in that case, the Directors may allot equity securities in pursuance of any such offer or
agreement as if the authority conferred hereby had not expired.”
ITEM
7
Determine the Price at which the
Company Can Reallot Shares Held
as Treasury Shares
The Board of Directors recommends
that shareholders vote FOR the
proposal to determine the price at
which the Company can re-allot
shares held as treasury shares.
Our open-market share repurchases (redemptions) and other share buyback activities may result in ordinary shares being acquired and held by
the Company as treasury shares. We may reissue treasury shares that we acquire through our various share buyback activities including in
connection with our executive compensation program and our director programs.
Under Irish law, our shareholders must authorize the price range at which we may reallot any shares held in treasury. In this proposal, that price
range is expressed as a minimum and maximum percentage of the closing market price of our ordinary shares on the NYSE the day preceding
the day on which the relevant share is reallotted. Under Irish law, this authorization expires 18 months after its passing unless renewed.
The authority being sought from shareholders provides that the minimum and maximum prices at which an ordinary share held in treasury may
be reallotted are 95% and 120%, respectively, of the closing market price of the ordinary shares on the NYSE the day preceding the day on
which the relevant share is re-issued, except as described below with respect to obligations under employee share schemes, which may be at
a minimum price of nominal value. Any reallotment of treasury shares will be at price levels that the Board considers in the best interests of our
shareholders.
As required under Irish law, the resolution in respect of this proposal is a special resolution that requires the affirmative vote of at least 75% of
the votes cast.
The text of the resolution in respect of this proposal is as follows:
“As a special resolution, that the reallotment price range at which any treasury shares held by the Company may be reallotted shall be as
follows:
a.
b.
c.
the maximum price at which such treasury share may be re-allotted shall be an amount equal to 120% of the “market price”; and
the minimum price at which a treasury share may be re-allotted shall be the nominal value of the share where such a share is required
to satisfy an obligation under an employee share scheme or any option schemes operated by the Company or, in all other cases, an
amount equal to 95% of the “market price”; and
for the purposes of this resolution, the “market price” shall mean the closing market price of the ordinary shares on the NYSE the day
preceding the day on which the relevant share is re-allotted.
FURTHER, that this authority to re-allot treasury shares shall expire at 18 months from the date of the passing of this resolution unless
previously varied or renewed in accordance with the provisions of Sections 109 and 1078 of the Companies Act 2014.”
2023 Proxy Statement
27
28
Corporate Governance
Corporate Governance Guidelines
CORPORATE GOVERNANCE
evaluations and separation;
• Lead the Board of Directors in all deliberations involving the CEO’s employment, including hiring, contract negotiations, performance
• Engage and counsel the Chair and CEO on issues of interest/concern to directors, including majority and minority viewpoints, and
encourage all directors to engage the Chair and CEO with their interests and concerns;
• Work with the Chair and CEO to develop an appropriate schedule of Board meetings and approve such schedule, to ensure that the
directors have sufficient time for discussion of all agenda items, while not interfering with the flow of Company operations;
Our Corporate Governance Guidelines, together with the charters of the various Board committees, provide a framework for the corporate
governance of the Company. The following is a summary of our Corporate Governance Guidelines and practices. A copy of our Corporate
Governance Guidelines, as well as the charters of each of our Board committees, are available on our website at www.tranetechnologies.com
under the heading “About Us – Corporate Governance.”
• Set the agendas for Board meetings in collaboration with the Chair and CEO;
• Plan the agendas and chair executive sessions of the Board’s independent directors;
• Act as the primary liaison between the directors and the Chair and CEO;
• Provide advice and counsel to the Chair and CEO;
• Keep abreast of key Company activities and advise the Chair and CEO as to the quality, quantity and timeliness of the flow of information
from Company management that is necessary for the directors to effectively and responsibly perform their duties; although Company
management is responsible for the preparation of materials for the Board, the Lead Independent Director will approve information provided
to the Board and may specifically request the inclusion of certain material;
• Engage consultants who report directly to the Board and assist in recommending consultants that work directly for Board Committees;
• Work in conjunction with the Sustainability, Corporate Governance and Nominating Committee in compliance with Committee processes to
interview director candidates and make recommendations to the Board;
• Provide oversight and act as a liaison between management and the Board with respect to succession of the CEO and lead the Board in an
annual review of Board and CEO succession plans;
• Assist the Board and Company officers in assuring compliance with and implementation of the Company’s Governance Guidelines;
• Work in conjunction with the Sustainability, Corporate Governance and Nominating Committee to identify for appointment the members of
the various Board Committees, as well as selection of the Committee chairs;
• Be available for consultation and direct communication with major shareholders coordinating with the Chair and CEO;
• Make a commitment to serve in the role of Lead Independent Director for a minimum of three years; and
• Help set the tone and uphold the highest standards of ethics and integrity and encourage that throughout the Company.
Mr. Forsee has been the Company’s Lead Independent Director since the 2021 Annual General Meeting.
Role of the Board of Directors
The Company’s business is managed under the direction of the Board of Directors. The Board delegates to the Chief Executive Officer, and
through that individual to other senior management, the authority and responsibility for managing the Company’s business. The role of the
Board of Directors is to oversee the management and governance of the Company and monitor senior management’s performance.
Board Responsibilities
Among the Board of Directors’ core responsibilities are:
• Select individuals for Board membership and evaluate the performance of the Board, Board committees and individual directors;
• Select, monitor, evaluate and compensate senior management;
• Assure that management succession planning is adequate;
• Review and approve significant corporate actions;
• Review and monitor implementation of management’s strategic plans;
• Review and approve the Company’s annual operating plans and budgets;
• Monitor corporate performance and evaluate results compared to the strategic plans and other long-range goals;
• Review the Company’s financial controls and reporting systems;
• Review and approve the Company’s financial statements and financial reporting;
• Review the Company’s ethical standards and legal compliance programs and procedures;
• Oversee the Company’s management of enterprise risk; and
• Monitor relations with shareholders, employees and the communities in which the Company operates.
Board Leadership Structure
The positions of Chair of the Board and CEO at the Company are held by the same person, except in unusual circumstances, such as during a
CEO transition. This policy has worked well for the Company. It is the Board of Directors’ view that the Company’s corporate governance
principles, the quality, stature and substantive business knowledge of the members of the Board, as well as the Board’s culture of open
communication with the CEO and senior management are conducive to Board effectiveness with a combined Chair and CEO position.
In addition, the Board of Directors has a strong Lead Independent Director and it believes this role adequately addresses the need for
independent leadership and an organizational structure for the independent directors. The Board of Directors appoints a Lead Independent
Director from among the Board’s independent directors. The Lead Independent Director coordinates the activities of all of the Board’s
independent directors working with the Chair and CEO. The Lead Independent Director is the principal liaison with the CEO and ensures that
the Board of Directors has an open, trustful relationship with the Company’s senior management team. In addition to the duties of all directors,
as set forth in the Company’s Governance Guidelines, the specific responsibilities of the Lead Independent Director are as follows:
• Chair meetings of the independent directors;
• Ensure full participation and engagement of all Board members in deliberations;
2023 Proxy Statement
29
30
Corporate Governance
Corporate Governance Guidelines
CORPORATE GOVERNANCE
• Lead the Board of Directors in all deliberations involving the CEO’s employment, including hiring, contract negotiations, performance
evaluations and separation;
• Engage and counsel the Chair and CEO on issues of interest/concern to directors, including majority and minority viewpoints, and
encourage all directors to engage the Chair and CEO with their interests and concerns;
• Work with the Chair and CEO to develop an appropriate schedule of Board meetings and approve such schedule, to ensure that the
directors have sufficient time for discussion of all agenda items, while not interfering with the flow of Company operations;
Our Corporate Governance Guidelines, together with the charters of the various Board committees, provide a framework for the corporate
governance of the Company. The following is a summary of our Corporate Governance Guidelines and practices. A copy of our Corporate
Governance Guidelines, as well as the charters of each of our Board committees, are available on our website at www.tranetechnologies.com
under the heading “About Us – Corporate Governance.”
• Set the agendas for Board meetings in collaboration with the Chair and CEO;
• Plan the agendas and chair executive sessions of the Board’s independent directors;
• Act as the primary liaison between the directors and the Chair and CEO;
• Provide advice and counsel to the Chair and CEO;
• Keep abreast of key Company activities and advise the Chair and CEO as to the quality, quantity and timeliness of the flow of information
from Company management that is necessary for the directors to effectively and responsibly perform their duties; although Company
management is responsible for the preparation of materials for the Board, the Lead Independent Director will approve information provided
to the Board and may specifically request the inclusion of certain material;
• Engage consultants who report directly to the Board and assist in recommending consultants that work directly for Board Committees;
• Work in conjunction with the Sustainability, Corporate Governance and Nominating Committee in compliance with Committee processes to
interview director candidates and make recommendations to the Board;
• Provide oversight and act as a liaison between management and the Board with respect to succession of the CEO and lead the Board in an
annual review of Board and CEO succession plans;
• Assist the Board and Company officers in assuring compliance with and implementation of the Company’s Governance Guidelines;
• Work in conjunction with the Sustainability, Corporate Governance and Nominating Committee to identify for appointment the members of
the various Board Committees, as well as selection of the Committee chairs;
• Be available for consultation and direct communication with major shareholders coordinating with the Chair and CEO;
• Make a commitment to serve in the role of Lead Independent Director for a minimum of three years; and
• Help set the tone and uphold the highest standards of ethics and integrity and encourage that throughout the Company.
Mr. Forsee has been the Company’s Lead Independent Director since the 2021 Annual General Meeting.
Role of the Board of Directors
The Company’s business is managed under the direction of the Board of Directors. The Board delegates to the Chief Executive Officer, and
through that individual to other senior management, the authority and responsibility for managing the Company’s business. The role of the
Board of Directors is to oversee the management and governance of the Company and monitor senior management’s performance.
• Select individuals for Board membership and evaluate the performance of the Board, Board committees and individual directors;
Board Responsibilities
Among the Board of Directors’ core responsibilities are:
• Select, monitor, evaluate and compensate senior management;
• Assure that management succession planning is adequate;
• Review and approve significant corporate actions;
• Review and monitor implementation of management’s strategic plans;
• Review and approve the Company’s annual operating plans and budgets;
• Monitor corporate performance and evaluate results compared to the strategic plans and other long-range goals;
• Review the Company’s financial controls and reporting systems;
• Review and approve the Company’s financial statements and financial reporting;
• Review the Company’s ethical standards and legal compliance programs and procedures;
• Oversee the Company’s management of enterprise risk; and
• Monitor relations with shareholders, employees and the communities in which the Company operates.
Board Leadership Structure
The positions of Chair of the Board and CEO at the Company are held by the same person, except in unusual circumstances, such as during a
CEO transition. This policy has worked well for the Company. It is the Board of Directors’ view that the Company’s corporate governance
principles, the quality, stature and substantive business knowledge of the members of the Board, as well as the Board’s culture of open
communication with the CEO and senior management are conducive to Board effectiveness with a combined Chair and CEO position.
In addition, the Board of Directors has a strong Lead Independent Director and it believes this role adequately addresses the need for
independent leadership and an organizational structure for the independent directors. The Board of Directors appoints a Lead Independent
Director from among the Board’s independent directors. The Lead Independent Director coordinates the activities of all of the Board’s
independent directors working with the Chair and CEO. The Lead Independent Director is the principal liaison with the CEO and ensures that
the Board of Directors has an open, trustful relationship with the Company’s senior management team. In addition to the duties of all directors,
as set forth in the Company’s Governance Guidelines, the specific responsibilities of the Lead Independent Director are as follows:
• Chair meetings of the independent directors;
• Ensure full participation and engagement of all Board members in deliberations;
2023 Proxy Statement
29
30
Board Risk Oversight
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
SPOTLIGHT: RISK OVERSIGHT
The Board of Directors has oversight responsibility of the processes established to report and monitor systems for material risks applicable to
the Company. The Board of Directors has delegated to its various committees the oversight of risk management practices for categories of risk
relevant to their functions.
BOARD OF DIRECTORS
• The Board of Directors focuses on the Company’s general risk management strategy and the most significant risks facing the Company
and ensures that appropriate risk mitigation strategies are implemented by management.
• The full Board has oversight of strategic Human Capital Management risks and opportunities including succession planning, diversity and
inclusion, employee engagement, employee health and safety and development.
• The Board regularly receives reports from each Committee as to risk oversight within its areas of responsibility.
Audit Committee
Human Resources and Compensation Committee
BOARD COMMITTEES
• Oversees risks associated with the Company’s systems of
disclosure controls and internal controls over financial reporting, as
well as the Company’s compliance with legal and regulatory
requirements.
• Oversees the Company’s internal audit function.
• Oversees the Company’s cybersecurity programs and risks,
including Board level oversight for management’s actions with
respect to:
the practices, procedures and controls to identify, assess and
manage its key cybersecurity programs and risks;
the protection, confidentiality, integrity and availability of the
Company’s digital information, intellectual property and
compliance-protected data through the associated networks as
it relates to connected networks, suppliers, employees and
channel partners; and
the protection and privacy of data related to our customers.
(1)
(2)
(3)
• Discusses with management and the independent auditors the
Company’s policies with respect to risk assessment and risk
management, including the review and approval of a risk-based
audit plan.
• Considers risks related to the attraction and retention of talent
and risks related to the design of compensation programs and
arrangements.
Sustainability, Corporate Governance and Nominating
Committee
• Oversees risks associated with Board succession, conflicts of
interest, corporate governance and sustainability.
• Oversees risks associated with the Company’s performance
against its sustainability and ESG objectives, including the
impacts of climate change.
Finance Committee
• Oversees risks associated with foreign exchange, insurance,
liquidity, credit and debt.
MANAGEMENT
• Identification, assessment and management of risks through the Company’s Enterprise Risk Intelligence program and Committee.
• The Enterprise Risk Intelligence program and Committee are responsible for identifying and managing strategic risks within the
Company’s risk appetite and providing reasonable assurance regarding the achievement of these objectives.
• Risks are prioritized based upon potential impact, likelihood and vulnerability; an owner is assigned to each risk area to develop a risk
mitigation strategy; and key risk indicators are utilized to track progress against these objectives. The risk universe is reviewed regularly to
ensure the Company is addressing any potential changes in the risk landscape.
• The Company has appointed the Chief Financial Officer (“CFO”) as its Chief Risk Officer, and in that role, the Chief Risk Officer
periodically reports on risk management policies and practices to the relevant Board Committee or to the full Board so that any decisions
can be made as to any required changes in the Company’s risk management and mitigation strategies or in the Board’s oversight of
these. The Chief Risk Officer also reports on specific risks and risk mitigation action plans, including risk indicators to track progress.
Business Strategy
Environmental, Social and Governance Matters
One of the primary responsibilities of the Board of Directors is to
The Sustainability, Corporate Governance and Nominating
review and monitor implementation of management’s strategic plans.
Committee of our Board of Directors oversees risks associated with
Our Directors have deep experience and expertise in strategic
corporate governance and sustainability, including the development
planning and execution and use their experience to engage in active
and implementation of policies relating to Environmental, Social and
dialogue with management. The Board of Directors evaluates strategic
Governance (“ESG”) issues. The Sustainability, Corporate
plans through regular discussions as part of Board meetings and
Governance and Nominating Committee monitors the Company’s
during strategic planning sessions dedicated to these topics.
performance against its sustainability and ESG objectives including
the impacts of climate change. The Sustainability, Corporate
Governance and Nominating Committee also evaluates social and
environmental trends and issues in connection with the Company’s
business activities and makes recommendations to the Board
regarding those trends and issues.
The Technology and Innovation Committee assists the Board in its
oversight of the Company’s responses to certain environmental
matters including climate change, greenhouse gas emissions,
energy-efficient and low-emissions products and product life cycle
and materials, and supports as needed, the Sustainability,
Corporate Governance and Nominating Committee in its review of
environmental and sustainability practices.
Human Resources and Compensation
Cybersecurity
As part of its oversight of the Company’s executive compensation
Our cybersecurity strategy is overseen by the Audit Committee of
program, the Human Resources and Compensation Committee
our Board of Directors and directed by our Executive Vice
considers the impact of the Company’s executive compensation
President, Supply Chain, Engineering and Information Technology.
program and the incentives created by the compensation awards that
Our cybersecurity strategy, programs and policies are designed to
it administers on the Company’s risk profile. In addition, the Company
protect the company’s most important information and technology
reviews all of its compensation policies and procedures, including the
assets from an ever-evolving landscape of threats. Our
incentives that they create and factors that may reduce the likelihood
Audit Committee:
of excessive risk taking, to determine whether they present a
significant risk to the Company. Based on this review, the Company
has concluded that its compensation policies and procedures are not
reasonably likely to have a material adverse effect on the Company.
The Human Resources and Compensation Committee reviews and
discusses with the Sustainability, Corporate Governance and
Nominating Committee and the Audit Committee, as appropriate, the
Company’s “Human Capital Management” disclosure in the
Company’s Annual Report on Form 10-K. The Human Resources and
Compensation Committee also sets, reviews and approves annual
ESG factors for purposes of the Company’s Annual Incentive Matrix.
The Human Resources and Compensation Committee also reviews at
least annually and discusses with management key human resource
management initiatives related to leadership talent recruitment,
retention, diversity and inclusion, pay equity and hourly wages.
• Maintains appropriate oversight of the Company’s IT
cybersecurity governance, strategy and compliance
• Oversees management’s implementation of cybersecurity
programs and risk policies and procedures and oversees
management’s actions to ensure their effectiveness in
maintaining the integrity of the Company’s electronic systems
and facilities.
• Oversees the Company’s efforts to comply with regulatory
requirements relating to cybersecurity matters, including but not
limited to the implementation of any remediation or other
measures in response to regulatory findings.
Senior management briefs the Audit Committee regarding
cybersecurity at least three times per year and reports to the Board
on a regular basis. We have cybersecurity insurance and we
regularly review our policy and levels of coverage based on current
risks. All salaried employees complete an annual cybersecurity
training program, where specific threats and scenarios are
highlighted, based on our analysis of current risks to the
organization.
The Technology and Innovation Committee supports, as requested,
the Audit Committee in its review of the Company’s information
technology and cybersecurity policies and practices.
2023 Proxy Statement
31
32
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Board Risk Oversight
The Board of Directors has oversight responsibility of the processes established to report and monitor systems for material risks applicable to
the Company. The Board of Directors has delegated to its various committees the oversight of risk management practices for categories of risk
relevant to their functions.
BOARD OF DIRECTORS
• The Board of Directors focuses on the Company’s general risk management strategy and the most significant risks facing the Company
and ensures that appropriate risk mitigation strategies are implemented by management.
• The full Board has oversight of strategic Human Capital Management risks and opportunities including succession planning, diversity and
inclusion, employee engagement, employee health and safety and development.
• The Board regularly receives reports from each Committee as to risk oversight within its areas of responsibility.
SPOTLIGHT: RISK OVERSIGHT
Business Strategy
One of the primary responsibilities of the Board of Directors is to
review and monitor implementation of management’s strategic plans.
Our Directors have deep experience and expertise in strategic
planning and execution and use their experience to engage in active
dialogue with management. The Board of Directors evaluates strategic
plans through regular discussions as part of Board meetings and
during strategic planning sessions dedicated to these topics.
BOARD COMMITTEES
Audit Committee
Human Resources and Compensation Committee
• Oversees risks associated with the Company’s systems of
disclosure controls and internal controls over financial reporting, as
well as the Company’s compliance with legal and regulatory
arrangements.
• Considers risks related to the attraction and retention of talent
and risks related to the design of compensation programs and
requirements.
respect to:
• Oversees the Company’s internal audit function.
Committee
• Oversees the Company’s cybersecurity programs and risks,
including Board level oversight for management’s actions with
Sustainability, Corporate Governance and Nominating
• Oversees risks associated with Board succession, conflicts of
interest, corporate governance and sustainability.
• Oversees risks associated with the Company’s performance
against its sustainability and ESG objectives, including the
(1) the practices, procedures and controls to identify, assess and
manage its key cybersecurity programs and risks;
(2) the protection, confidentiality, integrity and availability of the
Company’s digital information, intellectual property and
impacts of climate change.
Finance Committee
compliance-protected data through the associated networks as
• Oversees risks associated with foreign exchange, insurance,
it relates to connected networks, suppliers, employees and
liquidity, credit and debt.
channel partners; and
(3) the protection and privacy of data related to our customers.
• Discusses with management and the independent auditors the
Company’s policies with respect to risk assessment and risk
management, including the review and approval of a risk-based
audit plan.
MANAGEMENT
• Identification, assessment and management of risks through the Company’s Enterprise Risk Intelligence program and Committee.
• The Enterprise Risk Intelligence program and Committee are responsible for identifying and managing strategic risks within the
Company’s risk appetite and providing reasonable assurance regarding the achievement of these objectives.
• Risks are prioritized based upon potential impact, likelihood and vulnerability; an owner is assigned to each risk area to develop a risk
mitigation strategy; and key risk indicators are utilized to track progress against these objectives. The risk universe is reviewed regularly to
ensure the Company is addressing any potential changes in the risk landscape.
• The Company has appointed the Chief Financial Officer (“CFO”) as its Chief Risk Officer, and in that role, the Chief Risk Officer
periodically reports on risk management policies and practices to the relevant Board Committee or to the full Board so that any decisions
can be made as to any required changes in the Company’s risk management and mitigation strategies or in the Board’s oversight of
these. The Chief Risk Officer also reports on specific risks and risk mitigation action plans, including risk indicators to track progress.
Human Resources and Compensation
As part of its oversight of the Company’s executive compensation
program, the Human Resources and Compensation Committee
considers the impact of the Company’s executive compensation
program and the incentives created by the compensation awards that
it administers on the Company’s risk profile. In addition, the Company
reviews all of its compensation policies and procedures, including the
incentives that they create and factors that may reduce the likelihood
of excessive risk taking, to determine whether they present a
significant risk to the Company. Based on this review, the Company
has concluded that its compensation policies and procedures are not
reasonably likely to have a material adverse effect on the Company.
The Human Resources and Compensation Committee reviews and
discusses with the Sustainability, Corporate Governance and
Nominating Committee and the Audit Committee, as appropriate, the
Company’s “Human Capital Management” disclosure in the
Company’s Annual Report on Form 10-K. The Human Resources and
Compensation Committee also sets, reviews and approves annual
ESG factors for purposes of the Company’s Annual Incentive Matrix.
The Human Resources and Compensation Committee also reviews at
least annually and discusses with management key human resource
management initiatives related to leadership talent recruitment,
retention, diversity and inclusion, pay equity and hourly wages.
2023 Proxy Statement
31
32
Environmental, Social and Governance Matters
The Sustainability, Corporate Governance and Nominating
Committee of our Board of Directors oversees risks associated with
corporate governance and sustainability, including the development
and implementation of policies relating to Environmental, Social and
Governance (“ESG”) issues. The Sustainability, Corporate
Governance and Nominating Committee monitors the Company’s
performance against its sustainability and ESG objectives including
the impacts of climate change. The Sustainability, Corporate
Governance and Nominating Committee also evaluates social and
environmental trends and issues in connection with the Company’s
business activities and makes recommendations to the Board
regarding those trends and issues.
The Technology and Innovation Committee assists the Board in its
oversight of the Company’s responses to certain environmental
matters including climate change, greenhouse gas emissions,
energy-efficient and low-emissions products and product life cycle
and materials, and supports as needed, the Sustainability,
Corporate Governance and Nominating Committee in its review of
environmental and sustainability practices.
Cybersecurity
Our cybersecurity strategy is overseen by the Audit Committee of
our Board of Directors and directed by our Executive Vice President,
Supply Chain, Engineering and Information Technology. Our
cybersecurity strategy, programs and policies are designed to
protect the Company’s most important information and
technology assets from an ever-evolving landscape of threats. Our
Audit Committee:
• Maintains appropriate oversight of the Company’s IT
cybersecurity governance, strategy and compliance
• Oversees management’s implementation of cybersecurity
programs and risk policies and procedures and oversees
management’s actions to ensure their effectiveness in
maintaining the integrity of the Company’s electronic systems
and facilities.
• Oversees the Company’s efforts to comply with regulatory
requirements relating to cybersecurity matters, including but
not limited to the implementation of any remediation or other
measures in response to regulatory findings.
Senior management briefs the Audit Committee regarding
cybersecurity at least three times per year and reports to the
Board on a regular basis. We have cybersecurity insurance and
we regularly review our policy and levels of coverage based on
current risks. All salaried employees complete an annual
cybersecurity training program, where specific threats and
scenarios are highlighted, based on our analysis of current risks
to the organization.
The Technology and Innovation Committee supports, as requested,
the Audit Committee in its review of the Company’s information
technology and cybersecurity policies and practices.
Director Compensation and Share Ownership
Director Retirement
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
It is the policy of the Board of Directors that directors’ fees be the sole compensation received from the Company by any non-employee
director. The Company has a share ownership requirement of five times the annual cash retainer paid to the directors. A director cannot sell
any shares of Company stock until they attain such level of ownership and any sale thereafter cannot reduce the total number of holdings
below the required ownership level. A director is required to retain this minimum level of Company share ownership until their resignation or
retirement from the Board.
Board Committees
The Board of Directors has the following committees: Audit Committee, Human Resources and Compensation Committee, Sustainability,
Corporate Governance and Nominating Committee, Finance Committee, Technology and Innovation Committee and Executive Committee.
The Board of Directors consists of a substantial majority of independent, non-employee directors. Only non-employee directors serve on the
Audit, Human Resources and Compensation, Sustainability, Corporate Governance and Nominating, Finance and Technology and Innovation
Committees. The Board of Directors has determined that each member of each of these committees is “independent” as defined in the NYSE
listing standards and the Company’s Guidelines for Determining Independence of Directors. Chairpersons and members of these five
committees are rotated periodically, as appropriate. The Chair and CEO serves on the Company’s Executive Committee and is Chair of that
Committee. The remainder of the Executive Committee is comprised of the Lead Independent Director and the non-employee director
Chairpersons of the Audit, Human Resources and Compensation, Sustainability, Corporate Governance and Nominating and Finance
Committees.
Board Diversity
The Company’s policy on Board diversity relates to the selection of nominees for the Board of Directors. In selecting a nominee for the Board,
the Sustainability, Corporate Governance and Nominating Committee considers the skills, expertise and background that would complement
the existing Board and ensure that its members are of sufficiently diverse and independent backgrounds, recognizing that the Company’s
businesses and operations are diverse and global in nature. The Board of Directors is nominating five female directors (Ms. Arnold, Ms. Berzin,
Ms. Miller Boise, Ms. Hudson and Ms. Schaeffer), one Black director (Ms. Miller Boise) and one international director who is an Irish citizen (Mr.
Lee) out of a total of 11 directors. In addition, the tenure and experience of our directors is varied, which brings varying perspectives to our
Board functionality.
Board Advisors
The Board of Directors and its committees may, under their respective charters, retain their own advisors to carry out their responsibilities.
Executive Sessions
The Company’s independent directors meet privately in regularly scheduled executive sessions, without management present, to consider
such matters as the independent directors deem appropriate. These executive sessions are required to be held no less than twice each year.
Board and Board Committee Performance Evaluation
The Sustainability, Corporate Governance and Nominating Committee assists the Board in evaluating its performance and the performance of
the Board committees. Each committee also conducts an annual self-evaluation. The effectiveness of individual directors is considered each
year when the directors stand for re-nomination.
Director Orientation and Education
The Company has developed an orientation program for new directors and provides continuing education for all directors. In addition, the
directors are given full access to management and corporate staff as a means of providing additional information.
2023 Proxy Statement
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34
It is the policy of the Board of Directors that each non-employee director must retire at the annual general meeting immediately following their
75th birthday. An exception to the director retirement policy was made in 2022 for Mr. Bruton and Mr. White who were asked to remain
members of the Board of Directors until the 2023 Annual General Meeting in order to provide continuity after the Company’s CEO succession.
They along with Mr. Cohon, who turned age 75 prior to the 2023 Annual General Meeting, are retiring at the 2023 Annual General Meeting in
accordance with our Corporate Governance Guidelines.
Directors who change the occupation they held when initially elected must offer to resign from the Board of Directors. At that time, the
Sustainability, Corporate Governance and Nominating Committee reviews the continued appropriateness of Board membership under the new
circumstances and makes a recommendation to the Board of Directors. Employee directors, including the CEO, must retire from the Board of
Directors at the time of a change in their status as an officer of the Company, unless the policy is waived by the Board.
Director Independence
The Board of Directors has determined that all of our current directors, except Mr. Regnery, who is an employee of the Company, are
independent under the standards set forth in Exhibit I to our Corporate Governance Guidelines, which are consistent with the NYSE listing
standards. In determining the independence of directors, the Board evaluated transactions between the Company and entities with which
directors were affiliated that occurred in the ordinary course of business and that were provided on the same terms and conditions available to
Exhibit I to our Corporate Governance Guidelines is available on our website, www.tranetechnologies.com, under the heading “About Us—
other customers.
Corporate Governance.”
Communications with Directors
Shareholders and other interested parties wishing to communicate with the Board of Directors, the non-employee directors or any individual
director (including our Lead Independent Director and Human Resources and Compensation Committee Chair) may do so either by sending a
communication to the Board and/or a particular Board member, in care of the Secretary of the Company, or by e-mail at
board@tranetechnologies.com. Depending upon the nature of the communication and to whom it is directed, the Secretary will: (a) forward the
communication to the appropriate director or directors; (b) forward the communication to the relevant department within the Company; or (c)
attempt to handle the matter directly (for example, a communication dealing with a share ownership matter).
Management Succession Planning
One of the core functions of our Board of Directors is ensuring leadership continuity and strong management capabilities to effectively carry out
the Company’s strategy are critical responsibilities of the Board. The Board collaborates with the Chair and CEO and the Senior Vice President
and Chief Human Resources Officer on the succession planning process, including establishing selection criteria that reflect our business
strategies, and identifying and developing internal candidates. The Board also ensures there are successors available for key positions in the
normal course of business and for emergency situations.
The full Board formally reviews, at least annually, the plans for development, retention and replacement of key executives, and most importantly
the Chair and CEO. In addition, management succession for key leadership positions is discussed regularly by the directors in Board meetings
and in executive sessions of the Board of Directors. Directors become familiar with potential successors for key leadership positions through
various means including regular talent reviews, presentations to the Board and informal meetings.
Director Compensation and Share Ownership
Director Retirement
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
It is the policy of the Board of Directors that directors’ fees be the sole compensation received from the Company by any non-employee
director. The Company has a share ownership requirement of five times the annual cash retainer paid to the directors. A director cannot sell
any shares of Company stock until they attain such level of ownership and any sale thereafter cannot reduce the total number of holdings
below the required ownership level. A director is required to retain this minimum level of Company share ownership until their resignation or
retirement from the Board.
Board Committees
The Board of Directors has the following committees: Audit Committee, Human Resources and Compensation Committee, Sustainability,
Corporate Governance and Nominating Committee, Finance Committee, Technology and Innovation Committee and Executive Committee.
The Board of Directors consists of a substantial majority of independent, non-employee directors. Only non-employee directors serve on the
Audit, Human Resources and Compensation, Sustainability, Corporate Governance and Nominating, Finance and Technology and Innovation
Committees. The Board of Directors has determined that each member of each of these committees is “independent” as defined in the NYSE
listing standards and the Company’s Guidelines for Determining Independence of Directors. Chairpersons and members of these five
committees are rotated periodically, as appropriate. The Chair and CEO serves on the Company’s Executive Committee and is Chair of that
Committee. The remainder of the Executive Committee is comprised of the Lead Independent Director and the non-employee director
Chairpersons of the Audit, Human Resources and Compensation, Sustainability, Corporate Governance and Nominating and Finance
The Company’s policy on Board diversity relates to the selection of nominees for the Board of Directors. In selecting a nominee for the Board,
the Sustainability, Corporate Governance and Nominating Committee considers the skills, expertise and background that would complement
the existing Board and ensure that its members are of sufficiently diverse and independent backgrounds, recognizing that the Company’s
businesses and operations are diverse and global in nature. The Board of Directors is nominating five female directors (Ms. Arnold, Ms. Berzin,
Ms. Miller Boise, Ms. Hudson and Ms. Schaeffer), one Black director (Ms. Miller Boise) and one international director who is an Irish citizen (Mr.
Lee) out of a total of 11 directors. In addition, the tenure and experience of our directors is varied, which brings varying perspectives to our
Committees.
Board Diversity
Board functionality.
Board Advisors
Executive Sessions
The Board of Directors and its committees may, under their respective charters, retain their own advisors to carry out their responsibilities.
The Company’s independent directors meet privately in regularly scheduled executive sessions, without management present, to consider
such matters as the independent directors deem appropriate. These executive sessions are required to be held no less than twice each year.
Board and Board Committee Performance Evaluation
The Sustainability, Corporate Governance and Nominating Committee assists the Board in evaluating its performance and the performance of
the Board committees. Each committee also conducts an annual self-evaluation. The effectiveness of individual directors is considered each
year when the directors stand for re-nomination.
Director Orientation and Education
The Company has developed an orientation program for new directors and provides continuing education for all directors. In addition, the
directors are given full access to management and corporate staff as a means of providing additional information.
It is the policy of the Board of Directors that each non-employee director must retire at the annual general meeting immediately following their
75th birthday. An exception to the director retirement policy was made in 2022 for Mr. Bruton and Mr. White who were asked to remain
members of the Board of Directors until the 2023 Annual General Meeting in order to provide continuity after the Company’s CEO succession.
They along with Mr. Cohon, who turned age 75 prior to the 2023 Annual General Meeting, are retiring at the 2023 Annual General Meeting in
accordance with our Corporate Governance Guidelines.
Directors who change the occupation they held when initially elected must offer to resign from the Board of Directors. At that time, the
Sustainability, Corporate Governance and Nominating Committee reviews the continued appropriateness of Board membership under the new
circumstances and makes a recommendation to the Board of Directors. Employee directors, including the CEO, must retire from the Board of
Directors at the time of a change in their status as an officer of the Company, unless the policy is waived by the Board.
Director Independence
The Board of Directors has determined that all of our current directors, except Mr. Regnery, who is an employee of the Company, are
independent under the standards set forth in Exhibit I to our Corporate Governance Guidelines, which are consistent with the NYSE listing
standards. In determining the independence of directors, the Board evaluated transactions between the Company and entities with which
directors were affiliated that occurred in the ordinary course of business and that were provided on the same terms and conditions available to
other customers.
Exhibit I to our Corporate Governance Guidelines is available on our website, www.tranetechnologies.com, under the heading “About Us—
Corporate Governance.”
Communications with Directors
Shareholders and other interested parties wishing to communicate with the Board of Directors, the non-employee directors or any individual
director (including our Lead Independent Director and Human Resources and Compensation Committee Chair) may do so either by sending a
communication to the Board and/or a particular Board member, in care of the Secretary of the Company, or by e-mail at
board@tranetechnologies.com. Depending upon the nature of the communication and to whom it is directed, the Secretary will: (a) forward the
communication to the appropriate director or directors; (b) forward the communication to the relevant department within the Company; or (c)
attempt to handle the matter directly (for example, a communication dealing with a share ownership matter).
Management Succession Planning
One of the core functions of our Board of Directors is ensuring leadership continuity and strong management capabilities to effectively carry out
the Company’s strategy are critical responsibilities of the Board. The Board collaborates with the Chair and CEO and the Senior Vice President
and Chief Human Resources Officer on the succession planning process, including establishing selection criteria that reflect our business
strategies, and identifying and developing internal candidates. The Board also ensures there are successors available for key positions in the
normal course of business and for emergency situations.
The full Board formally reviews, at least annually, the plans for development, retention and replacement of key executives, and most importantly
the Chair and CEO. In addition, management succession for key leadership positions is discussed regularly by the directors in Board meetings
and in executive sessions of the Board of Directors. Directors become familiar with potential successors for key leadership positions through
various means including regular talent reviews, presentations to the Board and informal meetings.
2023 Proxy Statement
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34
Code of Conduct
Committees of the Board and Attendance
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Audit Committee
Meetings in 2022: 9
Members
John P. Surma (Chair)
Ann C. Berzin
April Miller Boise
John Bruton
Myles P. Lee
Melissa N. Schaeffer
Key Functions
• Review annual audited and quarterly financial statements, as well as the Company’s disclosures under
“Management’s Discussion and Analysis of Financial Conditions and Results of Operations,” in the
Company’s Annual Report on Form 10-K with management and the independent auditors.
• Obtain and review periodic reports, at least annually, from management assessing the effectiveness of
the Company’s internal controls and procedures for financial reporting.
• Review the Company’s processes to assure compliance with all applicable laws, regulations and
corporate policy.
• Recommend the public accounting firm to be proposed for appointment by the shareholders as our
independent auditors and review the performance of the independent auditors.
• Review the scope of the audit and the findings and approve the fees of the independent auditors.
• Approve in advance, subject to and in accordance with applicable laws and regulations, permitted
audit and non-audit services to be performed by the independent auditors.
• Satisfy itself as to the independence of the independent auditors and ensure receipt of their annual
independence statement.
• Discuss with management and the independent auditors the Company’s policies with respect to risk
assessment and risk management, including the review and approval of a risk-based audit plan.
• Oversee the Company’s cybersecurity programs and risks.
• Review the Company’s internal audit organization and the objectives and scope of the internal audit function
and examinations.
• Review and discuss with management and the Sustainability, Corporate Governance and Nominating
Committee and the Human Resources and Compensation Committee, as appropriate, the “Human
Capital Management” disclosure to be included in the Company’s Annual Report on Form 10-K.
The Board of Directors has determined that each member of the Audit Committee is “independent” for
the purposes of the applicable rules and regulations of the SEC, as defined in the NYSE listing
standards and the Company’s Corporate Governance Guidelines, and has determined that all
members other than one meet the qualifications of an “audit committee financial expert,” as that term is
defined by rules of the SEC. In addition, each member of the Audit Committee qualifies as an
independent director, meets the financial literacy and independence requirements of the Securities and
Exchange Commission (the “SEC”) and the NYSE applicable to audit committee members and
possesses the requisite competence in accounting or auditing in satisfaction of the requirements for
audit committees prescribed by the Companies Act 2014.
A copy of the charter of the Audit Committee is available on our website, www.tranetechnologies.com,
under the heading “About Us—Corporate Governance – Board Committees and Charters.”
The Company has adopted a worldwide Code of Conduct, applicable to all employees, directors and officers, including our Chair and CEO, our
CFO and our Chief Accounting Officer. The Code of Conduct meets the requirements of a “code of ethics” as defined by Item 406 of
Regulation S-K, as well as the requirements of a “code of business conduct and ethics” under the NYSE listing standards. The Code of
Conduct covers topics including, but not limited to, conflicts of interest, confidentiality of information and compliance with laws and regulations.
A copy of the Code of Conduct is available on our website located at www.tranetechnologies.com under the heading “About Us—Corporate
Governance.” Amendments to, or waivers of the provisions of, the Code of Conduct, if any, made with respect to any of our directors and
executive officers will be posted on our website.
Anti-Hedging Policy and Other Restrictions
The Company prohibits its directors and executive officers from (i) purchasing any financial instruments designed to hedge or offset any
decrease in the market value of Company securities, (ii) engaging in any form of short-term speculative trading in Company securities and (iii)
holding Company securities in a margin account or pledging Company securities as collateral for a loan.
Investor Outreach
We believe understanding both current and prospective shareholders’ perspectives and building strong relationships with the investment
community is integral to effective corporate governance. Our Board of Directors and management team are committed to the development and
execution of comprehensive outreach and communications programs that support and encourage open dialogue with shareholders to achieve
these goals. We actively utilize formal targeting, surveillance and corporate risk management tools to develop, track and monitor our progress,
and we regularly adjust our programs throughout the year to maximize the effectiveness of our engagement. Our engagement program
regularly includes our Chair and CEO, CFO and other members of our executive leadership team, including segment leaders, strategic business
unit presidents and functional leaders.
How We Engaged with our Shareholders in 2022:
• We met with approximately 250 unique investors, including shareholders representing approximately 80% of our active outstanding shares.
• We met with approximately 90% of our top 30 active shareholders and prospective holders, many of them multiple times throughout
the year.
• We held hundreds of meetings with shareholders, including 10 industry conferences, five non-deal roadshows, as well as onsite meetings,
videoconferences and teleconferences.
• During investor interactions, we regularly discuss issues such as Company strategy, financial performance, corporate governance, ESG,
cash generation and capital deployment, innovation, and other opportunities and risks.
• We report our shareholders’ views around major topics, including ESG, to our management team and Board of Directors on a regular basis
and proactively incorporate feedback into our investor engagement and communications programs.
Sustainability
At Trane Technologies, sustainability is core to who we are. Through the leadership of our CEO and senior leaders, we have embedded
sustainability into every aspect of how we operate and help our customers succeed. Our approach and initiatives are guided by an external
Advisory Council on Sustainability and regularly reviewed by our senior management and Board of Directors. Day-to-day, our Center for Energy
Efficiency and Sustainability team surveys the market landscape, continually bringing new ideas and requirements forward. This team is also
responsible for tracking and disclosing our progress.
For more information regarding our Company’s commitment to leadership in ESG matters and our achievements in these areas, please also
see “A Letter from Our Board of Directors” at the beginning of this Proxy Statement, our 2022 Annual Report to Shareholders included in these
proxy materials and our ESG Report available on our website located at www.tranetechnologies.com/ESG. For more information regarding our
achievements in ESG matters, please see “ESG Performance Highlights” in our “Compensation Discussion and Analysis.”
2023 Proxy Statement
35
36
Code of Conduct
Committees of the Board and Attendance
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
The Company has adopted a worldwide Code of Conduct, applicable to all employees, directors and officers, including our Chair and CEO, our
CFO and our Chief Accounting Officer. The Code of Conduct meets the requirements of a “code of ethics” as defined by Item 406 of
Regulation S-K, as well as the requirements of a “code of business conduct and ethics” under the NYSE listing standards. The Code of
Conduct covers topics including, but not limited to, conflicts of interest, confidentiality of information and compliance with laws and regulations.
A copy of the Code of Conduct is available on our website located at www.tranetechnologies.com under the heading “About Us—Corporate
Governance.” Amendments to, or waivers of the provisions of, the Code of Conduct, if any, made with respect to any of our directors and
executive officers will be posted on our website.
Anti-Hedging Policy and Other Restrictions
The Company prohibits its directors and executive officers from (i) purchasing any financial instruments designed to hedge or offset any
decrease in the market value of Company securities, (ii) engaging in any form of short-term speculative trading in Company securities and (iii)
holding Company securities in a margin account or pledging Company securities as collateral for a loan.
Investor Outreach
We believe understanding both current and prospective shareholders’ perspectives and building strong relationships with the investment
community is integral to effective corporate governance. Our Board of Directors and management team are committed to the development and
execution of comprehensive outreach and communications programs that support and encourage open dialogue with shareholders to achieve
these goals. We actively utilize formal targeting, surveillance and corporate risk management tools to develop, track and monitor our progress,
and we regularly adjust our programs throughout the year to maximize the effectiveness of our engagement. Our engagement program
regularly includes our Chair and CEO, CFO and other members of our executive leadership team, including segment leaders, strategic business
unit presidents and functional leaders.
How We Engaged with our Shareholders in 2022:
the year.
videoconferences and teleconferences.
• We met with approximately 250 unique investors, including shareholders representing approximately 80% of our active outstanding shares.
• We met with approximately 90% of our top 30 active shareholders and prospective holders, many of them multiple times throughout
• We held hundreds of meetings with shareholders, including 10 industry conferences, five non-deal roadshows, as well as onsite meetings,
• During investor interactions, we regularly discuss issues such as Company strategy, financial performance, corporate governance, ESG,
cash generation and capital deployment, innovation, and other opportunities and risks.
• We report our shareholders’ views around major topics, including ESG, to our management team and Board of Directors on a regular basis
and proactively incorporate feedback into our investor engagement and communications programs.
Sustainability
At Trane Technologies, sustainability is core to who we are. Through the leadership of our CEO and senior leaders, we have embedded
sustainability into every aspect of how we operate and help our customers succeed. Our approach and initiatives are guided by an external
Advisory Council on Sustainability and regularly reviewed by our senior management and Board of Directors. Day-to-day, our Center for Energy
Efficiency and Sustainability team surveys the market landscape, continually bringing new ideas and requirements forward. This team is also
responsible for tracking and disclosing our progress.
For more information regarding our Company’s commitment to leadership in ESG matters and our achievements in these areas, please also
see “A Letter from Our Board of Directors” at the beginning of this Proxy Statement, our 2022 Annual Report to Shareholders included in these
proxy materials and our ESG Report available on our website located at www.tranetechnologies.com/ESG. For more information regarding our
achievements in ESG matters, please see “ESG Performance Highlights” in our “Compensation Discussion and Analysis.”
Audit Committee
Meetings in 2022: 9
Members
John P. Surma (Chair)
Ann C. Berzin
April Miller Boise
John Bruton
Myles P. Lee
Melissa N. Schaeffer
Key Functions
• Review annual audited and quarterly financial statements, as well as the Company’s disclosures under
“Management’s Discussion and Analysis of Financial Conditions and Results of Operations,” in the
Company’s Annual Report on Form 10-K with management and the independent auditors.
• Obtain and review periodic reports, at least annually, from management assessing the effectiveness of
the Company’s internal controls and procedures for financial reporting.
• Review the Company’s processes to assure compliance with all applicable laws, regulations and
corporate policy.
• Recommend the public accounting firm to be proposed for appointment by the shareholders as our
independent auditors and review the performance of the independent auditors.
• Review the scope of the audit and the findings and approve the fees of the independent auditors.
• Approve in advance, subject to and in accordance with applicable laws and regulations, permitted
audit and non-audit services to be performed by the independent auditors.
• Satisfy itself as to the independence of the independent auditors and ensure receipt of their annual
independence statement.
• Discuss with management and the independent auditors the Company’s policies with respect to risk
assessment and risk management, including the review and approval of a risk-based audit plan.
• Oversee the Company’s cybersecurity programs and risks.
• Review the Company’s internal audit organization and the objectives and scope of the internal audit
function and examinations.
• Review and discuss with management and the Sustainability, Corporate Governance and Nominating
Committee and the Human Resources and Compensation Committee, as appropriate, the “Human
Capital Management” disclosure to be included in the Company’s Annual Report on Form 10-K.
The Board of Directors has determined that each member of the Audit Committee is “independent” for
the purposes of the applicable rules and regulations of the Securities and Exchange Commission (the
“SEC”), as defined in the NYSE listing standards and the Company’s Corporate Governance
Guidelines, and has determined that all members other than one meet the qualifications of an “audit
committee financial expert,” as that term is defined by rules of the SEC. In addition, each member of
the Audit Committee qualifies as an independent director, meets the financial literacy and
independence requirements of the SEC and the NYSE applicable to audit committee members and
possesses the requisite competence in accounting or auditing in satisfaction of the requirements for
audit committees prescribed by the Companies Act 2014.
A copy of the charter of the Audit Committee is available on our website, www.tranetechnologies.com,
under the heading “About Us—Corporate Governance – Board Committees and Charters.”
2023 Proxy Statement
35
36
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Human Resources
and Compensation
Committee
Meetings in 2022: 5
Members
Tony L. White (Chair)
Kirk E. Arnold
Jared L. Cohon
Gary D. Forsee
Mark R. George
John A. Hayes
Linda P. Hudson
Key Functions
• Establish our executive compensation strategies, policies and programs.
• Review and approve the goals and objectives relevant to the compensation of the Chief Executive
Officer, evaluate the Chief Executive Officer’s performance against those goals and objectives and set
the Chief Executive Officer’s compensation level based on this evaluation. The Human Resources and
Compensation Committee Chair presents all compensation decisions pertaining to the Chief Executive
Officer to the full Board of Directors (other than Mr. Regnery).
• Approve compensation of all other elected officers.
• Review and approve executive compensation and benefit programs.
• Review and assess the appropriateness of the material risks, if any, arising from or related to the
Company’s compensation programs or arrangements.
• Administer the Company’s equity compensation plans.
• At least annually, review and discuss with the Sustainability, Corporate Governance and Nominating
Committee and the Audit Committee, as appropriate, the Company’s “Human Capital Management”
disclosure for the Company’s Annual Report on Form 10-K.
• Set, review and approve annual ESG factors for purposes of the Company’s Annual Incentive Matrix.
• Review, at least annually and discuss with management, key human resource management initiatives
related to leadership talent recruitment/retention, diversity and inclusion, pay equity and hourly wages.
• Review and recommend significant changes in principal employee benefit programs.
• Approve and oversee Human Resources and Compensation Committee consultants.
For a discussion concerning the processes and procedures for determining NEO (Named Executive
Officer) and director compensation and the role of executive officers and compensation consultants in
determining or recommending the amount or form of compensation, see “Compensation Discussion
and Analysis” and “Compensation of Directors,” respectively. The Board of Directors has determined
that each member of the Human Resources and Compensation Committee is “independent” as
defined in the NYSE listing standards and the Company’s Corporate Governance Guidelines. In
addition, the Board of Directors has determined that each member of the Human Resources and
Compensation Committee qualifies as a “Non-Employee Director” within the meaning of Rule 16b-3 of
the Securities Exchange Act of 1934.
A copy of the charter of the Human Resources and Compensation Committee is available on our
website, www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.
Sustainability,
Corporate
Governance
and Nominating
Committee
Meetings in 2022: 5
Members
Gary D. Forsee (Chair)
Kirk E. Arnold
Jared L. Cohon
Mark R. George
John A. Hayes
Linda P. Hudson
Tony L. White
Key Functions
• Identify individuals qualified to become directors and recommend the candidates for all directorships.
• Recommend individuals for election as officers.
• Oversee the Company’s sustainability efforts including the development and implementation of
policies relating to ESG issues.
impacts of climate change.
• Monitor the Company’s performance against its sustainability and ESG objectives including the
• Review the Company’s Corporate Governance Guidelines and make recommendations for changes.
• Consider questions of independence of directors and possible conflicts of interest of directors as well
as executive officers.
• Take a leadership role in shaping the sustainability efforts and corporate governance of the Company.
• Evaluate social and environmental trends and issues in connection with the Company’s business
activities and make recommendations to the Board regarding those trends and issues.
The Board of Directors has determined that each member of the Sustainability, Corporate Governance
and Nominating Committee is “independent” as defined in the NYSE listing standards and the
Company’s Corporate Governance Guidelines.
A copy of the charter of the Sustainability, Corporate Governance and Nominating Committee is
available on our website, www.tranetechnologies.com, under the heading “About Us—Corporate
Governance – Board Committees and Charters.”
Finance Committee
Key Functions
Meetings in 2022: 5
Members
Ann C. Berzin (Chair)
April Miller Boise
John Bruton
Myles P. Lee
Melissa N. Schaeffer
John P. Surma
• Consider and recommend for approval by the Board of Directors (a) issuances of equity and/or debt
securities; or (b) authorizations for other financing transactions, including bank credit facilities.
• Consider and recommend for approval by the Board of Directors the repurchase of the
Company’s shares.
• Review cash management policies.
• Review periodic reports of the investment performance of the Company’s employee benefit plans.
• Consider and recommend for approval by the Board of Directors the Company’s external
• Consider and approve the Company’s financial risk management activities, including the areas of
foreign exchange, commodities, and interest rate exposures, insurance programs and customer
dividend policy.
financing risks.
The Board of Directors has determined that each member of the Finance Committee is “independent”
as defined in the NYSE listing standards and the Company’s Corporate Governance Guidelines.
A copy of the charter of the Finance Committee is available on our website,
www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.”
2023 Proxy Statement
37
38
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Human Resources
and Compensation
Committee
Meetings in 2022: 5
Members
Tony L. White (Chair)
Kirk E. Arnold
Jared L. Cohon
Gary D. Forsee
Mark R. George
John A. Hayes
Linda P. Hudson
Key Functions
• Establish our executive compensation strategies, policies and programs.
• Review and approve the goals and objectives relevant to the compensation of the Chief Executive
Officer, evaluate the Chief Executive Officer’s performance against those goals and objectives and set
the Chief Executive Officer’s compensation level based on this evaluation. The Human Resources and
Compensation Committee Chair presents all compensation decisions pertaining to the Chief Executive
Officer to the full Board of Directors (other than David S. Regnery).
• Approve compensation of all other elected officers.
• Review and approve executive compensation and benefit programs.
• Review and assess the appropriateness of the material risks, if any, arising from or related to the
Company’s compensation programs or arrangements.
• Administer the Company’s equity compensation plans.
• At least annually, review and discuss with the Sustainability, Corporate Governance and Nominating
Committee and the Audit Committee, as appropriate, the Company’s “Human Capital Management”
disclosure for the Company’s Annual Report on Form 10-K.
• Set, review and approve annual ESG factors for purposes of the Company’s Annual Incentive Matrix.
• Review, at least annually and discuss with management, key human resource management initiatives
related to leadership talent recruitment/retention, diversity and inclusion, pay equity and hourly wages.
• Review and recommend significant changes in principal employee benefit programs.
• Approve and oversee Human Resources and Compensation Committee consultants.
For a discussion concerning the processes and procedures for determining NEO (Named Executive
Officer) and director compensation and the role of executive officers and compensation consultants in
determining or recommending the amount or form of compensation, see “Compensation Discussion
and Analysis” and “Compensation of Directors,” respectively. The Board of Directors has determined
that each member of the Human Resources and Compensation Committee is “independent” as
defined in the NYSE listing standards and the Company’s Corporate Governance Guidelines. In
addition, the Board of Directors has determined that each member of the Human Resources and
Compensation Committee qualifies as a “Non-Employee Director” within the meaning of Rule 16b-3 of
the Securities Exchange Act of 1934.
A copy of the charter of the Human Resources and Compensation Committee is available on our
website, www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.
Sustainability,
Corporate
Governance
and Nominating
Committee
Meetings in 2022: 5
Members
Gary D. Forsee (Chair)
Kirk E. Arnold
Jared L. Cohon
Mark R. George
John A. Hayes
Linda P. Hudson
Tony L. White
Key Functions
• Identify individuals qualified to become directors and recommend the candidates for all directorships.
• Recommend individuals for election as officers.
• Oversee the Company’s sustainability efforts including the development and implementation of
policies relating to ESG issues.
• Monitor the Company’s performance against its sustainability and ESG objectives including the
impacts of climate change.
• Review the Company’s Corporate Governance Guidelines and make recommendations for changes.
• Consider questions of independence of directors and possible conflicts of interest of directors as well
as executive officers.
• Take a leadership role in shaping the sustainability efforts and corporate governance of the Company.
• Evaluate social and environmental trends and issues in connection with the Company’s business
activities and make recommendations to the Board regarding those trends and issues.
The Board of Directors has determined that each member of the Sustainability, Corporate Governance
and Nominating Committee is “independent” as defined in the NYSE listing standards and the
Company’s Corporate Governance Guidelines.
A copy of the charter of the Sustainability, Corporate Governance and Nominating Committee is
available on our website, www.tranetechnologies.com, under the heading “About Us—Corporate
Governance – Board Committees and Charters.”
Finance Committee
Meetings in 2022: 5
Key Functions
• Consider and recommend for approval by the Board of Directors (a) issuances of equity and/or debt
securities; or (b) authorizations for other financing transactions, including bank credit facilities.
Members
Ann C. Berzin (Chair)
April Miller Boise
John Bruton
Myles P. Lee
Melissa N. Schaeffer
John P. Surma
• Consider and recommend for approval by the Board of Directors the repurchase of the
Company’s shares.
• Review cash management policies.
• Review periodic reports of the investment performance of the Company’s employee benefit plans.
• Consider and recommend for approval by the Board of Directors the Company’s external
dividend policy.
• Consider and approve the Company’s financial risk management activities, including the areas of
foreign exchange, commodities, and interest rate exposures, insurance programs and customer
financing risks.
The Board of Directors has determined that each member of the Finance Committee is “independent”
as defined in the NYSE listing standards and the Company’s Corporate Governance Guidelines.
A copy of the charter of the Finance Committee is available on our website,
www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.”
2023 Proxy Statement
37
38
Executive
Committee
Meetings in 2022: None
Members
David S. Regnery (Chair)
Ann C. Berzin (Chair of the
Finance Committee)
Gary D. Forsee
(Lead Independent
Director and Chair of the
Sustainability, Corporate
Governance and
Nominating Committee)
John P. Surma (Chair of the
Audit Committee)
Tony L. White (Chair of the
Human Resources and
Compensation Committee)
Technology
and Innovation
Committee
Meetings in 2022: 2
Members
Jared L. Cohon (Chair)
Kirk E. Arnold
John Bruton
Gary D. Forsee
Linda P. Hudson
Tony L. White
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Key Functions
• Aid the Board in handling matters which, in the opinion of the Chair or Lead Independent Director,
should not be postponed until the next scheduled meeting of the Board (except as limited by the
charter of the Executive Committee).
The Board of Directors has determined that each member of the Executive Committee (other than Mr.
Regnery) is “independent” as defined in the NYSE listing standards and the Company’s Corporate
Governance Guidelines.
A copy of the charter of the Executive Committee is available on our website,
www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.”
There were five meetings of the Board of Directors in 2022. All directors attended at least 75% or more of the total number of meetings of the
Board of Directors. With the exception of Ms. Hudson, all directors also attended at least 75% of meetings of the the committees on which
they served during the year. Ms. Hudson did not attend one meeting of the Technology and Innovation Committee, which met twice during
2022. The Company’s non-employee directors held five independent director meetings without management present during the fiscal year
2022. It is the Board’s general practice to hold independent director meetings in connection with regularly scheduled Board meetings.
The Company expects all Board members to attend the annual general meeting, but from time to time other commitments prevent all directors
from attending the meeting. All of the members of our Board standing for re-election at the 2022 Annual General Meeting on June 2, 2022
attended the meeting.
Human Resources and Compensation Committee
Interlocks and Insider Participation
Our Human Resources and Compensation Committee is comprised solely of independent directors. During fiscal 2022, no member of our
Human Resources and Compensation Committee was an employee, officer or former officer of the Company or had any relationships requiring
disclosure under Item 404 of Regulation S-K. None of our executive officers has served on the board of directors or compensation committee
of any other entity that has or has had one or more executive officers who served as a member of our Human Resources and Compensation
Committee or our Board during fiscal 2022.
Key Functions
• Review the Company’s technology and innovation strategy and approach, including its impact on the
Company’s performance, growth and competitive position.
• Review with management technologies that can have a material impact on the Company, including
product and process development technologies, manufacturing technologies and practices, and the
utilization of quality assurance programs.
• Assist the Board in its oversight of the Company’s investments in technology and innovation, including
through acquisitions and other business development activities.
• Review technology trends that could significantly affect the Company and the industries in which
it operates.
• Assist the Board in its oversight of the Company’s technology and innovation initiatives, and support,
as requested, the Sustainability, Corporate Governance and Nominating Committee in its review of the
Company’s environment, health and safety policies and practices, and the Audit Committee in its
review of the Company’s information technology and cybersecurity policies and practices.
• Oversee the direction and effectiveness of the Company’s research and development operations.
• Assist the Board in its oversight of the Company’s responses to certain environmental matters
including climate change, greenhouse gas emissions, energy-efficient and low-emissions products
and product life cycle and materials, and support as needed, the Sustainability, Corporate
Governance and Nominating Committee in its review of environmental and sustainability practices.
The Board of Directors has determined that each member of the Technology and Innovation
Committee is “independent” as defined in the NYSE listing standards and the Company’s Corporate
Governance Guidelines.
A copy of the charter of the Technology and Innovation Committee is available on our website,
www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.”
2023 Proxy Statement
39
40
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
There were five meetings of the Board of Directors in 2022. All directors attended at least 75% or more of the total number of meetings of the
Board of Directors. With the exception of Ms. Hudson, all directors also attended at least 75% of meetings of the committees on which
they served during the year. Ms. Hudson did not attend one meeting of the Technology and Innovation Committee, which met twice during
2022. The Company’s non-employee directors held five independent director meetings without management present during the fiscal year
2022. It is the Board’s general practice to hold independent director meetings in connection with regularly scheduled Board meetings.
The Company expects all Board members to attend the annual general meeting, but from time to time other commitments prevent all directors
from attending the meeting. All of the members of our Board standing for re-election at the 2022 Annual General Meeting on June 2, 2022
attended the meeting.
Human Resources and Compensation Committee
Interlocks and Insider Participation
Our Human Resources and Compensation Committee is comprised solely of independent directors. During fiscal 2022, no member of our
Human Resources and Compensation Committee was an employee, officer or former officer of the Company or had any relationships requiring
disclosure under Item 404 of Regulation S-K. None of our executive officers has served on the board of directors or compensation committee
of any other entity that has or has had one or more executive officers who served as a member of our Human Resources and Compensation
Committee or our Board during fiscal 2022.
Executive
Committee
Meetings in 2022: None
Members
David S. Regnery (Chair)
Ann C. Berzin (Chair of the
Finance Committee)
Gary D. Forsee
(Lead Independent
Director and Chair of the
Sustainability, Corporate
Governance and
Nominating Committee)
John P. Surma (Chair of the
Audit Committee)
Tony L. White (Chair of the
Human Resources and
Compensation Committee)
Technology
and Innovation
Committee
Meetings in 2022: 2
Members
Jared L. Cohon (Chair)
Kirk E. Arnold
John Bruton
Gary D. Forsee
Linda P. Hudson
Tony L. White
Key Functions
• Aid the Board in handling matters which, in the opinion of the Chair or Lead Independent Director,
should not be postponed until the next scheduled meeting of the Board (except as limited by the
charter of the Executive Committee).
The Board of Directors has determined that each member of the Executive Committee (other than
David S. Regnery) is “independent” as defined in the NYSE listing standards and the Company’s
Corporate Governance Guidelines.
A copy of the charter of the Executive Committee is available on our website,
www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.”
Key Functions
• Review the Company’s technology and innovation strategy and approach, including its impact on the
Company’s performance, growth and competitive position.
• Review with management technologies that can have a material impact on the Company, including
product and process development technologies, manufacturing technologies and practices, and the
utilization of quality assurance programs.
• Assist the Board in its oversight of the Company’s investments in technology and innovation, including
through acquisitions and other business development activities.
• Review technology trends that could significantly affect the Company and the industries in which
it operates.
• Assist the Board in its oversight of the Company’s technology and innovation initiatives, and support,
as requested, the Sustainability, Corporate Governance and Nominating Committee in its review of the
Company’s environment, health and safety policies and practices, and the Audit Committee in its
review of the Company’s information technology and cybersecurity policies and practices.
• Oversee the direction and effectiveness of the Company’s research and development operations.
• Assist the Board in its oversight of the Company’s responses to certain environmental matters
including climate change, greenhouse gas emissions, energy-efficient and low-emissions products
and product life cycle and materials, and support as needed, the Sustainability, Corporate
Governance and Nominating Committee in its review of environmental and sustainability practices.
The Board of Directors has determined that each member of the Technology and Innovation
Committee is “independent” as defined in the NYSE listing standards and the Company’s Corporate
Governance Guidelines.
A copy of the charter of the Technology and Innovation Committee is available on our website,
www.tranetechnologies.com, under the heading “About Us—Corporate Governance – Board
Committees and Charters.”
2023 Proxy Statement
39
40
Compensation of Directors
Director Compensation
Our director compensation program is designed to compensate non-employee directors fairly for work required for a company of our size and
scope and to align their interests with the long-term interests of our shareholders. The program reflects our desire to attract, retain and use the
expertise of highly qualified people serving on the Company’s Board of Directors. Employee directors do not receive any additional
compensation for serving as a director. Our 2022 director compensation program for non-employee directors consisted of the
following components:
ANNUAL RETAINER
COMPENSATION OF DIRECTORS
Share Ownership Requirement
To align the interests of directors with shareholders, the Board of Directors has adopted a share ownership requirement of five times the annual
cash retainer paid to the directors. A director cannot sell any shares of Company stock until they attain such level of ownership, and any sale
thereafter cannot reduce the total number of holdings below the required ownership level. A director is required to retain this minimum level of
Company share ownership until their resignation or retirement from the Board.
2022 Director Compensation
The compensation paid or credited to our non-employee directors for the year ended December 31, 2022, is summarized in the table below.
Fees Earned or
Equity / Stock
All Other
Paid in Cash
Awards
Compensation
■ Paid in Cash $142,500 (47%)
■ Paid in Restricted Stock Units*
$162,500 (53%)
* The number of restricted stock units granted is determined by
dividing the grant date value of the award, $162,500, by the
closing price of the Company’s common stock on the date of
grant. A director who retires, resigns or otherwise separates from
the Company for any reason receives a pro-rata cash retainer
payment for the quarter in which such event occurs based on the
number of days elapsed since the end of the immediately
preceding quarter and immediately vests in any unvested
restricted stock units.
ANNUAL CASH RETAINER FOR COMMITTEE CHAIRS AND MEMBERS, LEAD INDEPENDENT DIRECTOR AND
OTHER ELEMENTS
Audit Committee Chair
$30,000
Human Resources and Compensation Committee Chair
Sustainability, Corporate Governance and Nominating Committee Chair
Finance Committee Chair
Executive Committee Chair
$0
Technology and Innovation Committee Chair
Audit Committee Member
Lead Independent Director
$7,500
$7,500
Additional Meetings or Unscheduled Planning Session Fees
$2,500
$XX
$XX
$20,000
$15,000
$15,000
$50,000
The Sustainability, Corporate Governance and Nominating Committee periodically reviews the compensation level of our non-employee
directors in consultation with the Human Resources and Compensation Committee’s independent compensation consultant, Korn Ferry, and
makes recommendations to the Board of Directors. The current compensation program was established in 2018.
Under our Incentive Stock Plan of 2018, the aggregate amount of stock-based and cash-based awards which may be granted to any non-
employee director in respect of any calendar year, solely with respect to their service as a member of the Board of Directors, is limited
to $1,000,000.
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George (b)
L. P. Hudson
M. P. Lee
K. B. Peetz (b)
M. N. Schaeffer (b)
J. P. Surma
T. L. White
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
L. P. Hudson
M. P. Lee
K. B. Peetz
M. N. Schaeffer
J. P. Surma
T. L. White
2023 Proxy Statement
41
42
(a)
The amounts in this column represent the following: annual cash retainer, the Committee Chair retainers, the Audit Committee member retainer, the Lead Independent
Director retainer, and the Board, Committee and other meeting or session fees.
($) (a)
142,500
165,000
150,000
150,000
150,000
207,500
31,753
142,500
150,000
37,974
33,424
172,500
162,500
($) (c)
162,621
162,621
162,621
162,621
162,621
162,621
—
162,621
162,621
—
—
162,621
162,621
($) (d)
Total
($)
30,330 335,451
1,066 328,687
22,635 335,256
1,282 313,903
25,807 338,428
27,389 397,510
—
31,753
— 305,121
94 312,715
—
—
37,974
33,424
33,577 368,698
— 325,121
Total Fees
Earned or
($)
142,500
165,000
150,000
150,000
150,000
207,500
31,753
142,500
150,000
37,974
33,424
172,500
162,500
($)
—
—
—
—
—
—
—
—
—
—
—
—
—
Committee
Committee
Chair
Retainer
Member
Retainer
Audit
Independent
Board,
Committee
and Other
Meeting or
Lead
Director
Retainer
Fees
($)
Session Fees
Paid In Cash
Cash
Retainer
($)
142,500
142,500
142,500
142,500
142,500
142,500
31,753
142,500
142,500
37,974
31,753
142,500
142,500
15,000
7,500
15,000
($)
—
—
—
—
—
—
—
—
30,000
20,000
($)
—
7,500
7,500
7,500
—
—
—
—
7,500
—
1,671
—
—
50,000
—
—
—
—
—
—
—
—
—
—
—
—
(b) Ms. Peetz resigned from the Board in April 2022. Mr. George and Ms. Schaeffer were elected to the Board on October 11, 2022.
(c)
(d)
Represents RSUs awarded in 2022 as part of each director’s annual retainer. The amounts in this column reflect the aggregate grant date fair value of RSU awards
granted for the year under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 and do not reflect amounts paid to or
realized by the directors. For a discussion of the assumptions made in determining the ASC 718 values see Note 14, “Share-Based Compensation,” to the Company’s
consolidated financial statements contained in its 2022 Form 10-K.
Includes (i) benefits in kind (spousal travel, meals, non-board related activities and gifts in connection with the June 2022 Board meeting) and (ii) payment of Irish taxes on
benefits in kind. For Mr. Surma, the amount shown also includes rebates on Company products purchased during 2022.
Compensation of Directors
Director Compensation
following components:
ANNUAL RETAINER
COMPENSATION OF DIRECTORS
Share Ownership Requirement
To align the interests of directors with shareholders, the Board of Directors has adopted a share ownership requirement of five times the annual
cash retainer paid to the directors. A director cannot sell any shares of Company stock until they attain such level of ownership, and any sale
thereafter cannot reduce the total number of holdings below the required ownership level. A director is required to retain this minimum level of
Company share ownership until their resignation or retirement from the Board.
Our director compensation program is designed to compensate non-employee directors fairly for work required for a company of our size and
scope and to align their interests with the long-term interests of our shareholders. The program reflects our desire to attract, retain and use the
expertise of highly qualified people serving on the Company’s Board of Directors. Employee directors do not receive any additional
compensation for serving as a director. Our 2022 director compensation program for non-employee directors consisted of the
2022 Director Compensation
The compensation paid or credited to our non-employee directors for the year ended December 31, 2022, is summarized in the table below.
■ Paid in Cash $142,500 (47%)
■ Paid in Restricted Stock Units*
$162,500 (53%)
* The number of restricted stock units granted is determined by
dividing the grant date value of the award, $162,500, by the
closing price of the Company’s common stock on the date of
grant. A director who retires, resigns or otherwise separates from
the Company for any reason receives a pro-rata cash retainer
payment for the quarter in which such event occurs based on the
number of days elapsed since the end of the immediately
preceding quarter and immediately vests in any unvested
restricted stock units.
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George (b)
L. P. Hudson
M. P. Lee
K. B. Peetz (b)
M. N. Schaeffer (b)
J. P. Surma
T. L. White
Fees Earned or
Paid in Cash
($) (a)
142,500
Equity / Stock
Awards
($) (c)
162,621
All Other
Compensation
($) (d)
Total
($)
30,330 335,451
165,000
150,000
150,000
150,000
207,500
31,753
142,500
150,000
37,974
33,424
172,500
162,500
162,621
162,621
162,621
162,621
162,621
—
162,621
162,621
—
—
162,621
162,621
1,066 328,687
22,635 335,256
1,282 313,903
25,807 338,428
27,389 397,510
—
31,753
— 305,121
94 312,715
—
—
37,974
33,424
33,577 368,698
— 325,121
(a)
The amounts in this column represent the following, as shown in the table below: annual cash retainer, the Committee Chair retainers, the Audit Committee member
retainer, the Lead Independent Director retainer, and the Board, Committee and other meeting or session fees.
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
L. P. Hudson
M. P. Lee
K. B. Peetz
M. N. Schaeffer
J. P. Surma
T. L. White
Cash
Retainer
($)
142,500
142,500
142,500
142,500
142,500
142,500
31,753
142,500
142,500
37,974
31,753
142,500
142,500
Committee
Chair
Retainer
($)
—
15,000
—
—
7,500
15,000
—
—
—
—
—
30,000
20,000
Audit
Committee
Member
Retainer
($)
—
7,500
7,500
7,500
—
—
—
—
7,500
—
1,671
—
—
Lead
Independent
Director
Retainer
Fees
($)
—
—
—
—
—
50,000
—
—
—
—
—
—
—
Board,
Committee
and Other
Meeting or
Session Fees
($)
—
—
—
—
—
—
—
—
—
—
—
—
—
Total Fees
Earned or
Paid In Cash
($)
142,500
165,000
150,000
150,000
150,000
207,500
31,753
142,500
150,000
37,974
33,424
172,500
162,500
(b) Ms. Peetz resigned from the Board in April 2022. Mr. George and Ms. Schaeffer were elected to the Board on October 11, 2022.
(c)
(d)
Represents RSUs awarded in 2022 as part of each director’s annual retainer. The amounts in this column reflect the aggregate grant date fair value of RSU awards
granted for the year under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 and do not reflect amounts paid to or
realized by the directors. For a discussion of the assumptions made in determining the ASC 718 values see Note 14, “Share-Based Compensation,” to the Company’s
consolidated financial statements contained in its 2022 Form 10-K.
Includes (i) benefits in kind (spousal travel, meals, non-board related activities and gifts in connection with the June 2022 Board meeting) and (ii) payment of Irish taxes on
benefits in kind. For Mr. Surma, the amount shown also includes rebates on Company products purchased during 2022.
2023 Proxy Statement
41
42
ANNUAL CASH RETAINER FOR COMMITTEE CHAIRS AND MEMBERS, LEAD INDEPENDENT DIRECTOR AND
OTHER ELEMENTS
Audit Committee Chair
$30,000
Human Resources and Compensation Committee Chair
Sustainability, Corporate Governance and Nominating Committee Chair
$XX
$XX
$20,000
$15,000
$15,000
Finance Committee Chair
Executive Committee Chair
$0
Technology and Innovation Committee Chair
Audit Committee Member
Lead Independent Director
$7,500
$7,500
Additional Meetings or Unscheduled Planning Session Fees
$2,500
$50,000
The Sustainability, Corporate Governance and Nominating Committee periodically reviews the compensation level of our non-employee
directors in consultation with the Human Resources and Compensation Committee’s independent compensation consultant, Korn Ferry, and
makes recommendations to the Board of Directors. The current compensation program was established in 2018.
Under our Incentive Stock Plan of 2018, the aggregate amount of stock-based and cash-based awards which may be granted to any non-
employee director in respect of any calendar year, solely with respect to their service as a member of the Board of Directors, is limited
to $1,000,000.
COMPENSATION OF DIRECTORS
Benefits in Kind
($)
Payment of Taxes on Benefits
in Kind
($)
15,772
554
11,770
667
13,420
14,242
—
—
49
—
—
21,190
—
14,558
512
10,865
615
12,387
13,147
—
—
45
—
—
12,387
—
Total
($)
30,330
1,066
22,635
1,282
25,807
27,389
—
—
94
—
—
33,577
—
Compensation Discussion
and Analysis
The Compensation Discussion and Analysis (“CD&A”) set forth below provides an overview of our executive compensation philosophy and
underlying programs, including the objectives of such programs, as well as a discussion of how awards are determined for our Named
Executive Officers (“NEOs”). These NEOs include our Chair and Chief Executive Officer (“CEO”), our Chief Financial Officer (“CFO”), and our
three most highly compensated executive officers for the 2022 fiscal year other than the Chair and CEO and CFO. The 2022 NEOs are
as follows:
Named Executive Officers
Title
Mr. David S. Regnery
Chair and Chief Executive Officer
Mr. Christopher J. Kuehn
Executive Vice President and Chief Financial Officer
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Executive Vice President and Chief Technology and Sustainability Officer
Senior Vice President, General Counsel and Secretary
Mr. Raymond D. Pittard
Executive Vice President Supply Chain, Engineering and Information Technology
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
L. P. Hudson
M. P. Lee
K. B. Peetz
M. N. Schaeffer
J. P. Surma
T. L. White
For each non-employee director, the following table reflects all unvested RSU awards at December 31, 2022:
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
L. P. Hudson
M. P. Lee
M. N. Schaeffer
J. P. Surma
T. L. White
Number of
Unvested RSUs
1,167
I. Executive Summary
1,167
1,167
1,167
1,167
1,167
—
1,167
1,167
—
1,167
1,167
Throughout 2022, Trane Technologies displayed continued strong financial performance placing us in the top quartile of leading industrial
companies while making significant progress toward advancing our purpose to boldly challenge what’s possible for a sustainable world. We
continued to see robust and broad-based demand for our innovative products and services and have maintained strong employee
engagement with year-over-year improvement in our employee engagement score. Our dynamic business operating system and uplifting
culture enable us to continue to overcome supply chain challenges and inflation concerns and deliver strong performance for our people,
customers, communities, shareholders and the planet.
In 2022, we continued our efforts to achieve our 2030 Sustainability Commitments to reduce one gigaton of carbon emissions from our
customers’ footprints, to reimagine our supply chain and operations to have a restorative impact on the environment and to uplift our people,
culture and communities through an inclusive approach and a focus on education and career development. Specific to compensation, we
continued to link annual leader short-term incentive compensation to achievement of specific emissions and greenhouse gas reduction and
diversity progress, as well as financial goals.
In 2022, we also continued to activate our Employee Value Proposition (“EVP”) and employer brand, with a focus on our service technicians
and manufacturing hourly team members. This work highlights our efforts to connect people to purpose with a focus on uplifting others,
making an impact and thriving at work and home.
Below are additional financial, environmental and social sustainability highlights taken into consideration in making compensation decisions.
2023 Proxy Statement
43
44
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
L. P. Hudson
M. P. Lee
K. B. Peetz
M. N. Schaeffer
J. P. Surma
T. L. White
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
L. P. Hudson
M. P. Lee
M. N. Schaeffer
J. P. Surma
T. L. White
Benefits in Kind
Payment of Taxes on Benefits
($)
15,772
554
11,770
667
13,420
14,242
—
—
49
—
—
21,190
—
in Kind
($)
14,558
512
10,865
615
12,387
13,147
—
—
45
—
—
12,387
—
COMPENSATION OF DIRECTORS
Total
($)
30,330
1,066
22,635
1,282
25,807
27,389
—
—
94
—
—
—
33,577
1,167
1,167
1,167
1,167
1,167
1,167
—
1,167
1,167
—
1,167
1,167
Compensation Discussion
and Analysis
The Compensation Discussion and Analysis (“CD&A”) set forth below provides an overview of our executive compensation philosophy and
underlying programs, including the objectives of such programs, as well as a discussion of how awards are determined for our Named
Executive Officers (“NEOs”). These NEOs include our Chair and Chief Executive Officer (“CEO”), our Chief Financial Officer (“CFO”), and our
three most highly compensated executive officers for the 2022 fiscal year other than the Chair and CEO and CFO. The 2022 NEOs are
as follows:
Named Executive Officers
Title
Mr. David S. Regnery
Chair and Chief Executive Officer
Mr. Christopher J. Kuehn
Executive Vice President and Chief Financial Officer
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Executive Vice President and Chief Technology and Sustainability Officer
Senior Vice President, General Counsel and Secretary
Mr. Raymond D. Pittard
Executive Vice President Supply Chain, Engineering and Information Technology
For each non-employee director, the following table reflects all unvested RSU awards at December 31, 2022:
Number of
Unvested RSUs
I. Executive Summary
Throughout 2022, Trane Technologies displayed continued strong financial performance placing us in the top quartile of leading industrial
companies while making significant progress toward advancing our purpose to boldly challenge what’s possible for a sustainable world. We
continued to see robust and broad-based demand for our innovative products and services and have maintained strong employee
engagement with year-over-year improvement in our employee engagement score. Our dynamic business operating system and uplifting
culture enable us to continue to overcome supply chain challenges and inflation concerns and deliver strong performance for our people,
customers, communities, shareholders and the planet.
In 2022, we continued our efforts to achieve our 2030 Sustainability Commitments to reduce one gigaton of carbon emissions from our
customers’ footprints, to reimagine our supply chain and operations to have a restorative impact on the environment and to uplift our people,
culture and communities through an inclusive approach and a focus on education and career development. Specific to compensation, we
continued to link annual leader short-term incentive compensation to achievement of specific emissions and greenhouse gas reduction and
diversity progress, as well as financial goals.
In 2022, we also continued to activate our Employee Value Proposition (“EVP”) and employer brand, with a focus on our service technicians
and manufacturing hourly team members. This work highlights our efforts to connect people to purpose with a focus on uplifting others,
making an impact and thriving at work and home.
Below are additional financial, environmental and social sustainability highlights taken into consideration in making compensation decisions.
2023 Proxy Statement
43
44
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
2022 Performance Highlights
The following graphics show the enterprise financial results realized in 2022 relative to our executive incentive compensation performance
targets established for the period and other significant ESG performance highlights achieved in 2022.
FINANCIAL PERFORMANCE
HIGHLIGHTS
3-Year Adjusted Cash Flow
Return on Invested Capital
(CROIC) (2020–2022)(a)
29.0%
Ranks at the 80th percentile of the
companies in the S&P 500 Industrials Index
3-Year Total Shareholder
Return (TSR)
(2020-2022)(a)
57.17%
Ranks at the 78th percentile
of the companies in the S&P 500
Industrials Index
Annual Revenue
$15.992
BILLION
Increase of 13% from 2021
Adjusted EBITDA(a)
$2.694
BILLION
Increase of 14% from 2021
Free Cash Flow(a)
$1.566
BILLION
Increase of 9.4% from 2021
The three core financial metrics laid out
above are further modified (up to +/-20%)
by our achievement relative to
our equally-weighted environmental &
social objectives—ESG Modifier
(a) We report our financial results in our Annual Report on Form 10-K and our quarterly reports on Form 10-Q in accordance with United States generally accepted
accounting principles (“GAAP”). Our financial results described above for Adjusted EBITDA and Free Cash Flow have been adjusted to exclude the impact of certain
items as shown in Appendix A to this Proxy Statement. These metrics and the related performance targets and results are relevant only to our executive compensation
program and should not be used or applied in other contexts. For a description of how the metrics above are calculated from our GAAP financial statements, please see
“Annual Incentive Matrix (‘AIM’)” with respect to AIM payments and “Long Term Incentive Program (‘LTI’) – 2020-2022 Performance Share Units Payout” with respect to
Performance Share Program (“PSP”) awards.
Based on our 2022 results for Revenue, Adjusted EBITDA, and Free Cash Flow and progress against our ESG goals, achievement under the
Annual Incentive Matrix (“AIM”) financial score was 146.88% of target for the Enterprise.
A 3-year CROIC average of 29.0% and a 3-year TSR of 57.17% resulted in a 200% Performance Share Unit (“PSU”) payout under our
Performance Share Program for the 2020-2022 performance period.
2023 Proxy Statement
45
46
Environmental
ESG PERFORMANCE HIGHLIGHTS
• First in our industry, and one of the first 11 companies worldwide, to have our net zero carbon emissions targets approved by the
Science Based Targets initiative (“SBTi”), a coalition of the Carbon Disclosure Project, the United Nations Global Compact, World
Resources Institute and the World Wide Fund for Nature
• Pledged to procure, specify or stock 50% net-zero steel by 2030 and 100% net-zero steel by 2050 as a member of SteelZero.
Announced contracts to purchase low-carbon steel to further reduce the carbon emissions throughout the Company’s supply chain
• Named to S&P Dow Jones Sustainability World Index for second consecutive year and North America Index for 12th consecutive year
• Recognized for corporate environmental transparency by the Climate Disclosure Project, securing a place on its annual A-list, one of 283
• Began an initiative to accelerate the decarbonization of our facilities by 25% by the year 2025 and to achieve our carbon-neutral
companies out of 15,000
operations goal early
Social
• Continued broad approach to Human Capital Management across engagement, development, diversity and inclusion:
• Maintained strong employee engagement with year-over-year improvement in our employee engagement score
• Our Employee Value Proposition (“EVP”), which connects team members to our Company’s purpose, strategies and leadership
principles, is representative of our entire employee population, inclusive of every role in the organization
• Through Trane Technologies University, we provide our team members with comprehensive learning and development solutions
designed to support them as they grow in their careers
• Launched The Inclusive Culture Learning Experience to all people leaders
• Supported employee well-being with the launch of a mental health hub and improvements to certain local paid time off programs
• Shifted our tuition support approach from offering tuition reimbursement to offering tuition advancement
• Ranked 18th on the 2023 JUST 100 list, named first in the Building Materials & Construction industry and ranked as the best company in
industry for communities and workers. Recognized as one of America’s Most JUST Companies for the sixth consecutive year
• Received wide recognition as an employer of choice:
• Forbes World’s Best Employers 2022, second consecutive year
• Disability Equality Index (“DEI”), top scorer (100%)
• Great Place to Work® (Belgium, Ireland, USA)
• Fortune World’s Most Admired Companies 2022, 11th consecutive year
• Fortune Best Workplaces in Manufacturing and Production 2022, top ten
• Military Times 2022 Best for Vets Employers List
• Expanded Sustainable Futures, our corporate citizenship strategy, through a partnership with Discovery Education to provide STEM and
sustainability tools to teachers in at-risk districts
• Continued Operation Possible, our innovation initiative to source social and environmental impact ideas from employees. Our ideas were
put into practice to fight food loss by developing a cooling cart for street vendors
Governance
• Developed compliance controls for ESG metrics and process to be maintained quarterly and annually
• Completed non-financial materiality assessment refresh
• Conducted Task Force on Climate-related Financial Disclosures (“TCFD”) Climate Scenario Analysis to identify risks and opportunities
• Continued to reinforce leadership accountability for 2030 Commitments with ESG modifier for annual incentive program for executives
and senior leaders, with progress towards greenhouse gas reduction and diverse representation
• Conducted ESG training with the Board with a focus on sustainability disclosure and emerging regulatory requirements
• Continued to develop next generation of talent and conducted ongoing leadership succession planning sessions with the Board
For more information regarding our Company’s commitment to leadership in ESG matters and our achievements in these areas, please also see our 2022 Annual Report to
Shareholders included in these proxy materials and our ESG Report available on our website located at www.tranetechnologies.com/ESG. Our 2022 ESG Report is
expected to be available on or around April 26, 2023.
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
2022 Performance Highlights
The following graphics show the enterprise financial results realized in 2022 relative to our executive incentive compensation performance
targets established for the period and other significant ESG performance highlights achieved in 2022.
FINANCIAL PERFORMANCE
HIGHLIGHTS
3-Year Adjusted Cash Flow
Return on Invested Capital
(CROIC) (2020–2022)(a)
29.0%
Ranks at the 80th percentile of the
companies in the S&P 500 Industrials Index
3-Year Total Shareholder
Return (TSR)
(2020-2022)(a)
57.17%
Ranks at the 78th percentile
of the companies in the S&P 500
Industrials Index
Annual Revenue
$15.992
BILLION
Increase of 13% from 2021
Adjusted EBITDA(a)
$2.694
BILLION
Increase of 14% from 2021
Free Cash Flow(a)
$1.566
BILLION
Increase of 9.4% from 2021
The three core financial metrics laid out
above are further modified (up to +/-20%)
by our achievement relative to
our equally-weighted environmental &
social objectives—ESG Modifier
Environmental
ESG PERFORMANCE HIGHLIGHTS
• First in our industry, and one of the first 11 companies worldwide, to have our net zero carbon emissions targets approved by the
Science Based Targets initiative (“SBTi”), a coalition of the Carbon Disclosure Project, the United Nations Global Compact, World
Resources Institute and the World Wide Fund for Nature
• Pledged to procure, specify or stock 50% net-zero steel by 2030 and 100% net-zero steel by 2050 as a member of SteelZero.
Announced contracts to purchase low-carbon steel to further reduce the carbon emissions throughout the Company’s supply chain
• Named to S&P Dow Jones Sustainability World Index for second consecutive year and North America Index for 12th consecutive year
• Recognized for corporate environmental transparency by the Climate Disclosure Project, securing a place on its annual A-list, one of 283
companies out of 15,000
• Began an initiative to accelerate the decarbonization of our facilities by 25% by the year 2025 and to achieve our carbon-neutral
operations goal early
Social
• Continued broad approach to Human Capital Management across engagement, development, diversity and inclusion:
• Maintained strong employee engagement with year-over-year improvement in our employee engagement score
• Our Employee Value Proposition (“EVP”), which connects team members to our Company’s purpose, strategies and leadership
principles, is representative of our entire employee population, inclusive of every role in the organization
• Through Trane Technologies University, we provide our team members with comprehensive learning and development solutions
designed to support them as they grow in their careers
• Launched The Inclusive Culture Learning Experience to all people leaders
• Supported employee well-being with the launch of a mental health hub and improvements to certain local paid time off programs
• Shifted our tuition support approach from offering tuition reimbursement to offering tuition advancement
• Ranked 18th on the 2023 JUST 100 list, named first in the Building Materials & Construction industry and ranked as the best company in
industry for communities and workers. Recognized as one of America’s Most JUST Companies for the sixth consecutive year
• Received wide recognition as an employer of choice:
• Forbes World’s Best Employers 2022, second consecutive year
• Disability Equality Index (“DEI”), top scorer (100%)
• Great Place to Work® (Belgium, Ireland, USA)
• Fortune World’s Most Admired Companies 2022, 11th consecutive year
• Fortune Best Workplaces in Manufacturing and Production 2022, top ten
• Military Times 2022 Best for Vets Employers List
• Expanded Sustainable Futures, our corporate citizenship strategy, through a partnership with Discovery Education to provide STEM and
sustainability tools to teachers in at-risk districts
• Continued Operation Possible, our innovation initiative to source social and environmental impact ideas from employees. Our ideas were
put into practice to fight food loss by developing a cooling cart for street vendors
Governance
• Developed compliance controls for ESG metrics and process to be maintained quarterly and annually
• Completed non-financial materiality assessment refresh
• Conducted Task Force on Climate-related Financial Disclosures (“TCFD”) Climate Scenario Analysis to identify risks and opportunities
• Continued to reinforce leadership accountability for 2030 Commitments with ESG modifier for annual incentive program for executives
and senior leaders, with progress towards greenhouse gas reduction and diverse representation
• Conducted ESG training with the Board with a focus on sustainability disclosure and emerging regulatory requirements
• Continued to develop next generation of talent and conducted ongoing leadership succession planning sessions with the Board
(a) We report our financial results in our Annual Report on Form 10-K and our quarterly reports on Form 10-Q in accordance with United States generally accepted
accounting principles (“GAAP”). Our financial results described above for Adjusted EBITDA and Free Cash Flow have been adjusted to exclude the impact of certain
items as shown in Appendix A to this Proxy Statement. These metrics and the related performance targets and results are relevant only to our executive compensation
program and should not be used or applied in other contexts. For a description of how the metrics above are calculated from our GAAP financial statements, please see
“Annual Incentive Matrix (‘AIM’)” with respect to AIM payments and “Long Term Incentive Program (‘LTI’) – 2020-2022 Performance Share Units Payout” with respect to
Performance Share Program (“PSP”) awards.
Based on our 2022 results for Revenue, Adjusted EBITDA, and Free Cash Flow and progress against our ESG goals, achievement under the
Annual Incentive Matrix (“AIM”) financial score was 146.88% of target for the Enterprise.
A 3-year CROIC average of 29.0% and a 3-year TSR of 57.17% resulted in a 200% Performance Share Unit (“PSU”) payout under our
Performance Share Program for the 2020-2022 performance period.
For more information regarding our Company’s commitment to leadership in ESG matters and our achievements in these areas, please also see our 2022 Annual Report to
Shareholders included in these proxy materials and our ESG Report available on our website located at www.tranetechnologies.com/ESG. Our 2022 ESG Report is
expected to be available on or around April 26, 2023.
2023 Proxy Statement
45
46
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
2022 Say-on-Pay Vote
The Committee considers the results of the annual advisory vote on executive compensation in making determinations about
the structure of Trane Technologies’ pay program or whether any changes to the program should be considered. In 2022,
92% of shareholders voted in favor of “Say-on-Pay.” In addition to shareholder feedback, the Committee reviews information
provided by its independent compensation consultant regarding general compensation practices within our Compensation
Peer Group, as well as third-party survey data to assess relevant market conditions. As a result of this analysis, the
Committee determined it was appropriate to maintain the core components of our executive compensation program and no
program modifications were made.
92%
Executive Compensation Program Overview
The Committee seeks to provide reasonable and competitive executive compensation programs which are structured to attract and retain
best-in-class leaders, incentivize and reward the achievement of short and long-term Company goals and align the interests of executives with
shareholders to provide sustainable value. The table below reflects the primary components of our executive compensation program and the
proportion of each component relative to target total direct compensation (“TDC”):
Component(a)
Chair and CEO
Other NEOs
Description of Component
D
E
X
F
I
I
I
K
K
S
S
R
R
T
T
A
A
Y
Y
A
A
P
P
Base Salary
11%
24%
Fixed cash compensation.
Annual
Incentive
Matrix (“AIM”)
Long-Term
Incentives
(“LTI”)
17%
20%
72%
56%
Variable cash incentive compensation. Any award earned is based on
performance measured against pre-defined annual Revenue, Adjusted
EBITDA and Free Cash Flow objectives as set by the Committee. These
Core Financial Metrics are then adjusted by the attainment of ESG goals
via an ESG Modifier and then multiplied by an individual’s performance
measured against pre-defined objectives.
Variable long-term incentive compensation. LTI performance is aligned
with the Company’s stock price and is awarded in the form of stock
options, restricted stock units (“RSUs”) and Performance Share Units
(“PSUs”). PSUs, which are granted under our Performance Share Program
(“PSP”), are only payable if the Company’s CROIC and TSR relative
to companies in the S&P 500 Industrials Index exceed threshold
performance.
(a)
See Section V, “Compensation Program Descriptions and Compensation Decisions”, for additional discussion of these components of compensation.
As illustrated, the Committee places significant emphasis on variable compensation (AIM and LTI) so that a substantial percentage of each
NEO’s target TDC is contingent on the successful achievement of the Company’s short-term and long-term performance goals.
Good Compensation Governance Practices
What We Do
What We Don’t Do
Diversified metrics for our AIM and PSP to align with business strategies and
shareholder interests, including ESG matters
Capped incentive awards tied to the achievement of rigorous, pre-
determined and measurable performance objectives
Significant emphasis on variable compensation in designing our
compensation programs
Regular competitive benchmarking and compensation reviews
Commitment to fair and competitive pay for our employees and the
avoidance of discrimination
Annual shareholder advisory vote on executive compensation
Independent compensation consultant to advise the Committee
Clawback / recoupment policy
Robust stock ownership requirements for our executives
Reasonable limits on full-value awards
Annual review of risk in executive compensation plans
Limit of $1 million dollars on non-employee directors’ annual compensation
No tax gross-ups for any change-in-control agreement
No dividends on unvested restricted stock and no
dividend equivalents on unvested restricted stock units
or performance units until the underlying awards vest
No liberal share recycling practices for options
No “Single-trigger” vesting for any cash payments
upon a change in control
No “Single-trigger” vesting for any time-based equity
awards upon a change in control
No hedging or pledging of Company stock by
directors and executive officers
No re-pricing of equity awards
II. Compensation Philosophy and Design Principles
Our executive compensation programs are designed to align the compensation of our executives with the Company’s performance and
strategy, and to create sustainable shareholder value. The Committee makes compensation decisions considering economic, technological,
regulatory, investor and competitive factors, as well as our executive compensation principles. The Committee regularly reviews and assesses
the philosophy, objectives and components of our executive compensation programs in relation to our short and long-term business objectives
and has concluded that our compensation programs are designed with the appropriate balance of risk and reward and do not encourage
excessive or unnecessary risk-taking behavior.
The design principles that govern our executive compensation programs are:
DESIGN PRINCIPLES AND RATIONALE
HOW THIS IS APPLIED TO TRANE TECHNOLOGIES PRACTICE
Business Strategy Alignment
Our executive compensation programs allow
flexibility to align with Company or business
strategies. The programs focus individuals
within the Company’s strategic business units on
specific financial measures to meet the
short and long-term performance goals of the
business for which they are accountable.
It is not only possible but also desirable for certain leaders to earn
substantial awards in years when their business outperforms against our
Annual Operating Plan. Conversely, if a business fails to meet its
performance goals, that business’ leader may earn a lesser award than their
peers in that year. To provide a balanced incentive, all executives have a
significant portion of their compensation tied to Company performance.
Pay for Performance
A strong alignment between pay and performance is
paramount to our success. Accordingly, each
executive’s target TDC is tied to Company, business
and individual performance against set goals.
Company and business performance are measured against pre-established
financial, operational and strategic objectives as set by the Committee.
Individual performance is measured against pre-established individual goals
as well as demonstrated competencies and behaviors consistent with our
leadership principles.
In addition, a portion of the long-term incentive is earned based upon
Company CROIC and TSR relative to peer companies.
Shareholder Alignment
Our executive compensation programs align
the interests of our executives with those of
shareholders by incorporating key financial
targets such as Revenue growth, Adjusted
EBITDA, Free Cash Flow, CROIC and TSR as well as
proactively addressing ESG issues.
Financial targets correlate with both share price appreciation over time
and the generation of cash flow for the Company, with an ESG modifier that
ties incentive compensation to the Company’s 2030 sustainability goals.
In addition, our long-term incentives are tied to total shareholder returns and the
effective use of assets to generate cash flow. Other program requirements, including
share ownership guidelines for executives and vesting schedules on equity awards
further align executives’ and shareholders’ interests.
Mix of Short and Long-Term Incentives
A proper mix of short and long-term incentives is
important to encourage consistent behavior and
performance that support the achievement of
the Company’s annual financial objectives while
promoting the long-term sustainability of our
business and maximizing shareholder value.
Internal Parity
Each executive’s target TDC opportunity is
proportionate with the responsibility, scope and
complexity of their role within the Company, as well as
their skills and experience.
Market Competitiveness
Compensation opportunities must serve to
attract and retain high performing executives in
a competitive talent market.
The mix of pay is determined with a focus on the Company’s pay for
performance compensation philosophy and strategic objectives as well as
what is deemed competitive within the market.
Comparable jobs are assigned comparable target compensation
opportunities. An annual review of pay equity by gender is completed for the
Company globally. In the U.S., an additional review of pay equity by race/ethnicity is
conducted annually.
Target TDC levels are set using applicable market benchmarks with
consideration of retention and recruiting demands in the industries and
markets where we compete for business and executive talent.
Each executive’s target TDC may be above or below the market benchmark
based on their level of experience, proficiency, performance and potential
growth relative to the duties required of their position.
2023 Proxy Statement
47
48
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
2022 Say-on-Pay Vote
II. Compensation Philosophy and Design Principles
The Committee considers the results of the annual advisory vote on executive compensation in making determinations about
the structure of Trane Technologies’ pay program or whether any changes to the program should be considered. In 2022,
92% of shareholders voted in favor of “Say-on-Pay.” In addition to shareholder feedback, the Committee reviews information
provided by its independent compensation consultant regarding general compensation practices within our Compensation
Peer Group, as well as third-party survey data to assess relevant market conditions. As a result of this analysis, the
Committee determined it was appropriate to maintain the core components of our executive compensation program and no
program modifications were made.
92%
Our executive compensation programs are designed to align the compensation of our executives with the Company’s performance and
strategy, and to create sustainable shareholder value. The Committee makes compensation decisions considering economic, technological,
regulatory, investor and competitive factors, as well as our executive compensation principles. The Committee regularly reviews and assesses
the philosophy, objectives and components of our executive compensation programs in relation to our short and long-term business objectives
and has concluded that our compensation programs are designed with the appropriate balance of risk and reward and do not encourage
excessive or unnecessary risk-taking behavior.
Executive Compensation Program Overview
The Committee seeks to provide reasonable and competitive executive compensation programs which are structured to attract and retain
best-in-class leaders, incentivize and reward the achievement of short and long-term Company goals and align the interests of executives with
shareholders to provide sustainable value. The table below reflects the primary components of our executive compensation program and the
proportion of each component relative to target total direct compensation (“TDC”):
Component(a)
Chair and CEO
Other NEOs
Description of Component
Base Salary
11%
24%
Fixed cash compensation.
D
E
X
I
F
K
K
S
S
I
I
R
R
T
T
A
A
Y
Y
A
A
P
P
Annual
Incentive
Matrix (“AIM”)
Long-Term
Incentives
(“LTI”)
17%
20%
Variable cash incentive compensation. Any award earned is based on
performance measured against pre-defined annual Revenue, Adjusted
EBITDA and Free Cash Flow objectives as set by the Committee. These
Core Financial Metrics are then adjusted by the attainment of ESG goals
via an ESG Modifier and then multiplied by an individual’s performance
measured against pre-defined objectives.
Variable long-term incentive compensation. LTI performance is aligned
with the Company’s stock price and is awarded in the form of stock
options, restricted stock units (“RSUs”) and Performance Share Units
(“PSP”), are only payable if the Company’s CROIC and TSR relative
to companies in the S&P 500 Industrials Index exceed threshold
performance.
72%
56%
(“PSUs”). PSUs, which are granted under our Performance Share Program
(a)
See Section V, “Compensation Program Descriptions and Compensation Decisions”, for additional discussion of these components of compensation.
As illustrated, the Committee places significant emphasis on variable compensation (AIM and LTI) so that a substantial percentage of each
NEO’s target TDC is contingent on the successful achievement of the Company’s short-term and long-term performance goals.
Good Compensation Governance Practices
What We Do
What We Don’t Do
Diversified metrics for our AIM and PSP to align with business strategies and
No tax gross-ups for any change-in-control agreement
shareholder interests, including ESG matters
Capped incentive awards tied to the achievement of rigorous, pre-
determined and measurable performance objectives
No dividends on unvested restricted stock and no
dividend equivalents on unvested restricted stock units
or performance units until the underlying awards vest
Significant emphasis on variable compensation in designing our
No liberal share recycling practices for options
compensation programs
No “Single-trigger” vesting for any cash payments
Regular competitive benchmarking and compensation reviews
upon a change in control
Commitment to fair and competitive pay for our employees and the
No “Single-trigger” vesting for any time-based equity
avoidance of discrimination
Annual shareholder advisory vote on executive compensation
Independent compensation consultant to advise the Committee
Clawback / recoupment policy
Robust stock ownership requirements for our executives
Reasonable limits on full-value awards
Annual review of risk in executive compensation plans
Limit of $1 million dollars on non-employee directors’ annual compensation
awards upon a change in control
No hedging or pledging of Company stock by
directors and executive officers
No re-pricing of equity awards
The design principles that govern our executive compensation programs are:
DESIGN PRINCIPLES AND RATIONALE
HOW THIS IS APPLIED TO TRANE TECHNOLOGIES PRACTICE
Business Strategy Alignment
Our executive compensation programs allow
flexibility to align with Company or business
strategies. The programs focus individuals
within the Company’s strategic business units on
specific financial measures to meet the
short and long-term performance goals of the
business for which they are accountable.
It is not only possible but also desirable for certain leaders to earn
substantial awards in years when their business outperforms against our
Annual Operating Plan. Conversely, if a business fails to meet its
performance goals, that business’ leader may earn a lesser award than their
peers in that year. To provide a balanced incentive, all executives have a
significant portion of their compensation tied to Company performance.
Pay for Performance
A strong alignment between pay and performance is
paramount to our success. Accordingly, each
executive’s target TDC is tied to Company, business
and individual performance against set goals.
Company and business performance are measured against pre-established
financial, operational and strategic objectives as set by the Committee.
Individual performance is measured against pre-established individual goals
as well as demonstrated competencies and behaviors consistent with our
leadership principles.
In addition, a portion of the long-term incentive is earned based upon
Company CROIC and TSR relative to peer companies.
Shareholder Alignment
Our executive compensation programs align
the interests of our executives with those of
shareholders by incorporating key financial
targets such as Revenue growth, Adjusted
EBITDA, Free Cash Flow, CROIC and TSR as well as
proactively addressing ESG issues.
Financial targets correlate with both share price appreciation over time
and the generation of cash flow for the Company, with an ESG modifier that
ties incentive compensation to the Company’s 2030 sustainability goals.
In addition, our long-term incentives are tied to total shareholder returns and the
effective use of assets to generate cash flow. Other program requirements, including
share ownership guidelines for executives and vesting schedules on equity awards
further align executives’ and shareholders’ interests.
Mix of Short and Long-Term Incentives
A proper mix of short and long-term incentives is
important to encourage consistent behavior and
performance that support the achievement of
the Company’s annual financial objectives while
promoting the long-term sustainability of our
business and maximizing shareholder value.
Internal Parity
Each executive’s target TDC opportunity is
proportionate with the responsibility, scope and
complexity of their role within the Company, as well as
their skills and experience.
Market Competitiveness
Compensation opportunities must serve to
attract and retain high performing executives in
a competitive talent market.
The mix of pay is determined with a focus on the Company’s pay for
performance compensation philosophy and strategic objectives as well as
what is deemed competitive within the market.
Comparable jobs are assigned comparable target compensation
opportunities. An annual review of pay equity by gender is completed for the
Company globally. In the U.S., an additional review of pay equity by race/ethnicity is
conducted annually.
Target TDC levels are set using applicable market benchmarks with
consideration of retention and recruiting demands in the industries and
markets where we compete for business and executive talent.
Each executive’s target TDC may be above or below the market benchmark
based on their level of experience, proficiency, performance and potential
growth relative to the duties required of their position.
2023 Proxy Statement
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48
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
III. Analysis to Support the Determination of Target Total
Direct Compensation
The Committee reviews and evaluates our executive compensation levels and practices against peer companies of comparable revenue,
industry and/or business fit with which we compete for executive talent (the “Compensation Peer Group”). During 2022, these reviews were
conducted throughout the year using a variety of methods and multiple sources of information such as:
• The direct analysis of the Proxy Statements of other global manufacturers and service providers (refer to peer group below);
• A review of compensation survey data of other global industrial companies of similar size and revenue published by independent
consulting firms;
• A review of customized compensation survey data provided by independent consulting firms; and
• Feedback received from external constituencies.
Many of the companies included in these compensation surveys are also included in the Standard & Poor’s 500 Industrials Index referred to in
our 2022 Form 10-K under the caption “Performance Graph.”
The Committee, with the assistance of its independent advisor, evaluates the Compensation Peer Group annually to ensure alignment and
reasonableness, while seeking to avoid significant changes to ensure a level of consistency year-over-year. The median 2022 revenue of the
2022 Compensation Peer Group was $16.1 billion, and the median market cap of the 2022 Compensation Peer Group as of the end of 2022
was $35.4 billion, as compared to 2022 revenue for the Company of $16.0 billion and market cap for the Company at the end of 2022 of
$38.5 billion. This peer group is comprised of the following sixteen global companies and remains unchanged from 2021.
Ametek, Inc.
Dover Corporation
Honeywell International Inc.
Otis Worldwide Corporation
Carrier Global Corporation
Eaton Corporation plc
Illinois Tool Works Inc.
Parker-Hannifin Corporation
IV. Role of the Committee, Independent Advisor and
Committee Actions
The Committee, which is composed solely of independent directors, oversees our compensation plans and policies and equity-based
programs and reviews and approves all forms of compensation relating to our executive officers, including the NEOs.
The Committee solely and independently decides the compensation components and the amounts to be awarded to our Chair and CEO. Our
Chair and CEO does not make any recommendations regarding his own compensation and is not informed of these awards until the decisions
have been finalized. Our Chair and CEO makes compensation recommendations related to our other NEOs and executive officers. The
Committee considers these recommendations when approving the compensation components and amounts to be awarded to our
other NEOs.
The Committee is responsible for reviewing and approving amendments to our executive compensation and benefit plans. In addition, the
Committee is responsible for reviewing our principal broad-based employee benefit plans and making recommendations to our Board of
Directors for significant amendments to, or termination of, such plans. The Committee’s charter and annual agenda incorporates a broader
range of human capital issues, beyond compensation, including corporate culture, diversity and inclusion and pay-equity—many of the topics
which would fall under the social aspect of ESG issues. The Committee’s Charter is available on our website at www.tranetechnologies.com.
The Committee has the authority to retain an independent advisor for the purpose of reviewing and providing guidance related to our executive
compensation and benefit programs. The Committee is directly responsible for the compensation and oversight of the independent advisor.
For 2022, the Committee continued its engagement with Korn Ferry to serve as its independent compensation advisor. The services that Korn
Ferry provides to the Committee include:
• Review and analysis of executive compensation benchmarking data for the Chair and CEO and other top executives as needed;
• Review and analysis of the Compensation Peer Group used to benchmark the Company’s executive pay levels;
Cummins Inc.
Emerson Electric Co.
Johnson Controls International plc
Rockwell Automation, Inc.
• Preparation of ad hoc analyses for the Committee to support decision-making around the executive compensation program; and
Danaher Corporation
Fortive Corporation
Lennox International Inc.
TE Connectivity Ltd.
• Review and analysis of and advisement on management proposals regarding key components of the executive compensation program.
In assessing the relationship of CEO compensation to compensation of other executive officers (including our NEOs), the Committee considers
overall organization structure and scope of responsibility and also reviews the NEOs’ compensation levels relative to the CEO and to one
another. This ensures that the target TDC levels are set in consideration of internal pay equity as well as market references and each
executive’s experience, proficiency, performance and potential growth relative to the duties required of their position.
The Committee determined that Korn Ferry is independent and does not have a conflict of interest. In making this determination, the
Committee considered the factors adopted by the NYSE with respect to independence and conflicts of interest.
2023 Proxy Statement
49
50
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
III. Analysis to Support the Determination of Target Total
Direct Compensation
The Committee reviews and evaluates our executive compensation levels and practices against peer companies of comparable revenue,
industry and/or business fit with which we compete for executive talent (the “Compensation Peer Group”). During 2022, these reviews were
conducted throughout the year using a variety of methods and multiple sources of information such as:
• The direct analysis of the Proxy Statements of other global manufacturers and service providers (refer to peer group below);
• A review of compensation survey data of other global industrial companies of similar size and revenue published by independent
consulting firms;
• A review of customized compensation survey data provided by independent consulting firms; and
• Feedback received from external constituencies.
Many of the companies included in these compensation surveys are also included in the Standard & Poor’s 500 Industrials Index referred to in
our 2022 Form 10-K under the caption “Performance Graph.”
The Committee, with the assistance of its independent advisor, evaluates the Compensation Peer Group annually to ensure alignment and
reasonableness, while seeking to avoid significant changes to ensure a level of consistency year-over-year. The median 2022 revenue of the
2022 Compensation Peer Group was $16.1 billion, and the median market cap of the 2022 Compensation Peer Group as of the end of 2022
was $35.4 billion, as compared to 2022 revenue for the Company of $16.0 billion and market cap for the Company at the end of 2022 of
$38.5 billion. This peer group is comprised of the following sixteen global companies and remains unchanged from 2021.
Ametek, Inc.
Dover Corporation
Honeywell International Inc.
Otis Worldwide Corporation
Carrier Global Corporation
Eaton Corporation plc
Illinois Tool Works Inc.
Parker-Hannifin Corporation
IV. Role of the Committee, Independent Advisor and
Committee Actions
The Committee, which is composed solely of independent directors, oversees our compensation plans and policies and equity-based
programs and reviews and approves all forms of compensation relating to our executive officers, including the NEOs.
The Committee solely and independently decides the compensation components and the amounts to be awarded to our Chair and CEO. Our
Chair and CEO does not make any recommendations regarding his own compensation and is not informed of these awards until the decisions
have been finalized. Our Chair and CEO makes compensation recommendations related to our other NEOs and executive officers. The
Committee considers these recommendations when approving the compensation components and amounts to be awarded to our
other NEOs.
The Committee is responsible for reviewing and approving amendments to our executive compensation and benefit plans. In addition, the
Committee is responsible for reviewing our principal broad-based employee benefit plans and making recommendations to our Board of
Directors for significant amendments to, or termination of, such plans. The Committee’s charter and annual agenda incorporates a broader
range of human capital issues, beyond compensation, including corporate culture, diversity and inclusion and pay-equity—many of the topics
which would fall under the social aspect of ESG issues. The Committee’s Charter is available on our website at www.tranetechnologies.com.
The Committee has the authority to retain an independent advisor for the purpose of reviewing and providing guidance related to our executive
compensation and benefit programs. The Committee is directly responsible for the compensation and oversight of the independent advisor.
For 2022, the Committee continued its engagement with Korn Ferry to serve as its independent compensation advisor. The services that Korn
Ferry provides to the Committee include:
• Review and analysis of executive compensation benchmarking data for the Chair and CEO and other top executives as needed;
• Review and analysis of the Compensation Peer Group used to benchmark the Company’s executive pay levels;
Cummins Inc.
Emerson Electric Co.
Johnson Controls International plc
Rockwell Automation, Inc.
• Preparation of ad hoc analyses for the Committee to support decision-making around the executive compensation program; and
Danaher Corporation
Fortive Corporation
Lennox International Inc.
TE Connectivity Ltd.
• Review and analysis of and advisement on management proposals regarding key components of the executive compensation program.
In assessing the relationship of CEO compensation to compensation of other executive officers (including our NEOs), the Committee considers
overall organization structure and scope of responsibility and also reviews the NEOs’ compensation levels relative to the CEO and to one
another. This ensures that the target TDC levels are set in consideration of internal pay equity as well as market references and each
executive’s experience, proficiency, performance and potential growth relative to the duties required of their position.
The Committee determined that Korn Ferry is independent and does not have a conflict of interest. In making this determination, the
Committee considered the factors adopted by the NYSE with respect to independence and conflicts of interest.
2023 Proxy Statement
49
50
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
V. Compensation Program Descriptions and
Compensation Decisions
The following table provides a summary of the components, objectives, risk mitigation factors and other key features of our executive
compensation program.
Compensation
Component
Base Salary
Annual Incentive Matrix
(“AIM”) Program
Component Objective Including
Risk Mitigation Factors
Key Features
Provides a sufficient and stable source of
cash compensation that rewards the skill
and expertise that our executive officers
contribute to the Company on a day-to-
day basis.
Serves as an annual cash award tied
to the achievement of pre-established
financial, operational, and strategic
performance objectives.
Amount of cash award earned cannot
exceed a maximum payout of 200% of
individual target levels and is also subject
to a clawback in accordance with our
clawback policy.
Avoids the encouragement of excessive
risk-taking by ensuring that an appropriate
level of cash compensation is not at risk.
Each NEO has an AIM target expressed
as a percentage of base salary. Actual
AIM payouts are dependent on enterprise
financial performance, performance
relative to established ESG objectives and
individual performance.
Long-Term Incentive Program
(“LTI”)
Incentivizes executives to achieve
sustainable performance results and
maximize growth, efficiency and long-term
shareholder value creation.
Mix of stock options, RSUs and PSUs
places a substantial portion of
compensation at risk and effectively links
equity compensation to shareholder value
creation and financial results.
• LTI: Performance
Share Program (“PSP”)
Structured to align management’s interests
with those of shareholders.
Amount earned cannot exceed a maximum
payout of 200% of the individual target
shares granted and is also subject to a
clawback in accordance with our
clawback policy.
PSUs granted under the PSP are earned or
forfeited following the conclusion of a three-
year performance period based on relative
TSR and relative CROIC compared to
companies within the S&P 500 Industrials
Index (with equal weight given to
each metric).
Actual value of the PSUs earned depends on
our share price at the time of payment.
• LTI: Stock Options /
Restricted Stock Units (“RSUs”)
Aligns management’s interests with those of
shareholders and bolsters retention. Awards
are subject to a clawback in accordance
with our clawback policy.
Stock options and RSUs are granted
annually, with stock options having an
exercise price equal to the fair market value
of ordinary shares on the date of grant.
Both stock options and RSUs typically vest
ratably over three years, at a rate of one third
per year.
Stock options expire on the day immediately
preceding the 10th anniversary of the grant
date (unless employment terminates sooner).
2023 Proxy Statement
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52
Base Salary
(Dollar Amounts Annualized)
Mr. David S. Regnery
Mr. Christopher J. Kuehn
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Mr. Raymond D. Pittard
The table below reflects the 2022 base salary adjustments for our NEOs. When determining base salary adjustments, each NEO is evaluated
based on their positioning relative to the market for their role, the results achieved and their performance relative to our leadership principles.
12/31/2021
12/31/2022
($)
($)
1,200,000 1,250,000
725,000
775,000
615,000
640,000
575,000
600,000
565,000
587,500
Annual Incentive Matrix (“AIM”) Program
The AIM program is an annual cash incentive program designed to reward NEOs for Revenue growth, increases in Adjusted EBITDA, the
delivery of strong Free Cash Flow, performance against ESG objectives and individual contributions to the Company. We believe that our AIM
program design provides participants with clarity as to how they can earn a cash incentive based on strong performance relative to each
metric. The Committee establishes a target award for each NEO that is expressed as a percentage of base salary. Individual AIM payouts are
calculated as the product of a financial performance score, which may be adjusted up or down by an ESG modifier, and an individual
performance score, all of which are based on achievement relative to pre-established performance objectives set by the Committee. Individual
AIM awards are calculated by multiplying individual AIM targets by an AIM Payout Percentage calculated as illustrated below:
Financial Score:
Core Financial
Metrics
×
1/3 Adjusted EBITDA
1/3 Free Cash Flow
Modifier
(Up to +/- 20%)
Adjusted
AIM Score
=
Modifier
×
1/3 Revenue
ESG Modifier
Financial Score ×
Performance
Individual
Performance
Score
(0% to 150%)
against
Individual
Objectives
=
AIM Payout
Percentage
(0% to 200%)
Financial Score ×
ESG Modifier ×
Individual
Performance Score
The AIM incentive opportunity is tied to pre-established financial goals for three equally weighted performance metrics (“Core Financial
Metrics”): Revenue, Adjusted EBITDA and Free Cash Flow. These metrics align with our objectives to profitably grow the businesses and
improve margins through operational efficiency. Threshold performance for each metric must be achieved for any incentive to be payable for
that metric. The financial score is the weighted sum of the calculated payout percentage for each metric.
To more closely align the annual short-term incentive compensation of our leaders to the value that we, as a Company, place on environmental
sustainability and employee diversity and inclusion, we utilize an ESG modifier as a component of Trane Technologies’ annual incentive
program. This strategic modifier may adjust AIM payout amounts upward or downward by up to 20% based on performance against four
equally weighted environmental sustainability and diversity and inclusion objectives: internal greenhouse gas reduction, external carbon
emissions reduction, increase in gender representation and increase in racial/ethnic diversity representation in the U.S., in conjunction with the
Committee’s holistic review of the Company’s key accomplishments and actions taken during the year to advance our ESG performance and
progress towards our 2030 sustainability commitments. The Committee will not apply the ESG Modifier to increase an annual cash incentive
payout above the overall cap of 200% of the total target payout opportunity under the program.
Individual performance scores are based on each NEO’s performance measured against their individual performance objectives.
Individual AIM awards are determined by multiplying the NEO’s target award by the financial performance score and ESG modifier and then
multiplying that result by the individual performance score. AIM payouts cannot exceed 200% of the target award. If the overall AIM payout
score is less than 30%, no award is payable.
2022 AIM Revenue, Adjusted EBITDA and Free Cash Flow performance goals were set based on 2022 financial plans and are summarized
with performance relative to those goals in the following table:
V. Compensation Program Descriptions and
Base Salary
Compensation Decisions
The table below reflects the 2022 base salary adjustments for our NEOs. When determining base salary adjustments, each NEO is evaluated
based on their positioning relative to the market for their role, the results achieved and their performance relative to our leadership principles.
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
The following table provides a summary of the components, objectives, risk mitigation factors and other key features of our executive
Component Objective Including
Risk Mitigation Factors
Key Features
Provides a sufficient and stable source of
Avoids the encouragement of excessive
risk-taking by ensuring that an appropriate
level of cash compensation is not at risk.
(Dollar Amounts Annualized)
Mr. David S. Regnery
Mr. Christopher J. Kuehn
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Mr. Raymond D. Pittard
12/31/2021
($)
12/31/2022
($)
1,200,000 1,250,000
725,000
775,000
615,000
640,000
575,000
600,000
565,000
587,500
Annual Incentive Matrix (“AIM”) Program
The AIM program is an annual cash incentive program designed to reward NEOs for Revenue growth, increases in Adjusted EBITDA, the
delivery of strong Free Cash Flow, performance against ESG objectives and individual contributions to the Company. We believe that our AIM
program design provides participants with clarity as to how they can earn a cash incentive based on strong performance relative to each
metric. The Committee establishes a target award for each NEO that is expressed as a percentage of base salary. Individual AIM payouts are
calculated as the product of a financial performance score, which may be adjusted up or down by an ESG modifier, and an individual
performance score, all of which are based on achievement relative to pre-established performance objectives set by the Committee. Individual
AIM awards are calculated by multiplying individual AIM targets by an AIM Payout Percentage calculated as illustrated below:
Financial Score:
Core Financial
Metrics
1/3 Revenue
1/3 Adjusted EBITDA
1/3 Free Cash Flow
Modifier
(Up to +/- 20%)
Adjusted
AIM Score
×
ESG Modifier
=
×
Financial Score ×
Modifier
Individual
Performance
Score
(0% to 150%)
Performance
against
Individual
Objectives
=
AIM Payout
Percentage
(0% to 200%)
Financial Score ×
ESG Modifier ×
Individual
Performance Score
The AIM incentive opportunity is tied to pre-established financial goals for three equally weighted performance metrics (“Core Financial
Metrics”): Revenue, Adjusted EBITDA and Free Cash Flow. These metrics align with our objectives to profitably grow the businesses and
improve margins through operational efficiency. Threshold performance for each metric must be achieved for any incentive to be payable for
that metric. The financial score is the weighted sum of the calculated payout percentage for each metric.
To more closely align the annual short-term incentive compensation of our leaders to the value that we, as a Company, place on environmental
sustainability and employee diversity and inclusion, we utilize an ESG modifier as a component of Trane Technologies’ annual incentive
program. This strategic modifier may adjust AIM payout amounts upward or downward by up to 20% based on performance against four
equally weighted environmental sustainability and diversity and inclusion objectives: internal greenhouse gas reduction, external carbon
emissions reduction, increase in gender representation and increase in racial/ethnic diversity representation in the U.S., in conjunction with the
Committee’s holistic review of the Company’s key accomplishments and actions taken during the year to advance our ESG performance and
progress towards our 2030 sustainability commitments. The Committee will not apply the ESG Modifier to increase an annual cash incentive
payout above the overall cap of 200% of the total target payout opportunity under the program.
Individual performance scores are based on each NEO’s performance measured against their individual performance objectives.
Individual AIM awards are determined by multiplying the NEO’s target award by the financial performance score and ESG modifier and then
multiplying that result by the individual performance score. AIM payouts cannot exceed 200% of the target award. If the overall AIM payout
score is less than 30%, no award is payable.
2022 AIM Revenue, Adjusted EBITDA and Free Cash Flow performance goals were set based on 2022 financial plans and are summarized
with performance relative to those goals in the following table:
2023 Proxy Statement
51
52
compensation program.
Compensation
Component
Base Salary
Annual Incentive Matrix
(“AIM”) Program
cash compensation that rewards the skill
and expertise that our executive officers
contribute to the Company on a day-to-
day basis.
Serves as an annual cash award tied
to the achievement of pre-established
financial, operational, and strategic
performance objectives.
Amount of cash award earned cannot
exceed a maximum payout of 200% of
individual target levels and is also subject
to a clawback in accordance with our
clawback policy.
Each NEO has an AIM target expressed
as a percentage of base salary. Actual
AIM payouts are dependent on enterprise
financial performance, performance
relative to established ESG objectives and
individual performance.
Long-Term Incentive Program
Incentivizes executives to achieve
Mix of stock options, RSUs and PSUs
(“LTI”)
sustainable performance results and
places a substantial portion of
maximize growth, efficiency and long-term
compensation at risk and effectively links
shareholder value creation.
equity compensation to shareholder value
creation and financial results.
• LTI: Performance
Share Program (“PSP”)
Structured to align management’s interests
PSUs granted under the PSP are earned or
with those of shareholders.
Amount earned cannot exceed a maximum
payout of 200% of the individual target
shares granted and is also subject to a
clawback in accordance with our
clawback policy.
forfeited following the conclusion of a three-
year performance period based on relative
TSR and relative CROIC compared to
companies within the S&P 500 Industrials
Index (with equal weight given to
each metric).
Actual value of the PSUs earned depends on
our share price at the time of payment.
• LTI: Stock Options /
Aligns management’s interests with those of
Stock options and RSUs are granted
Restricted Stock Units (“RSUs”)
shareholders and bolsters retention. Awards
annually, with stock options having an
are subject to a clawback in accordance
exercise price equal to the fair market value
with our clawback policy.
of ordinary shares on the date of grant.
Both stock options and RSUs typically vest
ratably over three years, at a rate of one third
per year.
Stock options expire on the day immediately
preceding the 10th anniversary of the grant
date (unless employment terminates sooner).
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
Enterprise
Metric
Revenue(b)
Adjusted EBITDA(b)
Free Cash Flow(b)
Threshold
Performance
($M)
Target
Performance
($M)
Maximum
Performance
($M)
2022 Adjusted
Performance
($M)(a)
14,502.00
15,265.20
16,028.50
16,133.32
2,370.10
2,633.40
2,896.80
1,329.40
1,661.70
1,994.00
2,698.68
1,600.13
(a)
(b)
2022 Performance reflects adjustments as summarized below.
Financial metrics generate payout of 30% at Threshold performance, 100% at Target performance and 200% at Maximum performance. Results are interpolated
between performance levels.
The Committee retains the authority to adjust the Company’s reported financial results for the impact of changes in accounting principles,
extraordinary items, and unusual or non-recurring gains or losses, including significant differences from the assumptions contained in the
operating plan upon which the incentive targets were established, based on its own review and on recommendations by the Chair and CEO.
Revenue results are also adjusted to reflect the foreign exchange rate used at the time the incentive targets were established. Adjustments to
reported financial results are intended to better reflect actual performance results, align award payments with decisions which support the plan
and strategies, avoid unintended inflation or deflation of awards due to unusual or non-recurring items in the applicable period, and emphasize
the Company’s preference for long-term and sustainable growth.
Before approving annual cash incentive payouts for the 2022 performance year, the Committee reviewed with management key
accomplishments and highlights for 2022 that could impact the Company’s financial performance target attainment. Following that review, the
Committee approved adjustments to 2022 financial performance results for purposes of the Annual Incentive Matrix (“AIM”) plan to (a) offset
contributions from two acquisitions completed during 2022, which were not contemplated when the annual performance measures were set:
Tozour Energy Systems which closed in the second quarter, and the AL-KO acquisition which closed in the fourth quarter, and (b) adjust for
the capital expenditures required to rebuild the Arecibo, Puerto Rico manufacturing facility damaged by a tornado in May 2022. These
adjustments, both positive and negative, equated to a net 3% increase to payout amounts and were reviewed with the Audit Committee prior
to approval by the Committee.
In accordance with the AIM plan design, the financial performance results are then adjusted upward or downward by an ESG modifier. The
ESG modifier can have a positive or negative impact of up to 20% based on the Company’s performance against four equally weighted
diversity and inclusion and environmental sustainability objectives.
Our annual diversity objectives are set to help cultivate a workforce that reflects the communities where we live and work and to create a glide
path that will allow us to meet our 2030 Sustainability Commitments for gender parity and racial and ethnic diversity. In 2022, representation of
women in management roles increased from 23.1% at the end of 2021 to 24.2% at the end of 2022 and we increased our racially or ethnically
diverse representation from 18.4% to 19.6% of our U.S. salaried population.
Our environmental sustainability goals are science-based targets. These annual targets align us with our 2030 commitments toward a
sustainable future by reducing greenhouse gas emissions in our worldwide operations, transportation fleets, and product manufacturing
processes, and inspiring the transition to advanced technologies that reduce emissions from product use. In 2022, our internal greenhouse gas
emissions decreased by 32,000 metric tons of CO2e and our external carbon emissions, which are mostly tied to customer product use,
decreased by 40.3 million metric tons of CO2e.
Based on the Company’s quantitative achievement against its established ESG targets and in conjunction with the holistic review of the
Company’s key accomplishments and actions taken during the year to advance our ESG performance toward attainment of our 2030
sustainability commitments, the Committee determined that an ESG modifier of +7% appropriately rewarded 2022 performance and, as a
result, a multiplier of 107% was applied to the financial payout score.
The calculated AIM financial score, inclusive of the +7% ESG modifier, was 146.88% for the NEOs aligned to Enterprise performance.
2023 AIM PROGRAM
For 2023, the AIM program design is not changing as the Committee believes that the current program effectively connects employees to the
Company’s ESG commitments while appropriately focusing on Revenue, Adjusted EBITDA and Free Cash Flow.
Long-Term Incentive Program (“LTI”)
Our long-term incentive program is comprised of stock options, RSUs and PSUs. This mix of equity-based awards places a substantial portion
of compensation at risk and effectively links equity compensation to long-term shareholder value creation and financial results.
Stock Options/Restricted Stock Units
We grant our NEOs an equal mix of stock options and RSUs. The Committee believes that this mix provides an effective balance between
performance and retention for our NEOs, and conserves share usage under our incentive stock plan. Stock options are considered “at risk”
since there is no value unless the stock price appreciates during the term of the option period. RSUs, on the other hand, provide stronger
retentive value because they have value even if our stock price does not grow during the restricted period. The Committee reviews our equity
mix and grant policies annually to ensure they are aligned with our pay for performance philosophy, our executive compensation objectives and
the interests of our shareholders.
Stock option and RSU targets are expressed in dollars. The dollar target is converted to a number of shares based on the fair market value of
the Company’s shares on the date that the award is granted.
Both stock options and RSUs generally vest ratably, one third per year, over a three-year period following the grant. Dividend equivalents are
accrued on outstanding RSU awards at the same time and at the same rate as dividends paid to shareholders. Dividend equivalents on RSUs
are only payable if the underlying RSU award has vested. At the time of vesting, one ordinary share is issued for each RSU, and any accrued
dividend equivalents are paid in cash.
Performance Share Program (“PSP”)
Our PSP is an equity-based incentive compensation program that provides our NEOs and other key executives with an opportunity to earn
PSUs based on our performance relative to the companies in the S&P 500 Industrials Index. PSUs granted in 2022 are earned or forfeited
following a three-year performance period based equally on our relative average CROIC and relative TSR as compared to the companies within
the S&P 500 Industrials Index. The actual number of PSUs earned or forfeited (which can range from 0% to 200% of target) for grants made in
2022 is based on the following thresholds:
Company Performance Relative to the Companies
within the S&P 500 Industrials Index
< 25th Percentile
25th Percentile
50th Percentile
> 75th Percentile
2022 – 2024 Measurement Period
% of Target PSUs Earned*
0%
25%
100%
200%
*
Results are interpolated between percentiles achieved.
PSP target awards for NEOs are expressed as a dollar amount and set in consideration of competitive long-term incentive market values for
executives in our peer group with similar roles and responsibilities and our mix of long-term incentives. The dollar target is converted to share
2022 AIM payout levels for NEOs, inclusive of the adjustments laid out above, are summarized in the following table.
equivalent PSUs based on the fair market value of our shares on the date that the award is granted.
Name
Mr. David S. Regnery
Mr. Christopher J. Kuehn
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Mr. Raymond D. Pittard
AIM Target
($)
AIM Achievement
For 2022(a)
AIM Award
For 2022
($)
1,875,000
161.57%
3,029,377
775,000
544,000
420,000
440,625
161.57%
1,252,143
146.88%
799,021
146.88%
616,891
161.57%
711,903
• TSR is measured as the total stock price appreciation and dividends earned during the three years of the performance cycle. To prevent an
anomalous short-term change in stock price from having an inappropriate and outsized impact on payout levels, a 30-day average stock
price at the beginning and ending periods is used. TSR provides a tool for measuring performance among peers.
• CROIC is measured by dividing Free Cash Flow by gross fixed assets (Property, Plant & Equipment) plus Working Capital (Accounts and
Notes Receivable plus Inventory less Accounts and Notes Payable). CROIC is calculated in accordance with GAAP, subject to adjustments
for unusual or infrequent items; the impact of any change in accounting principles; and gains or charges associated with discontinued
operations or through the acquisition or divestiture of a business. As a result, expense for outstanding PSP awards is recorded using the
fixed accounting method.
(a)
AIM achievement percentages are inclusive of each NEO’s individual performance score and ESG modifier of 107%.
2023 Proxy Statement
53
54
Enterprise
Metric
Revenue(b)
Adjusted EBITDA(b)
Free Cash Flow(b)
2022 Performance reflects adjustments as summarized below.
(a)
(b)
between performance levels.
Threshold
Target
Maximum
2022 Adjusted
Performance
Performance
Performance
Performance
($M)
($M)
($M)
($M)(a)
14,502.00
15,265.20
16,028.50
16,133.32
2,370.10
2,633.40
2,896.80
1,329.40
1,661.70
1,994.00
2,698.68
1,600.13
The Committee retains the authority to adjust the Company’s reported financial results for the impact of changes in accounting principles,
extraordinary items, and unusual or non-recurring gains or losses, including significant differences from the assumptions contained in the
operating plan upon which the incentive targets were established, based on its own review and on recommendations by the Chair and CEO.
Revenue results are also adjusted to reflect the foreign exchange rate used at the time the incentive targets were established. Adjustments to
reported financial results are intended to better reflect actual performance results, align award payments with decisions which support the plan
and strategies, avoid unintended inflation or deflation of awards due to unusual or non-recurring items in the applicable period, and emphasize
the Company’s preference for long-term and sustainable growth.
Before approving annual cash incentive payouts for the 2022 performance year, the Committee reviewed with management key
accomplishments and highlights for 2022 that could impact the Company’s financial performance target attainment. Following that review, the
Committee approved adjustments to 2022 financial performance results for purposes of the Annual Incentive Matrix (“AIM”) plan to (a) offset
contributions from two acquisitions completed during 2022, which were not contemplated when the annual performance measures were set:
Tozour Energy Systems which closed in the second quarter, and the AL-KO acquisition which closed in the fourth quarter, and (b) adjust for
the capital expenditures required to rebuild the Arecibo, Puerto Rico manufacturing facility damaged by a tornado in May 2022. These
adjustments, both positive and negative, equated to a net 3% increase to payout amounts and were reviewed with the Audit Committee prior
to approval by the Committee.
In accordance with the AIM plan design, the financial performance results are then adjusted upward or downward by an ESG modifier. The
ESG modifier can have a positive or negative impact of up to 20% based on the Company’s performance against four equally weighted
diversity and inclusion and environmental sustainability objectives.
Our annual diversity objectives are set to help cultivate a workforce that reflects the communities where we live and work and to create a glide
path that will allow us to meet our 2030 Sustainability Commitments for gender parity and racial and ethnic diversity. In 2022, representation of
women in management roles increased from 23.1% at the end of 2021 to 24.2% at the end of 2022 and we increased our racially or ethnically
diverse representation from 18.4% to 19.6% of our U.S. salaried population.
Our environmental sustainability goals are science-based targets. These annual targets align us with our 2030 commitments toward a
sustainable future by reducing greenhouse gas emissions in our worldwide operations, transportation fleets, and product manufacturing
processes, and inspiring the transition to advanced technologies that reduce emissions from product use. In 2022, our internal greenhouse gas
emissions decreased by 32,000 metric tons of CO2e and our external carbon emissions, which are mostly tied to customer product use,
decreased by 40.3 million metric tons of CO2e.
Based on the Company’s quantitative achievement against its established ESG targets and in conjunction with the holistic review of the
Company’s key accomplishments and actions taken during the year to advance our ESG performance toward attainment of our 2030
sustainability commitments, the Committee determined that an ESG modifier of +7% appropriately rewarded 2022 performance and, as a
result, a multiplier of 107% was applied to the financial payout score.
The calculated AIM financial score, inclusive of the +7% ESG modifier, was 146.88% for the NEOs aligned to Enterprise performance.
2022 AIM payout levels for NEOs, inclusive of the adjustments laid out above, are summarized in the following table.
Name
Mr. David S. Regnery
Mr. Christopher J. Kuehn
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Mr. Raymond D. Pittard
(a)
AIM achievement percentages are inclusive of each NEO’s individual performance score and ESG modifier of 107%.
AIM Target
AIM Achievement
For 2022
($)
For 2022(a)
($)
1,875,000
161.57%
3,029,377
AIM Award
775,000
544,000
420,000
440,625
161.57%
1,252,143
146.88%
799,021
146.88%
616,891
161.57%
711,903
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
2023 AIM PROGRAM
For 2023, the AIM program design is not changing as the Committee believes that the current program effectively connects employees to the
Company’s ESG commitments while appropriately focusing on Revenue, Adjusted EBITDA and Free Cash Flow.
Long-Term Incentive Program (“LTI”)
Financial metrics generate payout of 30% at Threshold performance, 100% at Target performance and 200% at Maximum performance. Results are interpolated
Our long-term incentive program is comprised of stock options, RSUs and PSUs. This mix of equity-based awards places a substantial portion
of compensation at risk and effectively links equity compensation to long-term shareholder value creation and financial results.
Stock Options/Restricted Stock Units
We grant our NEOs an equal mix of stock options and RSUs. The Committee believes that this mix provides an effective balance between
performance and retention for our NEOs, and conserves share usage under our incentive stock plan. Stock options are considered “at risk”
since there is no value unless the stock price appreciates during the term of the option period. RSUs, on the other hand, provide stronger
retentive value because they have value even if our stock price does not grow during the restricted period. The Committee reviews our equity
mix and grant policies annually to ensure they are aligned with our pay for performance philosophy, our executive compensation objectives and
the interests of our shareholders.
Stock option and RSU targets are expressed in dollars. The dollar target is converted to a number of shares based on the fair market value of
the Company’s shares on the date that the award is granted.
Both stock options and RSUs generally vest ratably, one third per year, over a three-year period following the grant. Dividend equivalents are
accrued on outstanding RSU awards at the same time and at the same rate as dividends paid to shareholders. Dividend equivalents on RSUs
are only payable if the underlying RSU award has vested. At the time of vesting, one ordinary share is issued for each RSU, and any accrued
dividend equivalents are paid in cash.
Performance Share Program (“PSP”)
Our PSP is an equity-based incentive compensation program that provides our NEOs and other key executives with an opportunity to earn
PSUs based on our performance relative to the companies in the S&P 500 Industrials Index. PSUs granted in 2022 are earned or forfeited
following a three-year performance period based equally on our relative average CROIC and relative TSR as compared to the companies within
the S&P 500 Industrials Index. The actual number of PSUs earned or forfeited (which can range from 0% to 200% of target) for grants made in
2022 is based on the following thresholds:
Company Performance Relative to the Companies
within the S&P 500 Industrials Index
2022 – 2024 Measurement Period
% of Target PSUs Earned*
< 25th Percentile
25th Percentile
50th Percentile
> 75th Percentile
0%
25%
100%
200%
*
Results are interpolated between percentiles achieved.
PSP target awards for NEOs are expressed as a dollar amount and set in consideration of competitive long-term incentive market values for
executives in our peer group with similar roles and responsibilities and our mix of long-term incentives. The dollar target is converted to share
equivalent PSUs based on the fair market value of our shares on the date that the award is granted.
• TSR is measured as the total stock price appreciation and dividends earned during the three years of the performance cycle. To prevent an
anomalous short-term change in stock price from having an inappropriate and outsized impact on payout levels, a 30-day average stock
price at the beginning and ending periods is used. TSR provides a tool for measuring performance among peers.
• CROIC is measured by dividing Free Cash Flow by gross fixed assets (Property, Plant & Equipment) plus Working Capital (Accounts and
Notes Receivable plus Inventory less Accounts and Notes Payable). CROIC is calculated in accordance with GAAP, subject to adjustments
for unusual or infrequent items; the impact of any change in accounting principles; and gains or charges associated with discontinued
operations or through the acquisition or divestiture of a business. As a result, expense for outstanding PSP awards is recorded using the
fixed accounting method.
2023 Proxy Statement
53
54
The Committee retains the authority and discretion to make downward adjustments to the calculated PSP award payouts or not to grant any
award payout regardless of actual performance.
VI. Other Compensation and Tax Matters
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
Dividend equivalents are accrued on outstanding PSU awards at the same time and at the same rate as dividends paid to shareholders.
Dividend equivalents are only paid upon vesting on the number of PSUs actually earned and vested. Dividend equivalents are payable in cash
at the time the shares associated with vested PSUs are distributed unless the NEO elected to defer the shares into our executive deferred
compensation plan, in which case the dividend equivalents are also deferred and subsequently settled in shares of our stock.
2022 Equity Awards
In 2022, the Committee approved the stock option, RSU and target value of PSU awards based on its evaluation of market competitiveness
and each NEO’s sustained individual performance and demonstrated potential to impact future business results. The values in the table below
reflect equity-based awards approved by the Committee. The target values for the PSU awards differ from the corresponding values reported
in the Summary Compensation Table and the Grants of Plan-Based Awards Table due to different methodologies used in assigning the
economic value of equity-based awards required for accounting and Proxy Statement reporting purposes. The Committee makes equity award
decisions based on grant date expected value while the accounting and Proxy Statement values are determined in accordance with GAAP
requirements. The PSU awards are earned, in part, based on TSR performance relative to the S&P 500 Industrials Index over a three-year
performance period, which requires valuations to take into account the expected payout distribution from 0-200% of target for accounting and
Proxy Statement purposes.
Name
Mr. David S. Regnery
Mr. Christopher J. Kuehn
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Mr. Raymond D. Pittard
Stock Option
Award
($)
Target Value
2022-2024
PSU Award
($)
RSU
Award
($)
2,000,000
2,000,000
4,000,000
625,000
625,000
1,250,000
375,000
375,000
750,000
350,000
350,000
700,000
196,875
196,875
375,000
2020-2022 Performance Share Units Payout
As discussed above, PSUs for the three-year 2020-2022 performance period were earned based on the Company’s CROIC and TSR
performance relative to the companies in the S&P 500 Industrials Index.
• CROIC is measured as the average of the annual CROIC in each of the three years of the performance cycle. CROIC was 29.0% for the
2020-2022 period, which ranked at the 80th percentile of the companies in the S&P 500 Industrials Index.
• TSR is measured as the total stock price appreciation plus dividends earned during the three years of the performance cycle. To account for
stock price volatility, a 30-day average stock price at the beginning and ending periods is used. TSR was 57.17% for the 2020-2022 period,
which ranked at the 78th percentile of the companies in the S&P 500 Industrials Index. For purposes of the TSR calculation, the Reverse
Morris Trust transaction in Q1 2020 was treated as a dividend of $28.93 per share.
PSUs for the 2020-2022 performance cycle achieved 200% of target levels as summarized in the table below.
Performance Metric
Relative CROIC
Relative TSR
Company
Performance
Percentile
Rank
Metric
Payout Weighting
Payout
Level
29.0%
57.17%
80th
78th
200%
200%
50%
50%
Total Award Payout Percentage:
100%
100%
200%
Retirement Programs and Other Benefits
We offer a qualified defined contribution (401(k)) plan called the Trane Technologies Employee Savings Plan (the “ESP”) to our salaried and
non-union hourly U.S. workforce, including the NEOs. The ESP is a plan that provides a dollar-for-dollar Company match on the first six
percent of the employee’s eligible compensation that the employee contributes to the ESP. The ESP has several investment options and is an
important component of our U.S. retirement program.
We also have a nonqualified defined contribution plan. The Trane Technologies Supplemental Employee Savings Plan (the “Supplemental ESP”)
is an unfunded plan that makes up employer contributions that cannot be made to the ESP due to the Internal Revenue Code (“the Code”)
limitation on the amount of compensation considered under the ESP or due to a deferral election under another nonqualified plan.
Supplemental ESP balances are deemed to be invested in the funds selected by the NEOs, which are the same funds available in the ESP,
except for a self-directed brokerage account, which is not available in the Supplemental ESP.
We maintain qualified and nonqualified defined benefit pension plans for our employees hired before July 1, 2012, including our NEOs, to
provide for fixed benefits upon retirement based on the individual’s age, compensation and years of service. These plans include the Trane
Technologies Pension Plan Number One (“Pension Plan”), the Trane Technologies Supplemental Pension Plan (the “Supplemental Pension
Plan I”) and the Trane Technologies Supplemental Pension Plan II (“Supplemental Pension Plan II” and, together with the Supplemental Pension
Plan I, the “Supplemental Pension Plans”) and our supplemental executive retirement plan (the Key Management Supplemental Program
(“KMP”)). In 2022, the Committee elected to close the KMP to new entrants; however, current participants continue to accrue benefits. Refer to
the Pension Benefits table and accompanying narrative for additional details on these programs.
In June 2012, our Board of Directors approved significant changes to our broad-based, qualified retirement programs with the intent to move
employees from a combined defined benefit/defined contribution approach to a fully defined contribution plan approach over time. Employees
active prior to July 1, 2012 were given a choice between continuing to participate in the defined benefit plan until December 31, 2022 or
discontinuing their participation in the defined benefit plan and moving to an enhanced version of the ESP effective January 1, 2013.
Employees hired or rehired on or after July 1, 2012 were automatically covered under the enhanced version of the ESP. Under the enhanced
version of the ESP, employees receive a basic employer contribution equal to two percent of eligible compensation in addition to the
Company’s matching contribution. Effective as of December 31, 2022, accruals in the Pension Plan and the Supplemental Pension Plans have
ceased for all employees. Additional details on the changes can be found in the narrative accompanying the Pension Benefits table.
Our Trane Technologies Executive Deferred Compensation Plan (the “EDCP I”) and the Trane Technologies Executive Deferred Compensation
Plan II (the “EDCP II” and, together with the EDCP I, the “EDCP”) allow eligible employees to defer receipt of a portion of their annual salary,
AIM award and/or PSP award in exchange for deemed investments in our ordinary shares or in the same funds available in the ESP, except for
a self-directed brokerage account. Refer to the Nonqualified Deferred Compensation table for additional details on the EDCP.
We provide an enhanced, long-term disability plan to certain executives. The plan supplements the broad-based group plan and provides an
additional monthly maximum benefit if the executive elects to purchase supplemental coverage under the group plan. It has an underlying
individual policy that is portable when the executive terminates.
In light of the enactment of Section 409A of the Code as part of the American Jobs Creation Act of 2004, “mirror plans” for several of our
nonqualified plans, including the Trane Technologies Supplemental Pension Plan I and the EDCP I, were created. The mirror plans are the
Trane Technologies Supplemental Pension Plan II and the EDCP II. The purpose of these mirror plans is not to provide additional benefits to
participants, but merely to preserve the tax treatment of the plans that were in place prior to December 31, 2004. For the Supplemental
Pension Plans, the mirror plan benefits are calculated by subtracting the original benefit value to avoid double counting the benefit. For the
EDCP plans, balances accrued through December 31, 2004 are maintained separately from balances accrued after that date.
We provide our NEOs with other benefits that we believe are consistent with prevailing market practice and those of our peer companies.
These other benefits and their incremental cost to the Company are reported in “All Other Compensation” shown in the Summary
Compensation Table.
2023 Proxy Statement
55
56
The Committee retains the authority and discretion to make downward adjustments to the calculated PSP award payouts or not to grant any
award payout regardless of actual performance.
VI. Other Compensation and Tax Matters
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
Dividend equivalents are accrued on outstanding PSU awards at the same time and at the same rate as dividends paid to shareholders.
Dividend equivalents are only paid upon vesting on the number of PSUs actually earned and vested. Dividend equivalents are payable in cash
at the time the shares associated with vested PSUs are distributed unless the NEO elected to defer the shares into our executive deferred
compensation plan, in which case the dividend equivalents are also deferred and subsequently settled in shares of our stock.
2022 Equity Awards
In 2022, the Committee approved the stock option, RSU and target value of PSU awards based on its evaluation of market competitiveness
and each NEO’s sustained individual performance and demonstrated potential to impact future business results. The values in the table below
reflect equity-based awards approved by the Committee. The target values for the PSU awards differ from the corresponding values reported
in the Summary Compensation Table and the Grants of Plan-Based Awards Table due to different methodologies used in assigning the
economic value of equity-based awards required for accounting and Proxy Statement reporting purposes. The Committee makes equity award
decisions based on grant date expected value while the accounting and Proxy Statement values are determined in accordance with GAAP
requirements. The PSU awards are earned, in part, based on TSR performance relative to the S&P 500 Industrials Index over a three-year
performance period, which requires valuations to take into account the expected payout distribution from 0-200% of target for accounting and
Proxy Statement purposes.
Name
Mr. David S. Regnery
Mr. Christopher J. Kuehn
Mr. Paul A. Camuti
Mr. Evan M. Turtz
Mr. Raymond D. Pittard
Stock Option
Award
($)
Target Value
RSU
2022-2024
Award
PSU Award
($)
($)
2,000,000
2,000,000
4,000,000
625,000
625,000
1,250,000
375,000
375,000
750,000
350,000
350,000
700,000
196,875
196,875
375,000
2020-2022 Performance Share Units Payout
As discussed above, PSUs for the three-year 2020-2022 performance period were earned based on the Company’s CROIC and TSR
performance relative to the companies in the S&P 500 Industrials Index.
• CROIC is measured as the average of the annual CROIC in each of the three years of the performance cycle. CROIC was 29.0% for the
2020-2022 period, which ranked at the 80th percentile of the companies in the S&P 500 Industrials Index.
• TSR is measured as the total stock price appreciation plus dividends earned during the three years of the performance cycle. To account for
stock price volatility, a 30-day average stock price at the beginning and ending periods is used. TSR was 57.17% for the 2020-2022 period,
which ranked at the 78th percentile of the companies in the S&P 500 Industrials Index. For purposes of the TSR calculation, the Reverse
Morris Trust transaction in Q1 2020 was treated as a dividend of $28.93 per share.
PSUs for the 2020-2022 performance cycle achieved 200% of target levels as summarized in the table below.
Performance Metric
Relative CROIC
Relative TSR
Company
Percentile
Metric
Performance
Rank
Payout Weighting
29.0%
57.17%
80th
78th
200%
200%
50%
50%
Total Award Payout Percentage:
Payout
Level
100%
100%
200%
Retirement Programs and Other Benefits
We offer a qualified defined contribution (401(k)) plan called the Trane Technologies Employee Savings Plan (the “ESP”) to our salaried and
non-union hourly U.S. workforce, including the NEOs. The ESP is a plan that provides a dollar-for-dollar Company match on the first six
percent of the employee’s eligible compensation that the employee contributes to the ESP. The ESP has several investment options and is an
important component of our U.S. retirement program.
We also have a nonqualified defined contribution plan. The Trane Technologies Supplemental Employee Savings Plan (the “Supplemental ESP”)
is an unfunded plan that makes up employer contributions that cannot be made to the ESP due to the Internal Revenue Code (“the Code”)
limitation on the amount of compensation considered under the ESP or due to a deferral election under another nonqualified plan.
Supplemental ESP balances are deemed to be invested in the funds selected by the NEOs, which are the same funds available in the ESP,
except for a self-directed brokerage account, which is not available in the Supplemental ESP.
We maintain qualified and nonqualified defined benefit pension plans for our employees hired before July 1, 2012, including our NEOs, to
provide for fixed benefits upon retirement based on the individual’s age, compensation and years of service. These plans include the Trane
Technologies Pension Plan Number One (“Pension Plan”), the Trane Technologies Supplemental Pension Plan (the “Supplemental Pension
Plan I”) and the Trane Technologies Supplemental Pension Plan II (“Supplemental Pension Plan II” and, together with the Supplemental Pension
Plan I, the “Supplemental Pension Plans”) and our supplemental executive retirement plan (the Key Management Supplemental Program
(“KMP”)). In 2022, the Committee elected to close the KMP to new entrants; however, current participants continue to accrue benefits. Refer to
the Pension Benefits table and accompanying narrative for additional details on these programs.
In June 2012, our Board of Directors approved significant changes to our broad-based, qualified retirement programs with the intent to move
employees from a combined defined benefit/defined contribution approach to a fully defined contribution plan approach over time. Employees
active prior to July 1, 2012 were given a choice between continuing to participate in the defined benefit plan until December 31, 2022 or
discontinuing their participation in the defined benefit plan and moving to an enhanced version of the ESP effective January 1, 2013.
Employees hired or rehired on or after July 1, 2012 were automatically covered under the enhanced version of the ESP. Under the enhanced
version of the ESP, employees receive a basic employer contribution equal to two percent of eligible compensation in addition to the
Company’s matching contribution. Effective as of December 31, 2022, accruals in the Pension Plan and the Supplemental Pension Plans have
ceased for all employees. Additional details on the changes can be found in the narrative accompanying the Pension Benefits table.
Our Trane Technologies Executive Deferred Compensation Plan (the “EDCP I”) and the Trane Technologies Executive Deferred Compensation
Plan II (the “EDCP II” and, together with the EDCP I, the “EDCP”) allow eligible employees to defer receipt of a portion of their annual salary,
AIM award and/or PSP award in exchange for deemed investments in our ordinary shares or in the same funds available in the ESP, except for
a self-directed brokerage account. Refer to the Nonqualified Deferred Compensation table for additional details on the EDCP.
We provide an enhanced, long-term disability plan to certain executives. The plan supplements the broad-based group plan and provides an
additional monthly maximum benefit if the executive elects to purchase supplemental coverage under the group plan. It has an underlying
individual policy that is portable when the executive terminates.
In light of the enactment of Section 409A of the Code as part of the American Jobs Creation Act of 2004, “mirror plans” for several of our
nonqualified plans, including the Trane Technologies Supplemental Pension Plan I and the EDCP I, were created. The mirror plans are the
Trane Technologies Supplemental Pension Plan II and the EDCP II. The purpose of these mirror plans is not to provide additional benefits to
participants, but merely to preserve the tax treatment of the plans that were in place prior to December 31, 2004. For the Supplemental
Pension Plans, the mirror plan benefits are calculated by subtracting the original benefit value to avoid double counting the benefit. For the
EDCP plans, balances accrued through December 31, 2004 are maintained separately from balances accrued after that date.
We provide our NEOs with other benefits that we believe are consistent with prevailing market practice and those of our peer companies.
These other benefits and their incremental cost to the Company are reported in “All Other Compensation” shown in the Summary
Compensation Table.
2023 Proxy Statement
55
56
Severance Arrangements
Share Ownership Requirements
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
We impose share ownership requirements on each of our officers. These share ownership requirements are designed to encourage share
ownership by our officers and to further align their interests with our shareholders. Each officer must achieve and maintain ownership of
ordinary shares or ordinary share equivalents at or above a prescribed level. In October 2022, to align our share ownership requirements with
prevalent market practice, we moved from a fixed-share approach to a multiple of base salary approach.
The new requirements are as follows:
Position
Chair and Chief Executive Officer
Chief Financial Officer
Executive Vice Presidents and Senior Vice Presidents
Strategic Business Unit Presidents and Chief Accounting Officer
(a)
Based on the closing price on the record date of $170.68.
Individual
Ownership
Number of Active
Requirement
Average Actual
Participants as of
(Multiple of
Multiple of Base
the Record Date
Base Salary)
Salary(a)
1
1
7
7
6
4
3
2
15.0
13.1
12.1
3.4
These ownership requirements have been met by all the NEOs who continue to be employed by the Company as of the record date.
Our share ownership program requires the accumulation of ordinary shares (or ordinary share equivalents) over a five-year period following the
date the person becomes subject to share ownership requirements at the rate of 20% of the required level each year. Executives who are
promoted and have their ownership requirement increased have five years to achieve the new level from the date of promotion. Ownership
credit is given for actual ordinary shares owned, deferred compensation that is invested in ordinary shares within our EDCP Plan, ordinary
share equivalents accumulated in our qualified and nonqualified employee savings plans as well as unvested RSUs. Stock options and
unvested PSUs do not count toward meeting the share ownership target. If executives fall behind their scheduled accumulation level during
their applicable accumulation period, or if they fail to maintain their required level of ownership after their applicable accumulation period, their
right to exercise stock options will be limited to “buy and hold” transactions, and any shares received upon the vesting of RSU and PSU
awards must be held until the required ownership level is achieved.
In connection with recruiting of certain officers, we generally enter into employment arrangements that provide for severance payments upon
certain termination events other than in the event of a change in control (which is covered by separate agreements with the officers). Mr.
Regnery has such an arrangement in his employment agreement. In 2019 we amended our Major Restructuring Severance Plan, originally
adopted in 2012, to provide certain employees, including our NEOs, with certain benefits in the event of a termination of employment without
cause or for good reason under a Major Restructuring (as defined in the Post-Employment Section below). Although we do not have a formal
severance policy for our executives (other than in the event of a Major Restructuring), we do have guidelines that in most cases would provide
for severance in the event of termination without cause.
The severance payable under the employment agreement for Mr. Regnery and the benefits available in connection with a Major Restructuring
and under the severance guidelines are further described in the “Post-Employment Benefits” section of this Proxy Statement.
Change-in-Control Provisions
We have entered into change-in-control agreements with our NEOs. Payments are subject to a “double trigger,” meaning that payments would
be received only if an officer is terminated without cause or resigns for good reason within two years following a change in control. We provide
change-in-control agreements to our NEOs to focus them on the best interests of shareholders and assure continuity of management in
circumstances that reduce or eliminate job security and might otherwise lead to accelerated departures. Under the Incentive Stock Plan of
2018 (“2018 Plan”), time-based awards will only vest and become exercisable or payable, as applicable, on a change in control if they are not
assumed, substituted, or otherwise replaced in connection with the change in control. If the awards are assumed or continued after the change
in control, the Committee may provide that such awards will be subject to automatic vesting acceleration upon a participant’s involuntary
termination within a designated period following the change in control. Furthermore, under the 2018 Plan, PSUs will automatically vest upon a
change in control of the Company based on (i) the target level prorated to reflect the period the participant was in service during the
performance period or (ii) the actual performance level attained, as determined by the Committee. Outstanding PSUs would be prorated based
on the target for the actual days worked during the applicable performance period. Refer to the “Post-Employment Benefits” section of this
Proxy Statement for a more detailed description of the change-in-control provisions.
Tax and Accounting Considerations
Although we consider the tax and accounting consequences of our compensation programs, the forms of compensation we utilize are
determined primarily by their effectiveness in creating maximum alignment with our key strategic objectives and the interests of
our shareholders.
Timing of Awards
The Committee generally grants our regular annual equity awards after the annual earnings release. The grant date is never selected or
changed to increase the value of equity awards for executives.
Clawback/Recoupment Policy
To further align the interests of our employees and our shareholders, we have a clawback/recoupment policy to ensure that any fraud or
intentional misconduct leading to a restatement of our financial statements would be properly addressed. The policy provides that if it is found
that an employee committed fraud or engaged in intentional misconduct that resulted, directly or indirectly, in a need to restate our financial
statements, then the Committee has the discretion to direct the Company to recover all or a portion of any cash or equity incentive
compensation paid or value realized, and/or to cancel any stock-based awards or AIM award granted to an employee on or after February 2,
2010, the effective date of the policy. The Committee may also request that the Company seek to recover any gains realized on or after the
effective date of the policy for equity or cash awards made prior to that date (including AIM, stock options, PSUs and RSUs). Application of the
clawback/recoupment policy is subject to a determination by the Committee that: (i) the cash incentive or equity compensation to be recouped
was calculated on, or its realized value affected by, the financial results that were subsequently restated; (ii) the cash incentive or equity award
would have been less valuable than what was actually awarded or paid based on the application of the correct financial results; and (iii) the
employee to whom the policy applied engaged in fraud or intentional misconduct. The Committee will review this policy in 2023, and will revise
it as necessary to ensure that it aligns with the final clawback policy requirements of the Dodd-Frank Wall Street Reform and Consumer
Protection Act and applicable NYSE listing standards.
2023 Proxy Statement
57
58
Severance Arrangements
Share Ownership Requirements
COMPENSATION DISCUSSION AND ANALYSIS
COMPENSATION DISCUSSION AND ANALYSIS
We impose share ownership requirements on each of our officers. These share ownership requirements are designed to encourage share
ownership by our officers and to further align their interests with our shareholders. Each officer must achieve and maintain ownership of
ordinary shares or ordinary share equivalents at or above a prescribed level. In October 2022, to align our share ownership requirements with
prevalent market practice, we moved from a fixed-share approach to a multiple of base salary approach.
The new requirements are as follows:
Position
Chair and Chief Executive Officer
Chief Financial Officer
Executive Vice Presidents and Senior Vice Presidents
Strategic Business Unit Presidents and Chief Accounting Officer
(a)
Based on the closing price on the record date of $170.68.
Number of Active
Participants as of
the Record Date
1
Individual
Ownership
Requirement
(Multiple of
Base Salary)
6
Average Actual
Multiple of Base
Salary(a)
15.0
1
7
7
4
3
2
13.1
12.1
3.6
2018 (“2018 Plan”), time-based awards will only vest and become exercisable or payable, as applicable, on a change in control if they are not
These ownership requirements have been met by all the NEOs who continue to be employed by the Company as of the record date.
Our share ownership program requires the accumulation of ordinary shares (or ordinary share equivalents) over a five-year period following the
date the person becomes subject to share ownership requirements at the rate of 20% of the required level each year. Executives who are
promoted and have their ownership requirement increased have five years to achieve the new level from the date of promotion. Ownership
credit is given for actual ordinary shares owned, deferred compensation that is invested in ordinary shares within our EDCP Plan, ordinary
share equivalents accumulated in our qualified and nonqualified employee savings plans as well as unvested RSUs. Stock options and
unvested PSUs do not count toward meeting the share ownership target. If executives fall behind their scheduled accumulation level during
their applicable accumulation period, or if they fail to maintain their required level of ownership after their applicable accumulation period, their
right to exercise stock options will be limited to “buy and hold” transactions, and any shares received upon the vesting of RSU and PSU
awards must be held until the required ownership level is achieved.
In connection with recruiting of certain officers, we generally enter into employment arrangements that provide for severance payments upon
certain termination events other than in the event of a change in control (which is covered by separate agreements with the officers). Mr.
Regnery has such an arrangement in his employment agreement. In 2019 we amended our Major Restructuring Severance Plan, originally
adopted in 2012, to provide certain employees, including our NEOs, with certain benefits in the event of a termination of employment without
cause or for good reason under a Major Restructuring (as defined in the Post-Employment Section below). Although we do not have a formal
severance policy for our executives (other than in the event of a Major Restructuring), we do have guidelines that in most cases would provide
for severance in the event of termination without cause.
The severance payable under the employment agreement for Mr. Regnery and the benefits available in connection with a Major Restructuring
and under the severance guidelines are further described in the “Post-Employment Benefits” section of this Proxy Statement.
Change-in-Control Provisions
We have entered into change-in-control agreements with our NEOs. Payments are subject to a “double trigger,” meaning that payments would
be received only if an officer is terminated without cause or resigns for good reason within two years following a change in control. We provide
change-in-control agreements to our NEOs to focus them on the best interests of shareholders and assure continuity of management in
circumstances that reduce or eliminate job security and might otherwise lead to accelerated departures. Under the Incentive Stock Plan of
assumed, substituted, or otherwise replaced in connection with the change in control. If the awards are assumed or continued after the change
in control, the Committee may provide that such awards will be subject to automatic vesting acceleration upon a participant’s involuntary
termination within a designated period following the change in control. Furthermore, under the 2018 Plan, PSUs will automatically vest upon a
change in control of the Company based on (i) the target level prorated to reflect the period the participant was in service during the
performance period or (ii) the actual performance level attained, as determined by the Committee. Outstanding PSUs would be prorated based
on the target for the actual days worked during the applicable performance period. Refer to the “Post-Employment Benefits” section of this
Proxy Statement for a more detailed description of the change-in-control provisions.
Tax and Accounting Considerations
Although we consider the tax and accounting consequences of our compensation programs, the forms of compensation we utilize are
determined primarily by their effectiveness in creating maximum alignment with our key strategic objectives and the interests of
our shareholders.
Timing of Awards
The Committee generally grants our regular annual equity awards after the annual earnings release. The grant date is never selected or
changed to increase the value of equity awards for executives.
Clawback/Recoupment Policy
To further align the interests of our employees and our shareholders, we have a clawback/recoupment policy to ensure that any fraud or
intentional misconduct leading to a restatement of our financial statements would be properly addressed. The policy provides that if it is found
that an employee committed fraud or engaged in intentional misconduct that resulted, directly or indirectly, in a need to restate our financial
statements, then the Committee has the discretion to direct the Company to recover all or a portion of any cash or equity incentive
compensation paid or value realized, and/or to cancel any stock-based awards or AIM award granted to an employee on or after February 2,
2010, the effective date of the policy. The Committee may also request that the Company seek to recover any gains realized on or after the
effective date of the policy for equity or cash awards made prior to that date (including AIM, stock options, PSUs and RSUs). Application of the
clawback/recoupment policy is subject to a determination by the Committee that: (i) the cash incentive or equity compensation to be recouped
was calculated on, or its realized value affected by, the financial results that were subsequently restated; (ii) the cash incentive or equity award
would have been less valuable than what was actually awarded or paid based on the application of the correct financial results; and (iii) the
employee to whom the policy applied engaged in fraud or intentional misconduct. The Committee will review this policy in 2023, and will revise
it as necessary to ensure that it aligns with the final clawback policy requirements of the Dodd-Frank Wall Street Reform and Consumer
Protection Act and applicable NYSE listing standards.
2023 Proxy Statement
57
58
Human Resources and Compensation
Committee Report
Executive Compensation
The following table provides summary information concerning compensation paid by the Company or accrued on behalf of our NEOs for
services rendered during the years ended December 31, 2022, 2021 and 2020.
We have reviewed and discussed with management the “Compensation Discussion and Analysis” contained in this Proxy Statement. Based on
our review and discussion, we recommended to the Board of Directors that the “Compensation Discussion and Analysis” be included in this
Proxy Statement as well as the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
Summary Compensation Table
HUMAN RESOURCES AND COMPENSATION COMMITTEE
Tony L. White (Chair)
Kirk E. Arnold
Jared L. Cohon
Gary D. Forsee
Mark R. George
John A. Hayes
Linda P. Hudson
Change in
Pension
Value and
Nonqualified
Deferred
Stock
Option
Incentive Plan
Compensation
All Other
Non-Equity
Name and
Salary
Bonus
Awards
Awards
Compensation
Earnings
Compensation
Principal Position
Year
($)(a)
($)
($)(b)
($)(c)
($)(d)
D. S. Regnery
Chair and Chief
Executive Officer
2022 1,237,500
— 6,082,088 2,000,006
3,029,377
2021 1,037,500
— 5,173,935 1,500,036
2,224,399
2,695,010
257,638 12,888,518
2020 850,000 150,000 2,408,938 650,009
850,000
3,735,597
119,679 8,764,223
C. J. Kuehn
Executive Vice President
and Chief Financial Officer
2022 762,500
— 1,900,662 625,024
2021 713,750
— 1,783,728 600,003
2020 642,742 150,000 1,667,489 450,012
1,252,143
1,205,682
680,000
—
172,830 4,713,159
191,069
445,140
121,536 4,615,768
88,607 4,123,990
($)(e)
—
($)(f)
Total
($)
421,224 12,770,195
2022 633,750
— 1,140,634 375,015
799,021
—
103,565 3,051,985
and Sustainability Officer
2020 575,000 150,000 1,389,663 375,008
2021 608,750
— 1,300,297 412,530
2022 593,750
— 1,064,548 350,035
210,898
814,644
78,125 3,438,542
77,655 3,883,470
—
91,407 2,716,631
R. D. Pittard
2022 581,875
— 579,764 196,893
—
104,907 2,175,342
2021 563,750
— 891,952 300,016
564,580
67,668 3,025,454
827,942
501,500
616,891
637,488
711,903
P. A. Camuti
Executive Vice President
and Chief Technology
E. M. Turtz
Senior Vice President
and General Counsel
Executive Vice President
Supply Chain, Engineering
and Information
Technology
(a)
(b)
Pursuant to the EDCP II, a portion of a participant’s annual salary may be deferred into a number of investment options. For 2022, Mr. Turtz elected to defer 10% of his
annual salary into the EDCP II. Amounts shown in this column are not reduced to reflect deferrals of annual salary into the EDCP II.
The amounts in this column reflect the aggregate grant date fair value of PSU awards and any RSU awards granted for the year under Financial Accounting Standards
Board (FASB) Accounting Standards Codification (ASC) Topic 718 and do not reflect amounts paid to or realized by the NEOs. For a discussion of the assumptions
made in determining the ASC 718 values see Note 14, “Share-Based Compensation,” to the Company’s consolidated financial statements contained in its 2022 Form
10-K. The ASC grant date fair value of the PSU award is spread over the number of months of service required for the grant to become non-forfeitable, disregarding any
adjustments for potential forfeitures. In determining the aggregate grant date fair value of the PSU awards, the awards are valued assuming target level performance
achievement. The table below includes the maximum grant date value of the 2022-2024 PSU awards for the persons listed. If the maximum level performance
achievement is assumed, the aggregate grant date fair value of the PSU awards would be as follows:
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Maximum Grant Date
Value of PSU Awards
($)
8,163,892
2,551,152
1,530,964
1,428,946
765,653
2023 Proxy Statement
59
60
Human Resources and Compensation
Executive Compensation
Committee Report
The following table provides summary information concerning compensation paid by the Company or accrued on behalf of our NEOs for
services rendered during the years ended December 31, 2022, 2021 and 2020.
We have reviewed and discussed with management the “Compensation Discussion and Analysis” contained in this Proxy Statement. Based on
our review and discussion, we recommended to the Board of Directors that the “Compensation Discussion and Analysis” be included in this
Proxy Statement as well as the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
Summary Compensation Table
HUMAN RESOURCES AND COMPENSATION COMMITTEE
Tony L. White (Chair)
Kirk E. Arnold
Jared L. Cohon
Gary D. Forsee
Mark R. George
John A. Hayes
Linda P. Hudson
Year
Salary
($)(a)
Bonus
($)
Stock
Awards
($)(b)
Option
Awards
($)(c)
Non-Equity
Incentive Plan
Compensation
($)(d)
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(e)
All Other
Compensation
($)(f)
Total
($)
2022 1,237,500
— 6,082,088 2,000,006
3,029,377
—
421,224 12,770,195
2021 1,037,500
— 5,173,935 1,500,036
2,224,399
2,695,010
257,638 12,888,518
2020 850,000 150,000 2,408,938 650,009
850,000
3,735,597
119,679 8,764,223
Name and
Principal Position
D. S. Regnery
Chair and Chief
Executive Officer
C. J. Kuehn
Executive Vice President
and Chief Financial Officer
— 1,900,662 625,024
2022 762,500
2021 713,750
— 1,783,728 600,003
2020 642,742 150,000 1,667,489 450,012
1,252,143
1,205,682
680,000
—
191,069
445,140
172,830 4,713,159
121,536 4,615,768
88,607 4,123,990
2022 633,750
— 1,140,634 375,015
799,021
—
103,565 3,051,985
2021 608,750
— 1,300,297 412,530
2020 575,000 150,000 1,389,663 375,008
2022 593,750
— 1,064,548 350,035
2021 563,750
— 891,952 300,016
2022 581,875
— 579,764 196,893
827,942
501,500
616,891
637,488
711,903
210,898
814,644
78,125 3,438,542
77,655 3,883,470
—
91,407 2,716,631
564,580
67,668 3,025,454
—
104,907 2,175,342
P. A. Camuti
Executive Vice President
and Chief Technology
and Sustainability Officer
E. M. Turtz
Senior Vice President
and General Counsel
R. D. Pittard
Executive Vice President
Supply Chain, Engineering
and Information
Technology
(a)
(b)
Pursuant to the EDCP II, a portion of a participant’s annual salary may be deferred into a number of investment options. For 2022, Mr. Turtz elected to defer 10% of his
annual salary into the EDCP II. Amounts shown in this column are not reduced to reflect deferrals of annual salary into the EDCP II.
The amounts in this column reflect the aggregate grant date fair value of PSU awards and any RSU awards granted for the year under Financial Accounting Standards
Board (FASB) Accounting Standards Codification (ASC) Topic 718 and do not reflect amounts paid to or realized by the NEOs. For a discussion of the assumptions
made in determining the ASC 718 values see Note 14, “Share-Based Compensation,” to the Company’s consolidated financial statements contained in its 2022 Form
10-K. The ASC grant date fair value of the PSU award is spread over the number of months of service required for the grant to become non-forfeitable, disregarding any
adjustments for potential forfeitures. In determining the aggregate grant date fair value of the PSU awards, the awards are valued assuming target level performance
achievement. The table below includes the maximum grant date value of the 2022-2024 PSU awards for the persons listed. If the maximum level performance
achievement is assumed, the aggregate grant date fair value of the PSU awards would be as follows:
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Maximum Grant Date
Value of PSU Awards
($)
8,163,892
2,551,152
1,530,964
1,428,946
765,653
2023 Proxy Statement
59
60
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
(c)
(d)
(e)
The amounts in this column reflect the aggregate grant date fair value of stock option grants for financial reporting purposes for the year under ASC 718 and do not
reflect amounts paid to or realized by the NEOs. For a discussion of the assumptions made in determining the ASC 718 values see Note 14, “Share-Based
Compensation,” to the Company’s consolidated financial statements contained in its 2022 Form 10-K. Please see “2022 Grants of Plan-Based Awards” and
“Outstanding Equity Awards at December 31, 2022” for additional detail.
This column reflects the amounts earned as annual awards under the AIM program. Unless deferred into the EDCP II, AIM program payments are made in cash. For
2022, Mr. Regnery, Mr. Kuehn and Mr. Turtz elected to defer a percentage (60%, 15% and 10% respectively) of their AIM awards into the EDCP II. Amounts shown in
this column are not reduced to reflect deferrals of AIM awards into the EDCP II.
This column represents the change in pension value for our NEOs under the Pension Plan, Supplemental Pension Plans, and the KMP, as applicable. The amounts
reported in this column vary with a number of factors, including the discount rate applied to determine the present value of pension benefits. Because interest rates
increased, the change in the value of pension benefits for our NEOs is negative. As Mr. Pittard became an NEO during 2022, the amount shown represents the
difference between his Pension Benefit Table amount as of December 31, 2022 and the amount that would have been reported as of December 31, 2021 if he had been
an NEO at that time. For the changes in pension value that are negative, those changes are included in the table below:
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Change in Pension Value
($)
(589,239)
(106,837)
(70,294)
(517,364)
(1,488,957)
Other external factors, outside the influence of the plan design, also impact the values shown in this column. Examples of these factors include changes to mortality
tables as well as interest and discount rates.
There was no above market interest earned by the NEOs in any year.
(f)
The following table summarizes the components of this column for fiscal year 2022:
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Company
Contributions
($)(1)
Tax
Assistance
($)(2)
Personal use
of Aircraft
($)(3)
Company Cost
For Life
Insurance/LTD
($)
Executive
Health
Program
($)(4)
207,714
100,810
72,008
10,613
157,455
87,702
73,874
77,195
—
—
—
—
—
—
—
6,787
3,483
6,386
3,901
4,154
Financial
Planning
($)
Other
Benefits
($)(5)
Total
($)
9,269
14,980
421,224
5,830
3,889
5,460
2,850
3,600
2,743
10,740
5,153
172,830
417
149
103,565
91,407
4,430
9,000
3,341
104,907
— 126,000 420,000 840,000
—
—
—
PSUs (2022-2024)
2/1/2022
(1)
(2)
(3)
(4)
(5)
Represents Company contributions under the Company’s ESP and Supplemental ESP plans.
The amount for Mr. Regnery represents tax equalization payments related to Irish taxes owed on $335,000, which is the portion of his income that is allocated to his
role as a Director of the Company and $13,910 of benefits in kind primarily due to spousal travel to the June 2022 Board meeting. Without these payments, Mr.
Regnery would be subject to double taxation on this amount since he is already paying U.S. taxes on this income.
For Mr. Regnery, this amount includes the incremental cost to the Company of personal use of the Company aircraft (whether leased or owned) by the Chair and
CEO. For security and safety reasons and to maximize his availability for Company business, the Board of Directors requires the Chair and CEO to travel on
Company-provided aircraft for business and personal purposes, unless commercial travel is deemed a minimal security risk by the Company. The incremental cost
to the Company of personal use of the aircraft is calculated: (i) by taking the hourly average variable operating costs to the Company (including fuel, maintenance, on
board catering and landing fees) multiplied by the amount of time flown for personal use in the case of leased aircraft; and (ii) by multiplying the flight time by a
variable fuel charge and the average fuel price per gallon and adding any ground costs such as landing and parking fees as well as crew charges for travel expenses
in the case of the Company owned aircraft. Both methodologies exclude fixed costs that do not change based on usage, such as pilots’ and other employees’
salaries, management fees and training, hangar and insurance expenses. We impose an annual limit of $150,000 on the Chair and CEO’s non-business use of
Company-provided aircraft. Under the Company’s aircraft use policy, the Human Resources and Compensation Committee has determined that business use
includes travel that is related to the Company’s business or benefits the Company, such as travel to meetings of other boards on which the Chair and CEO sits. In
2022, Mr. Regnery did not incur any charges for such business-related travel.
For Mr. Pittard, this amount represents bereavement use of the Company aircraft.
The amount includes medical services provided through an on-site physician under the Executive Health Program for all NEOs. For Mr. Regnery and Mr. Pittard, the
amount also includes the estimated year-over-year increase in the value of the retiree medical plan, calculated based on the methods used for financial statement as
they are the only NEOs eligible for the subsidized retiree medical plan upon retirement.
These amounts include: (i) product rebates and Company-branded items, (ii) fitness reimbursement, (iii) spousal travel to the June 2022 board meeting along with
meals and entertainment and (iv) rewards/recognition.
2023 Proxy Statement
61
62
2022 Grants of Plan-Based Awards
The following table shows all plan-based awards granted to the NEOs during fiscal 2022. This table is supplemental to the Summary
Compensation Table and is intended to complement the disclosure of equity awards and grants made under non-equity incentive plans in the
Summary Compensation Table. For additional information regarding outstanding awards, please see the “Outstanding Equity Awards at
December 31, 2022” table.
Estimated Future Payouts Under
Estimated Future Payouts Under
Non-Equity Plan Awards
Equity Incentive Plan Awards
Grant
Date
Threshold
Target
Maximum
Threshold
Target
Maximum
($)(a)
($)(a)
($)(a)
(#)(b)
(#)(b)
(#)(b)
All Other
All Other
Stock
Awards:
Option
Awards:
Number of
Number of
Shares of
Securities
Stock or
Underlying
Units
(#)(c)
Options
(#)(c)
Exercise
Grant Date
or Base
Price of
Fair Value
of Stock
Option
and Option
Awards
($/Sh)(d)
Awards
($)(e)
PSUs (2022-2024)
2/1/2022
— 562,500 1,875,000 3,750,000
—
—
—
5,982 23,927
47,854
—
—
—
—
—
—
—
—
—
—
— 4,081,946
55,726 167.18 2,000,006
11,964
—
— 2,000,142
PSUs (2022-2024)
2/1/2022
— 232,500 775,000 1,550,000
—
—
—
1,870 7,477
14,954
—
—
—
—
—
—
—
—
—
—
— 1,275,576
17,415 167.18 625,024
3,739
—
— 625,086
PSUs (2022-2024)
2/1/2022
— 163,200 544,000 1,088,000
—
—
—
1,122 4,487
8,974
—
—
—
—
—
—
—
—
—
—
— 765,482
10,449 167.18 375,015
2,244
—
— 375,152
D. S. Regnery
Name
AIM
Options
RSUs
C. J. Kuehn
AIM
Options
RSUs
P. A. Camuti
AIM
Options
RSUs
E. M. Turtz
AIM
Options
RSUs
R. D. Pittard
AIM
2/1/2022
2/1/2022
2/1/2022
2/1/2022
2/1/2022
2/1/2022
2/1/2022
2/1/2022
PSUs (2022-2024)
2/1/2022
Options
RSUs
2/1/2022
2/1/2022
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
1,047 4,188
8,376
—
—
—
—
—
—
—
—
—
—
— 714,473
9,753 167.18 350,035
2,094
—
— 350,075
561 2,244
4,488
—
—
—
—
—
—
—
—
—
—
— 382,826
5,486 167.18 196,893
1,178
—
— 196,938
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
— 132,188 440,625 881,250
—
—
—
(a)
(b)
The target award levels established for the AIM program are established annually in February and are expressed as a percentage of the NEO’s base salary. Refer to
“Compensation Discussion and Analysis” under the heading “Annual Incentive Matrix Program” for a description of the Human Resources and Compensation
Committee’s process for establishing AIM program target award levels. The amounts reflected in the “Estimated Future Payouts Under Non-Equity Incentive Plan
Awards” columns represent the threshold, target and maximum amounts for awards under the AIM program that were paid in February 2023, based on performance in
2022. Thus, the amounts shown in the “threshold,” “target” and “maximum” columns reflect the range of potential payouts when the target award levels were established
in February 2022 for all NEOs. The AIM program pays $0 for performance below threshold. The actual amounts paid pursuant to those awards are reflected in the “Non-
Equity Incentive Plan Compensation” column of the Summary Compensation Table.
The amounts reflected in the “Estimated Future Payouts Under Equity Incentive Plan Awards” columns represent the threshold, target and maximum amounts for PSU
awards. The PSP pays $0 for performance below threshold. For a description of the Human Resources and Compensation Committee’s process for establishing PSP
target award levels and the terms of PSU awards, please refer to “Compensation Discussion and Analysis” under the heading “Long-Term Incentive Program” and the
“Post-Employment Benefits” section below.
(c)
(d)
(e)
The amounts in this column reflect the aggregate grant date fair value of stock option grants for financial reporting purposes for the year under ASC 718 and do not
reflect amounts paid to or realized by the NEOs. For a discussion of the assumptions made in determining the ASC 718 values see Note 14, “Share-Based
Compensation,” to the Company’s consolidated financial statements contained in its 2022 Form 10-K. Please see “2022 Grants of Plan-Based Awards” and
“Outstanding Equity Awards at December 31, 2022” for additional detail.
This column reflects the amounts earned as annual awards under the AIM program. Unless deferred into the EDCP II, AIM program payments are made in cash. For
2022, Mr. Regnery, Mr. Kuehn and Mr. Turtz elected to defer a percentage (60%, 15% and 10% respectively) of their AIM awards into the EDCP II. Amounts shown in
this column are not reduced to reflect deferrals of AIM awards into the EDCP II.
This column represents the change in pension value for our NEOs under the Pension Plan, Supplemental Pension Plans, and the KMP, as applicable. The amounts
reported in this column vary with a number of factors, including the discount rate applied to determine the present value of pension benefits. Because interest rates
increased, the change in the value of pension benefits for our NEOs is negative. As Mr. Pittard became an NEO during 2022, the amount shown represents the
difference between his Pension Benefit Table amount as of December 31, 2022 and the amount that would have been reported as of December 31, 2021 if he had been
an NEO at that time. For the changes in pension value that are negative, those changes are included in the table below:
Change in Pension Value
($)
(589,239)
(106,837)
(70,294)
(517,364)
(1,488,957)
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Other external factors, outside the influence of the plan design, also impact the values shown in this column. Examples of these factors include changes to mortality
tables as well as interest and discount rates.
There was no above market interest earned by the NEOs in any year.
(f)
The following table summarizes the components of this column for fiscal year 2022:
Company Cost
Executive
Company
Tax
Personal use
For Life
Health
Financial
Other
Contributions
Assistance
of Aircraft
Insurance/LTD
Program
Planning
Benefits
($)(1)
($)(2)
($)(3)
($)
($)
($)(5)
Total
($)
207,714
100,810
72,008
10,613
9,269
14,980
421,224
157,455
87,702
73,874
77,195
—
—
—
—
—
—
—
6,787
3,483
6,386
3,901
4,154
2,850
3,600
5,153
172,830
417
149
103,565
91,407
2,743
10,740
4,430
9,000
3,341
104,907
($)(4)
5,830
3,889
5,460
(1)
(2)
(3)
(4)
(5)
Represents Company contributions under the Company’s ESP and Supplemental ESP plans.
The amount for Mr. Regnery represents tax equalization payments related to Irish taxes owed on $335,000, which is the portion of his income that is allocated to his
role as a Director of the Company and $13,910 of benefits in kind primarily due to spousal travel to the June 2022 Board meeting. Without these payments, Mr.
Regnery would be subject to double taxation on this amount since he is already paying U.S. taxes on this income.
For Mr. Regnery, this amount includes the incremental cost to the Company of personal use of the Company aircraft (whether leased or owned) by the Chair and
CEO. For security and safety reasons and to maximize his availability for Company business, the Board of Directors requires the Chair and CEO to travel on
Company-provided aircraft for business and personal purposes, unless commercial travel is deemed a minimal security risk by the Company. The incremental cost
to the Company of personal use of the aircraft is calculated: (i) by taking the hourly average variable operating costs to the Company (including fuel, maintenance, on
board catering and landing fees) multiplied by the amount of time flown for personal use in the case of leased aircraft; and (ii) by multiplying the flight time by a
variable fuel charge and the average fuel price per gallon and adding any ground costs such as landing and parking fees as well as crew charges for travel expenses
in the case of the Company owned aircraft. Both methodologies exclude fixed costs that do not change based on usage, such as pilots’ and other employees’
salaries, management fees and training, hangar and insurance expenses. We impose an annual limit of $150,000 on the Chair and CEO’s non-business use of
Company-provided aircraft. Under the Company’s aircraft use policy, the Human Resources and Compensation Committee has determined that business use
includes travel that is related to the Company’s business or benefits the Company, such as travel to meetings of other boards on which the Chair and CEO sits. In
2022, Mr. Regnery did not incur any charges for such business-related travel.
For Mr. Pittard, this amount represents bereavement use of the Company aircraft.
The amount includes medical services provided through an on-site physician under the Executive Health Program for all NEOs. For Mr. Regnery and Mr. Pittard, the
amount also includes the estimated year-over-year increase in the value of the retiree medical plan, calculated based on the methods used for financial statement as
they are the only NEOs eligible for the subsidized retiree medical plan upon retirement.
These amounts include: (i) product rebates and Company-branded items, (ii) fitness reimbursement, (iii) spousal travel to the June 2022 board meeting along with
meals and entertainment and (iv) rewards/recognition.
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
2022 Grants of Plan-Based Awards
The following table shows all plan-based awards granted to the NEOs during fiscal 2022. This table is supplemental to the Summary
Compensation Table and is intended to complement the disclosure of equity awards and grants made under non-equity incentive plans in the
Summary Compensation Table. For additional information regarding outstanding awards, please see the “Outstanding Equity Awards at
December 31, 2022” table.
Estimated Future Payouts Under
Non-Equity Plan Awards
Estimated Future Payouts Under
Equity Incentive Plan Awards
Grant
Date
Threshold
($)(a)
Target
($)(a)
Maximum
($)(a)
Threshold
(#)(b)
Target
(#)(b)
Maximum
(#)(b)
All Other
Stock
Awards:
Number of
Shares of
Stock or
Units
(#)(c)
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)(c)
Exercise
or Base
Price of
Option
Awards
($/Sh)(d)
Grant Date
Fair Value
of Stock
and Option
Awards
($)(e)
Name
D. S. Regnery
AIM
Options
RSUs
C. J. Kuehn
AIM
Options
RSUs
P. A. Camuti
AIM
Options
RSUs
E. M. Turtz
AIM
Options
RSUs
R. D. Pittard
AIM
PSUs (2022-2024)
2/1/2022
— 562,500 1,875,000 3,750,000
—
—
—
2/1/2022
2/1/2022
—
—
—
—
—
—
—
—
—
5,982 23,927
47,854
—
—
—
—
—
—
PSUs (2022-2024)
2/1/2022
— 232,500 775,000 1,550,000
—
—
—
2/1/2022
2/1/2022
—
—
—
—
—
—
—
—
—
1,870 7,477
14,954
—
—
—
—
—
—
PSUs (2022-2024)
2/1/2022
— 163,200 544,000 1,088,000
—
—
—
2/1/2022
2/1/2022
—
—
—
—
—
—
—
—
—
1,122 4,487
8,974
—
—
—
—
—
—
PSUs (2022-2024)
2/1/2022
— 126,000 420,000 840,000
—
—
—
2/1/2022
2/1/2022
—
—
—
—
—
—
—
—
—
1,047 4,188
8,376
—
—
—
—
—
—
— 132,188 440,625 881,250
—
—
—
PSUs (2022-2024)
2/1/2022
Options
RSUs
2/1/2022
2/1/2022
—
—
—
—
—
—
—
—
—
561 2,244
4,488
—
—
—
—
—
—
—
—
—
—
—
—
—
— 4,081,946
55,726 167.18 2,000,006
11,964
—
— 2,000,142
—
—
—
—
—
—
—
— 1,275,576
17,415 167.18 625,024
3,739
—
— 625,086
—
—
—
—
—
—
—
— 765,482
10,449 167.18 375,015
2,244
—
— 375,152
—
—
—
—
—
—
—
— 714,473
9,753 167.18 350,035
2,094
—
— 350,075
—
—
—
—
—
—
—
— 382,826
5,486 167.18 196,893
1,178
—
— 196,938
(a)
(b)
The target award levels established for the AIM program are established annually in February and are expressed as a percentage of the NEO’s base salary. Refer to
“Compensation Discussion and Analysis” under the heading “Annual Incentive Matrix Program” for a description of the Human Resources and Compensation
Committee’s process for establishing AIM program target award levels. The amounts reflected in the “Estimated Future Payouts Under Non-Equity Incentive Plan
Awards” columns represent the threshold, target and maximum amounts for awards under the AIM program that were paid in February 2023, based on performance in
2022. Thus, the amounts shown in the “threshold,” “target” and “maximum” columns reflect the range of potential payouts when the target award levels were established
in February 2022 for all NEOs. The AIM program pays $0 for performance below threshold. The actual amounts paid pursuant to those awards are reflected in the “Non-
Equity Incentive Plan Compensation” column of the Summary Compensation Table.
The amounts reflected in the “Estimated Future Payouts Under Equity Incentive Plan Awards” columns represent the threshold, target and maximum amounts for PSU
awards. The PSP pays $0 for performance below threshold. For a description of the Human Resources and Compensation Committee’s process for establishing PSP
target award levels and the terms of PSU awards, please refer to “Compensation Discussion and Analysis” under the heading “Long-Term Incentive Program” and the
“Post-Employment Benefits” section below.
2023 Proxy Statement
61
62
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
(c)
(d)
(e)
The amounts in these columns reflect the stock option and RSU awards. For a description of the Human Resources and Compensation Committee’s process for
determining stock option and RSU awards and the terms of such awards, see “Compensation Discussion and Analysis” under the heading “Long-Term Incentive
Program” and the “Post-Employment Benefits” section below.
Stock options were granted under the Company’s 2018 Plan, which requires options to be granted at an exercise price equal to or greater than the fair market value of
the Company’s ordinary shares on the date of grant. The fair market value is defined in the 2018 Plan as the closing price of the Company’s ordinary shares listed on the
NYSE on the grant date.
Amounts in this column include the grant date fair value of the equity awards calculated in accordance with ASC 718. The Company cautions that the actual amount
ultimately realized by each NEO from the stock option awards will likely vary based on a number of factors, including stock price fluctuations, differences from the
valuation assumptions used and timing of exercise or applicable vesting. For a description of the assumptions made in valuing the equity awards see Note 14, “Share-
Based Compensation” to the Company’s consolidated financial statements contained in its 2022 Form 10-K. For PSUs, the grant date fair value has been determined
based on achievement of target level performance, which is the performance threshold the Company believes is the most likely to be achieved under the grants.
Outstanding Equity Awards at December 31, 2022
Option Awards
Stock Awards
Number of
Securities
Underlying
Number of
Securities
Underlying
Options
(#)
Unexercised
Unexercised
Option
Options
Exercise
Option
Have Not
Have Not
Rights That Have
That Have Not
Number
of Shares
Market
Value of
Equity Incentive
Equity Incentive
Plan Awards:
Plan Awards: Market
or Units of
Shares or
Number of
or Payout Value of
Stock
Units of
Unearned Shares,
Unearned Shares,
That
Stock That
Units or Other
Units or Other Rights
Vested
(#)(c)
Vested
($)(d)
Not Vested
(#)(e)
Vested
($)(d)
Name
Exercisable(a)
Unexercisable(a)
($)
Date(b)
D. S. Regnery
2/3/2015
2/10/2016
Grant
Date
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
7/1/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
8/1/2019
3/9/2020
2/8/2021
2/1/2022
17,585
29,450
22,497
43,778
48,091
25,964
8,772
6,478
—
8,025
13,591
17,975
6,747
23,687
23,640
22,810
14,979
4,639
—
1,926
4,182
5,992
3,374
—
15,813
7,190
2,227
—
(#)
Price
Expiration
— 52.28 2/2/2025
— 38.99 2/9/2026
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
—
—
—
—
12,982 105.28 3/8/2030
2,059 346,097
17,544 148.98 2/7/2031
3,491 586,802
12,956 186.20 6/30/2031
2,578 433,336
55,726 167.18 1/31/2032
11,964 2,011,029
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
8,988 105.28 3/8/2030
1,425 239,528
13,496 148.98 2/7/2031
2,686 451,490
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
7,490 105.28 3/8/2030
1,188 199,691
9,279 148.98 2/7/2031
1,846 310,294
10,449 167.18 1/31/2032
2,244 377,194
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
2,996 105.28 3/8/2030
475
79,843
6,748 148.98 2/7/2031
1,343 225,745
9,753 167.18 1/31/2032
2,094 351,980
— 94.91 7/31/2029
—
—
3,595 105.28 3/8/2030
4,454 148.98 2/7/2031
570
95,811
887 149,096
5,486 167.18 1/31/2032
1,178 198,010
—
17,415 167.18 1/31/2032
3,739 628,489
—
—
—
—
—
12,349
8,727
9,130
23,927
—
—
8,549
6,713
7,477
—
—
—
7,124
5,035
4,487
—
—
2,375
3,357
4,188
—
2,280
1,611
2,244
—
—
—
—
—
—
—
—
—
—
—
—
2,075,743
1,466,921
1,534,662
4,021,889
1,437,001
1,128,388
1,256,809
1,197,473
846,333
754,220
399,214
564,278
703,961
—
383,245
270,793
377,194
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
(a)
(b)
(c)
(d)
(e)
These columns represent stock option awards. These awards generally become exercisable in three equal annual installments beginning on the first anniversary after the
date of grant, subject to continued employment or retirement.
All options granted to the NEOs expire on the tenth anniversary (less one day) of the grant date.
This column represents unvested RSUs. RSUs generally become vested in three equal annual installments beginning on the first anniversary after the date of grant,
subject to continued employment or retirement.
The market value was computed based on $168.09, the closing market price of the Company’s ordinary shares on the NYSE at December 30, 2022.
This column represents the target number of unvested and unearned PSUs. PSUs vest upon the completion of a three-year performance period. The actual number of
shares an NEO will receive, if any, is subject to achievement of the performance goals as certified by the Human Resources and Compensation Committee, and
continued employment.
2023 Proxy Statement
63
64
(c)
(d)
(e)
The amounts in these columns reflect the stock option and RSU awards. For a description of the Human Resources and Compensation Committee’s process for
determining stock option and RSU awards and the terms of such awards, see “Compensation Discussion and Analysis” under the heading “Long-Term Incentive
Program” and the “Post-Employment Benefits” section below.
Stock options were granted under the Company’s 2018 Plan, which requires options to be granted at an exercise price equal to or greater than the fair market value of
the Company’s ordinary shares on the date of grant. The fair market value is defined in the 2018 Plan as the closing price of the Company’s ordinary shares listed on the
NYSE on the grant date.
Amounts in this column include the grant date fair value of the equity awards calculated in accordance with ASC 718. The Company cautions that the actual amount
ultimately realized by each NEO from the stock option awards will likely vary based on a number of factors, including stock price fluctuations, differences from the
valuation assumptions used and timing of exercise or applicable vesting. For a description of the assumptions made in valuing the equity awards see Note 14, “Share-
Based Compensation” to the Company’s consolidated financial statements contained in its 2022 Form 10-K. For PSUs, the grant date fair value has been determined
based on achievement of target level performance, which is the performance threshold the Company believes is the most likely to be achieved under the grants.
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Outstanding Equity Awards at December 31, 2022
Option Awards
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable(a)
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable(a)
Number
of Shares
or Units of
Stock
That
Have Not
Vested
(#)(c)
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)(d)
Stock Awards
Equity Incentive
Plan Awards:
Number of
Unearned Shares,
Units or Other
Rights That Have
Not Vested
(#)(e)
—
—
—
—
—
—
—
—
—
—
Option
Option
Exercise
Expiration
Price
Date(b)
($)
— 52.28 2/2/2025
— 38.99 2/9/2026
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
17,585
29,450
22,497
43,778
48,091
25,964
8,772
6,478
—
8,025
13,591
17,975
6,747
12,982 105.28 3/8/2030
2,059 346,097
17,544 148.98 2/7/2031
3,491 586,802
12,956 186.20 6/30/2031
2,578 433,336
55,726 167.18 1/31/2032
11,964 2,011,029
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
8,988 105.28 3/8/2030
1,425 239,528
13,496 148.98 2/7/2031
2,686 451,490
—
17,415 167.18 1/31/2032
3,739 628,489
23,687
23,640
22,810
14,979
4,639
—
1,926
4,182
5,992
3,374
—
15,813
7,190
2,227
—
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
7,490 105.28 3/8/2030
1,188 199,691
9,279 148.98 2/7/2031
1,846 310,294
10,449 167.18 1/31/2032
2,244 377,194
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
2,996 105.28 3/8/2030
475
79,843
6,748 148.98 2/7/2031
1,343 225,745
9,753 167.18 1/31/2032
2,094 351,980
— 94.91 7/31/2029
—
—
3,595 105.28 3/8/2030
4,454 148.98 2/7/2031
570
95,811
887 149,096
5,486 167.18 1/31/2032
1,178 198,010
Equity Incentive
Plan Awards: Market
or Payout Value of
Unearned Shares,
Units or Other Rights
That Have Not
Vested
($)(d)
—
—
—
—
—
—
12,349
8,727
9,130
23,927
—
—
8,549
6,713
7,477
—
—
—
7,124
5,035
4,487
—
—
2,375
3,357
4,188
—
2,280
1,611
2,244
—
—
—
—
2,075,743
1,466,921
1,534,662
4,021,889
—
—
1,437,001
1,128,388
1,256,809
—
—
—
1,197,473
846,333
754,220
—
—
399,214
564,278
703,961
—
383,245
270,793
377,194
Name
Grant
Date
D. S. Regnery
2/3/2015
2/10/2016
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
7/1/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
8/1/2019
3/9/2020
2/8/2021
2/1/2022
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
(a)
(b)
(c)
(d)
(e)
These columns represent stock option awards. These awards generally become exercisable in three equal annual installments beginning on the first anniversary after the
date of grant, subject to continued employment or retirement.
All options granted to the NEOs expire on the tenth anniversary (less one day) of the grant date.
This column represents unvested RSUs. RSUs generally become vested in three equal annual installments beginning on the first anniversary after the date of grant,
subject to continued employment or retirement.
The market value was computed based on $168.09, the closing market price of the Company’s ordinary shares on the NYSE at December 30, 2022.
This column represents the target number of unvested and unearned PSUs. PSUs vest upon the completion of a three-year performance period. The actual number of
shares an NEO will receive, if any, is subject to achievement of the performance goals as certified by the Human Resources and Compensation Committee, and
continued employment.
2023 Proxy Statement
63
64
Vesting occurs at the earlier of the attainment of age 55 and the completion of 5 years of service or age 65. For employees who began
participating on or after June 2015, there is a minimum 5-year service requirement from date of participation to date of retirement. Benefits are
only available as a lump sum after termination and paid in accordance with Section 409A of the Code. In 2022, the Committee made the
decision to close the KMP to new entrants effective immediately. Mr. Regnery, Mr. Kuehn, Mr. Camuti, Mr. Turtz and Mr. Pittard participate in
The table below represents the estimated present value of defined benefits for the plans in which each NEO participates.
Name
D. S. Regnery(c)
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard(c)
Supplemental Pension Plan I
Supplemental Pension Plan II
Plan Name
Pension Plan
KMP
KMP
Pension Plan
KMP
Pension Plan
KMP
Pension Plan
KMP
Supplemental Pension Plan II
Supplemental Pension Plan II
Supplemental Pension Plan II
Number
of Years
Credited
Service
Present
Value of
Accumulated
(#)(a)
37.42
19.42
37.42
30
7.58
11.42
11.42
11.42
18.58
18.58
18.58
32.67
32.67
Benefit
($)(b)
509,898
346,192
2,750,056
11,669,049
1,113,958
164,923
504,600
2,251,193
184,298
350,534
2,126,293
378,912
939,631
30
4,057,502
(a)
(b)
(c)
Under the KMP, for officers covered prior to May 19, 2009, a full year of service is credited for any year in which they work at least one day. In the Pension Plan, the
Supplemental Pension Plans as well as the KMP for officers covered on or after May 19, 2009, the number of years of credited service is based on elapsed time (i.e.,
credit is given for each month in which a participant works at least one day). The years of credited service used for calculating benefits under all plans are the years of
credited service through December 31, 2022. The years of crediting service used for calculating benefits under the Supplemental Pension Plan I are the years of crediting
service through December 31, 2004 and the benefits earned under this plan serve as offsets to the benefits earned under the Supplemental Pension Plan II.
The amounts in this column reflect the estimated present value of each NEO’s accumulated benefit under the plans indicated. The calculations reflect the value of the
benefits assuming that each NEO was fully vested under each plan. The present value of the accumulated benefits is calculated under each plan using the following
assumptions: (i) a discount rate of 5.52% for the Pension Plan; (ii) a discount rate of 5.46% for the Supplemental Pension Plan II and KMP; (iii) retirement at age 65 and
(iv) the 2006 rates underlying the RP-2014 mortality tables projected to the 2014 base year using the MP-2017 projection scale and further projected generationally using
the MP-2020 projection scale. For the Supplemental Pension Plan II and the KMP, additional assumptions include payment in a lump sum.
Under the provisions of the KMP, Mr. Regnery’s and Mr. Pittard’s service is capped at 30 years.
2022 Option Exercises and Stock Vested
The following table provides information regarding the amounts received by each NEO upon exercise of stock options, the vesting of RSUs or
the vesting of PSUs during the fiscal year ended December 31, 2022:
the KMP.
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Name
D. S. Regnery
C. J. Kuehn(b)
P. A. Camuti
E. M. Turtz(c)
R. D. Pittard
Option Awards
Stock Awards
Number of
Shares
Acquired on
Exercise
(#)
14,651
Value
Realized on
Exercise
($)(a)
861,785
Number of
Shares
Acquired on
Vesting
(#)
36,891
Value
Realized on
Vesting
($)
7,448,778
—
—
—
—
—
—
3,522
559,512
18,575
3,189,107
3,143
488,126
5,019
121,010
10,567
1,782,905
(a)
This column reflects the aggregate dollar amount realized by the NEO upon the exercise of the stock options by determining the difference between the market price of
the Company’s ordinary shares at exercise and the exercise price of the stock options.
(b) Mr. Kuehn elected to defer the shares acquired upon the vesting of his PSU award on March 1, 2022 into the Company’s EDCP II. Mr. Kuehn deferred 8,234 shares
having a value of $1,252,062. Mr. Kuehn’s cash dividends of $50,494 that had accrued on the deferred PSU award were also deferred under the EDCP II. Please see
“2022 Nonqualified Deferred Compensation” for more information about the terms of the Company’s EDCP Plans.
(c) Mr. Turtz elected to defer a portion of the shares acquired upon the vesting of his PSU award on March 1, 2022 into the Company’s EDCP II. Mr. Turtz deferred 888
shares having a value of $135,029. Mr. Turtz’s cash dividends of $5,445 that had accrued on the deferred PSU award were also deferred under the EDCP II. Please see
“2022 Nonqualified Deferred Compensation” for more information about the terms of the Company’s EDCP Plans.
2022 Pension Benefits
The NEOs participate in one or more, but not in all, of the following defined benefit plans:
• the Pension Plan;
• the Supplemental Pension Plans; and
• the KMP.
The Pension Plan is a funded, tax qualified, non-contributory (for all but a small subset of participants) defined benefit plan that covers the
majority of the Company’s salaried and non-union hourly U.S. employees who were hired or rehired prior to July 1, 2012. The Pension Plan
provides for normal retirement at age 65 and the formula to determine the lump sum benefit under the Pension Plan is five percent of final
average pay (the five consecutive years with the highest compensation out of the last ten years of eligible compensation) multiplied by years of
credited service (as defined in the Pension Plan). A choice for distribution between an annuity and a lump sum option is available. The Pension
Plan was closed to new participants after June 30, 2012 and no further benefits will accrue to any Pension Plan participant for service
performed after December 31, 2022. In addition, any employee who was a Pension Plan participant on June 30, 2012 was provided the option
to waive participation in the Pension Plan effective January 1, 2013, and in lieu of participation in the Pension Plan, receive an annual non-
elective employer contribution equal to two percent of eligible compensation in the ESP.
The Supplemental Pension Plans are unfunded, nonqualified, non-contributory defined benefit restoration plans. The Supplemental Pension
Plans restore what is lost in the Pension Plan due to limitations under the Code on the annual compensation and benefits recognized when
calculating benefits under the qualified Pension Plan. The Supplemental Pension Plans cover all employees of the Company who participate in
the Pension Plan and who are impacted by the Code compensation and benefits limits. A participant must meet the vesting requirements of
the qualified Pension Plan to vest in benefits under the Supplemental Pension Plans. Benefits under the Supplemental Pension Plans are
available only as a lump sum distribution after termination and paid in accordance with Section 409A of the Code. As a result of the 2012
changes to the Pension Plan, the Supplemental Pension Plans were closed to employees hired after June 30, 2012, and no further benefits will
accrue to any Supplemental Plan participant for service performed after December 31, 2022.
The KMP is an unfunded, nonqualified, non-contributory defined benefit plan available to certain key management employees on a highly
selective basis. The KMP is designed to replace a percentage of a key employee’s final average pay based on their age and years of service at
the time of retirement. Final average pay is defined as the sum of the key employee’s current annual base salary plus the average of the
employee’s three highest AIM awards during the most recent six years. No other components of compensation (other than base salary and
AIM awards) are included in final average pay. The KMP provides a benefit pursuant to a formula in which 1.7% of a key employee’s final
average pay is multiplied by years of service (up to a maximum of 30 years) and then reduced by the value of other retirement benefits the key
employee will receive that are provided by the Company under certain qualified and nonqualified retirement plans as well as Social Security.
2023 Proxy Statement
65
66
2022 Option Exercises and Stock Vested
The following table provides information regarding the amounts received by each NEO upon exercise of stock options, the vesting of RSUs or
the vesting of PSUs during the fiscal year ended December 31, 2022:
Vesting occurs at the earlier of the attainment of age 55 and the completion of 5 years of service or age 65. For employees who began
participating on or after June 2015, there is a minimum 5-year service requirement from date of participation to date of retirement. Benefits are
only available as a lump sum after termination and paid in accordance with Section 409A of the Code. In 2022, the Committee made the
decision to close the KMP to new entrants effective immediately. Mr. Regnery, Mr. Kuehn, Mr. Camuti, Mr. Turtz and Mr. Pittard participate in
the KMP.
The table below represents the estimated present value of defined benefits for the plans in which each NEO participates.
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Name
D. S. Regnery(c)
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard(c)
Plan Name
Pension Plan
Supplemental Pension Plan I
Supplemental Pension Plan II
KMP
KMP
Pension Plan
Supplemental Pension Plan II
KMP
Pension Plan
Supplemental Pension Plan II
KMP
Pension Plan
Supplemental Pension Plan II
KMP
Number
of Years
Credited
Service
(#)(a)
37.42
Present
Value of
Accumulated
Benefit
($)(b)
509,898
19.42
37.42
30
7.58
11.42
11.42
11.42
18.58
18.58
18.58
32.67
32.67
346,192
2,750,056
11,669,049
1,113,958
164,923
504,600
2,251,193
184,298
350,534
2,126,293
378,912
939,631
30
4,057,502
(a)
(b)
(c)
Under the KMP, for officers covered prior to May 19, 2009, a full year of service is credited for any year in which they work at least one day. In the Pension Plan, the
Supplemental Pension Plans as well as the KMP for officers covered on or after May 19, 2009, the number of years of credited service is based on elapsed time (i.e.,
credit is given for each month in which a participant works at least one day). The years of credited service used for calculating benefits under all plans are the years of
credited service through December 31, 2022. The years of crediting service used for calculating benefits under the Supplemental Pension Plan I are the years of crediting
service through December 31, 2004 and the benefits earned under this plan serve as offsets to the benefits earned under the Supplemental Pension Plan II.
The amounts in this column reflect the estimated present value of each NEO’s accumulated benefit under the plans indicated. The calculations reflect the value of the
benefits assuming that each NEO was fully vested under each plan. The present value of the accumulated benefits is calculated under each plan using the following
assumptions: (i) a discount rate of 5.52% for the Pension Plan; (ii) a discount rate of 5.46% for the Supplemental Pension Plan II and KMP; (iii) retirement at age 65 and
(iv) the 2006 rates underlying the RP-2014 mortality tables projected to the 2014 base year using the MP-2017 projection scale and further projected generationally using
the MP-2020 projection scale. For the Supplemental Pension Plan II and the KMP, additional assumptions include payment in a lump sum.
Under the provisions of the KMP, Mr. Regnery’s and Mr. Pittard’s service is capped at 30 years.
Name
D. S. Regnery
C. J. Kuehn(b)
P. A. Camuti
E. M. Turtz(c)
R. D. Pittard
Option Awards
Stock Awards
Number of
Shares
Value
Number of
Shares
Acquired on
Realized on
Acquired on
Realized on
Exercise
(#)
Exercise
($)(a)
Vesting
(#)
Value
Vesting
($)
14,651
861,785
36,891
7,448,778
—
—
—
—
—
—
3,522
559,512
18,575
3,189,107
3,143
488,126
5,019
121,010
10,567
1,782,905
(a)
This column reflects the aggregate dollar amount realized by the NEO upon the exercise of the stock options by determining the difference between the market price of
the Company’s ordinary shares at exercise and the exercise price of the stock options.
(b) Mr. Kuehn elected to defer the shares acquired upon the vesting of his PSU award on March 1, 2022 into the Company’s EDCP II. Mr. Kuehn deferred 8,234 shares
having a value of $1,252,062. Mr. Kuehn’s cash dividends of $50,494 that had accrued on the deferred PSU award were also deferred under the EDCP II. Please see
“2022 Nonqualified Deferred Compensation” for more information about the terms of the Company’s EDCP Plans.
(c) Mr. Turtz elected to defer a portion of the shares acquired upon the vesting of his PSU award on March 1, 2022 into the Company’s EDCP II. Mr. Turtz deferred 888
shares having a value of $135,029. Mr. Turtz’s cash dividends of $5,445 that had accrued on the deferred PSU award were also deferred under the EDCP II. Please see
“2022 Nonqualified Deferred Compensation” for more information about the terms of the Company’s EDCP Plans.
2022 Pension Benefits
The NEOs participate in one or more, but not in all, of the following defined benefit plans:
• the Pension Plan;
• the Supplemental Pension Plans; and
• the KMP.
The Pension Plan is a funded, tax qualified, non-contributory (for all but a small subset of participants) defined benefit plan that covers the
majority of the Company’s salaried and non-union hourly U.S. employees who were hired or rehired prior to July 1, 2012. The Pension Plan
provides for normal retirement at age 65 and the formula to determine the lump sum benefit under the Pension Plan is five percent of final
average pay (the five consecutive years with the highest compensation out of the last ten years of eligible compensation) multiplied by years of
credited service (as defined in the Pension Plan). A choice for distribution between an annuity and a lump sum option is available. The Pension
Plan was closed to new participants after June 30, 2012 and no further benefits will accrue to any Pension Plan participant for service
performed after December 31, 2022. In addition, any employee who was a Pension Plan participant on June 30, 2012 was provided the option
to waive participation in the Pension Plan effective January 1, 2013, and in lieu of participation in the Pension Plan, receive an annual non-
elective employer contribution equal to 2% of eligible compensation in the ESP.
The Supplemental Pension Plans are unfunded, nonqualified, non-contributory defined benefit restoration plans. The Supplemental Pension
Plans restore what is lost in the Pension Plan due to limitations under the Code on the annual compensation and benefits recognized when
calculating benefits under the qualified Pension Plan. The Supplemental Pension Plans cover all employees of the Company who participate in
the Pension Plan and who are impacted by the Code compensation and benefits limits. A participant must meet the vesting requirements of
the qualified Pension Plan to vest in benefits under the Supplemental Pension Plans. Benefits under the Supplemental Pension Plans are
available only as a lump sum distribution after termination and paid in accordance with Section 409A of the Code. As a result of the 2012
changes to the Pension Plan, the Supplemental Pension Plans were closed to employees hired after June 30, 2012, and no further benefits will
accrue to any Supplemental Plan participant for service performed after December 31, 2022.
The KMP is an unfunded, nonqualified, non-contributory defined benefit plan available to certain key management employees on a highly
selective basis. The KMP is designed to replace a percentage of a key employee’s final average pay based on their age and years of service at
the time of retirement. Final average pay is defined as the sum of the key employee’s current annual base salary plus the average of the
employee’s three highest AIM awards during the most recent six years. No other components of compensation (other than base salary and
AIM awards) are included in final average pay. The KMP provides a benefit pursuant to a formula in which 1.7% of a key employee’s final
average pay is multiplied by years of service (up to a maximum of 30 years) and then reduced by the value of other retirement benefits the key
employee will receive that are provided by the Company under certain qualified and nonqualified retirement plans as well as Social Security.
2023 Proxy Statement
65
66
2022 Nonqualified Deferred Compensation
Post-Employment Benefits
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
The Company’s EDCP is an unfunded, nonqualified plan that permits certain employees, including the NEOs, to defer receipt of up to 50% of
their annual salary and up to 100% of their AIM awards and PSP awards. Elections to defer generally must be made prior to the beginning of
the calendar year or performance period, as applicable. The Company has established a nonqualified grantor trust with a bank as the trustee to
hold certain assets as a funding vehicle for the Company’s obligations under the EDCP. These assets are considered general assets of the
Company and are available to its creditors in the event of the Company’s insolvency. Amounts held in the trust are invested by the trustee
using various investment vehicles.
Participants are offered certain investment options (the same investment options available in the ESP other than the self-directed brokerage)
and can choose how they wish to allocate their cash deferrals among those investment options. Participants are 100% vested in all amounts
deferred and bear the risk of any earnings and losses on such deferred amounts.
Generally, deferred amounts may be distributed following termination of employment or at the time of a scheduled in-service distribution date
chosen by the participant. If a participant has completed five or more years of service at the time of termination, or is terminated due to long-
term disability, death or retirement, the distribution is paid in accordance with the participant’s election. If a participant terminates without
meeting these requirements, the account balance for all plan years will be paid in a lump sum in the year following the year of termination. A
participant can elect to receive distributions at termination over five, 10, or 15 annual installments, or in a single lump sum. A participant can
elect to receive scheduled in-service distributions in future years that are at least two years after the end of the plan year for which they are
deferring. In-service distributions can be received in two to five annual installments, or if no election is made, in a lump sum. For those
participants who have investments in ordinary shares, the distribution of these assets will be in the form of ordinary shares, not cash.
The following table provides information regarding contributions, distributions, earnings and balances for each NEO under our nonqualified
deferred compensation plans.
Name
D. S. Regnery
Plan Name
EDCP
Executive
Contributions
in Last Fiscal
Year
($)(a)
Registrant
Contributions
in Last Fiscal
Year
($)(b)
1,334,639
—
Aggregate
Earnings in
Last Fiscal
Year
($)(c)
(718,396)
Aggregate
Withdrawals/
Distributions
($)
Aggregate
Balance At
Last Fiscal
Year End
($)(d)
(850,092) 6,812,789
Supplemental ESP
—
189,414
(206,892)
C. J. Kuehn
EDCP
Supplemental ESP
P. A. Camuti
EDCP
Supplemental ESP
E. M. Turtz
EDCP
Supplemental ESP
R. D. Pittard
EDCP
Supplemental ESP
1,509,535
—
—
—
—
133,055
(52,948)
(73,682)
—
(1,804,784)
69,402
(95,464)
266,208
—
(390,981)
—
—
—
55,574
(54,553)
—
(3,611,374)
58,895
(159,917)
— 1,543,659
— 2,426,925
—
473,423
— 9,925,859
—
621,714
— 2,038,334
—
382,032
— 17,410,664
—
823,452
(a)
(b)
(c)
(d)
The annual deferrals (salary, AIM and PSP) are all reflected in the Salary column, the Non-Equity Incentive Plan column and the Stock Awards column, respectively of the
Summary Compensation Table.
All of the amounts reflected in this column are included in the All Other Compensation column of the Summary Compensation Table.
Amounts in this column include gains and losses on investments, as well as dividends on ordinary shares or ordinary share equivalents. None of the earnings or losses
reported in this column are included in the Summary Compensation Table.
The following table reflects the amounts reported in this column as compensation to the NEOs in the Company’s Summary Compensation Table in Proxy Statements for
prior years. Each of Mr. Regnery, Mr. Kuehn, Mr. Camuti, Mr. Turtz and Mr. Pittard first became NEOs and therefore had their compensation reported in the Company’s
Proxy Statements beginning with fiscal years 2017 (Regnery), 2020 (Kuehn), 2019 (Camuti), 2021 (Turtz) and 2022 (Pittard).
The following discussion describes the compensation to which each active NEO would be entitled in the event of termination of such
executive’s employment.
Employment Arrangements and Severance Not in
Connection with a Change in Control
Mr. Regnery is entitled to severance in the event of his involuntary termination without cause pursuant to the terms of his employment
agreement. Under the terms of his employment agreement, Mr. Regnery is eligible for 24 months of base annual salary plus a prorated AIM
award earned for the year of termination as determined and paid at the conclusion of the full performance year in accordance with the terms of
the AIM program.
Although the Company does not have a formal severance policy for officers, NEOs who do not have employment agreements providing for
severance and who are terminated by the Company other than for cause will generally be considered for severance benefits of up to 12
months’ base salary. Depending on the circumstances and timing of the termination, they may also be eligible for a pro-rated portion of their
AIM award earned for the year of termination as determined and paid at the conclusion of the full performance year in accordance with the
In addition, in general, the Company’s equity award agreements provide for the following treatment upon the occurrence of one of the specified
terms of the AIM program.
events in the table below:
Stock Options
RSUs
PSUs
Retirement
Continue to vest on the same basis as
Continue to vest on the
Vest pro-rata based on the time worked during
active employees and remain
same basis as active
the performance period and the achievement of
exercisable for a period of up to five
employees.
performance goals through the end of the
years following retirement.
performance period unless full-time employment
commences with another employer, in which
case unvested awards are forfeited.
Group
Termination
Immediately vest in the portion of the
Immediately vest in the
Vest pro-rata based on the time worked during
awards that would have vested within
portion of the awards that
the performance period and the achievement of
twelve months of termination and
would have vested within
performance goals through the end of the
remain exercisable for a period of up to
twelve months of
performance period.
Unvested awards are forfeited and
Unvested awards are
Vest pro-rata based on the time worked during
Job
Elimination
three years following termination of
termination.
employment.
vested awards remain exercisable for a
forfeited.
period of up to one year following
termination.
Death or
Disability
Immediately vest in unvested awards
and vested awards remain exercisable
Immediately vest in
unvested awards.
for a period of up to three years
following death or disability.
the performance period and the achievement of
performance goals through the end of the
performance period.
Vest pro-rata based on the time worked during
the performance period and the achievement of
performance goals at target performance unless
termination occurs in the final quarter of the
performance period in which case the awards
vest based on actual performance.
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
EDCP
($)
Supplemental ESP
($)
In the event of a change in control or termination due to a Major Restructuring, severance would be determined pursuant to the terms of the
change-in-control agreements or the Major Restructuring Severance Plan described below in lieu of severance under the terms of the
1,910,441
160,685
—
201,964
—
372,864
148,218
129,857
38,685
—
employment agreements or the severance guidelines described above.
2023 Proxy Statement
67
68
2022 Nonqualified Deferred Compensation
Post-Employment Benefits
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
The Company’s EDCP is an unfunded, nonqualified plan that permits certain employees, including the NEOs, to defer receipt of up to 50% of
their annual salary and up to 100% of their AIM awards and PSP awards. Elections to defer generally must be made prior to the beginning of
the calendar year or performance period, as applicable. The Company has established a nonqualified grantor trust with a bank as the trustee to
hold certain assets as a funding vehicle for the Company’s obligations under the EDCP. These assets are considered general assets of the
Company and are available to its creditors in the event of the Company’s insolvency. Amounts held in the trust are invested by the trustee
using various investment vehicles.
Participants are offered certain investment options (the same investment options available in the ESP other than the self-directed brokerage)
and can choose how they wish to allocate their cash deferrals among those investment options. Participants are 100% vested in all amounts
deferred and bear the risk of any earnings and losses on such deferred amounts.
Generally, deferred amounts may be distributed following termination of employment or at the time of a scheduled in-service distribution date
chosen by the participant. If a participant has completed five or more years of service at the time of termination, or is terminated due to long-
term disability, death or retirement, the distribution is paid in accordance with the participant’s election. If a participant terminates without
meeting these requirements, the account balance for all plan years will be paid in a lump sum in the year following the year of termination. A
participant can elect to receive distributions at termination over five, 10, or 15 annual installments, or in a single lump sum. A participant can
elect to receive scheduled in-service distributions in future years that are at least two years after the end of the plan year for which they are
deferring. In-service distributions can be received in two to five annual installments, or if no election is made, in a lump sum. For those
participants who have investments in ordinary shares, the distribution of these assets will be in the form of ordinary shares, not cash.
The following table provides information regarding contributions, distributions, earnings and balances for each NEO under our nonqualified
deferred compensation plans.
Name
Plan Name
D. S. Regnery
EDCP
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Supplemental ESP
Supplemental ESP
EDCP
EDCP
EDCP
EDCP
Supplemental ESP
Supplemental ESP
Supplemental ESP
Executive
Registrant
Aggregate
Contributions
Contributions
Earnings in
in Last Fiscal
in Last Fiscal
Last Fiscal
Year
($)(a)
Year
($)(b)
Year
($)(c)
Aggregate
Withdrawals/
Distributions
($)
Aggregate
Balance At
Last Fiscal
Year End
($)(d)
1,334,639
—
(718,396)
(850,092) 6,812,789
—
189,414
(206,892)
1,509,535
—
—
—
—
—
—
—
133,055
(52,948)
(73,682)
—
(1,804,784)
69,402
(95,464)
55,574
(54,553)
—
(3,611,374)
58,895
(159,917)
266,208
—
(390,981)
— 1,543,659
— 2,426,925
—
473,423
— 9,925,859
—
621,714
— 2,038,334
—
382,032
— 17,410,664
—
823,452
(a)
(b)
(c)
(d)
The annual deferrals (salary, AIM and PSP) are all reflected in the Salary column, the Non-Equity Incentive Plan column and the Stock Awards column, respectively of the
Summary Compensation Table.
All of the amounts reflected in this column are included in the All Other Compensation column of the Summary Compensation Table.
Amounts in this column include gains and losses on investments, as well as dividends on ordinary shares or ordinary share equivalents. None of the earnings or losses
reported in this column are included in the Summary Compensation Table.
The following table reflects the amounts reported in this column as compensation to the NEOs in the Company’s Summary Compensation Table in Proxy Statements for
prior years. Each of Mr. Regnery, Mr. Kuehn, Mr. Camuti, Mr. Turtz and Mr. Pittard first became NEOs and therefore had their compensation reported in the Company’s
Proxy Statements beginning with fiscal years 2017 (Regnery), 2020 (Kuehn), 2019 (Camuti), 2021 (Turtz) and 2022 (Pittard).
Name
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
EDCP
Supplemental ESP
($)
1,910,441
160,685
201,964
—
—
($)
372,864
148,218
129,857
38,685
—
The following discussion describes the compensation to which each active NEO would be entitled in the event of termination of such
executive’s employment.
Employment Arrangements and Severance Not in
Connection with a Change in Control
Mr. Regnery is entitled to severance in the event of his involuntary termination without cause pursuant to the terms of his employment
agreement. Under the terms of his employment agreement, Mr. Regnery is eligible for 24 months of base annual salary plus a prorated AIM
award earned for the year of termination as determined and paid at the conclusion of the full performance year in accordance with the terms of
the AIM program.
Although the Company does not have a formal severance policy for officers, NEOs who do not have employment agreements providing for
severance and who are terminated by the Company other than for cause will generally be considered for severance benefits of up to 12
months’ base salary. Depending on the circumstances and timing of the termination, they may also be eligible for a pro-rated portion of their
AIM award earned for the year of termination as determined and paid at the conclusion of the full performance year in accordance with the
terms of the AIM program.
In addition, in general, the Company’s equity award agreements provide for the following treatment upon the occurrence of one of the specified
events in the table below:
Retirement
Stock Options
Continue to vest on the same basis as
active employees and remain
exercisable for a period of up to five
years following retirement.
RSUs
Continue to vest on the
same basis as active
employees.
Group
Termination
Job
Elimination
Death or
Disability
Immediately vest in the portion of the
awards that would have vested within
twelve months of termination and
remain exercisable for a period of up to
three years following termination of
employment.
Unvested awards are forfeited and
vested awards remain exercisable for a
period of up to one year following
termination.
Immediately vest in unvested awards
and vested awards remain exercisable
for a period of up to three years
following death or disability.
Immediately vest in the
portion of the awards that
would have vested within
twelve months of
termination.
Unvested awards are
forfeited.
Immediately vest in
unvested awards.
PSUs
Vest pro-rata based on the time worked during
the performance period and the achievement of
performance goals through the end of the
performance period unless full-time employment
commences with another employer, in which
case unvested awards are forfeited.
Vest pro-rata based on the time worked during
the performance period and the achievement of
performance goals through the end of the
performance period.
Vest pro-rata based on the time worked during
the performance period and the achievement of
performance goals through the end of the
performance period.
Vest pro-rata based on the time worked during
the performance period and the achievement of
performance goals at target performance unless
termination occurs in the final quarter of the
performance period in which case the awards
vest based on actual performance.
In the event of a change in control or termination due to a Major Restructuring, severance would be determined pursuant to the terms of the
change-in-control agreements or the Major Restructuring Severance Plan described below in lieu of severance under the terms of the
employment agreements or the severance guidelines described above.
2023 Proxy Statement
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68
Change in Control
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Major Restructuring
The Company has entered into a change-in-control agreement with each NEO. The change-in-control agreement provides for certain
payments if the employment is terminated by the Company without “cause” (as defined in the change-in-control agreements) or by the NEO for
“good reason” (as defined in the change-in-control agreements), in each case, within two years following a change in control of the Company.
Following a change in control, each NEO is entitled to continue receiving their current base salary and is entitled to an annual bonus in an
amount not less than the highest annual bonus paid during the prior three full fiscal years.
If an NEO’s employment is terminated “without cause” or by the NEO for “good reason” within two years following a change in control, the
NEO is entitled to the following:
• any base salary and annual bonus for a completed fiscal year that had not been paid;
The Company has adopted a Major Restructuring Severance Plan (the “Severance Plan”) that provides a cash severance payment in the event
a participant’s employment is terminated due to an involuntary loss of job without “cause” (as defined in the Severance Plan) or a “good
reason” (as defined in the Severance Plan), provided that the termination is substantially related to or a result of a Major Restructuring. The
cash severance payment would be equal to two and one-half times (for the Chair and CEO) or two times (for other NEOs) (a) current base
salary, and (b) current target AIM award. As of December 31, 2022, the value of cash severance for NEOs was: Mr. Regnery, $7,812,500; Mr.
Kuehn, $3,100,000; Mr. Camuti, $2,368,000; Mr. Turtz, $2,040,000 and Mr, Pittard, $2,173,750.
Participants would also receive a prorated portion of their target AIM award based on actual Company and individual performance during the
fiscal year in which termination of employment occurred. Participants in the KMP who are not vested in such plans would also receive a cash
payment equal to the amount of the benefit to which they would have been entitled if they were vested.
• an amount equal to the NEO’s annual bonus for the last completed fiscal year pro-rated for the number of full months employed in the
In addition, the Company’s equity awards provide that employees who terminate employment due to an involuntary loss of job without
“Cause” (as defined in the applicable award agreement) or for “Good Reason” (as defined in the applicable award agreement) within one year
of completion of a Major Restructuring will, provided that the termination is substantially related to the Major Restructuring, (i) immediately vest
in all unvested stock options and may exercise all vested stock options at any time within the following three-year period (five years if retirement
eligible) or the remaining term of the stock option, if shorter, (ii) immediately vest in all RSUs, except that retirement eligible participants with at
least five years of service would continue their existing vesting schedule, and (iii) receive a prorated payout of outstanding PSUs based on
actual performance at the end of performance period. As of December 31, 2022, the value of unvested equity awards was: Mr. Regnery,
$9,995,004; Mr. Kuehn, $4,765,883; Mr. Camuti, $3,557,502; Mr. Turtz, $1,993,461 and Mr. Pittard, $1,448,332.
A “Major Restructuring” is defined as a reorganization, recapitalization, extraordinary stock dividend, merger, sale, spin-off or other similar
transaction or series of transactions, which individually or in the aggregate, has the effect of resulting in the elimination of all, or the majority of,
any one or more of the Company’s business segments, so long as such transaction or transactions do not constitute a Change in Control (as
defined in the applicable plan).
current fiscal year;
• an amount equal to the NEO’s base salary pro-rated for any unused vacation days;
• a lump sum severance payment from the Company equal to three times (for the Chair and CEO) or two and one-half times (for other NEOs)
the sum of:
• the NEO’s annual salary in effect on the termination date, or, if higher, the annual salary in effect immediately prior to the reduction of the
NEO’s annual salary after the change in control; and
• the NEO’s target AIM award for the year of termination or, if higher, the average of the AIM award amounts beginning three years
immediately preceding the change in control and ending on the termination date.
A “change in control” is defined as the occurrence of any of the following events: (i) any person unrelated to the Company becomes the
beneficial owner of 30% or more of the combined voting power of the Company’s voting stock; (ii) the directors serving at the time the change-
in-control agreements were executed (or the directors subsequently elected by the shareholders of the Company whose election or nomination
was duly approved by at least two-thirds of the then serving directors) fail to constitute a majority of the Board of Directors; (iii) the
consummation of a merger or consolidation of the Company with any other corporation in which the Company’s voting securities outstanding
immediately prior to such merger or consolidation represent 50% or less of the combined voting securities of the Company immediately after
such merger or consolidation; (iv) any sale or transfer of all or substantially all of the Company’s assets, other than a sale or transfer with a
corporation where the Company owns at least 80% of the combined voting power of such corporation or its parent after such transfer; or
(v) any other event that the continuing directors determine to be a change in control; provided however, with respect to (i), (iii) and (v) above,
there shall be no change in control if shareholders of the Company own more than 50% of the combined voting power of the voting securities
of the Company or the surviving entity or any parent immediately following such transaction in substantially the same proportion to each other
as prior to such transaction.
In addition to the foregoing, the NEOs would also be eligible to participate in the Company’s welfare employee benefit programs for the
severance period (three years for the Chair and CEO and two and one-half years for the other NEOs). For purposes of determining eligibility for
applicable post-retirement welfare benefits, the NEO would be credited with any combination of additional years of service and age, not
exceeding 10 years, to the extent necessary to qualify for such benefits. Mr. Regnery and Mr. Pittard are the only active NEOs eligible for
subsidized retiree medical benefits (only until age 65) due to their age and service as of January 1, 2003, when eligibility for the retiree medical
benefit was frozen. The Company would also provide each NEO up to $100,000 of outplacement services.
In the event of a change in control, participants in the KMP would be immediately vested. A termination within two years following a change in
control also triggers the payment of an enhanced benefit, whereby three years would be added to both age and service with the Company
under the KMP. In addition, the “final average pay” under the KMP would be calculated as 33.33% of his severance benefit under the change-
in-control agreement in the case of Mr. Regnery and 40% of the severance benefit under the change-in-control agreement in the case of the
other NEOs. These percentages reflect an annualized value of severance payments that would be provided in accordance with their
respective agreements.
Under the Company’s Incentive Stock Plan of 2018 (“2018 Plan”), time-based awards will only vest and become exercisable or payable, as
applicable, on a change in control (as defined in the 2018 Plan) if they are not assumed, substituted or otherwise replaced in connection with
the change in control. If the awards are assumed or continued after the change in control, the Committee may provide that such awards will be
subject to automatic vesting acceleration upon a participant’s involuntary termination within a designated period following the change in
control. Further, under the 2018 Plan, PSUs will automatically vest upon a change in control of our Company, based on (a) the target level, pro-
rated to reflect the period the participant was in service during the performance period or (b) the actual performance level attained, in each
case, as determined by the Committee.
2023 Proxy Statement
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70
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Major Restructuring
The Company has adopted a Major Restructuring Severance Plan (the “Severance Plan”) that provides a cash severance payment in the event
a participant’s employment is terminated due to an involuntary loss of job without “cause” (as defined in the Severance Plan) or a “good
reason” (as defined in the Severance Plan), provided that the termination is substantially related to or a result of a Major Restructuring. The
cash severance payment would be equal to two and one-half times (for the Chair and CEO) or two times (for other NEOs) (a) current base
salary, and (b) current target AIM award. As of December 31, 2022, the value of cash severance for NEOs was: Mr. Regnery, $7,812,500; Mr.
Kuehn, $3,100,000; Mr. Camuti, $2,368,000; Mr. Turtz, $2,040,000 and Mr. Pittard, $2,173,750.
Participants would also receive a prorated portion of their target AIM award based on actual Company and individual performance during the
fiscal year in which termination of employment occurred. Participants in the KMP who are not vested in such plans would also receive a cash
payment equal to the amount of the benefit to which they would have been entitled if they were vested.
In addition, the Company’s equity awards provide that employees who terminate employment due to an involuntary loss of job without
“cause” (as defined in the applicable award agreement) or for “good reason” (as defined in the applicable award agreement) within one year of
completion of a Major Restructuring will, provided that the termination is substantially related to the Major Restructuring, (i) immediately vest in
all unvested stock options and may exercise all vested stock options at any time within the following three-year period (five years if retirement
eligible) or the remaining term of the stock option, if shorter, (ii) immediately vest in all RSUs, except that retirement eligible participants with at
least five years of service would continue their existing vesting schedule, and (iii) receive a prorated payout of outstanding PSUs based on
actual performance at the end of performance period. As of December 31, 2022, the value of unvested equity awards was: Mr. Regnery,
$9,995,004; Mr. Kuehn, $4,765,883; Mr. Camuti, $3,557,502; Mr. Turtz, $1,993,461 and Mr. Pittard, $1,448,332.
A “Major Restructuring” is defined as a reorganization, recapitalization, extraordinary stock dividend, merger, sale, spin-off or other similar
transaction or series of transactions, which individually or in the aggregate, has the effect of resulting in the elimination of all, or the majority of,
any one or more of the Company’s business segments, so long as such transaction or transactions do not constitute a “change in control” (as
defined in the applicable plan).
Change in Control
The Company has entered into a change-in-control agreement with each NEO. The change-in-control agreement provides for certain
payments if the employment is terminated by the Company without “cause” (as defined in the change-in-control agreements) or by the NEO for
“good reason” (as defined in the change-in-control agreements), in each case, within two years following a change in control of the Company.
Following a change in control, each NEO is entitled to continue receiving their current base salary and is entitled to an annual bonus in an
amount not less than the highest annual bonus paid during the prior three full fiscal years.
If an NEO’s employment is terminated “without cause” or by the NEO for “good reason” within two years following a change in control, the
NEO is entitled to the following:
• any base salary and annual bonus for a completed fiscal year that had not been paid;
• an amount equal to the NEO’s annual bonus for the last completed fiscal year pro-rated for the number of full months employed in the
• an amount equal to the NEO’s base salary pro-rated for any unused vacation days;
• a lump sum severance payment from the Company equal to three times (for the Chair and CEO) or two and one-half times (for other NEOs)
current fiscal year;
the sum of:
• the NEO’s annual salary in effect on the termination date, or, if higher, the annual salary in effect immediately prior to the reduction of the
NEO’s annual salary after the change in control; and
• the NEO’s target AIM award for the year of termination or, if higher, the average of the AIM award amounts beginning three years
immediately preceding the change in control and ending on the termination date.
A “change in control” is defined as the occurrence of any of the following events: (i) any person unrelated to the Company becomes the
beneficial owner of 30% or more of the combined voting power of the Company’s voting stock; (ii) the directors serving at the time the change-
in-control agreements were executed (or the directors subsequently elected by the shareholders of the Company whose election or nomination
was duly approved by at least two-thirds of the then serving directors) fail to constitute a majority of the Board of Directors; (iii) the
consummation of a merger or consolidation of the Company with any other corporation in which the Company’s voting securities outstanding
immediately prior to such merger or consolidation represent 50% or less of the combined voting securities of the Company immediately after
such merger or consolidation; (iv) any sale or transfer of all or substantially all of the Company’s assets, other than a sale or transfer with a
corporation where the Company owns at least 80% of the combined voting power of such corporation or its parent after such transfer; or
(v) any other event that the continuing directors determine to be a change in control; provided however, with respect to (i), (iii) and (v) above,
there shall be no change in control if shareholders of the Company own more than 50% of the combined voting power of the voting securities
of the Company or the surviving entity or any parent immediately following such transaction in substantially the same proportion to each other
as prior to such transaction.
In addition to the foregoing, the NEOs would also be eligible to participate in the Company’s welfare employee benefit programs for the
severance period (three years for the Chair and CEO and two and one-half years for the other NEOs). For purposes of determining eligibility for
applicable post-retirement welfare benefits, the NEO would be credited with any combination of additional years of service and age, not
exceeding 10 years, to the extent necessary to qualify for such benefits. Mr. Regnery and Mr. Pittard are the only active NEOs eligible for
subsidized retiree medical benefits (only until age 65) due to their age and service as of January 1, 2003, when eligibility for the retiree medical
benefit was frozen. The Company would also provide each NEO up to $100,000 of outplacement services.
In the event of a change in control, participants in the KMP would be immediately vested. A termination within two years following a change in
control also triggers the payment of an enhanced benefit, whereby three years would be added to both age and service with the Company
under the KMP. In addition, the “final average pay” under the KMP would be calculated as 33.33% of his severance benefit under the change-
in-control agreement in the case of Mr. Regnery and 40% of the severance benefit under the change-in-control agreement in the case of the
other NEOs. These percentages reflect an annualized value of severance payments that would be provided in accordance with their
respective agreements.
Under the Company’s Incentive Stock Plan of 2018 (“2018 Plan”), time-based awards will only vest and become exercisable or payable, as
applicable, on a change in control (as defined in the 2018 Plan) if they are not assumed, substituted or otherwise replaced in connection with
the change in control. If the awards are assumed or continued after the change in control, the Committee may provide that such awards will be
subject to automatic vesting acceleration upon a participant’s involuntary termination within a designated period following the change in
control. Further, under the 2018 Plan, PSUs will automatically vest upon a change in control of our Company, based on (a) the target level, pro-
rated to reflect the period the participant was in service during the performance period or (b) the actual performance level attained, in each
case, as determined by the Committee.
2023 Proxy Statement
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70
2022 Post-Employment Benefits Table
The following table describes the compensation to which each of the NEOs would be entitled in the event of termination of such executive’s
employment on December 31, 2022, including termination following a change in control. The potential payments were determined under the
terms of our plans and arrangements in effect on December 31, 2022. The table does not include the pension benefits or nonqualified deferred
compensation amounts that would be paid to an NEO, which are set forth in the Pension Benefits table and the Nonqualified Deferred
Compensation table above, except to the extent that the NEO is entitled to an additional benefit as a result of the termination.
No NEOs are entitled to payment in connection with an Involuntary Termination With Cause.
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Name
D. S. Regnery
Termination
Scenario
Severance
($)(a)
Earned
but
Unpaid
AIM
Awards
($)(b)
PSP
Award
Payout
($)(c)
Value of
Unvested
Equity
Awards
($)(d)
Enhanced
Retirement
Benefits
($)(e)
Health
Benefits
($)(f)
Outplacement
($)(g)
Total
($)
payable to the NEO under these termination scenarios.
Voluntary Resignation/
Retirement
Involuntary without
Cause
— 3,029,377 5,416,364 4,578,640
—
—
— 13,024,381
retiree coverage.
2,500,000 1,875,000 5,416,364 4,578,640
—
—
11,400 14,381,404
For the “Involuntary without Cause” scenario, each NEO is eligible for outplacement services for a twelve-month period, not to exceed $11,400. For the “Change in
Control” scenario, the amount represents the maximum expenses the Company would reimburse the NEO for professional outplacement services.
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Change in Control
9,853,776 2,224,399 5,417,541 4,578,640 11,447,472 111,604
100,000 33,733,432
Death/Disability
— 3,029,377 5,416,364 4,578,640
—
—
— 13,024,381
Voluntary Resignation/
Retirement
Involuntary without
Cause
—
—
700,481
—
—
—
—
—
—
—
—
—
—
—
11,400
711,881
Change in Control
4,552,354 1,205,682 2,608,421 2,157,799 2,284,637 67,276
100,000 12,976,169
Death/Disability
— 1,252,143 2,608,084 2,157,799
—
—
— 6,018,026
Voluntary Resignation/
Retirement
Involuntary without
Cause
— 799,021 2,013,046 1,544,456
—
—
— 4,356,523
640,000 799,021 2,013,046 1,544,456
—
—
11,400 5,007,923
Change in Control
3,373,719 827,942 2,013,214 1,544,456 2,218,485 45,878
100,000 10,123,694
Death/Disability
— 799,021 2,013,046 1,544,456
—
—
— 4,356,523
Voluntary Resignation/
Retirement
Involuntary without
Cause
—
—
600,000
—
—
—
—
—
—
—
—
—
—
—
11,400
611,400
Change in Control
2,854,483 637,488 1,010,053
983,576 2,892,445 66,470
100,000 8,544,515
Death/Disability
— 616,891 1,009,885
983,576
—
—
— 2,610,352
Voluntary Resignation/
Retirement
Involuntary without
Cause
— 711,903
689,505
758,827
—
—
— 2,160,235
587,500 711,903
689,505
758,827
—
—
11,400 2,759,135
Change in Control
2,989,878 704,701
689,505
758,827 3,218,469 107,858
100,000 8,569,238
Death/Disability
— 711,903
689,505
758,827
—
—
— 2,160,235
(a)
(b)
For the “Involuntary without Cause” scenario, for those NEOs who do not have a formal separation agreement, the current severance guidelines permit payment of up to
one year’s base salary provided that such termination was not eligible for severance benefits under the Major Restructuring Severance Plan. Because of his service, Mr.
Kuehn’s severance is equal to 47 weeks rather than 52. For the amounts shown under in the “Change in Control” scenario, refer to the description of how severance is
calculated in the section above, entitled Post-Employment Benefits.
NEOs.
For the “Voluntary Resignation/Retirement” scenario, the amount shown is only provided in the case of a voluntary retirement; for resignation, the NEO would not receive
an AIM award. For the “Involuntary without Cause” scenario, the amount for Mr. Regnery represents the target AIM award pursuant to the terms of his employment
2023 Proxy Statement
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72
agreement; Mr. Camuti and Mr. Pittard are retirement eligible; therefore, under the terms of the AIM plan, they would be eligible to receive prorated AIM awards (up to
target) depending on the circumstances and timing of the termination. For the amounts under the “Change in Control” scenario, these amounts represent the award paid
in 2022 for the 2021 performance period based on the Change in Control agreements in place.
For the “Involuntary without Cause” scenario, these amounts represent the cash value of the prorated PSU award payout to the NEOs as a result of their retirement
eligibility at December 31, 2022. For the “Change in Control” scenario for the NEOs, these values represent a pro-rated payment for all outstanding awards at target.
However, under the terms of the 2018 Plan, this payment could also be made based on actual performance with the payment amount being determined by the
Committee, For the “Retirement,” and “Death/Disability” scenarios, amounts represent the cash value of the prorated portion of their PSUs that vest upon such events
assuming performance at target. Amounts for each scenario are based on the closing stock price of the ordinary shares on December 30, 2022 ($168.09).
The amounts shown for “Retirement,” “Involuntary without Cause,” “Change in Control,” and “Death/Disability” represent (i) the value of the unvested RSUs, which is
calculated based on the number of unvested RSUs multiplied by the closing stock price of the ordinary shares on December 30, 2022 ($168.09), and (ii) the intrinsic
value of the unvested stock options, which is calculated based on the difference between the closing stock price of the ordinary shares on December 30, 2022 ($168.09)
and the relevant exercise price. However, only in the event of termination following a “Change in Control” or termination due to “Death/Disability” is there accelerated
vesting of unvested awards. For “Retirement,” the awards do not accelerate but continue to vest on the same basis as active employees. Mr. Regnery, Mr. Camuti and
Mr. Pittard are retirement eligible.
In the event of a “Change in Control” and termination of the NEOs, the present value of the pension benefits under the, KMP and Supplemental Pension Plan would be
paid out as lump sums. While there is no additional benefit to the NEOs as a result of either “Voluntary Resignation/Retirement” and/or “Involuntary without Cause”, there
are differences (based on the methodology mandated by the SEC) between the numbers that are shown in the Pension Benefits Table and those that would actually be
For the “Change in Control” scenario, these amounts represent the COBRA cost of health and welfare coverage (for medical, dental and vision) along with the cost of
basic life and AD&D, which is the cost for continued active coverage for the severance period. For Mr. Regnery and Mr. Pittard, the value shown includes the cost for
(c)
(d)
(e)
(f)
(g)
CEO Pay Ratio
The ratio of our CEO’s total compensation to our median employee’s total compensation (the “CEO Pay Ratio”) is a reasonable estimate
calculated in a manner consistent with Item 402(u) of Regulation S-K. Due to the flexibility afforded by Item 402(u) in calculating the CEO Pay
Ratio, the ratio may not be comparable to CEO pay ratios presented by other companies.
We chose to maintain the same median employee for our CEO Pay Ratio calculation in 2022 as there were no changes to our employee
population or employee compensation arrangements during 2021 or 2022 that would result in a significant change to our pay ratio disclosure.
We identified our median employee using our global employee population as of October 31, 2020. To determine our median employee, we
used annual base salary (or actual earnings in the case of commission-based employees) as our consistently applied compensation measure
for 2020 and annualized pay for full-time and part-time employees (but not seasonal and temporary employees) who commenced work during
2020. The median employee identified had anomalous total annual compensation related to a facility closure. We, therefore, substituted an
employee with the next lowest annual base pay. We believe that annual base salary provides a reasonable estimate of annual compensation of
our employees.
We calculated the median employee’s total annual compensation in accordance with the requirements of the Summary Compensation Table.
Based on such calculation, our median employee’s total compensation was $68,215, while our CEO’s compensation was $12,770,195.
Accordingly, our CEO Pay Ratio was 187:1.
Pay Versus Performance
In accordance with the new requirements prescribed in Item 402(v) of Regulation S-K, we are providing the following information about the
relationship between executive compensation actually paid (“CAP”) and our financial performance for the prior three fiscal years.
For this purpose, CAP is determined in accordance with SEC rules by adjusting the amounts reported in the Summary Compensation Table by
(a) subtracting the change in pension value, if any, for the year; (b) adding the pension service cost for the year; (c) subtracting the grant date
fair value of equity awards granted during the year; (d) adding the year-end fair value of unvested equity awards granted during the year; (e) for
awards granted in prior years that vested during the year, adding the difference between the vesting date fair value and the fair value at the
immediately preceding year-end; and (f) for awards granted in prior years that remain outstanding or unvested at the end of the year, adding
the difference between the year-end fair value and the fair value at the immediately preceding year-end. These adjustments are shown below.
The table below provides CAP for our principal executive officer (“PEO”) (our CEO) and an average CAP for our non-PEO named executive
officers (“NEOs”), as well as other financial information as required. Please see the Compensation Discussion & Analysis above for information
regarding the decisions made by the Human Resources and Compensation Committee with respect to the compensation paid to our CEO and
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
2022 Post-Employment Benefits Table
The following table describes the compensation to which each of the NEOs would be entitled in the event of termination of such executive’s
employment on December 31, 2022, including termination following a change in control. The potential payments were determined under the
terms of our plans and arrangements in effect on December 31, 2022. The table does not include the pension benefits or nonqualified deferred
compensation amounts that would be paid to an NEO, which are set forth in the Pension Benefits table and the Nonqualified Deferred
Compensation table above, except to the extent that the NEO is entitled to an additional benefit as a result of the termination.
No NEOs are entitled to payment in connection with an Involuntary Termination With Cause.
Name
Scenario
($)(a)
($)(b)
Termination
Severance
Awards
Awards
Benefits
Benefits
Outplacement
($)(d)
($)(e)
($)(f)
($)(g)
Total
($)
Earned
but
Unpaid
AIM
Award
Payout
($)(c)
Value of
PSP
Unvested
Enhanced
Equity
Retirement
Health
D. S. Regnery
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
Retirement
Cause
Retirement
Cause
Retirement
Cause
Retirement
Cause
Retirement
Cause
Voluntary Resignation/
— 3,029,377 5,416,364 4,578,640
—
—
— 13,024,381
Involuntary without
2,500,000 1,875,000 5,416,364 4,578,640
—
—
11,400 14,381,404
Change in Control
9,853,776 2,224,399 5,417,541 4,578,640 11,447,472 111,604
100,000 33,733,432
Death/Disability
— 3,029,377 5,416,364 4,578,640
—
—
— 13,024,381
Voluntary Resignation/
—
—
—
—
—
—
Involuntary without
700,481
—
—
—
11,400
711,881
Change in Control
4,552,354 1,205,682 2,608,421 2,157,799 2,284,637 67,276
100,000 12,976,169
Death/Disability
— 1,252,143 2,608,084 2,157,799
—
—
— 6,018,026
—
—
—
—
Voluntary Resignation/
— 799,021 2,013,046 1,544,456
—
—
— 4,356,523
Involuntary without
640,000 799,021 2,013,046 1,544,456
—
—
11,400 5,007,923
Change in Control
3,373,719 827,942 2,013,214 1,544,456 2,218,485 45,878
100,000 10,123,694
Death/Disability
— 799,021 2,013,046 1,544,456
—
—
— 4,356,523
Voluntary Resignation/
—
—
—
—
—
—
Involuntary without
600,000
—
—
—
11,400
611,400
Change in Control
2,854,483 637,488 1,010,053
983,576 2,892,445 66,470
100,000 8,544,515
Death/Disability
— 616,891 1,009,885
983,576
—
—
— 2,610,352
—
—
—
—
Voluntary Resignation/
— 711,903
689,505
758,827
—
—
— 2,160,235
Involuntary without
587,500 711,903
689,505
758,827
—
—
11,400 2,759,135
Change in Control
2,989,878 704,701
689,505
758,827 3,218,469 107,858
100,000 8,569,238
Death/Disability
— 711,903
689,505
758,827
—
—
— 2,160,235
(a)
(b)
For the “Involuntary without Cause” scenario, for those NEOs who do not have a formal separation agreement, the current severance guidelines permit payment of up to
one year’s base salary provided that such termination was not eligible for severance benefits under the Major Restructuring Severance Plan. Because of his service, Mr.
Kuehn’s severance is equal to 47 weeks rather than 52. For the amounts shown under in the “Change in Control” scenario, refer to the description of how severance is
calculated in the section above, entitled Post-Employment Benefits.
For the “Voluntary Resignation/Retirement” scenario, the amount shown is only provided in the case of a voluntary retirement; for resignation, the NEO would not receive
an AIM award. For the “Involuntary without Cause” scenario, the amount for Mr. Regnery represents the target AIM award pursuant to the terms of his employment
agreement; Mr. Camuti and Mr. Pittard are retirement eligible; therefore, under the terms of the AIM plan, they would be eligible to receive prorated AIM awards (up to
target) depending on the circumstances and timing of the termination. For the amounts under the “Change in Control” scenario, these amounts represent the award paid
in 2022 for the 2021 performance period based on the Change in Control agreements in place.
For the “Involuntary without Cause” scenario, these amounts represent the cash value of the prorated PSU award payout to the NEOs as a result of their retirement
eligibility at December 31, 2022. For the “Change in Control” scenario for the NEOs, these values represent a pro-rated payment for all outstanding awards at target.
However, under the terms of the 2018 Plan, this payment could also be made based on actual performance with the payment amount being determined by the
Committee, For the “Retirement,” and “Death/Disability” scenarios, amounts represent the cash value of the prorated portion of their PSUs that vest upon such events
assuming performance at target. Amounts for each scenario are based on the closing stock price of the ordinary shares on December 30, 2022 ($168.09).
The amounts shown for “Retirement,” “Involuntary without Cause,” “Change in Control,” and “Death/Disability” represent (i) the value of the unvested RSUs, which is
calculated based on the number of unvested RSUs multiplied by the closing stock price of the ordinary shares on December 30, 2022 ($168.09), and (ii) the intrinsic
value of the unvested stock options, which is calculated based on the difference between the closing stock price of the ordinary shares on December 30, 2022 ($168.09)
and the relevant exercise price. However, only in the event of termination following a “Change in Control” or termination due to “Death/Disability” is there accelerated
vesting of unvested awards. For “Retirement,” the awards do not accelerate but continue to vest on the same basis as active employees. Mr. Regnery, Mr. Camuti and
Mr. Pittard are retirement eligible.
In the event of a “Change in Control” and termination of the NEOs, the present value of the pension benefits under the, KMP and Supplemental Pension Plan would be
paid out as lump sums. While there is no additional benefit to the NEOs as a result of either “Voluntary Resignation/Retirement” and/or “Involuntary without Cause”, there
are differences (based on the methodology mandated by the SEC) between the numbers that are shown in the Pension Benefits Table and those that would actually be
payable to the NEO under these termination scenarios.
For the “Change in Control” scenario, these amounts represent the COBRA cost of health and welfare coverage (for medical, dental and vision) along with the cost of
basic life and AD&D, which is the cost for continued active coverage for the severance period. For Mr. Regnery and Mr. Pittard, the value shown includes the cost for
retiree coverage.
For the “Involuntary without Cause” scenario, each NEO is eligible for outplacement services for a twelve-month period, not to exceed $11,400. For the “Change in
Control” scenario, the amount represents the maximum expenses the Company would reimburse the NEO for professional outplacement services.
(c)
(d)
(e)
(f)
(g)
CEO Pay Ratio
The ratio of our CEO’s total compensation to our median employee’s total compensation (the “CEO Pay Ratio”) is a reasonable estimate
calculated in a manner consistent with Item 402(u) of Regulation S-K. Due to the flexibility afforded by Item 402(u) in calculating the CEO Pay
Ratio, the ratio may not be comparable to CEO pay ratios presented by other companies.
We chose to maintain the same median employee for our CEO Pay Ratio calculation in 2022 as there were no changes to our employee
population or employee compensation arrangements during 2021 or 2022 that would result in a significant change to our pay ratio disclosure.
We identified our median employee using our global employee population as of October 31, 2020. To determine our median employee, we
used annual base salary (or actual earnings in the case of commission-based employees) as our consistently applied compensation measure
for 2020 and annualized pay for full-time and part-time employees (but not seasonal and temporary employees) who commenced work during
2020. The median employee identified had anomalous total annual compensation related to a facility closure. We, therefore, substituted an
employee with the next lowest annual base pay. We believe that annual base salary provides a reasonable estimate of annual compensation of
our employees.
We calculated the median employee’s total annual compensation in accordance with the requirements of the Summary Compensation Table.
Based on such calculation, our median employee’s total compensation was $68,215, while our CEO’s compensation was $12,770,195.
Accordingly, our CEO Pay Ratio was 187:1.
Pay Versus Performance
In accordance with the new requirements prescribed in Item 402(v) of Regulation S-K, we are providing the following information about the
relationship between executive compensation actually paid (“CAP”) and our financial performance for the prior three fiscal years.
For this purpose, CAP is determined in accordance with SEC rules by adjusting the amounts reported in the Summary Compensation Table by
(a) subtracting the change in pension value, if any, for the year; (b) adding the pension service cost for the year; (c) subtracting the grant date
fair value of equity awards granted during the year; (d) adding the year-end fair value of unvested equity awards granted during the year; (e) for
awards granted in prior years that vested during the year, adding the difference between the vesting date fair value and the fair value at the
immediately preceding year-end; and (f) for awards granted in prior years that remain outstanding or unvested at the end of the year, adding
the difference between the year-end fair value and the fair value at the immediately preceding year-end. These adjustments are shown below.
The table below provides CAP for our principal executive officer (“PEO”) (our CEO) and an average CAP for our non-PEO named executive
officers (“NEOs”), as well as other financial information as required. Please see the Compensation Discussion & Analysis above for information
regarding the decisions made by the Human Resources and Compensation Committee with respect to the compensation paid to our CEO and
NEOs.
2023 Proxy Statement
71
72
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Summary
Compensation
Table Total for
First PEO
($)(a)
Compensation
Actually Paid
to First PEO
($)(b)
Summary
Compensation
Table Total for
Second PEO
($)(a)
Compensation
Actually Paid to
Second PEO
($)(b)
Year
Average
Summary
Compensation
Table Total for
non-PEO NEOs
($)(a)
Average
Compensation
Actually Paid to
non-PEO NEOs
($)(a)(b)
Total
Shareholder
Return
($)(c)
Peer Group
Total
Shareholder
Return
($)(c)
Net
Income
($M) (d)
Revenue
($M) (e)
2022
N/A
N/A
12,770,195
9,019,182
3,164,279
1,947,464
2021 18,253,260 46,032,830 12,888,518
20,449,001
3,813,093
8,590,730
2020 28,107,486 55,194,418
N/A
N/A
4,854,212
9,065,250
171
202
144
127 1,756.5 15,991.7
134 1,423.4 14,136.4
111
854.9 12,454.7
Value of Initial Fixed $100
Investment Based On:
(a)
(b)
(c)
(d)
(e)
The First PEO represents our former CEO Mr. Lamach who became Executive Chair effective July 1, 2021 and retired December 31, 2021; the Second PEO represents
Mr. Regnery who became CEO effective July 1, 2021. The non-PEO NEOs represent the following individuals: 2020: Mr. Kuehn, Ms. Carter, Mr. Regnery, Ms. Avedon,
and Mr. Camuti; 2021: Mr. Kuehn, Ms. Avedon, Mr. Camuti and Mr. Turtz; 2022: Mr. Kuehn, Mr. Camuti, Mr. Turtz and Mr. Pittard. The amounts shown for each PEO
are the amounts reported in the “Total” column of the Summary Compensation Table for the applicable year. The amounts shown for the non-PEO NEOs are the
average of amounts reported in the “Total” column of the Summary Compensation Table for the applicable year for NEOs other than the PEO.
The following table provides the calculation required to determine CAP in accordance with SEC rules. The CAP amounts reflected do not reflect the actual amount of
compensation earned by or paid to our NEOs. The fair values reflected in the Equity Compensation section are calculated in a manner consistent with the methodology
used to account for share-based payments in our financial statements, as described in Note 14 to the 2022 10-K. To determine equity award fair values for purposes of
calculating CAP in accordance with SEC rules, adjustments were made based on the stock price, updated Black-Scholes stock option assumptions, and estimated
Performance Share Unit payouts as of the year-end and vesting measurement dates.
Pension Compensation
Equity Compensation
LESS SCT
Aggregate
Change in the
Actuarial
Present Value of
All Defined
Benefit and
Actuarial
Pension Plans
($)(1)
Summary
Compensation
Table (SCT)
Total
($)
Fiscal
Year
(FY)
PLUS Service
Cost and Prior
Service Cost
($)
LESS SCT Grant
Date Fair Value
of Equity Awards
Granted in FY
($)(2)
PLUS Fair Value
of Outstanding
Equity Awards
Granted in FY
($)
PLUS Change
in Fair Value of
Equity Awards
from Prior
Years That
Vested in FY
($)
PLUS Change in
Fair Value of
Outstanding
Equity Awards
from Prior Years
($)
Compensation
Actually Paid
(CAP) Total
($)
First PEO
M. W. Lamach
Second PEO
D. S. Regnery
Average non-
PEO NEOs
2021 18,253,260
920,815
2,165,012
11,417,703
12,915,519
1,898,863
23,138,694 46,032,830
2020 28,107,486
11,591,666
1,584,239
11,762,881
19,402,771
4,924,066
24,530,403 55,194,418
2022 12,770,195
—
2021 12,888,518
2,695,010
2022
3,164,279
—
2021
3,813,093
309,031
2020
4,854,212
1,634,400
479
3,454
287,386
457,055
248,316
8,082,094
8,790,912
(3,480,220)
(980,090)
9,019,182
6,673,971
9,239,470
634,638
7,051,902 20,449,001
1,558,144
1,695,006
(1,305,293)
(335,770)
1,947,464
1,822,743
3,002,913
181,250
3,268,193
8,590,730
1,783,574
2,941,593
711,361
3,727,742
9,065,250
(1) As reported in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” of the Summary Compensation Table for each applicable year.
(2) As reported in the “Stock Awards” and “Option Awards” columns of the Summary Compensation Table for each applicable year.
Performance Measures
Reflects the cumulative Total Shareholder Return for Trane Technologies and the Standard & Poor’s 500 Industrials Index, which is the peer group used in the
Performance Graph required under Item 201(e) of Regulation S-K shown in Item 5 of our 2022 Form 10-K. Assumes an initial investment of $100 on December 31, 2019
(adjusted for our Reverse Morris Trust transaction that closed on February 29, 2020) and reinvestment of dividends.
As reflected in the Company’s Consolidated Statement of Earnings included in the Form 10-K for each fiscal year.
The Company Selected Measure (“CSM”) is Net Revenues for Products and Services (“Revenue”) as reported in the Company’s Consolidated Statement of Earnings
included in the Company’s Annual Report on Form 10-K for each fiscal year. The revenue performance targets and results related to executive compensation within our
AIM program are not the same as the Revenue listed for the CSM. Revenue results related to AIM are further adjusted for the impact of acquisitions and/or divestitures,
foreign exchange, changes in accounting principles, extraordinary items, and unusual or non-recurring gains or losses, including significant differences from the
assumptions contained in the financial plan upon which the incentive targets were established. All adjustments are reviewed and approved by the Human Resources and
Compensation Committee.
recently completed fiscal year.
Financial Measures
Revenue
Adjusted EBITDA
Free Cash Flow
Relative 3-Year Total Shareholder Return Percentile Ranking
Relative Cash Flow Return on Invested Capital Percentile Ranking
CAP VS TT AND PEER GROUP TSR
$60
$50
$40
$30
$20
$10
$0
)
M
$
(
P
A
C
$100
$46.0
$202
$134
$20.4
$55.2
$144
$111
$9.1
$171
$127
$8.6
$9.0
$1.9
$210
$175
$140
$70
$35
$0
$105
R
S
T
2019
2020
2021
2022
First PEO CAP
Company TSR
Second PEO CAP
Peer TSR
Avg NEO CAP
CAP VS NET INCOME
$1,757
$55.2
$46.0
$1,423
$20.4
$855
$9.1
$8.6
$9.0
$1.9
$60
$50
$40
$30
$20
$10
$0
)
M
$
(
P
A
C
$1,800
$1,500
$1,200
$900
$600
$300
$0
E
M
O
C
N
I
T
E
N
)
M
$
(
P
A
C
$60
$50
$40
$30
$20
$10
$0
CAP VS REVENUE
$15,992
$55.2
$12,455
$14,136
$46.0
$20.4
$9.1
$8.6
$9.0
$16,000
$12,000
E
U
N
E
V
E
R
$8,000
$4,000
$1.9
$0
2020
2021
2022
2020
2021
2022
First PEO CAP
Second PEO CAP
Avg NEO CAP
Net Income
First PEO CAP
Second PEO CAP
Avg NEO CAP
Revenue
We used the following unranked performance measures to link executive compensation actually paid to Company performance for the most
Relationships between Pay and Various Metrics
In accordance with regulatory requirements, the graphs below reflect the relationships of PEO and Average Non-PEO CAP over the prior three
fiscal years to (i) Company TSR and Peer Group TSR, (ii) Net Income, and (iii) Revenue, our Company Selected Measure.
Additional information about the performance measures used to calculate PEO and NEO compensation can be found in the discussions of our
short-term and long-term incentive programs in the “Compensation Discussion and Analysis” under the headings “Annual Incentive Matrix
(‘AIM’) Program” and “Long-Term Incentive Program (‘LTI’)”. We believe the Company’s executive compensation program appropriately
rewards our PEO and the Other NEOs for Company and individual performance, assists the Company in retaining our senior leadership team
and supports long-term value creation for our shareholders. These values demonstrate alignment of interests of our PEO and the Other NEOs
and our stockholders.
2023 Proxy Statement
73
74
Summary
Summary
Average
Summary
Average
Compensation
Compensation
Compensation
Compensation
Compensation
Compensation
Total
Table Total for
Actually Paid
Table Total for
Actually Paid to
Table Total for
Actually Paid to
Shareholder
Shareholder
First PEO
to First PEO
Second PEO
Second PEO
non-PEO NEOs
non-PEO NEOs
Year
($)(a)
($)(b)
($)(a)
($)(b)
($)(a)
($)(a)(b)
Return
($)(c)
Return
($)(c)
Net
Income
($M) (d)
Revenue
($M) (e)
2022
N/A
N/A
12,770,195
9,019,182
3,164,279
1,947,464
2021 18,253,260 46,032,830 12,888,518
20,449,001
3,813,093
8,590,730
2020 28,107,486 55,194,418
N/A
N/A
4,854,212
9,065,250
171
202
144
127 1,756.5 15,991.7
134 1,423.4 14,136.4
111
854.9 12,454.7
Value of Initial Fixed $100
Investment Based On:
Peer Group
Total
The First PEO represents our former CEO Mr. Lamach who became Executive Chair effective July 1, 2021 and retired December 31, 2021; the Second PEO represents
Mr. Regnery who became CEO effective July 1, 2021. The non-PEO NEOs represent the following individuals: 2020: Mr. Kuehn, Ms. Carter, Mr. Regnery, Ms. Avedon,
and Mr. Camuti; 2021: Mr. Kuehn, Ms. Avedon, Mr. Camuti and Mr. Turtz; 2022: Mr. Kuehn, Mr. Camuti, Mr. Turtz and Mr. Pittard. The amounts shown for each PEO
are the amounts reported in the “Total” column of the Summary Compensation Table for the applicable year. The amounts shown for the non-PEO NEOs are the
average of amounts reported in the “Total” column of the Summary Compensation Table for the applicable year for NEOs other than the PEO.
The following table provides the calculation required to determine CAP in accordance with SEC rules. The CAP amounts reflected do not reflect the actual amount of
compensation earned by or paid to our NEOs. The fair values reflected in the Equity Compensation section are calculated in a manner consistent with the methodology
used to account for share-based payments in our financial statements, as described in Note 14 to the 2022 10-K. To determine equity award fair values for purposes of
calculating CAP in accordance with SEC rules, adjustments were made based on the stock price, updated Black-Scholes stock option assumptions, and estimated
Performance Share Unit payouts as of the year-end and vesting measurement dates.
Pension Compensation
Equity Compensation
LESS SCT
Aggregate
Change in the
Actuarial
Present Value of
All Defined
Benefit and
PLUS Change
in Fair Value of
PLUS Change in
Summary
Compensation
Table (SCT)
Total
($)
Fiscal
Year
(FY)
LESS SCT Grant
PLUS Fair Value
Equity Awards
Fair Value of
PLUS Service
Date Fair Value
of Outstanding
from Prior
Outstanding
Compensation
Actuarial
Cost and Prior
of Equity Awards
Equity Awards
Years That
Equity Awards
Actually Paid
Pension Plans
Service Cost
Granted in FY
Granted in FY
Vested in FY
from Prior Years
(CAP) Total
($)(1)
($)
($)(2)
($)
($)
($)
($)
First PEO
M. W. Lamach
Second PEO
D. S. Regnery
Average non-
PEO NEOs
2021 18,253,260
920,815
2,165,012
11,417,703
12,915,519
1,898,863
23,138,694 46,032,830
2020 28,107,486
11,591,666
1,584,239
11,762,881
19,402,771
4,924,066
24,530,403 55,194,418
2022 12,770,195
8,082,094
8,790,912
(3,480,220)
(980,090)
9,019,182
2021 12,888,518
2,695,010
6,673,971
9,239,470
634,638
7,051,902 20,449,001
2022
3,164,279
1,558,144
1,695,006
(1,305,293)
(335,770)
1,947,464
2021
3,813,093
309,031
1,822,743
3,002,913
181,250
3,268,193
8,590,730
2020
4,854,212
1,634,400
1,783,574
2,941,593
711,361
3,727,742
9,065,250
—
—
479
3,454
287,386
457,055
248,316
Reflects the cumulative Total Shareholder Return for Trane Technologies and the Standard & Poor’s 500 Industrials Index, which is the peer group used in the
Performance Graph required under Item 201(e) of Regulation S-K shown in Item 5 of our 2022 Form 10-K. Assumes an initial investment of $100 on December 31, 2019
(adjusted for our Reverse Morris Trust transaction that closed on February 29, 2020) and reinvestment of dividends.
As reflected in the Company’s Consolidated Statement of Earnings included in the Form 10-K for each fiscal year.
The Company Selected Measure (“CSM”) is Net Revenues for Products and Services (“Revenue”) as reported in the Company’s Consolidated Statement of Earnings
included in the Company’s Annual Report on Form 10-K for each fiscal year. The revenue performance targets and results related to executive compensation within our
AIM program are not the same as the Revenue listed for the CSM. Revenue results related to AIM are further adjusted for the impact of acquisitions and/or divestitures,
foreign exchange, changes in accounting principles, extraordinary items, and unusual or non-recurring gains or losses, including significant differences from the
assumptions contained in the financial plan upon which the incentive targets were established. All adjustments are reviewed and approved by the Human Resources and
Compensation Committee.
Relationships between Pay and Various Metrics
In accordance with regulatory requirements, the graphs below reflect the relationships of PEO and Average Non-PEO CAP over the prior three
fiscal years to (i) Company TSR and Peer Group TSR, (ii) Net Income, and (iii) Revenue, our Company Selected Measure.
(a)
(b)
(c)
(d)
(e)
EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
CAP VS TT AND PEER GROUP TSR
$60
$50
$40
$30
$20
$10
$0
)
M
$
(
P
A
C
$100
$46.0
$202
$134
$20.4
$55.2
$144
$111
$9.1
$171
$127
$8.6
$9.0
$1.9
$210
$175
$140
$105
R
S
T
$70
$35
$0
2019
2020
2021
2022
First PEO CAP
Company TSR
Second PEO CAP
Peer TSR
Avg NEO CAP
)
M
$
(
P
A
C
$60
$50
$40
$30
$20
$10
$0
CAP VS NET INCOME
$1,757
$55.2
$46.0
$1,423
$20.4
$855
$9.1
2020
2021
$8.6
$9.0
$1.9
2022
$1,800
$1,500
$1,200
$900
$600
$300
$0
)
M
$
(
E
M
O
C
N
I
T
E
N
$60
$50
$40
$30
$20
$10
$0
)
M
$
(
P
A
C
CAP VS REVENUE
$55.2
$12,455
$14,136
$46.0
$15,992
$20.4
$9.1
$8.6
$9.0
2020
2021
$1.9
2022
$18,000
$15,000
$12,000
$9,000
$6,000
$3,000
$0
)
M
$
(
E
U
N
E
V
E
R
First PEO CAP
Second PEO CAP
Avg NEO CAP
Net Income
First PEO CAP
Second PEO CAP
Avg NEO CAP
Revenue
(1) As reported in the “Change in Pension Value and Nonqualified Deferred Compensation Earnings” of the Summary Compensation Table for each applicable year.
(2) As reported in the “Stock Awards” and “Option Awards” columns of the Summary Compensation Table for each applicable year.
Performance Measures
We used the following unranked performance measures to link executive compensation actually paid to Company performance for the most
recently completed fiscal year.
Financial Measures
Revenue
Adjusted EBITDA
Free Cash Flow
Relative 3-Year Total Shareholder Return Percentile Ranking
Relative Cash Flow Return on Invested Capital Percentile Ranking
Additional information about the performance measures used to calculate PEO and NEO compensation can be found in the discussions of our
short-term and long-term incentive programs in the “Compensation Discussion and Analysis” under the headings “Annual Incentive Matrix
(‘AIM’) Program” and “Long-Term Incentive Program (‘LTI’)”. We believe the Company’s executive compensation program appropriately
rewards our PEO and the Other NEOs for Company and individual performance, assists the Company in retaining our senior leadership team
and supports long-term value creation for our shareholders. These values demonstrate alignment of interests of our PEO and the Other NEOs
and our stockholders.
2023 Proxy Statement
73
74
Equity Compensation Plan Information
Information Concerning Voting
The following table provides information as of December 31, 2022, with respect to the Company’s ordinary shares that may be issued
under equity compensation plans:
and Solicitation
EXECUTIVE COMPENSATION
Plan Category
Equity compensation plans approved by
security holders(a)
Equity compensation plans not approved by
security holders(b)
Total
Number of Securities to
Be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights
Weighted Average
Exercise Price
of Outstanding Options,
Warrants and Rights
5,054,163
$94.06
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding Securities
Reflected in First Column)
12,955,860
532,008
5,586,171
—
—
informed basis.
(a) Consists of the Incentive Stock Plan of 2007, the Incentive Stock Plan of 2013 and the 2018 Plan.
(b) Consists of the EDCP, the Trane Technologies Directors Deferred Compensation Plan (the “DDCP I”), the Trane Technologies Directors Deferred Compensation and
Stock Award Plan II (the “DDCP II” and, together with the DDCP I, the “DDCP”), and the Trane Deferred Compensation Plan (the “TDCP”). Plan participants acquire
Company shares under these plans as a result of the deferral of salary or directors’ fees, AIM awards and PSUs.
Why Did I Receive This Proxy Statement?
We sent you this Proxy Statement or a Notice of Internet Availability of Proxy Materials (“Notice”) because our Board of Directors is soliciting
your proxy to vote at the Annual General Meeting. This Proxy Statement summarizes the information you need to know to vote on an
Why Are There Two Sets of Financial Statements
Covering the Same Fiscal Period?
U.S. securities laws require us to send you our 2022 Form 10-K, which includes our financial statements prepared in accordance with GAAP.
These financial statements are included in the mailing of this Proxy Statement. Irish law also requires us to provide you with our Irish Financial
Statements for our 2022 fiscal year, including the reports of our Directors and auditors thereon, which accounts have been prepared in
accordance with Irish law. The Irish Financial Statements are available on the Company’s website at www.tranetechnologies.com under the
heading “Investors – Irish Statutory Accounts” and will be laid before the Annual General Meeting.
How Do I Attend the Annual General Meeting?
We strongly encourage all shareholders to submit proxy forms to ensure they can vote and be represented at the Annual General Meeting
without attending in person. Shareholders are encouraged to keep up-to-date with, and follow, the guidance from the Government of Ireland
and the Department of Health (of Ireland) and other local health departments as circumstances may change at short notice.
Taking into account the latest guidance from the Government of Ireland, particularly in relation to indoor public gatherings, it is possible the
Annual General Meeting may be adjourned to a different time and/ or venue, in each case notification of such adjournment will be given in
accordance with Company’s constitution. Any announcements of changes or updates to the arrangements for the Annual General Meeting will
be made available at www.tranetechnologies.com.
Due to travel restrictions and/or health concerns, the Directors may participate by telephone instead of attending in person, there may be
significantly reduced attendance by Company personnel, and the meeting will be conducted as efficiently as possible.
In the event that the Annual General Meeting can proceed as normal, in order to be admitted, you must present a form of personal
identification and evidence of share ownership.
If you are a shareholder of record, evidence of share ownership will be either (1) an admission ticket, which is attached to the proxy card and
must be separated from the proxy card and kept for presentation at the meeting if you vote your proxy by mail, or (2) a Notice.
If you own your shares through a bank, broker or other holder of record (“street name holders”), evidence of share ownership will be either (1)
your most recent bank or brokerage account statement, or (2) a Notice. If you would rather have an admission ticket, you can obtain one in
advance by mailing a written request, along with proof of your ownership of the Company’s ordinary shares, to:
Secretary
Trane Technologies plc
170/175 Lakeview Dr.
Airside Business Park
Swords, Co. Dublin
Ireland
No cameras, recording equipment, electronic devices, large bags, briefcases or packages will be
permitted at the Annual General Meeting.
2023 Proxy Statement
75
76
Equity Compensation Plan Information
The following table provides information as of December 31, 2022, with respect to the Company’s ordinary shares that may be issued
under equity compensation plans:
Information Concerning Voting
and Solicitation
EXECUTIVE COMPENSATION
Equity compensation plans approved by
Equity compensation plans not approved by
Plan Category
security holders(a)
security holders(b)
Total
Number of Securities to
Be Issued Upon Exercise
Weighted Average
Exercise Price
of Outstanding Options,
of Outstanding Options,
Plans (Excluding Securities
Warrants and Rights
Warrants and Rights
Reflected in First Column)
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
$94.06
—
12,955,860
—
5,054,163
532,008
5,586,171
(a) Consists of the Incentive Stock Plan of 2007, the Incentive Stock Plan of 2013 and the 2018 Plan.
(b) Consists of the EDCP, the Trane Technologies Directors Deferred Compensation Plan (the “DDCP I”), the Trane Technologies Directors Deferred Compensation and
Stock Award Plan II (the “DDCP II” and, together with the DDCP I, the “DDCP”), and the Trane Deferred Compensation Plan (the “TDCP”). Plan participants acquire
Company shares under these plans as a result of the deferral of salary or directors’ fees, AIM awards and PSUs.
Why Did I Receive This Proxy Statement?
We sent you this Proxy Statement or a Notice of Internet Availability of Proxy Materials (“Notice”) because our Board of Directors is soliciting
your proxy to vote at the Annual General Meeting. This Proxy Statement summarizes the information you need to know to vote on an
informed basis.
Why Are There Two Sets of Financial Statements
Covering the Same Fiscal Period?
U.S. securities laws require us to send you our 2022 Form 10-K, which includes our financial statements prepared in accordance with GAAP.
These financial statements are included in the mailing of this Proxy Statement. Irish law also requires us to provide you with our Irish Financial
Statements for our 2022 fiscal year, including the reports of our Directors and auditors thereon, which accounts have been prepared in
accordance with Irish law. The Irish Financial Statements are available on the Company’s website at www.tranetechnologies.com under the
heading “Investors – Irish Statutory Accounts” and will be laid before the Annual General Meeting.
How Do I Attend the Annual General Meeting?
We strongly encourage all shareholders to submit proxy forms to ensure they can vote and be represented at the Annual General Meeting
without attending in person. Shareholders are encouraged to keep up-to-date with, and follow, the guidance from the Government of Ireland
and the Department of Health (of Ireland) and other local health departments as circumstances may change at short notice.
Taking into account the latest guidance from the Government of Ireland, particularly in relation to indoor public gatherings, it is possible the
Annual General Meeting may be adjourned to a different time and/or venue, in each case notification of such adjournment will be given in
accordance with Company’s constitution. Any announcements of changes or updates to the arrangements for the Annual General Meeting will
be made available at www.tranetechnologies.com.
Due to travel restrictions and/or health concerns, the Directors may participate by telephone instead of attending in person, there may be
significantly reduced attendance by Company personnel, and the meeting will be conducted as efficiently as possible.
In the event that the Annual General Meeting can proceed as normal, in order to be admitted, you must present a form of personal
identification and evidence of share ownership.
If you are a shareholder of record, evidence of share ownership will be either (1) an admission ticket, which is attached to the proxy card and
must be separated from the proxy card and kept for presentation at the meeting if you vote your proxy by mail, or (2) a Notice.
If you own your shares through a bank, broker or other holder of record (“street name holders”), evidence of share ownership will be either (1)
your most recent bank or brokerage account statement, or (2) a Notice. If you would rather have an admission ticket, you can obtain one in
advance by mailing a written request, along with proof of your ownership of the Company’s ordinary shares, to:
Secretary
Trane Technologies plc
170/175 Lakeview Dr.
Airside Business Park
Swords, Co. Dublin
Ireland
No cameras, recording equipment, electronic devices, large bags, briefcases or packages will be
permitted at the Annual General Meeting.
2023 Proxy Statement
75
76
Who May Vote?
May I Revoke My Proxy?
INFORMATION CONCERNING VOTING AND SOLICITATION
INFORMATION CONCERNING VOTING AND SOLICITATION
You are entitled to vote if you beneficially owned the Company’s ordinary shares at the close of business on April 6, 2023, the Record Date. At
that time, there were 228,049,657 of the Company’s ordinary shares outstanding and entitled to vote. Each ordinary share that you own
entitles you to one vote on all matters to be voted on a poll at the Annual General Meeting.
You may revoke your proxy at any time before it is voted at the Annual General Meeting in any of the following ways:
• by notifying the Company’s Secretary in writing: c/o Trane Technologies plc, 170/175 Lakeview Drive, Airside Business Park, Swords, Co.
How Do I Vote?
Shareholders of record can cast their votes by proxy by:
• using the Internet and voting at www.proxyvote.com;
• calling 1-800-690-6903 and following the telephone prompts; or
• completing, signing and returning a proxy card by mail.
If you received a Notice and did not receive a proxy card, you may request one at sendmaterial@proxyvote.com.
The Notice is not a proxy card and it cannot be used to vote your shares.
If you are a shareholder of record and you choose to submit your proxy by telephone by calling the toll-free number on your proxy card, your
use of that telephone system and in particular the entry of your pin number/other unique identifier, will be deemed to constitute your
appointment, in writing and under hand, and for all purposes of the Companies Act 2014, of the persons named on the proxy card as your
proxy to vote your shares on your behalf in accordance with your telephone instructions.
Subject to guidance from the Government of Ireland at the time of the Annual General Meeting, shareholders of record may also vote their
shares directly by attending the Annual General Meeting and casting their vote in person or appointing a proxy (who does not have to be a
shareholder) to attend the Annual General Meeting and casting votes on their behalf in accordance with their instructions.
Street name holders must vote their shares in the manner prescribed by their bank, brokerage firm or nominee. Street name holders who wish
to vote in person at the Annual General Meeting must obtain a legal proxy from their bank, brokerage firm or nominee. Street name holders will
need to bring the legal proxy with them to the Annual General Meeting and hand it in with a signed ballot that is available upon request at the
meeting. Street name holders will not be able to vote their shares at the Annual General Meeting without a legal proxy and a signed ballot.
Even if you plan to attend the Annual General Meeting, we recommend that you vote by proxy as described above so that your vote will be
counted if you later decide not to attend the meeting.
In order to be timely processed, your vote must be received by 11:59 p.m. Eastern Time on May 31, 2023
(or, if you are a street name holder, such earlier time as your bank, brokerage firm or nominee may require).
How May Employees Vote under Our Employee Plans?
If you participate in the ESP, the Trane Technologies Employee Savings Plan for Bargained Employees, the Trane Technologies Retirement
Savings Plan for Participating Affiliates in Puerto Rico, or the Trane 401(k) and Thrift Plan, then you may be receiving these materials because of
shares held for you in those plans. In that case, you may use the enclosed proxy card to instruct the plan trustees of those plans how to vote
your shares, or give those instructions by telephone or over the Internet. They will vote these shares in accordance with your instructions and
the terms of the plan. The plan trustees will not disclose to the Company how any individual employee instructed the plan trustees to vote
their shares.
To allow plan administrators to properly process your vote, your voting instructions
must be received by 11:59 p.m. Eastern Time on May 26, 2023.
If you do not provide voting instructions for shares held for you in any of these plans, the plan trustees will vote these shares in the same ratio
as the shares for which voting instructions are provided.
2023 Proxy Statement
77
78
• by submitting another properly signed proxy card with a later date or another Internet or telephone proxy at a later date but prior to the close
of voting described above; or
• by voting in person at the Annual General Meeting.
Dublin, Ireland;
described above.
How Will My Proxy Get Voted?
Merely attending the Annual General Meeting does not revoke your proxy. To revoke a proxy, you must take one of the actions
If your proxy is properly submitted, your proxy holder (one of the individuals named on the proxy card) will vote your shares as you have
directed. If you are a street name holder, the rules of the NYSE permit your bank, brokerage firm or nominee to vote your shares on Items 4, 5,
6 and 7 (routine matters) if it does not receive instructions from you. However, your bank, brokerage firm or nominee may not vote your shares
on Items 1, 2 and 3 (non-routine matters) if it does not receive instructions from you (“broker non-votes”). Broker non-votes will not be counted
as votes for or against the non-routine matters, but rather will be regarded as votes withheld and will not be counted in the calculation of votes
for or against the resolution.
If you are a shareholder of record and you do not specify on the proxy card you send to the Company (or when giving your proxy
over the Internet or telephone) how you want to vote your shares, then the Company-designated proxy holders will vote your
shares in the manner recommended by our Board of Directors on all matters presented in this Proxy Statement and as the proxy
holders may determine in their discretion regarding any other matters properly presented for a vote at the meeting.
What Constitutes a Quorum?
The presence (in person or by proxy) of shareholders entitled to exercise a majority of the voting power of the Company on the Record Date is
necessary to constitute a quorum for the conduct of business. Abstentions and broker non-votes are treated as “shares present” for the
purposes of determining whether a quorum exists.
What Vote is Required to Approve Each Proposal?
A majority of the votes cast at the Annual General Meeting is required to approve each of Items 1, 2, 3, 4 and 5. A majority of the votes cast
means that the number of votes cast “for” an Item must exceed the number of votes cast “against” that Item. Items 6 and 7 are considered
special resolutions under Irish law and require 75% of the votes cast for approval.
Although abstentions and broker non-votes are counted as “shares present” at the Annual General Meeting for the purpose of determining
whether a quorum exists, they are not counted as votes cast either “for” or “against” the resolution and, accordingly, will not affect the outcome
of the vote.
Who Pays the Expenses of This Proxy Statement?
We have hired Alliance Advisors, LLC to assist in the distribution of proxy materials and the solicitation of proxies for a fee estimated at $20,000
plus out-of-pocket expenses. Proxies will be solicited on behalf of our Board of Directors by mail, in person, by telephone and through the
Internet. We will bear the cost of soliciting proxies. We will also reimburse brokers and other custodians, nominees and fiduciaries for their
reasonable out-of-pocket expenses for forwarding proxy materials to the persons for whom they hold shares.
How Will Voting on Any Other Matter be Conducted?
Although we do not know of any matters to be presented or acted upon at the Annual General Meeting other than the items described in this
Proxy Statement, if any other matter is proposed and properly presented at the Annual General Meeting, the proxy holders will vote on such
matters in accordance with their best judgment.
Who May Vote?
May I Revoke My Proxy?
INFORMATION CONCERNING VOTING AND SOLICITATION
INFORMATION CONCERNING VOTING AND SOLICITATION
You are entitled to vote if you beneficially owned the Company’s ordinary shares at the close of business on April 6, 2023, the Record Date. At
that time, there were 228,049,657 of the Company’s ordinary shares outstanding and entitled to vote. Each ordinary share that you own
entitles you to one vote on all matters to be voted on a poll at the Annual General Meeting.
How Do I Vote?
Shareholders of record can cast their votes by proxy by:
• using the Internet and voting at www.proxyvote.com;
• calling 1-800-690-6903 and following the telephone prompts; or
• completing, signing and returning a proxy card by mail.
If you received a Notice and did not receive a proxy card, you may request one at sendmaterial@proxyvote.com.
The Notice is not a proxy card and it cannot be used to vote your shares.
If you are a shareholder of record and you choose to submit your proxy by telephone by calling the toll-free number on your proxy card, your
use of that telephone system and in particular the entry of your pin number/other unique identifier, will be deemed to constitute your
appointment, in writing and under hand, and for all purposes of the Companies Act 2014, of the persons named on the proxy card as your
proxy to vote your shares on your behalf in accordance with your telephone instructions.
Subject to guidance from the Government of Ireland at the time of the Annual General Meeting, shareholders of record may also vote their
shares directly by attending the Annual General Meeting and casting their vote in person or appointing a proxy (who does not have to be a
shareholder) to attend the Annual General Meeting and casting votes on their behalf in accordance with their instructions.
Street name holders must vote their shares in the manner prescribed by their bank, brokerage firm or nominee. Street name holders who wish
to vote in person at the Annual General Meeting must obtain a legal proxy from their bank, brokerage firm or nominee. Street name holders will
need to bring the legal proxy with them to the Annual General Meeting and hand it in with a signed ballot that is available upon request at the
meeting. Street name holders will not be able to vote their shares at the Annual General Meeting without a legal proxy and a signed ballot.
Even if you plan to attend the Annual General Meeting, we recommend that you vote by proxy as described above so that your vote will be
counted if you later decide not to attend the meeting.
In order to be timely processed, your vote must be received by 11:59 p.m. Eastern Time on May 31, 2023
(or, if you are a street name holder, such earlier time as your bank, brokerage firm or nominee may require).
How May Employees Vote under Our Employee Plans?
If you participate in the ESP, the Trane Technologies Employee Savings Plan for Bargained Employees, the Trane Technologies Retirement
Savings Plan for Participating Affiliates in Puerto Rico, or the Trane 401(k) and Thrift Plan, then you may be receiving these materials because of
shares held for you in those plans. In that case, you may use the enclosed proxy card to instruct the plan trustees of those plans how to vote
your shares, or give those instructions by telephone or over the Internet. They will vote these shares in accordance with your instructions and
the terms of the plan. The plan trustees will not disclose to the Company how any individual employee instructed the plan trustees to vote
their shares.
To allow plan administrators to properly process your vote, your voting instructions
must be received by 11:59 p.m. Eastern Time on May 26, 2023.
If you do not provide voting instructions for shares held for you in any of these plans, the plan trustees will vote these shares in the same ratio
as the shares for which voting instructions are provided.
You may revoke your proxy at any time before it is voted at the Annual General Meeting in any of the following ways:
• by notifying the Company’s Secretary in writing: c/o Trane Technologies plc, 170/175 Lakeview Drive, Airside Business Park, Swords, Co.
Dublin, Ireland;
• by submitting another properly signed proxy card with a later date or another Internet or telephone proxy at a later date but prior to the close
of voting described above; or
• by voting in person at the Annual General Meeting.
Merely attending the Annual General Meeting does not revoke your proxy. To revoke a proxy, you must take one of the actions
described above.
How Will My Proxy Get Voted?
If your proxy is properly submitted, your proxy holder (one of the individuals named on the proxy card) will vote your shares as you have
directed. If you are a street name holder, the rules of the NYSE permit your bank, brokerage firm or nominee to vote your shares on Items 4, 5,
6 and 7 (routine matters) if it does not receive instructions from you. However, your bank, brokerage firm or nominee may not vote your shares
on Items 1, 2 and 3 (non-routine matters) if it does not receive instructions from you (“broker non-votes”). Broker non-votes will not be counted
as votes for or against the non-routine matters, but rather will be regarded as votes withheld and will not be counted in the calculation of votes
for or against the resolution.
If you are a shareholder of record and you do not specify on the proxy card you send to the Company (or when giving your proxy
over the Internet or telephone) how you want to vote your shares, then the Company-designated proxy holders will vote your
shares in the manner recommended by our Board of Directors on all matters presented in this Proxy Statement and as the proxy
holders may determine in their discretion regarding any other matters properly presented for a vote at the meeting.
What Constitutes a Quorum?
The presence (in person or by proxy) of shareholders entitled to exercise a majority of the voting power of the Company on the Record Date is
necessary to constitute a quorum for the conduct of business. Abstentions and broker non-votes are treated as “shares present” for the
purposes of determining whether a quorum exists.
What Vote is Required to Approve Each Proposal?
A majority of the votes cast at the Annual General Meeting is required to approve each of Items 1, 2, 3, 4 and 5. A majority of the votes cast
means that the number of votes cast “for” an Item must exceed the number of votes cast “against” that Item. Items 6 and 7 are considered
special resolutions under Irish law and require 75% of the votes cast for approval.
Although abstentions and broker non-votes are counted as “shares present” at the Annual General Meeting for the purpose of determining
whether a quorum exists, they are not counted as votes cast either “for” or “against” the resolution and, accordingly, will not affect the outcome
of the vote.
Who Pays the Expenses of This Proxy Statement?
We have hired Alliance Advisors, LLC to assist in the distribution of proxy materials and the solicitation of proxies for a fee estimated at $20,000
plus out-of-pocket expenses. Proxies will be solicited on behalf of our Board of Directors by mail, in person, by telephone and through the
Internet. We will bear the cost of soliciting proxies. We will also reimburse brokers and other custodians, nominees and fiduciaries for their
reasonable out-of-pocket expenses for forwarding proxy materials to the persons for whom they hold shares.
How Will Voting on Any Other Matter be Conducted?
Although we do not know of any matters to be presented or acted upon at the Annual General Meeting other than the items described in this
Proxy Statement, if any other matter is proposed and properly presented at the Annual General Meeting, the proxy holders will vote on such
matters in accordance with their best judgment.
2023 Proxy Statement
77
78
Amount and
Nature of
Beneficial
Ownership
Percent
of Class(a)
19,614,853
8.6 %
18,472,563
8.1 %
18,594,004
8.2 %
BlackRock, Inc.(b)
55 East 52nd Street
New York, NY 10055
JPMorgan Chase & Co.(c)
383 Madison Avenue
New York, NY 10179
The Vanguard Group(d)
100 Vanguard Blvd.
Malvern, PA 19355
(a)
(b)
(c)
(d)
The ownership percentages set forth in this column are based on the Company’s outstanding ordinary shares on the Record Date and assumes that each of the
beneficial owners continued to own the number of shares reflected in the table above on such date.
Information regarding BlackRock, Inc. and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 8, 2023. The filing indicated that, as of
December 31, 2022, BlackRock, Inc. had sole voting power as to 17,645,284 of such shares, shared voting power as to none of such shares, sole dispositive power as
to 19,614,853 of such shares and shared dispositive power as to none of such shares.
Information regarding JPMorgan Chase & Co. and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on January 27, 2023. The filing indicated
that, as of December 30, 2022, JPMorgan Chase & Co. had sole voting power as to 16,546,980 of such shares, shared voting power as to 123,656 of such shares, sole
dispositive power as to 18,334,563 of such shares and shared dispositive power as to 135,524 of such shares.
Information regarding the Vanguard Group and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 9, 2023. The filing indicated that,
as of December 30, 2022, the Vanguard Group had sole voting power as to none of such shares, shared voting power as to 334,034 of such shares, sole dispositive
power as to 17,636,530 of such shares and shared dispositive power as to 957,474 of such shares.
Security Ownership of Certain
Beneficial Owners and Management
The following table sets forth as of the Record Date, the beneficial ownership of our ordinary shares by (i) each director of the Company,
(ii) each executive officer of the Company named in the Summary Compensation Table below, and (iii) all directors and executive officers of
the Company as a group:
Name and Address of Beneficial Owner
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth each shareholder which is known by us to be the beneficial owner of more than 5% of the outstanding ordinary
shares of the Company based solely on the information filed by such shareholder on Schedule 13D or filed by such shareholder in 2022 for the
year ended December 31, 2022 on Schedule 13G under the Securities Exchange Act of 1934:
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
J. A. Hayes
L. P. Hudson
M. P. Lee
M. N. Schaeffer
J. P. Surma
T. L. White
D. S. Regnery
C.J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
All directors and executive officers as a group (21 persons)(d)
Ordinary
Shares(a)
Notional
Shares(b)
Options
Exercisable
Within
60 Days(c)
4,650
33,501
1,798
12,048
26,989
31,230
—
30
7,769
8,122
—
12,027
30,687
122,463
34,236
40,709
15,196
11,957
—
47,805
—
—
—
—
—
—
—
67,508
—
—
—
—
—
—
—
—
—
—
—
—
—
542
242,944
29,005
48,510
8,183
79,215
67,879
95,367
25,095
9,877
416,304
317,813
470,395
(a)
(b)
(c)
(d)
Represents (i) ordinary shares held directly; (ii) ordinary shares held indirectly through a trust; (iii) unvested shares, including any RSUs or PSUs, and ordinary shares and
ordinary share equivalents notionally held under the TDCP that may vest or are distributable within 60 days of the Record Date; and (iv) ordinary shares held by the
trustee under the ESP for the benefit of executive officers. No director or executive officer of the Company beneficially owns 1% or more of the Company’s
ordinary shares.
Represents ordinary shares and ordinary share equivalents notionally held under the DDCP, and the EDCP that are not distributable within 60 days of the Record Date.
Represents ordinary shares as to which directors and executive officers had stock options exercisable within 60 days of the Record Date, under the Company’s Incentive
Stock Plans.
The Company’s ordinary shares beneficially owned by all directors and executive officers as a group (including shares issuable under exercisable options) aggregated
approximately 0.39% of the total outstanding ordinary shares. Ordinary shares and ordinary share equivalents notionally held under the DDCP, the EDCP and the TDCP
and ordinary share equivalents resulting from dividends on deferred stock awards are not counted as outstanding shares in calculating these percentages because they
are not beneficially owned; the directors and executive officers have no voting or investment power with respect to these shares or share equivalents.
2023 Proxy Statement
79
80
Security Ownership of Certain
Beneficial Owners and Management
The following table sets forth as of the Record Date, the beneficial ownership of our ordinary shares by (i) each director of the Company,
(ii) each executive officer of the Company named in the Summary Compensation Table below, and (iii) all directors and executive officers of
the Company as a group:
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth each shareholder which is known by us to be the beneficial owner of more than 5% of the outstanding ordinary
shares of the Company based solely on the information filed by such shareholder on Schedule 13D or filed by such shareholder in 2022 for the
year ended December 31, 2022 on Schedule 13G under the Securities Exchange Act of 1934:
Name and Address of Beneficial Owner
BlackRock, Inc.(b)
55 East 52nd Street
New York, NY 10055
JPMorgan Chase & Co.(c)
383 Madison Avenue
New York, NY 10179
The Vanguard Group(d)
100 Vanguard Blvd.
Malvern, PA 19355
Amount and
Nature of
Beneficial
Ownership
Percent
of Class(a)
19,614,853
8.6 %
18,472,563
8.1 %
18,594,004
8.2 %
(a)
(b)
(c)
(d)
The ownership percentages set forth in this column are based on the Company’s outstanding ordinary shares on the Record Date and assumes that each of the
beneficial owners continued to own the number of shares reflected in the table above on such date.
Information regarding BlackRock, Inc. and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 8, 2023. The filing indicated that, as of
December 31, 2022, BlackRock, Inc. had sole voting power as to 17,645,284 of such shares, shared voting power as to none of such shares, sole dispositive power as
to 19,614,853 of such shares and shared dispositive power as to none of such shares.
Information regarding JPMorgan Chase & Co. and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on January 27, 2023. The filing indicated
that, as of December 30, 2022, JPMorgan Chase & Co. had sole voting power as to 16,546,980 of such shares, shared voting power as to 123,656 of such shares, sole
dispositive power as to 18,334,563 of such shares and shared dispositive power as to 135,524 of such shares.
Information regarding the Vanguard Group and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 9, 2023. The filing indicated that,
as of December 30, 2022, the Vanguard Group had sole voting power as to none of such shares, shared voting power as to 334,034 of such shares, sole dispositive
power as to 17,636,530 of such shares and shared dispositive power as to 957,474 of such shares.
Ordinary
Shares(a)
Notional
Shares(b)
Options
Exercisable
Within
60 Days(c)
—
—
—
—
—
—
—
—
—
—
—
—
—
4,650
33,501
1,798
12,048
26,989
31,230
—
30
7,769
8,122
—
12,027
30,687
122,463
34,236
40,709
15,196
11,957
47,805
—
—
—
—
—
—
—
—
67,508
29,005
48,510
8,183
79,215
542
242,944
67,879
95,367
25,095
9,877
All directors and executive officers as a group (21 persons)(d)
416,304
317,813
470,395
Represents (i) ordinary shares held directly; (ii) ordinary shares held indirectly through a trust; (iii) unvested shares, including any RSUs or PSUs, and ordinary shares and
ordinary share equivalents notionally held under the TDCP that may vest or are distributable within 60 days of the Record Date; and (iv) ordinary shares held by the
trustee under the ESP for the benefit of executive officers. No director or executive officer of the Company beneficially owns 1% or more of the Company’s
Represents ordinary shares and ordinary share equivalents notionally held under the DDCP, and the EDCP that are not distributable within 60 days of the Record Date.
Represents ordinary shares as to which directors and executive officers had stock options exercisable within 60 days of the Record Date, under the Company’s Incentive
The Company’s ordinary shares beneficially owned by all directors and executive officers as a group (including shares issuable under exercisable options) aggregated
approximately 0.39% of the total outstanding ordinary shares. Ordinary shares and ordinary share equivalents notionally held under the DDCP, the EDCP and the TDCP
and ordinary share equivalents resulting from dividends on deferred stock awards are not counted as outstanding shares in calculating these percentages because they
are not beneficially owned; the directors and executive officers have no voting or investment power with respect to these shares or share equivalents.
Name
K. E. Arnold
A. C. Berzin
A. Miller Boise
J. Bruton
J. L. Cohon
G. D. Forsee
M. R. George
J. A. Hayes
L. P. Hudson
M. P. Lee
M. N. Schaeffer
J. P. Surma
T. L. White
D. S. Regnery
C.J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
(a)
(b)
(c)
(d)
ordinary shares.
Stock Plans.
2023 Proxy Statement
79
80
Certain Relationships and Related
Person Transactions
Shareholder Proposals and
Nominations
The Company does not generally engage in transactions in which its executive officers, directors or nominees for directors, any of their
immediate family members or any of its 5% shareholders have a material interest. Pursuant to the Company’s written related person
transaction policy, any such transaction must be reported to management, which will prepare a summary of the transaction and refer it to
the Sustainability, Corporate Governance and Nominating Committee for consideration and pre-approval by the disinterested directors. The
Sustainability, Corporate Governance and Nominating Committee reviews the material terms of the related person transaction, including the
dollar values involved, the relationships and interests of the parties to the transaction and the impact, if any, to a director’s independence.
The Sustainability, Corporate Governance and Nominating Committee only approves those transactions that are in the best interest of the
Company. In addition, the Company’s Code of Conduct, which sets forth standards applicable to all employees, officers and directors of the
Company, generally proscribes transactions that could result in a conflict of interest for the Company. Any waiver of the Code of Conduct for
any executive officer or director requires the approval of the Company’s Board of Directors. Any such waiver will, to the extent required by law
or the NYSE, be disclosed on the Company’s website at www.tranetechnologies.com or on a current report on Form 8-K. No such waivers
were requested or granted in 2022.
We have not made payments to directors other than the fees to which they are entitled as directors (described under the heading
“Compensation of Directors”) and the reimbursement of expenses related to their services as directors. We have made no loans to any
director or officer nor have we purchased any shares of the Company from any director or officer.
Any proposal by a shareholder intended to be presented at the 2024 Annual General Meeting of shareholders of the Company must be
received by the Company at its registered office at 170/175 Lakeview Drive, Airside Business Park, Swords, Co. Dublin, Ireland, Attn:
Secretary, no later than December 22, 2023, for inclusion in the proxy materials relating to that meeting. Any such proposal must meet the
requirements set forth in the rules and regulations of the SEC, including Rule 14a-8, in order for such proposals to be eligible for inclusion in our
2024 Proxy Statement.
The Company’s Articles of Association set forth procedures to be followed by shareholders who wish to nominate candidates for election to
the Board of Directors in connection with Annual General Meetings of shareholders or pursuant to written shareholder consents or who wish to
bring other business before a shareholders’ general meeting. All such nominations must be accompanied by certain background and other
information specified in the Articles of Association. In connection with the 2024 Annual General Meeting, written notice of a shareholder’s
intention to make such nominations or bring business before the Annual General Meeting must be given to the Secretary of the Company not
later than March 1, 2024. If the date of the 2024 Annual General Meeting occurs more than 30 days before, or 60 days after, the anniversary of
the 2023 Annual General Meeting, then the written notice must be provided to the Secretary of the Company not later than the seventh day
after the date on which notice of such Annual General Meeting is given. In addition, to comply with the universal proxy rules, shareholders who
intend to solicit proxies in support of director nominees other than the Company’s nominees must provide timely notice by the same deadline
disclosed above (March 1, 2024), as well as comply with the additional requirements of Rule 14a-19 of the Securities Exchange Act of 1934.
In addition, the Company’s Articles of Association separately provide shareholders representing 3% or more of the voting power of the
Company’s shares with the right, subject to certain terms and conditions, to nominate candidates for election to the Board of Directors and
have such candidate included in our proxy materials for the applicable Annual General Meeting (“proxy access”). All such nominations must be
accompanied by certain background and other information specified in the Articles of Association. In connection with the 2024 Annual General
Meeting, written notice of proxy access nominations must be given to the Secretary of the Company not earlier than November 23, 2023 and
not later than later than December 22, 2023. If the date of the 2024 Annual General Meeting occurs more than 30 days before, or 60 days
after, the anniversary of the 2023 Annual General Meeting, then the written notice must be provided to the Secretary of the Company not
earlier than 120 days prior to the 2024 Annual General Meeting and not later than the close of business on the later of (x) the 90th day prior to
the 2024 Annual General Meeting or (y) the 10th day following the day on which public announcement of the date of the 2024 Annual General
Meeting is first made.
The Sustainability, Corporate Governance and Nominating Committee will consider all shareholder recommendations for candidates for Board
membership, which should be sent to the Committee, care of the Secretary of the Company, at the address set forth above. In addition to
considering candidates recommended by shareholders, the Committee considers potential candidates recommended by current directors,
Company officers, employees and others. As stated in the Company’s Corporate Governance Guidelines, all candidates for Board membership
are selected based upon their judgment, character, achievements and experience in matters affecting business and industry. Candidates
recommended by shareholders are evaluated in the same manner as director candidates identified by any other means.
In order for you to bring other business before a shareholder general meeting, timely notice must be received by the Secretary of the Company
within the time limits described above. The notice must include a description of the proposed item, the reasons you believe support your
position concerning the item, and other specified matters. These requirements are separate from and in addition to the requirements you must
meet to have a proposal included in our Proxy Statement. The foregoing time limits also apply in determining whether notice is timely pursuant
to rules adopted by the SEC relating to the exercise of discretionary voting authority.
If a shareholder wishes to communicate with the Board of Directors for any other reason, all such communications should be sent in writing,
care of the Secretary of the Company, or by email at board@tranetechnologies.com.
2023 Proxy Statement
81
82
Certain Relationships and Related
Person Transactions
Shareholder Proposals and
Nominations
The Company does not generally engage in transactions in which its executive officers, directors or nominees for directors, any of their
immediate family members or any of its 5% shareholders have a material interest. Pursuant to the Company’s written related person
transaction policy, any such transaction must be reported to management, which will prepare a summary of the transaction and refer it to
the Sustainability, Corporate Governance and Nominating Committee for consideration and pre-approval by the disinterested directors. The
Sustainability, Corporate Governance and Nominating Committee reviews the material terms of the related person transaction, including the
dollar values involved, the relationships and interests of the parties to the transaction and the impact, if any, to a director’s independence.
The Sustainability, Corporate Governance and Nominating Committee only approves those transactions that are in the best interest of the
Company. In addition, the Company’s Code of Conduct, which sets forth standards applicable to all employees, officers and directors of the
Company, generally proscribes transactions that could result in a conflict of interest for the Company. Any waiver of the Code of Conduct for
any executive officer or director requires the approval of the Company’s Board of Directors. Any such waiver will, to the extent required by law
or the NYSE, be disclosed on the Company’s website at www.tranetechnologies.com or on a current report on Form 8-K. No such waivers
were requested or granted in 2022.
We have not made payments to directors other than the fees to which they are entitled as directors (described under the heading
“Compensation of Directors”) and the reimbursement of expenses related to their services as directors. We have made no loans to any
director or officer nor have we purchased any shares of the Company from any director or officer.
Any proposal by a shareholder intended to be presented at the 2024 Annual General Meeting of shareholders of the Company must be
received by the Company at its registered office at 170/175 Lakeview Drive, Airside Business Park, Swords, Co. Dublin, Ireland, Attn:
Secretary, no later than December 22, 2023, for inclusion in the proxy materials relating to that meeting. Any such proposal must meet the
requirements set forth in the rules and regulations of the SEC, including Rule 14a-8, in order for such proposals to be eligible for inclusion in our
2024 Proxy Statement.
The Company’s Articles of Association set forth procedures to be followed by shareholders who wish to nominate candidates for election to
the Board of Directors in connection with Annual General Meetings of shareholders or pursuant to written shareholder consents or who wish to
bring other business before a shareholders’ general meeting. All such nominations must be accompanied by certain background and other
information specified in the Articles of Association. In connection with the 2024 Annual General Meeting, written notice of a shareholder’s
intention to make such nominations or bring business before the Annual General Meeting must be given to the Secretary of the Company not
later than March 1, 2024. If the date of the 2024 Annual General Meeting occurs more than 30 days before, or 60 days after, the anniversary of
the 2023 Annual General Meeting, then the written notice must be provided to the Secretary of the Company not later than the seventh day
after the date on which notice of such Annual General Meeting is given. In addition, to comply with the universal proxy rules, shareholders who
intend to solicit proxies in support of director nominees other than the Company’s nominees must provide timely notice by the same deadline
disclosed above (March 1, 2024), as well as comply with the additional requirements of Rule 14a-19 of the Securities Exchange Act of 1934.
In addition, the Company’s Articles of Association separately provide shareholders representing 3% or more of the voting power of the
Company’s shares with the right, subject to certain terms and conditions, to nominate candidates for election to the Board of Directors and
have such candidate included in our proxy materials for the applicable Annual General Meeting (“proxy access”). All such nominations must be
accompanied by certain background and other information specified in the Articles of Association. In connection with the 2024 Annual General
Meeting, written notice of proxy access nominations must be given to the Secretary of the Company not earlier than November 23, 2023 and
not later than later than December 22, 2023. If the date of the 2024 Annual General Meeting occurs more than 30 days before, or 60 days
after, the anniversary of the 2023 Annual General Meeting, then the written notice must be provided to the Secretary of the Company not
earlier than 120 days prior to the 2024 Annual General Meeting and not later than the close of business on the later of (x) the 90th day prior to
the 2024 Annual General Meeting or (y) the 10th day following the day on which public announcement of the date of the 2024 Annual General
Meeting is first made.
The Sustainability, Corporate Governance and Nominating Committee will consider all shareholder recommendations for candidates for Board
membership, which should be sent to the Committee, care of the Secretary of the Company, at the address set forth above. In addition to
considering candidates recommended by shareholders, the Committee considers potential candidates recommended by current directors,
Company officers, employees and others. As stated in the Company’s Corporate Governance Guidelines, all candidates for Board membership
are selected based upon their judgment, character, achievements and experience in matters affecting business and industry. Candidates
recommended by shareholders are evaluated in the same manner as director candidates identified by any other means.
In order for you to bring other business before a shareholder general meeting, timely notice must be received by the Secretary of the Company
within the time limits described above. The notice must include a description of the proposed item, the reasons you believe support your
position concerning the item, and other specified matters. These requirements are separate from and in addition to the requirements you must
meet to have a proposal included in our Proxy Statement. The foregoing time limits also apply in determining whether notice is timely pursuant
to rules adopted by the SEC relating to the exercise of discretionary voting authority.
If a shareholder wishes to communicate with the Board of Directors for any other reason, all such communications should be sent in writing,
care of the Secretary of the Company, or by email at board@tranetechnologies.com.
2023 Proxy Statement
81
82
Householding
Appendix A
SEC rules permit a single set of annual reports and Proxy Statements to be sent to any household at which two or more shareholders reside if
they appear to be members of the same family. Each shareholder continues to receive a separate proxy card. This procedure is referred to as
householding. While the Company does not household in mailings to its shareholders of record, a number of brokerage firms with account
holders who are Company shareholders have instituted householding. In these cases, a single Proxy Statement and annual report will be
delivered to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once a
shareholder has received notice from his or her broker that the broker will be householding communications to the shareholder’s address,
householding will continue until the shareholder is notified otherwise or until the shareholder revokes his or her consent. If at any time a
shareholder no longer wishes to participate in householding and would prefer to receive a separate Proxy Statement and annual report, he or
she should notify his or her broker. Any shareholder can receive a copy of the Company’s Proxy Statement and annual report by contacting the
Company at its registered office at 170/175 Lakeview Drive, Airside Business Park, Swords, Co. Dublin, Ireland, Attention: Secretary or by
accessing it on the Company’s website at www.tranetechnologies.com.
Shareholders who hold their shares through a broker or other nominee who currently receive multiple copies of the Proxy Statement and
annual report at their address and would like to request householding of their communications should contact their broker.
Dated: April 21, 2023
TRANE TECHNOLOGIES PLC
Reconciliation of GAAP to Non-GAAP
UNAUDITED
(in millions)
Less: items to reconcile adjusted EBITDA to net earnings attributable to Trane Technologies plc
Total Company
Adjusted EBITDA
Depreciation and amortization(1)
Interest expense
Provision for income taxes
Restructuring
Transformation Costs
M&A transaction costs
Non-cash adjustments for contingent consideration
Insurance settlement on property claim
Settlement charge for retired executive
Acquisition inventory step-up and backlog amortization
Charges related to certain entities deconsolidated under Chapter 11
Gain on release of a pension indemnification liability
Discontinued operations, net of tax
Net earnings from continuing operations attributable to noncontrolling interests
Net earnings from discontinued operations attributable to noncontrolling interests
For the year ended
For the year ended
December 31, 2022
December 31, 2021
$ 2,694.0
$ 2,363.7
(323.2)
(223.5)
(375.9)
(20.7)
(5.8)
(3.6)
46.9
25.0
(15.8)
(1.2)
—
—
(21.5)
(18.2)
—
(299.4)
(233.7)
(333.5)
(27.0)
(16.7)
(1.8)
—
—
—
—
(7.2)
12.8
(20.6)
(13.2)
—
Net earnings attributable to Trane Technologies plc
$ 1,756.5
$ 1,423.4
(1)
Depreciation and amortization excludes acquisition backlog amortization of $0.4 million which has been included in the acquisition inventory step-up and backlog
amortization line.
2023 Proxy Statement
83
84
Householding
Appendix A
SEC rules permit a single set of annual reports and Proxy Statements to be sent to any household at which two or more shareholders reside if
they appear to be members of the same family. Each shareholder continues to receive a separate proxy card. This procedure is referred to as
householding. While the Company does not household in mailings to its shareholders of record, a number of brokerage firms with account
holders who are Company shareholders have instituted householding. In these cases, a single Proxy Statement and annual report will be
delivered to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once a
shareholder has received notice from his or her broker that the broker will be householding communications to the shareholder’s address,
householding will continue until the shareholder is notified otherwise or until the shareholder revokes his or her consent. If at any time a
shareholder no longer wishes to participate in householding and would prefer to receive a separate Proxy Statement and annual report, he or
she should notify his or her broker. Any shareholder can receive a copy of the Company’s Proxy Statement and annual report by contacting the
Company at its registered office at 170/175 Lakeview Drive, Airside Business Park, Swords, Co. Dublin, Ireland, Attention: Secretary or by
accessing it on the Company’s website at www.tranetechnologies.com.
Shareholders who hold their shares through a broker or other nominee who currently receive multiple copies of the Proxy Statement and
annual report at their address and would like to request householding of their communications should contact their broker.
Dated: April 21, 2023
TRANE TECHNOLOGIES PLC
Reconciliation of GAAP to Non-GAAP
UNAUDITED
(in millions)
Total Company
Adjusted EBITDA
Less: items to reconcile adjusted EBITDA to net earnings attributable to Trane Technologies plc
For the year ended
December 31, 2022
For the year ended
December 31, 2021
$ 2,694.0
$ 2,363.7
Depreciation and amortization(1)
Interest expense
Provision for income taxes
Restructuring
Transformation Costs
M&A transaction costs
Non-cash adjustments for contingent consideration
Insurance settlement on property claim
Settlement charge for retired executive
Acquisition inventory step-up and backlog amortization
Charges related to certain entities deconsolidated under Chapter 11
Gain on release of a pension indemnification liability
Discontinued operations, net of tax
Net earnings from continuing operations attributable to noncontrolling interests
Net earnings from discontinued operations attributable to noncontrolling interests
(323.2)
(223.5)
(375.9)
(20.7)
(5.8)
(3.6)
46.9
25.0
(15.8)
(1.2)
—
—
(21.5)
(18.2)
—
(299.4)
(233.7)
(333.5)
(27.0)
(16.7)
(1.8)
—
—
—
—
(7.2)
12.8
(20.6)
(13.2)
—
Net earnings attributable to Trane Technologies plc
$ 1,756.5
$ 1,423.4
(1)
Depreciation and amortization excludes acquisition backlog amortization of $0.4 million which has been included in the acquisition inventory step-up and backlog
amortization line.
2023 Proxy Statement
83
84
TRANE TECHNOLOGIES PLC
Reconciliation of GAAP to Non-GAAP
UNAUDITED
(in millions)
APPENDIX A
Cash flow provided by continuing operating activities
Capital expenditures
Cash payments for restructuring
Transformation costs paid
QSF funding (continuing operations component)
Compensation related payment to a retired executive
Insurance settlement on property claim in Q3 2022
Free cash flow
For the year ended
December 31, 2022
$ 1,698.7
For the year ended
December 31, 2021
$ 1,594.4
(291.8)
17.9
9.6
91.8
64.3
(25.0)
(223.0)
38.1
21.4
—
—
—
$ 1,565.5
$ 1,430.9
For purposes of our compensation programs, Cash Flow Return on Invested Capital (“CROIC”) is measured by dividing Free Cash Flow by
gross fixed assets (Property, Plant & Equipment) plus Working Capital (Accounts and Notes Receivable plus Inventory less Accounts and Notes
Payable). CROIC is calculated in accordance with GAAP, subject to adjustments for unusual or infrequent items; the impact of any change in
accounting principles; and gains or charges associated with discontinued operations or through the acquisition or divestiture of a business.
For purposes of our compensation programs, Total Shareholder Return (“TSR”) is measured as the total stock price appreciation plus
dividends earned during the three years of the performance cycle. To account for stock price volatility, a 30-day average stock price at the
beginning and ending periods is used. TSR was 57.17% for the 2020-2022 period, which ranked at the 78th percentile of the companies in the
S&P 500 Industrials Index. For purposes of the TSR calculation, the Reverse Morris Trust transaction in Q1 2020 was treated as a dividend of
$28.93 per share.
2023 Proxy Statement
85
EXECUTIVE COMPENSATION
Outstanding Equity Awards at December 31, 2022
Option Awards
Stock Awards
Number of
Securities
Underlying
Number of
Securities
Underlying
Options
(#)
Unexercised
Unexercised
Option
Options
Exercise
Option
Have Not
Have Not
Rights That Have
That Have Not
Number
of Shares
Market
Value of
Equity Incentive
Equity Incentive
Plan Awards:
Plan Awards: Market
or Units of
Shares or
Number of
or Payout Value of
Stock
Units of
Unearned Shares,
Unearned Shares,
That
Stock That
Units or Other
Units or Other Rights
Vested
(#)(c)
Vested
($)(d)
Not Vested
(#)(e)
Vested
($)(d)
Name
Exercisable(a)
Unexercisable(a)
($)
Date(b)
D. S. Regnery
2/3/2015
2/10/2016
Grant
Date
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
7/1/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/7/2017
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
2/6/2018
2/5/2019
3/9/2020
2/8/2021
2/1/2022
8/1/2019
3/9/2020
2/8/2021
2/1/2022
17,585
29,450
22,497
43,778
48,091
25,964
8,772
6,478
—
8,025
13,591
17,975
6,747
23,687
23,640
22,810
14,979
4,639
—
1,926
4,182
5,992
3,374
—
15,813
7,190
2,227
—
(#)
Price
Expiration
— 52.28 2/2/2025
— 38.99 2/9/2026
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
—
—
—
—
12,982 105.28 3/8/2030
2,059 346,097
17,544 148.98 2/7/2031
3,491 586,802
12,956 186.20 6/30/2031
2,578 433,336
55,726 167.18 1/31/2032
11,964 2,011,029
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
8,988 105.28 3/8/2030
1,425 239,528
13,496 148.98 2/7/2031
2,686 451,490
— 62.53 2/6/2027
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
—
—
7,490 105.28 3/8/2030
1,188 199,691
9,279 148.98 2/7/2031
1,846 310,294
10,449 167.18 1/31/2032
2,244 377,194
— 70.22 2/5/2028
— 78.97 2/4/2029
—
—
—
—
2,996 105.28 3/8/2030
475
79,843
6,748 148.98 2/7/2031
1,343 225,745
9,753 167.18 1/31/2032
2,094 351,980
— 94.91 7/31/2029
—
—
3,595 105.28 3/8/2030
4,454 148.98 2/7/2031
570
95,811
887 149,096
5,486 167.18 1/31/2032
1,178 198,010
—
17,415 167.18 1/31/2032
3,739 628,489
—
—
—
—
—
12,349
8,727
9,130
23,927
—
—
8,549
6,713
7,477
—
—
—
7,124
5,035
4,487
—
—
2,375
3,357
4,188
—
2,280
1,611
2,244
—
—
—
—
—
—
—
—
—
—
—
—
2,075,743
1,466,921
1,534,662
4,021,889
1,437,001
1,128,388
1,256,809
1,197,473
846,333
754,220
399,214
564,278
703,961
—
383,245
270,793
377,194
These columns represent stock option awards. These awards generally become exercisable in three equal annual installments beginning on the first anniversary after the
date of grant, subject to continued employment or retirement.
All options granted to the NEOs expire on the tenth anniversary (less one day) of the grant date.
This column represents unvested RSUs. RSUs generally become vested in three equal annual installments beginning on the first anniversary after the date of grant,
subject to continued employment or retirement.
The market value was computed based on $168.09, the closing market price of the Company’s ordinary shares on the NYSE at December 30, 2022.
This column represents the target number of unvested and unearned PSUs. PSUs vest upon the completion of a three-year performance period. The actual number of
shares an NEO will receive, if any, is subject to achievement of the performance goals as certified by the Human Resources and Compensation Committee, and
continued employment.
C. J. Kuehn
P. A. Camuti
E. M. Turtz
R. D. Pittard
(a)
(b)
(c)
(d)
(e)
64
2022
Financials
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2022
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File No. 001-34400
TRANE TECHNOLOGIES PLC
(Exact name of registrant as specified in its charter)
Ireland
(State or other jurisdiction of incorporation or organization)
98-0626632
(I.R.S. Employer Identification No.)
170/175 Lakeview Dr.
Airside Business Park
Swords Co. Dublin
Ireland
(Address of principal executive offices)
Registrant’s telephone number, including area code: +(353) (0) 18707400
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Ordinary Shares, Par Value $1.00 per Share
Trading Symbol
TT
Name of each exchange on which registered
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant
to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was
required to submit such files). Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,”
and “emerging growth company” in Rule 12b-2 of the Exchange Act.:
Large accelerated filer
Non-accelerated filer
Accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public
accounting firm that prepared or issued its audit report. Yes No
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based
compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b).
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No
The aggregate market value of ordinary shares held by nonaffiliates on June 30, 2022 was approximately $30.0 billion based on the closing
price of such stock on the New York Stock Exchange.
The number of ordinary shares outstanding of Trane Technologies plc as of February 3, 2023 was 229,074,725.
Portions of the registrant’s proxy statement to be filed within 120 days of the close of the registrant’s fiscal year in connection with the
registrant’s Annual General Meeting of Shareholders to be held June 1, 2023 are incorporated by reference into Part II and Part III of this
Form 10-K.
DOCUMENTS INCORPORATED BY REFERENCE
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TRANE TECHNOLOGIES PLC
Form 10-K
For the Fiscal Year Ended December 31, 2022
TABLE OF CONTENTS
Part I
Part II
Part III
Part IV
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 9C.
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Item 15.
Item 16.
Signatures
Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosures
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
[Reserved]
Management’s Discussion and Analysis of Financial Condition and Results of
Operations
Quantitative and Qualitative Disclosure About Market Risk
Financial Statements
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Exhibits and Financial Statement Schedules
Form 10-K Summary
Page
6
15
26
27
27
27
28
29
29
46
46
47
47
47
47
48
48
48
48
48
49
59
60
2022 Annual Report
3
Cautionary Statement for Forward Looking Statements
Certain statements in this report, other than purely historical information, are “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believe,”
“project,” “expect,” “anticipate,” “estimate,” “forecast,” “outlook,” “intend,” “strategy,” “plan,” “may,” “might”, “could,” “should,”
“will,” “would,” “will be,” “will continue,” “will likely result,” or the negative thereof or variations thereon or similar terminology
generally intended to identify forward-looking statements.
Forward-looking statements may relate to such matters as projections of revenue, margins, expenses, tax provisions,
earnings, cash flows, benefit obligations, share or debt repurchases or other financial items; any statements of the plans,
strategies and objectives of management for future operations, including those relating to any statements concerning
expected development, performance or market share relating to our products and services; any statements regarding
future economic conditions or our performance including our future performance statements related to the continued
impact of the Coronavirus Disease 2019 (COVID-19) global pandemic; any statements regarding our sustainability
commitments; any statements regarding pending investigations, claims or disputes; any statements of expectation or
belief; and any statements of assumptions underlying any of the foregoing. These statements are based on currently
available information and our current assumptions, expectations and projections about future events. While we believe
that our assumptions, expectations and projections are reasonable in view of the currently available information, you
are cautioned not to place undue reliance on our forward-looking statements. You are advised to review any further
disclosures we make on related subjects in materials we file with or furnish to the Securities and Exchange Commission.
Forward-looking statements speak only as of the date they are made and are not guarantees of future performance.
They are subject to future events, risks and uncertainties – many of which are beyond our control – as well as potentially
inaccurate assumptions, that could cause actual results to differ materially from our expectations and projections. We do
not undertake to update any forward-looking statements.
Factors that might affect our forward-looking statements include, among other things:
• overall economic, political and business conditions in the markets in which we operate including recessions,
economic downturns, price instability, slow economic growth and social and political instability;
• impacts of the COVID-19 global pandemic on our business operations, financial results and financial position and on
the world economy;
• commodity shortages, supply chain risks and price increases;
• national and international conflict, including war, civil disturbances and terrorist acts, such as the Russia-Ukraine
conflict;
• trade protection measures such as import or export restrictions and requirements, the imposition of tariffs and quotas
or revocation or material modification of trade agreements;
• competitive factors in the industries in which we compete;
• the development, commercialization and acceptance of new and enhanced products and services;
• attracting and retaining talent;
• work stoppages, union negotiations, labor disputes and similar issues;
• other capital market conditions, including availability of funding sources, interest rate fluctuations and other changes in
borrowing costs;
• currency exchange rate fluctuations, exchange controls and currency devaluations;
• the outcome of any litigation, governmental investigations, claims or proceedings;
• risks and uncertainties associated with the asbestos-related bankruptcy for our deconsolidated subsidiaries Aldrich
Pump LLC and Murray Boiler LLC;
• the impact of potential information technology system failures, vulnerabilities, data security breaches or other
cybersecurity issues;
• evolving data privacy and protection laws;
• intellectual property infringement claims and the inability to protect our intellectual property rights;
4
• changes in laws and regulations;
• health epidemics or pandemics or other contagious outbreaks;
• climate change, changes in weather patterns, natural disasters and seasonal fluctuations;
• national, regional and international regulations and policies associated with climate change and the environment;
• the outcome of any tax audits or settlements;
• the strategic acquisition or divestiture of businesses, product lines and joint ventures;
• impairment of our goodwill, indefinite-lived intangible assets and/or our long-lived assets; and
• changes in tax laws and requirements (including tax rate changes, new tax laws, new and/or revised tax law
interpretations and any legislation that may limit or eliminate potential tax benefits resulting from our incorporation in a
non-U.S. jurisdiction, such as Ireland).
Some of the significant risks and uncertainties that could cause actual results to differ materially from our expectations
and projections are described more fully in Part I, Item 1A “Risk Factors.” You should read that information in conjunction
with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of this
report and our Consolidated Financial Statements and related notes in Part II, Item 8 “Financial Statements” of this report.
We note such information for investors as permitted by the Private Securities Litigation Reform Act of 1995.
2022 Annual Report
5
Part I
Item 1. Business
OVERVIEW
Trane Technologies plc, a public limited company, incorporated in Ireland in 2009, and its consolidated subsidiaries
(collectively we, us, our, the Company) is a global climate innovator. We bring sustainable and efficient solutions to
buildings, homes and transportation through our strategic brands, Trane® and Thermo King®, and our environmentally
responsible portfolio of products, services and connected intelligent controls. We generate revenue and cash primarily
through the design, manufacture, sales and service of solutions for Heating, Ventilation and Air Conditioning (HVAC),
transport refrigeration, and custom refrigeration solutions. As an industry leader with an extensive global install base,
our growth strategy includes expanding recurring revenue through services and rental options. Our unique business
operating system, uplifting culture and highly engaged team around the world are also central to our earnings and cash
flow growth.
Through our sustainability-focused strategy and purpose to boldly challenge what’s possible for a sustainable world,
we meet critical needs and growing global demand for innovation that reduces greenhouse gas emissions while
enabling healthier, efficient indoor environments and safe, reliable delivery of essential temperature-controlled cargo.
We have announced certain defined sustainability commitments with a goal of achieving these commitments by 2030
(2030 Sustainability Commitments). Trane Technologies’ bold 2030 Sustainability Commitments have been verified by
the Science Based Targets initiative (SBTi) and include our ‘Gigaton Challenge’ to reduce customer greenhouse gas
emissions by a billion metric tons, ‘Leading by Example’ through carbon-neutral operations across our own footprint, and
‘Opportunity for All’ by building a diverse workforce reflective of our communities.
REPORTABLE SEGMENTS
We operate under three reportable segments.
• Our Americas segment innovates for customers in North America and Latin America. The Americas segment
encompasses commercial heating, cooling and ventilation systems, building controls, and energy services and
solutions; residential heating and cooling; and transport refrigeration systems and solutions. This segment had 2022
net revenues of $12,640.8 million.
• Our EMEA segment innovates for customers in the Europe, Middle East and Africa region. The EMEA segment
encompasses heating, cooling and ventilation systems, services and solutions for commercial buildings and industrial
processing, and transport refrigeration systems and solutions. This segment had 2022 net revenues of $2,034.5 million.
• Our Asia Pacific segment innovates for customers throughout the Asia Pacific region. The Asia Pacific segment
encompasses heating, cooling and ventilation systems, services and solutions for commercial buildings and transport
refrigeration systems and solutions. This segment had 2022 net revenues of $1,316.4 million.
6
PART I
PRODUCTS AND SERVICES
Our principal products and services include the following:
Air conditioners
Air exchangers
Air handlers
Airside and terminal devices
Air-sourced heat pumps
Large commercial unitary
Light commercial unitary
Multi-pipe HVAC systems
Package heating and cooling systems
Parts and supplies (aftermarket and OEM)
Auxiliary power units (electric and diesel)
Rail refrigeration systems
Building management systems
Bus air purification systems
Bus and rail HVAC systems
Chillers
Coils and condensers
Rate chambers
Refrigerant reclamation
Renewable energy projects
Repair and maintenance services
Rental services
Container refrigeration systems and gensets
Residential Air Filtration System
Control systems
Cryogenic refrigeration systems
Dehumidifiers
Ductless
Energy efficiency programs
Energy infrastructure programs
Energy management services
Energy performance contracting
Furnaces
Geothermal systems
Home automation
Humidifiers
Residential Hybrid Heating Solutions
Self-powered truck refrigeration systems
Service agreements
Telematics Solutions
Temporary heating and cooling systems
Thermal energy storage
Thermostats/controls & associated digital solutions
Trailer refrigeration systems (diesel, electric and hybrid)
Transport heater products
Truck refrigeration systems (diesel, electric and hybrid)
Ultra-low temperature freezers
Unitary systems (light and large)
HVAC Performance-monitoring applications
Variable refrigerant flow
Indoor air quality assessments and related products
for HVAC and Transport solutions
Vehicle-powered truck refrigeration systems
Industrial refrigeration
Installation contracting
Ventilation
Water source heat pumps
These products are sold primarily under our tradenames including Trane® and Thermo King®.
COMPETITIVE CONDITIONS
Our products and services are sold in highly competitive markets throughout the world. Due to the diversity of these
products and services and the variety of markets served, we encounter a wide variety of competitors that vary by
product line and services. They include well-established regional or specialized competitors, as well as larger U.S. and
non-U.S. corporations or divisions of larger companies.
The principal methods of competition in these markets relate to price, quality, delivery, service and support, technology
and innovation. We are one of the leading manufacturers in the world of HVAC systems and services and transport
temperature control products and services.
DISTRIBUTION
Our products are distributed by a number of methods, which we believe are appropriate to the type of product. U.S. sales
are made through branch sales offices, distributors and dealers across the country. Non-U.S. sales are made through
numerous subsidiary sales and service companies with a supporting chain of distributors throughout the world.
2022 Annual Report
7
PART I
OPERATIONS BY GEOGRAPHIC AREA
Approximately 28% of our net revenues in 2022 were derived outside the U.S. and we sold products in approximately
100 countries. Therefore, the attendant risks of manufacturing or selling in a particular country, such as currency devaluation,
nationalization and establishment of common markets, may have an adverse impact on our non-U.S. operations.
CUSTOMERS
We have no customer that accounted for more than 10% of our consolidated net revenues in 2022, 2021 or 2020. No material
part of our business is dependent upon a single customer or a small group of customers; therefore, the loss of any one
customer would not have a material adverse effect on our results of operations or cash flows.
MATERIALS
We both manufacture and procure many of the components included in our products. For components we manufacture,
we are required to source a wide variety of commodities such as steel, copper, and aluminum. These principal
commodities are purchased from a large number of independent sources around the world, primarily within the region
where the products are manufactured. We believe that available sources of supply will generally be sufficient for the
foreseeable future.
For many components we procure, we have multiple capable sources with minimal concerns for sufficient supply, however
there are certain categories of components that continue to see limited availability or shortages.
SEASONALITY
Demand for certain of our products and services is influenced by weather conditions. For instance, sales in our commercial
and residential HVAC businesses historically tend to be higher in the second and third quarters of the year because this
represents spring and summer in the U.S. and other northern hemisphere markets, which are the peak seasons for sales
of air conditioning systems and services. Therefore, results of any quarterly period may not be indicative of expected results
for a full year and unusual weather patterns or events could positively or negatively affect certain segments of our business
and impact overall results of operations.
RESEARCH AND DEVELOPMENT
We engage in research and development activities in an effort to introduce new products, enhance existing product
effectiveness, improve ease of use and reliability as well as expand the various applications for which our products may be
appropriate. In 2022, we spent $211.2 million on research and development, focused on product and system sustainability
improvements such as increasing energy efficiency, developing products that allow for use of lower global warming
potential refrigerants, reducing material content in products, and designing products for circularity. All new product
development (NPD) programs must complete a Design for Sustainability module within our NPD process to ensure that
every program has a positive impact on sustainability.
We also have a strong focus on sustaining activities, which include costs incurred to reduce production costs, improve
existing products, create custom solutions for customers and provide support to our manufacturing facilities. We anticipate
that we will continue to make significant expenditures for research and development and sustaining activities as we look to
maintain and improve our competitive position.
PATENTS AND LICENSES
Our intellectual property rights are important to our business and include numerous patents, trademarks, copyrights, trade
secrets, proprietary technology, technical data, business processes, and other confidential information. Although in the
aggregate we consider our intellectual property rights to be valuable to our operations, we do not believe that our business
is materially dependent on a single intellectual property right or any group of them. In our opinion, engineering, production
skills and experience are more responsible for our market position than our intellectual property rights.
8
BACKLOG
Our backlog of orders, believed to be firm, at December 31, was as follows:
IN MILLIONS
Americas
EMEA
Asia Pacific
Total
PART I
2022
2021
$ 5,325.2
$ 3,856.7
616.1
941.8
727.2
852.8
$ 6,883.1
$ 5,436.7
These backlog figures are based on orders received and only include amounts associated with our equipment and
contracting and installation performance obligations. Beginning in 2022, our backlog figures include additional revenue
streams due to increased lead times. A major portion of our residential products are built in advance of order and either
shipped or assembled from stock. As a result, we expect to ship a majority of the December 31, 2022 backlog during
2023. However, orders for specialized machinery or specific customer applications are submitted with extensive lead
times and are often subject to revision and deferral, and to a lesser extent cancellation or termination. During the year
ended December 31, 2022, we experienced significant increases in end market demand for our sustainability-focused
products and services resulting in a higher backlog of orders in the current year as compared to prior year. In addition,
we are seeing industry-wide supply chain and resource constraints impacting our ability to produce and ship product,
which we are proactively managing. To the extent projects are delayed or there are additional supply chain and resource
constraints, the timing of our revenue could be affected.
ENVIRONMENTAL MATTERS
We continue to be dedicated to environmental and sustainability programs to minimize the use of natural resources,
reduce the utilization and generation of hazardous materials from our manufacturing processes and to remediate
identified environmental concerns. As to the latter, we are currently engaged in site investigations and remediation
activities to address environmental cleanup from past operations at current and former manufacturing facilities and
off-site waste disposal facilities.
It is our policy to establish environmental reserves for investigation and remediation activities when it is probable that a liability
has been incurred and a reasonable estimate of the liability can be made. Estimated liabilities are determined based upon
existing remediation laws and technologies. Inherent uncertainties exist in such evaluations due to unknown environmental
conditions, changes in government laws and regulations, and changes in cleanup technologies. The environmental reserves
are updated on a routine basis as remediation efforts progress and new information becomes available.
We are sometimes a party to environmental lawsuits and claims and have received notices of potential violations of
environmental laws and regulations from the Environmental Protection Agency and similar state and international
authorities. We have also been identified as a potentially responsible party (PRP) for cleanup costs associated with off-site
waste disposal at federal Superfund and state remediation sites. In most instances at multi-party sites, our share of the
liability is not material.
In estimating our liability at multi-party sites, we have assumed that we will not bear the entire cost of remediation of any
site to the exclusion of other PRPs who may be jointly and severally liable. The ability of other PRPs to participate has
been taken into account, based on our understanding of the parties’ financial condition and probable contributions on a
per site basis.
For a further discussion of our potential environmental liabilities, see Note 20 “Commitments and Contingencies” to the
Consolidated Financial Statements.
SEPARATION OF INDUSTRIAL SEGMENT BUSINESSES
On February 29, 2020 (Distribution Date), we completed our Reverse Morris Trust transaction (the Transaction) with
Gardner Denver Holdings, Inc. (Gardner Denver, which changed its name to Ingersoll Rand Inc. (Ingersoll Rand)
after the Transaction) whereby we distributed Ingersoll-Rand U.S. HoldCo, Inc., which contained our former Industrial
segment (Ingersoll Rand Industrial) through a pro rata distribution (the Distribution) to shareholders of record as of
February 24, 2020 (Spin-off Shareholders). Ingersoll Rand Industrial then merged into a wholly-owned subsidiary of
2022 Annual Report
9
PART I
Ingersoll Rand. Upon close of the Transaction, the Spin-off Shareholders received 50.1% of the shares of Ingersoll Rand
common stock on a fully-diluted basis and Gardner Denver shareholders retained 49.9% of the shares of Ingersoll Rand
on a fully diluted basis. As a result, the Spin-off Shareholders received .8824 shares of Ingersoll Rand common stock with
respect to each share owned as of February 24, 2020. In connection with the Transaction, we received a special cash
payment of $1.9 billion.
During the year ended December 31, 2022, the Company recorded a reduction to Retained earnings of $18.9 million
primarily related to tax matters associated with Ingersoll Rand Industrial and the settlement of certain items related to the
Transaction. During the year ended December 31, 2021, we paid Ingersoll Rand $49.5 million to settle certain items related
to the Transaction. This payment was related to working capital, cash and indebtedness amounts as of the Distribution
Date, as well as funding levels related to pension plans, non-qualified deferred compensation plans and retiree health
benefits. We recorded the settlement as a reduction to Retained earnings during the first quarter of 2021.
After the Distribution Date, we do not beneficially own any Ingersoll Rand Industrial shares of common stock and no
longer consolidate Ingersoll Rand Industrial in our financial statements. The historical results of Ingersoll Rand Industrial
are presented as a discontinued operation in the Consolidated Statements of Earnings and Consolidated Statements of
Cash Flows.
ASBESTOS-RELATED MATTERS
We are involved in a number of asbestos-related lawsuits, claims and legal proceedings. In June 2020, our indirect
wholly-owned subsidiaries Aldrich Pump LLC (Aldrich) and Murray Boiler LLC (Murray) each filed a voluntary petition for
reorganization under Chapter 11 of Title 11 of the United States Code (the Bankruptcy Code) in the United States Bankruptcy
Court for the Western District of North Carolina in Charlotte (the Bankruptcy Court). As a result of the Chapter 11 filings, all
asbestos-related lawsuits against Aldrich and Murray have been stayed due to the imposition of a statutory automatic
stay applicable in Chapter 11 bankruptcy cases. Only Aldrich and Murray have filed for Chapter 11 relief. Neither Aldrich’s
wholly-owned subsidiary, 200 Park, Inc. (200 Park), Murray’s wholly-owned subsidiary, ClimateLabs LLC (ClimateLabs), Trane
Technologies plc nor its other subsidiaries (the Trane Companies) are part of the Chapter 11 filings. In addition, at the
request of Aldrich and Murray, the Bankruptcy Court has entered an order temporarily staying all asbestos-related claims
against the Trane Companies that relate to claims against Aldrich or Murray (except for asbestos-related claims for which
the exclusive remedy is provided under workers’ compensation statutes or similar laws).
The goal of these Chapter 11 filings is to resolve equitably and permanently all current and future asbestos-related claims
in a manner beneficial to claimants, Aldrich and Murray through court approval of a plan of reorganization that would
create a trust pursuant to section 524(g) of the Bankruptcy Code, establish claims resolution procedures for all current
and future asbestos-related claims against Aldrich and Murray and channel such claims to the trust for resolution in
accordance with those procedures.
For detailed information on the bankruptcy cases of Aldrich and Murray, see:
• Part I, Item 1A, “Risk Factors – Risks Related to Litigation,”
• Part I, Item 3, “Legal Proceedings,”
• Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Significant
Events,” and
• Part II, Item 8, Consolidated Financial Statements, Note 1, “Description of Company,” and Note 20, “Commitments and
Contingencies.”
HUMAN CAPITAL MANAGEMENT
Our people and culture are critical to achieving our operational, financial and strategic success.
As of December 31, 2022, we employed approximately 39,000 people in nearly 60 countries including approximately 14,000
outside of the United States. As of December 31, 2022, 25.7% of our global employees were women and 37.4% of our
employees in the United States were racially and ethnically diverse. In 2022, 30.2% of our new hires globally were women
and 50.5% of new hires in the United States were racially and ethnically diverse. Approximately 24.2% of leadership and
management positions were held by women as of December 31, 2022. The diversity percentages included in this section
exclude current year business acquisitions.
10
PART I
As a result of maintaining a consistent focus on an uplifting culture, our key talent (employees with the highest potential
rating) retention rate excluding retirements in 2022 was 93.1%. Our company-wide (all employees) voluntary retention rate
excluding retirements was 86.3%.
Culture and Purpose
In 2022, we continued to drive our purpose to boldly challenge what’s possible for a sustainable world through our
strategic priorities and 2030 Sustainability Commitments. We use our Leadership Principles to guide our actions each
day and enable our uplifting, engaging and inclusive culture. As part of our commitment to people and culture, we strive
to create a work environment where our people uplift each other, make a positive impact on the planet and thrive at work
and at home.
Since 2006, our annual employee engagement survey has enabled employees to share their experiences and
perceptions of our Company. Employees provide ratings and written comments for continuous improvement. In 2022,
88% of our workforce participated in our annual engagement survey, and our overall employee engagement score
remains high. While our work on culture is never done, these scores indicate that we’re continuing to raise the bar to
increase pride, energy and optimism across the company and create the best employee experience.
Diversity and Inclusion
Our commitment to Diversity and Inclusion is core to our purpose and our 2030 Sustainability Commitments. We are
proud members of Paradigm for Parity (a coalition of more than 100 corporations who have committed to closing the
gender gap in corporate leadership) and OneTen (a coalition dedicated to hiring one million Black Americans in the
next ten years to achieve economic mobility). In addition, we are a 2017 signatory to the CEO Action for Diversity and
Inclusion pledge (the largest CEO-driven business commitment to advance diversity and inclusion within the workplace).
We offer company-sponsored forums to promote diversity and inclusion in the workplace including:
• Bridging Connections – a safe forum created to allow our employees to speak from the heart about a variety of topics
without fear of retribution.
• Employee Resources Groups (ERGs) – we sponsor eight ERGs (the Women’s Employee Network, the Black Employee
Network, the Veterans Employee Resource Group, the Asian Employee Resource Group, the Global Organization of
Latinos, the Lesbian, Gay, Bisexual, Transgender and Allies (LGBTA) Employee Resource Group, the InterGenerational
Employee Network, and VisAbility). All ERGs are voluntary, open and inclusive organizations that offer employees a
sense of belonging, networking and learning opportunities.
• Women’s Leadership Development Programs
• The Women in Action Leadership Program is a virtual, self-paced cohort program that provides women with access
to content that promotes their leadership development skills.
• The Women on the Rise (WOR) program is designed over eight-weeks to help empower, develop, connect and
support emerging women leaders.
• The Women’s Leadership Program (WLP) is a cohort program for high potential talent that provides an opportunity
to network with other senior women leaders, gain individual insights through an executive mentoring partnership
and build leadership skills and confidence through a variety of learning components, speakers, experiences and
assessments.
• In 2022, the Inclusive Leader Learning Experience was promoted to people leaders detailing three stages of inclusive
leadership: Becoming Aware, Becoming an Ally and Upstander, and Becoming a Change Agent.
• In 2022, the Global Diversity & Inclusion summit continued its focus on development of the inclusive leader behaviors;
highlighting allyship.
Additionally, our corporate citizenship strategy, Sustainable Futures, which was launched in 2021, aims at creating
educational and career opportunities specifically for people of color who are under-represented in our industry. This
strategy will support our efforts to create opportunity for all by providing marginalized students with a range of resources,
from classroom curriculum introducing them to careers at a climate innovation company, to soft-skill development for
landing a science, technology, engineering, and mathematics (STEM) job.
2022 Annual Report
11
PART I
Learning and Development
We offer learning and career development opportunities that enhance our employees’ skills and abilities and ensure
contemporary technical and functional skills and competencies such as innovation, collaboration and leadership.
Examples of these programs include:
• Team Leader Development Program – An eight-week experiential development program that engages, teaches and
empowers front-line plant leaders to apply continuous improvement methods, make sound business decisions, solve
problems, and serve as a coach to their teams.
• Graduate Training Program (GTP) – A five-month development program designed to prepare university graduate
engineers for a rewarding career in technical sales. The program prepares sales engineers to sell Trane’s complex
HVAC systems and energy services. The program, started in 1926, is recognized as the industry’s most comprehensive
training program and provides intensive technical, business, sales, and leadership training.
• Accelerated Development Program (ADP) – An early career rotational program focused on both functional and
leadership development, designed to build a pipeline of strong talent for key roles in the organization. Participants
rotate to multiple geographic locations and business units during the 2.5 year program, while completing diverse
assignments, and receiving dedicated functional training and developmental experiences.
• Leadership Development – We invest in custom, key transition leadership development programs for our high potential
talent. We partner with best-in-class external leadership development experts such as INSEAD, Center for Creative
Leadership, and the NeuroLeadership Institute to deliver these programs globally each year. Additionally, we offer our
Trane Technologies people leaders learning programs to develop their skills in leading their teams, such as building
diverse and inclusive teams, increasing engagement, and coaching skills.
• Professional development – We have numerous online courses in professional development skills as varied as working
virtually, resiliency, Microsoft Teams, unconscious bias, and strategic capability initiatives such as product management
and other programs that support our strategy of being a world class lean enterprise.
• Dependent Scholarships – To support learning in our employees’ families, we offer scholarships to support their
dependent children’s pursuits beyond high school, whether for a traditional degree, or a trade certification.
• Compliance Training – Our Compliance Training curriculum covers key topics that are important to protect our
Company, our people and our customers. Topics include certification in our Code of Conduct, Information Security,
Understanding and Preventing Sexual Harassment and Human Trafficking Prevention. All salaried employees globally
complete our annual compliance curriculum.
Employee Volunteerism
In 2022, with the height of the COVID-19 pandemic behind us, we saw many employees re-engage in in-person
volunteerism. From Monterrey, Mexico to St. Paul, MN and Dubai UAE to Davidson, NC, our teams made meaningful
contributions to their local communities.
This year, we formed Purple Teams, a new global employee network that provides vital support for driving our
corporate citizenship efforts around the world, and volunteerism in particular. More than 70 Purple Teams were stood
up, spanning each business and region where we do business. They are comprised of local champions who will
cultivate the spirit of volunteerism, ensure alignment with our strategy, and also help ensure accurate data tracking.
After launching in summer 2022, one of their first coordinated engagements was a back-to-school volunteer literacy
project in partnership with Reading Is Fundamental. Employees in multiple locations donated hundreds of hours
assembling literacy backpacks with three new STEM-themed books and bookmarks for more than 11,000 elementary
school students around the U.S. Our definition of the term community also includes our own colleagues and this year,
we were honored to be able to provide relief grant support to nearly 800 employees in Puerto Rico who were impacted
by Hurricane Ivan.
12
PART I
Employee Well-being
Trane Technologies believes employees that can thrive at work, at home and in their communities are our greatest asset.
We integrate well-being into our culture through core global resources that support physical, social, emotional, and
financial well-being. Several elements of our holistic well-being actions include:
• Giving 100% of our team members access to company-sponsored wellness offerings, including a global Employee
Assistance Program and a global wellness platform covering an array of topics like mindfulness, resiliency, and
nutrition.
• Offering financial relief through the Helping Hand program, an employee funded program created to help associates
facing financial hardship immediately after a qualified disaster or an unforeseen personal hardship.
• Implementing and adapting Flex Time and Flex Place policies and resources as well as work-from-home
arrangements, and other approaches to support evolving employee needs.
Recognizing the pervasiveness of mental health challenges facing employees and their families post-pandemic, we
prioritized mental well-being globally by:
• Introducing a series of conversations with team members around the world to share their stories related to mental
health to address stigma and promote a culture that encourages and supports open discussion about mental
health issues.
• Implementing an enterprise Mental Well-Being Hub to streamline access to mental health resources and guidance
for supporting others and leveraging our global Employee Assistance Program to provide frequent communications
targeted to concerns such as mental health, stress & burnout, relationships, childcare and education.
Competitive Pay and Benefits
Trane Technologies’ compensation programs and policies are designed to align the compensation of our employees
with the Company’s performance and strategy: to attract and retain a talented workforce and to meet the needs of
employees globally. We are committed to providing competitive and equitable wages and benefits that will allow our
employees to thrive at work and at home. In addition, the structure of our compensation programs balances incentive
earnings for both long-term and short-term performance, with our annual incentive plan closely tied to our 2030
sustainability commitments, which includes environmental sustainability and workforce diversity goals, in addition to
financial goals.
Trane Technologies’ benefits programs and policies are designed to support the well-being of employees and their
families. Purpose-driven and locally relevant benefits programs are provided globally. In addition to core and competitive
medical, welfare and retirement programs, we offer programs to support work-life balance, including:
• Expanded family support programs inclusive of child and elder back-up care programs;
• Enhanced parental leave programs; and
• Tuition assistance to support the ongoing growth and development of our employees.
Our proxy statement provides more detail on the competitive compensation and benefit programs we offer.
Employee Safety
In 2022, we continued our multi-year, world class safety record with a Lost-time Incident Rate of 0.13 and Recordable
Rate below 1.00. In response to the pandemic, we continue to monitor, track, update and implement our COVID-19
guidance based on World Health Organization (WHO), U.S. and European Centers for Disease Control and Prevention
and other local or country specific guidelines. We completed over 35,000 observations of our service technicians and
manufacturing employees to ensure all employees were following safe work practices and COVID-19 protocols.
In addition, we reviewed and updated our Automatic External Defibrillator program so that locations globally can
respond to sudden cardiac arrest emergencies. We also continue to maintain all our locations globally as Tobacco
Free Workplaces.
2022 Annual Report
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PART I
AVAILABLE INFORMATION
We have used, and intend to continue to use, the homepage, the investor relations and the “News” section of our website
(www.tranetechnologies.com), among other sources such as press releases, public conference calls and webcasts, as
a means of disclosing additional information, which may include future developments regarding the Company and/or
material non-public information. We encourage investors, the media, and others interested in our Company to review the
information it makes public in these locations on its website.
We file annual, quarterly, and current reports, proxy statements, and other documents with the Securities and Exchange
Commission under the Securities Exchange Act of 1934.
This Annual Report on Form 10-K, as well as our quarterly reports on Form 10-Q, current reports on Form 8-K
and any amendments to all of the foregoing reports, are made available free of charge on our Internet website
(www.tranetechnologies.com) as soon as reasonably practicable after such reports are electronically filed with or
furnished to the Securities and Exchange Commission. The Board of Directors of our Company has also adopted and
posted in the Investor Relations section of our website the Corporate Governance Guidelines and charters for each of
the Board’s standing committees. The contents of our website are not incorporated by reference in this report.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following is a list of our executive officers as of February 10, 2023.
NAME AND AGE
DATE OF SERVICE AS AN
EXECUTIVE OFFICER
David S. Regnery (60)
8/5/2017
Christopher J. Kuehn (50)
6/1/2015
Paul A. Camuti (61)
8/1/2011
Raymond D. Pittard (57)
7/1/2021
Evan M. Turtz (54)
4/3/2019
Keith A. Sultana (53)
10/12/2015
Mairéad A. Magner (45)
1/6/2022
Mark A. Majocha (51)
12/1/2022
PRINCIPAL OCCUPATION AND OTHER INFORMATION FOR PAST FIVE YEARS
Chair of the Board (since January 2022); Chief Executive Officer and
Director (since July 2021); President and Chief Operating Officer
(January 2020 to June 2021); Executive Vice President (September 2017
to December 2019)
Executive Vice President and Chief Financial Officer (since July 2021);
Senior Vice President and Chief Financial Officer (March 2020 to
June 2021); Vice President and Chief Accounting Officer (June 2015 to
February 2020)
Executive Vice President and Chief Technology and Strategy Officer
(since January 2020); Senior Vice President, Innovation and Chief
Technology Officer (August 2011 to December 2019)
Executive Vice President, Supply Chain, Engineering and Information
Technology (since July 2021); Transformation Office Leader
(December 2019 to June 2021); Vice President, SBU President of
Transport Solutions North America and EMEA (December 2013 to
December 2019)
Senior Vice President and General Counsel (since April 2019); Secretary
(since October 2013); Vice President (2008-2019); Deputy General
Counsel, Industrial, General Counsel, CTS (2016-2019)
Senior Vice President, Supply Chain and Operational Services (since
January 2020); Senior Vice President, Global Operations and Integrated
Supply Chain (October 2015-December 2019)
Senior Vice President, Chief Human Resources Officer (since January
2022); Vice President, Talent and Organization Capability (January 2018
to January 2022); Vice President, Human Resources, CTS (March 2015 to
January 2018)
Vice President and Chief Accounting Officer (since December 2022);
Vice President, Finance CHVAC Americas (April 2020-November 2022);
Vice President, Corporate Development (July 2018 - April 2020)
No family relationship exists between any of the above-listed executive officers of our Company. All officers are elected to
hold office for one year or until their successors are elected and qualified.
14
PART I
Item 1A. Risk Factors
Our business, financial condition, results of operations, and cash flows are subject to a number of risks that could cause
the actual results and conditions to differ materially from those projected in forward-looking statements contained in
this Annual Report on Form 10-K. The risks set forth below are those we consider most significant. We face other risks,
however, that we do not currently perceive to be material which could cause actual results and conditions to differ
materially from our expectations. You should evaluate all risks before you invest in our securities. If any of the risks actually
occur, our business, financial condition, results of operations or cash flows could be adversely impacted. In that case, the
trading price of our ordinary shares could decline, and you may lose all or part of your investment.
RISKS RELATED TO ECONOMIC CONDITIONS
The full extent to which a resurgence of COVID-19 or spread of new infectious diseases will affect us will depend on
future developments that are highly uncertain and cannot be accurately predicted.
The COVID-19 pandemic has had widespread, rapidly evolving and unpredictable impacts on global society, economics,
financial markets and business practices. Government efforts to contain COVID-19 have included travel bans and
restrictions, quarantines, shelter in place orders and shutdowns. Our business and global operations have been
impacted by supply chain delays, higher material costs and product prices, lower revenues for some quarters, and
unfavorable foreign currency exchange rates. The COVID-19 pandemic has also at times affected our ability to obtain
needed products and services, operate in certain locations, maintain our distribution channels, and attract and retain
talent. We continue to closely monitor the impact of the COVID-19 pandemic on all aspects of our business and
geographies, including how it has and will impact our customers, team members, suppliers, vendors, business partners
and distribution channels.
The extent to which COVID-19 or other widespread outbreaks of infectious disease impact our business going forward
will depend on factors such as the duration and scope of infections; governmental, business, and individuals’ actions in
response to the health crisis; and the impact on economic activity including the possibility of financial market instability
or recession. How a resurgence of COVID-19 or other potential global pandemics will affect us will depend on future
developments that are highly uncertain and cannot be accurately predicted. Such events may also exacerbate other
risks discussed herein, any of which could have a material adverse effect on us.
Our global operations subject us to economic risks.
Our global operations are dependent upon products manufactured, purchased and sold in the U.S. and internationally.
These activities are subject to risks that are inherent in operating globally, including:
• changes in local laws and regulations including potential imposition of currency restrictions, new or changing tax laws
and other restraints;
• limitation of ownership rights, including expropriation of assets by a local government, and limitation on the ability to
repatriate earnings;
• sovereign debt crises and currency instability in developed and developing countries;
• trade protection measures such as import or export restrictions and requirements, the imposition of burdensome
tariffs and quotas or revocation or material modification of trade agreements;
• difficulty in staffing and managing global operations including supply chain disruptions which may be exacerbated by
pandemics or other events affecting the supply of labor, materials and components;
• difficulty of enforcing agreements, collecting receivables and protecting assets through non-U.S. legal systems;
• national and international conflict, including war, civil disturbances and terrorist acts; and
• recessions, economic downturns, price instability, slowing economic growth and social and political instability.
These risks could increase our cost of doing business internationally, increase our counterparty risk, disrupt our
operations, disrupt the ability of suppliers and customers to fulfill their obligations, limit our ability to sell products in
certain markets and have a material adverse impact on our results of operations, financial condition, and cash flows.
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PART I
Commodity shortages, supply chain risks and price increases could adversely affect our financial results.
We rely on suppliers to secure commodities, particularly steel and non-ferrous metals, and third-party parts and
components required for the manufacture of our products. A disruption in deliveries from our suppliers or decreased
availability of commodities and third-party parts and components could have an adverse effect on our ability to meet our
commitments to customers or increase our operating costs. Disruptions have occurred due to the COVID-19 pandemic,
the Russia-Ukraine conflict, supplier capacity constraints, labor shortages, port congestion, logistical problems and other
issues. Some of these disruptions have resulted in supply chain constraints affecting our business including our ability
to timely produce and ship our products. The unavailability of some commodities and third-party parts and components
could have a material adverse impact on our results of operations and cash flows.
Volatility in the prices of commodities and third-party parts and components or the impact of inflationary increases
could increase the costs of our products and services. We may not be able to pass on these costs to our customers
and this could have a material adverse impact on our results of operations and cash flows. Conversely, in the event
there is deflation, we may experience pressure from our customers to reduce prices. There can be no assurance that
we would be able to reduce our costs (through negotiations with suppliers or other measures) to offset any such price
concessions which could adversely impact results of operations and cash flows. While we may use financial derivatives
or supplier price locks to hedge against this volatility, by using these instruments we may potentially forego the benefits
that might result from favorable fluctuations in prices and could experience lower margins in periods of declining
commodity prices. In addition, while hedging activity may minimize near-term volatility of the commodity prices, it would
not protect us from long-term commodity price increases.
Some of our purchases are from sole or limited source suppliers for reasons of cost effectiveness, uniqueness of design,
or product quality. If these suppliers encounter financial or operating difficulties, we might not be able to quickly establish
or qualify replacement sources of supply.
We face significant competition in the markets that we serve.
The markets that we serve are highly competitive. We compete worldwide with a number of other manufacturers and
distributors that produce and sell similar products. There has been consolidation and new entrants (including non-
traditional competitors) within our industries and there may be future consolidation and new entrants which could result
in increased competition and significantly alter the dynamics of the competitive landscape in which we operate. Due
to our global footprint we are competing worldwide with large companies and with smaller, local operators who may
have customer, regulatory or economic advantages in the geographies in which they are located. In addition, some
of our competitors may employ pricing and other strategies that are not traditional. While we understand our markets
and competitive landscape, there is always the risk of disruptive technologies coming from companies that are not
traditionally manufacturers or service providers of our products.
Our growth is dependent, in part, on the timely development, commercialization and acceptance of new and
enhanced products and services.
We must timely develop and commercialize new and enhanced products and services in a rapidly changing
technological and business environment in order to remain competitive in our current and future markets and in order
to continue to grow our business. The development and commercialization of new products and the modification
of existing products and services to meet customer demands require a significant investment of resources and an
anticipation of the impact of new technologies and the ability to compete with others who may have superior resources
in specific technology domains. We cannot provide any assurance that any new or enhanced product or service will
be successfully commercialized in a timely manner, if ever, or, if commercialized, will result in returns greater than our
investment. Investment in a product or service could divert our attention and resources from other projects that become
more commercially viable in the market. We also cannot provide any assurance that any new or enhanced product or
service will be accepted by our current and future markets. Failure to timely develop new and enhanced products and
services that are accepted by these markets could have a material adverse impact on our competitive position, results of
operations, financial condition, and cash flows.
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PART I
The capital and credit markets are important to our business.
Instability in U.S. and global capital and credit markets, including market disruptions, limited liquidity and interest rate
volatility, or reductions in the credit ratings assigned to us by independent rating agencies could reduce our access
to capital markets or increase the cost of funding our short and long term credit requirements. In particular, if we are
unable to access capital and credit markets on terms that are acceptable to us, we may not be able to make certain
investments or fully execute our business plans and strategies.
Our suppliers and customers are also dependent upon the capital and credit markets. Limitations on the ability of
customers, suppliers or financial counterparties to access credit at interest rates and on terms that are acceptable to
them could lead to insolvencies of key suppliers and customers, limit or prevent customers from obtaining credit to
finance purchases of our products and services and cause delays in the delivery of key products from suppliers.
Currency exchange rate fluctuations and other related risks may adversely affect our results.
We are exposed to a variety of market risks, including the effects of changes in currency exchange rates. See Part II
Item 7A, “Quantitative and Qualitative Disclosure About Market Risk.”
We have operations throughout the world that manufacture and sell products in various international markets. As a result,
we are exposed to movements in exchange rates of various currencies against the U.S. dollar as well as against other
currencies throughout the world.
Many of our non-U.S. operations have a functional currency other than the U.S. dollar, and their results are translated into
U.S. dollars for reporting purposes. Therefore, our reported results will be higher or lower depending on the weakening or
strengthening of the U.S. dollar against the respective foreign currency.
We use derivative instruments to hedge those material exposures that cannot be naturally offset. The instruments utilized
are viewed as risk management tools, and are not used for trading or speculative purposes. To minimize the risk of
counterparty non-performance, derivative instrument agreements are made only through major financial institutions with
significant experience in such derivative instruments.
We also face risks arising from the imposition of exchange controls and currency devaluations. Exchange controls may
limit our ability to convert foreign currencies into U.S. dollars or to remit dividends and other payments by our foreign
subsidiaries or businesses located in or conducted within a country imposing controls. Currency devaluations result in a
diminished value of funds denominated in the currency of the country instituting the devaluation.
Changes in U.S. or foreign trade policies and other factors beyond our control may adversely impact our business
and operating results
Geopolitical tensions and trade disputes can disrupt supply chains and increase the cost of our products. This could
cause our products to be more expensive for customers, which could reduce the demand for or attractiveness of such
products. In addition, a geopolitical conflict in a region where we operate could disrupt our ability to conduct business
operations in that region. Beyond tariffs and sanctions, countries also could adopt other measures, such as controls
on imports or exports of goods, technology, or data, which could adversely affect our operations and supply chain and
limit our ability to offer our products and services as intended. These kinds of restrictions could be adopted with little to
no advanced notice, and we may not be able to effectively mitigate the adverse impacts from such measures. Political
uncertainty surrounding trade or other international disputes also could have a negative impact on customer confidence
and willingness to spend money, which could impair our future growth.
The military conflict between Russia and Ukraine has created a humanitarian crisis, materially impacted economic
activities, and may materially impact our global and regional operations.
The global economy has been negatively impacted by the military conflict between Russia and Ukraine. Governments
including the U.S., United Kingdom, and those of the European Union have imposed export controls on certain products
and financial and economic sanctions on certain industry sectors and parties in Russia which has triggered retaliatory
sanctions by the Russian government and its allies. The outcome and future impacts of the conflict remain highly
uncertain, continue to evolve and may grow more severe the longer the military action and sanctions remain in effect. Risks
associated with the Russian-Ukrainian conflict include, but are not limited to, adverse effects on political developments and
2022 Annual Report
17
PART I
on general economic conditions, including inflation and consumer spending; disruptions to our supply chains; disruptions
to our information systems, including through network failures, malicious or disruptive software, or cyberattacks; trade
disruptions; energy shortages or rationing that may adversely impact our manufacturing facilities and consumer spending,
particularly in Europe; rising fuel and/or rising costs of producing, procuring and shipping our products; our exposure to
foreign currency exchange rate fluctuations; and constraints, volatility or disruption in the financial markets.
When Russia invaded Ukraine in February 2022, we immediately halted new orders and shipments into and out of Russia
and Belarus. As of December 31, 2022, we have exited all business activity within these markets. To date, the Russia-
Ukraine war has not had a material adverse effect on our business or financial performance.
We have no way to predict the progress or outcome of the situation in Ukraine. Until there is a peaceful resolution, the
conflict could have a material adverse effect on our operations, results of operations, financial condition, liquidity, growth
prospects and business outlook.
RISKS RELATED TO LITIGATION
Material adverse legal judgments, fines, penalties or settlements could adversely affect our results of operations or
financial condition.
We are currently and may in the future become involved in legal proceedings and disputes incidental to the operation
of our business or the business operations of previously-owned entities. Our business may be adversely affected by the
outcome of these proceedings and other contingencies (including, without limitation, contract claims or other commercial
disputes, product liability, product defects and asbestos-related matters) that cannot be predicted with certainty. Moreover,
any insurance or indemnification rights that we may have may be insufficient or unavailable to protect us against the
total aggregate amount of losses sustained as a result of such proceedings and contingencies. As required by generally
accepted accounting principles in the United States, we establish reserves based on our assessment of contingencies.
Subsequent developments in legal proceedings and other events could affect our assessment and estimates of the loss
contingency recorded as a reserve and we may be required to make additional material payments, which could have a
material adverse impact on our liquidity, results of operations, financial condition, and cash flows.
The Aldrich and Murray Chapter 11 cases involve various risks and uncertainties that could have a material
effect on us.
Our indirect wholly-owned subsidiaries Aldrich and Murray have each filed a voluntary petition for reorganization
under the Bankruptcy Code in the Bankruptcy Court. The goal of these Chapter 11 filings is to resolve equitably and
permanently all current and future asbestos-related claims in a manner beneficial to claimants, Aldrich and Murray
through court approval of a plan of reorganization that would create a trust pursuant to section 524(g) of the Bankruptcy
Code, establish claims resolution procedures for all current and future asbestos-related claims against Aldrich and
Murray and channel such claims to the trust for resolution in accordance with those procedures. Such a resolution, if
achieved, would likely include a channeling injunction to enjoin asbestos claims resolved in the Chapter 11 cases from
being filed or pursued against us or our affiliates. The Chapter 11 cases remain pending as of February 10, 2023.
There are a number of risks and uncertainties associated with these Chapter 11 cases, including, among others, those
related to:
• the ultimate determination of the asbestos liability of Aldrich and Murray to be satisfied under a Chapter 11 plan and
the ability to consummate the settlement reached with the court appointed legal representative of future asbestos
claimants (the FCR);
• the outcome of negotiations with the committee representing current asbestos claimants (ACC) and the FCR and
other participants in the Chapter 11 cases, including insurers, concerning, among other things, the size and structure of
a potential section 524(g) trust to pay the asbestos liability of Aldrich and Murray and the means for funding that trust;
• the actions of representatives of the asbestos claimants, including the ACC’s pursuit of certain causes of action
against us, following the Bankruptcy Court’s grant of the ACC’s motion seeking standing to investigate and pursue
certain causes of action at a hearing held on January 27, 2022, and other potential actions by the ACC in opposition
to, or otherwise inconsistent with, the efforts by Aldrich and Murray to diligently prosecute the Chapter 11 cases and
ultimately seek Bankruptcy Court approval of a plan of reorganization;
18
PART I
• the decisions of the Bankruptcy Court relating to numerous substantive and procedural aspects of the Chapter 11
cases, including in connection with a proceeding by Aldrich and Murray to estimate their aggregate liability for
asbestos claims, following the Bankruptcy Court’s grant of their motion seeking such a proceeding, and other efforts
by Aldrich and Murray to diligently prosecute the Chapter 11 cases and ultimately seek Bankruptcy Court approval of a
plan of reorganization, whether such decisions are in response to actions of representatives of the asbestos claimants
or otherwise;
• the risk that Aldrich and Murray may be unable to obtain the necessary approvals of the Bankruptcy Court or the
United States District Court for the Western District of North Carolina (the District Court) of a plan of reorganization;
• the risk that any orders approving a plan of reorganization and issuing the channeling injunction do not become final;
• the terms and conditions of any plan of reorganization that is ultimately confirmed in the Chapter 11 cases;
• delays in the confirmation or effective date of a plan of reorganization due to factors beyond the Company’s control;
• the risk that the ultimate amount required under any final plan of reorganization may exceed the amounts agreed to
with the FCR in the Plan;
• the risk that the insurance carriers do not support the Plan and the risk that the ACC objects to the Plan; and
• the decisions of appellate courts regarding approval of a plan of reorganization or relating to orders of the Bankruptcy
Court or the District Court that may be appealed.
The ability of Aldrich and Murray to successfully reorganize and resolve their asbestos liabilities will depend on various
factors, including their ability to reach agreements with representatives of the asbestos claimants on the terms of a plan
of reorganization that satisfies all applicable legal requirements and to obtain the requisite court approvals of such plan,
and remains subject to the risks and uncertainties described above. We cannot ensure that Aldrich and Murray can
successfully reorganize, nor can we give any assurances as to the amount of the ultimate obligations under the Funding
Agreements or any plan of reorganization, or the resulting impact on our financial condition, results of operations or future
prospects. We also are unable to predict the timing of any of the foregoing matters or the timing for a resolution of the
Chapter 11 cases, all of which could have an impact on us.
It also is possible that, in the Chapter 11 cases, various parties will be successful in bringing claims against us and
other related parties, including by successfully challenging the 2020 corporate restructuring, consolidating entities
and/or raising allegations that we are liable for the asbestos-related liabilities of Aldrich and Murray as set forth in certain
pleadings filed by the ACC in the Chapter 11 cases. Although we believe we have no such responsibility for liabilities of
Aldrich and Murray, except indirectly through our obligation to provide funding to Aldrich and Murray under the terms of
the Funding Agreements, we cannot provide assurances that such claims will not be successful.
In sum, the outcome of the Chapter 11 cases is uncertain and there is uncertainty as to what extent we may have to
contribute to a section 524(g) trust under the Funding Agreements.
For detailed information on the bankruptcy cases of Aldrich and Murray, see Part I, Item 1, “Business – Asbestos-Related
Matters,” Part I, Item 3, “Legal Proceedings”, Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition
and Results of Operations – Significant Events,” and Part II, Item 8, Consolidated Financial Statements, Note 1, “Description
of Company,” and Note 20, “Commitments and Contingencies.”
RISKS RELATED TO CYBERSECURITY AND TECHNOLOGY
We are subject to risks relating to our information technology systems.
We rely extensively on information technology systems, some of which are supported by third party vendors including
cloud-based systems and managed service providers, to manage and operate our business. We invest in new
information technology systems designed to improve our operations. We have had failures of these systems in the
past and may have failures of these systems in the future. If these systems cease to function properly, if these systems
experience security breaches or disruptions or if these systems do not provide the anticipated benefits, our ability to
manage our operations could be impaired, which could have a material adverse impact on our results of operations,
financial condition, and cash flows.
2022 Annual Report
19
PART I
Security breaches or disruptions of the technology systems, infrastructure or products of the Company or our
vendors could negatively impact our business and financial results.
Our information technology systems, networks and infrastructure and technology embedded in certain of our control
products have been and are vulnerable to cyber attacks and unauthorized security intrusions. From time to time,
vulnerabilities in our products are discovered and updates are made available, but customers are vulnerable until those
updates are applied or other mitigating actions are taken by customers to protect their systems and networks. Like other
large companies, certain of our information technology systems and the systems of our vendors have been subject to
computer viruses, malicious code, unauthorized access, phishing attempts, denial-of-service attacks and other cyber
attacks and we expect that we and our vendors will be subject to similar attacks in the future.
The methods used to obtain unauthorized access, disable or degrade service, or sabotage information technology
systems are constantly changing and evolving. Despite having instituted security policies and business continuity
plans, and implementing and regularly reviewing and updating processes and procedures to protect against
unauthorized access and requiring similar protections from our vendors, the ever-evolving threats mean we are
continually evaluating and adapting our systems and processes and ask our vendors to do the same, and there is
no guarantee that such systems and processes will be adequate to safeguard against all data security breaches
or misuses of data. Hardware, software or applications we develop or obtain from third parties sometimes contain
defects in design or deployment or other problems that could unexpectedly result in security breaches or disruptions.
Open source software components embedded into certain software that we use has in the past contained
vulnerabilities and others may be discovered in the future. Such vulnerabilities can expose our systems to malware or
allow third party access to data. While these issues are not specific to our Company, we are required to take action
when such vulnerabilities are identified including patching and modification to certain of our products and enterprise
systems. To date, there has been no material business impact from such vulnerabilities, but we continue to monitor
these issues and our responses are ongoing. Our systems, networks and certain of our control products and those
of our vendors are vulnerable to system damage, malicious attacks from hackers, employee errors or misconduct,
viruses, power and utility outages, and other catastrophic events. Any of these incidents could cause significant
harm to our business by negatively impacting our business operations, compromising the security of our proprietary
information or the personally identifiable information of our customers, employees and business partners, exposing us
to litigation or other legal actions against us or the imposition of penalties, fines, fees or liabilities. Such events could
have a material adverse impact on our results of operations, financial condition and cash flows and could damage our
reputation which could adversely affect our business. Our insurance coverage may not be adequate to cover all the
costs related to a cybersecurity attack or disruptions resulting from such attacks. Customers are increasingly requiring
cybersecurity protections and mandating cybersecurity standards in our products, and we may incur additional costs
to comply with such demands.
Data privacy and protection laws are evolving and present increasing compliance challenges.
The regulatory environment surrounding data privacy and protection is increasingly demanding, with the frequent
imposition of new and changing requirements across businesses and geographic areas. We are required to comply
with complex regulations when collecting, transferring and using personal data, which increases our costs, affects our
competitiveness and can expose us to substantial fines or other penalties.
Intellectual property infringement claims of others and the inability to protect our intellectual property rights could
harm our competitive position.
Our intellectual property (IP) rights are important to our business and include numerous patents, trademarks, copyrights,
trade secrets, proprietary technology, technical data, business processes, and other confidential information. Although
in aggregate we consider our intellectual property rights to be valuable to our operations, we do not believe that our
business is materially dependent on a single intellectual property right or any group of them. In our opinion, engineering,
production skills and experience are more responsible for our market position than our patents and/or licenses.
Nonetheless, this intellectual property may be subject to challenge, infringement, invalidation or circumvention by third
parties. Despite extensive security measures, our intellectual property may be subject to misappropriation through
unauthorized access of our information technology systems, employee theft, or theft by private parties or foreign actors,
including those affiliated with or controlled by state actors. Our business and competitive position could be harmed
20
PART I
by such events. Our ability to protect our intellectual property rights by legal recourse or otherwise may be limited,
particularly in countries where laws or enforcement practices are inadequate or undeveloped. Our inability to enforce our
IP rights under any of these circumstances could have an impact on our competitive position and business.
RISKS RELATED TO REGULATORY MATTERS
Our reputation, ability to do business and results of operations could be impaired by improper conduct by any of
our employees, agents or business partners.
We are subject to regulation under a wide variety of U.S. federal and state and non-U.S. laws, regulations and policies,
including laws related to anti-corruption, anti-human trafficking, anti-bribery, export and import compliance, anti-trust and
money laundering, due to our global operations. We cannot provide assurance our internal controls will always protect us
from the improper conduct of our employees, agents and business partners. Any violations of law or improper conduct
could damage our reputation and, depending on the circumstances, subject us to, among other things, civil and criminal
penalties, material fines, equitable remedies (including profit disgorgement and injunctions on future conduct), securities
litigation and a general loss of investor confidence, any one of which could have a material adverse impact on our
business prospects, financial condition, results of operations, cash flows, and the market value of our stock.
Our operations are subject to regulatory risks.
Our U.S. and non-U.S. operations are subject to a number of laws and regulations, including among others, laws related to
the environment and health and safety. We have made, and will be required to continue to make, significant expenditures
to comply with these laws and regulations. Any violations of applicable laws and regulations could lead to significant
penalties, fines or other sanctions. Changes in current laws and regulations could require us to increase our compliance
expenditures, cause us to significantly alter or discontinue offering existing products and services or cause us to develop
new products and services. Altering current products and services or developing new products and services to comply
with changes in the applicable laws and regulations could require significant research and development investments,
increase the cost of providing the products and services and adversely affect the demand for our products and services.
The U.S. federal government and various states and municipalities have enacted or may enact legislation intended to
deny government contracts to U.S. companies that reincorporate outside of the U.S. or have reincorporated outside of the
U.S. or may take other actions negatively impacting such companies. If we are unable to effectively respond to changes
to applicable laws and regulations, interpretations of applicable laws and regulations, or comply with existing and future
laws and regulations, our competitive position, results of operations, financial condition and cash flows could be materially
adversely impacted.
Global climate change and related regulations could negatively affect our business.
Climate change presents immediate and long-term risks to our Company and to our customers, with the risks expected
to increase over time. Our products and operations are subject to and affected by environmental regulation by federal,
state and local authorities in the U.S. and regulatory authorities with jurisdiction over our international operations,
including with respect to the use, storage, and dependence upon refrigerants which are considered greenhouse gases.
Refrigerants are essential to many of our products and there is concern regarding the global warming potential of such
materials. As such, national, regional and international regulations and policies are being implemented to curtail their
use. Some of these regulations could have a negative competitive impact on our company by requiring us to make
costly changes to our products. As regulations reduce the use of the current class of widely used refrigerants, we are
developing and selling our next generation products that utilize lower global warming potential solutions. There can
be no assurance that climate change or environmental regulation or deregulation will not have a negative competitive
impact on our ability to sell these products or that economic returns will match the investment that we are making in
new product development. We face increasing complexity related to product design, the use of regulated materials,
the associated energy consumption and efficiency related to the use of products, the transportation and shipping
of products, climate change regulations, and the reuse, recycling and/or disposal of products and their components
at end-of-use or useful life as we adjust to new and future requirements relating to our transition to a more circular
economy. There continues to be a lack of consistent climate legislation, which creates economic and regulatory
uncertainty. Such regulatory uncertainty extends to future incentives for energy efficient buildings and vehicles
and costs of compliance, which may impact the demand for our products, obsolescence of our products and our
results of operations.
2022 Annual Report
21
PART I
Our climate commitment requires us to offer a full line of next generation products by 2030 without compromising
safety or energy efficiency. Additionally, in 2019, we announced our 2030 commitment which targets reducing one
gigaton – one billion metric tons – of carbon emissions (CO2e) from our customers’ footprint by 2030. While we are
committed to pursuing these sustainability objectives, there can be no assurance that we will successfully achieve our
commitments. Failure to meet these commitments could result in reputational harm to our company. Changes regarding
climate risk management and practices may result in higher regulatory, compliance risks and costs.
RISKS RELATED TO OUR BUSINESS OPERATIONS
Our business strategy includes acquiring businesses, product lines, technologies and capabilities, plants and
other assets, entering into joint ventures and making investments that complement our existing businesses. We
also occasionally divest businesses that we own. We may not identify acquisition or joint venture candidates or
investment opportunities at the same rate as the past. Acquisitions, dispositions, joint ventures and investments
that we identify could be unsuccessful or consume significant resources, which could adversely affect our
operating results.
We continue to analyze and evaluate the acquisition and divestiture of strategic businesses and product lines,
technologies and capabilities, plants and other assets, joint ventures and investments with the potential to, among
other things, strengthen our industry position, to enhance our existing set of product and services offerings, to increase
productivity and efficiencies, to grow revenues, earnings and cash flow, to help us stay competitive or to reduce costs.
There can be no assurance that we will identify or successfully complete transactions with suitable candidates in the
future, that we will consummate these transactions at rates similar to the past or that completed transactions will be
successful. Strategic transactions may involve significant cash expenditures, debt incurrence, operating losses and
expenses that could have a material adverse effect on our business, financial condition, results of operations and cash
flows. Such transactions involve numerous other risks, including:
• diversion of management time and attention from daily operations;
• difficulties integrating acquired businesses, technologies and personnel into our business, including doing so without
high costs;
• difficulties in obtaining and verifying the financial statements and other business and other due diligence information
of acquired businesses;
• inability to obtain required regulatory approvals and/or required financing on favorable terms;
• potential loss of key employees, key contractual relationships or key customers of either acquired businesses or
our business;
• assumption of the liabilities and exposure to unforeseen or undisclosed liabilities of acquired businesses and
exposure to regulatory sanctions;
• inheriting internal control deficiencies;
• dilution of interests of holders of our common shares through the issuance of equity securities or equity-linked
securities; and
• in the case of joint ventures and other investments, interests that diverge from those of our partners without the
ability to direct the management and operations of the joint venture or investment in the manner we believe most
appropriate to achieve the expected value.
Any acquisitions, divestitures, joint ventures or investments may ultimately harm our business, financial condition, results of
operations and cash flows. There are additional risks related to our Reverse Morris Trust transaction, see Part IA, Item 1A,
“Risk Factors – Risks Related to the Transactions” for more information.
Natural disasters, epidemics or other unexpected events may disrupt our operations, adversely affect our results of
operations and financial condition, and may not be fully covered by insurance.
The occurrence of one or more catastrophic events including hurricanes, fires, earthquakes, floods and other forms of
severe weather, health epidemics or pandemics or other contagious outbreaks or other catastrophic events in the U.S.
or in other countries in which we operate or are located could adversely affect our operations and financial performance.
Natural disasters, power outages, health epidemics or pandemics or other contagious outbreaks or other unexpected
events could result in physical damage to and complete or partial closure of one or more of our plants, temporary or
22
PART I
long-term disruption of our operations by causing business interruptions, material scarcity, price volatility or supply
chain disruptions. Climate change is a risk multiplier with respect to these physical disasters in both frequency and
severity and may affect our global business operations as a result. Existing insurance arrangements may not provide full
protection for the costs that may arise from such events, particularly if such events are catastrophic in nature or occur
in combination. The occurrence of any of these events could increase our insurance and other operating costs or harm
our sales in affected areas.
Our business success depends on attracting, developing, and retaining highly qualified talent.
The skills, experience, and industry knowledge of our employees significantly benefit our operations and performance.
The market for employees and leaders with certain skills and experiences is very competitive, and difficulty attracting,
developing, and retaining members of our management team and key employees could have a negative effect on our
business, operating results, and financial condition. Maintaining a positive and inclusive culture and work environment,
offering attractive compensation, benefits, and development opportunities, and effectively implementing processes
and technology that enable our employees to work effectively and efficiently are important to our ability to attract and
retain employees.
Our business may be adversely affected by temporary work stoppages, union negotiations, labor disputes and
other matters associated with our labor force.
Certain of our employees are covered by collective bargaining agreements or works councils. We experience from
time-to-time temporary work stoppages, union negotiations, labor disputes and other matters associated with our labor
force and some of these events could result in significant increases in our cost of labor, impact our productivity or
damage our reputation. Additionally, a work stoppage at one of our suppliers could materially and adversely affect our
operations if an alternative source of supply were not readily available. Stoppages by employees of our customers could
also result in reduced demand for our products.
RISKS RELATING TO TAX MATTERS
Changes in tax or other laws, regulations or treaties, changes in our status under U.S. or non-U.S. laws or adverse
determinations by taxing or other governmental authorities could increase our tax burden or otherwise affect our
financial condition or operating results, as well as subject our shareholders to additional taxes.
The taxes associated with our operations and corporate structure could be impacted by changes in tax or other laws,
treaties or regulations or the interpretation or enforcement thereof by the U.S. or non-U.S. tax or other governmental
authorities. Even after legislation is enacted, further guidance, regulations and technical corrections pertaining to the
legislation continue to be issued by the tax authorities, some of which may have retroactive application. We continue to
monitor and review new guidance and regulations as they are issued, as any changes could have a material adverse
effect on our financial statements. In addition, governmental authorities are actively engaged in formulating new legislative
proposals. Any future legislative changes to the tax laws and judicial or regulatory interpretation thereof, the geographic mix
of earnings, changes in overall profitability, and other factors could also materially impact our effective tax rate.
We continue to monitor for other tax changes, U.S. (including state and local) and non-U.S. related, which can also
adversely impact our overall tax burden. From time to time, proposals have been made and/or legislation has been
introduced to change the tax laws, regulations or interpretations thereof of various jurisdictions or limit tax treaty benefits
that if enacted or implemented could materially increase our tax burden and/or effective tax rate and could have a
material adverse impact on our financial condition and results of operations. Moreover, the Organisation for Economic
Co-operation and Development (OECD) has released proposals to create an agreed set of international rules for fighting
base erosion and profit shifting, including Pillar One and Pillar Two, such that tax laws in countries in which we do
business could change on a prospective or retroactive basis, and any such changes could adversely impact us. On
December 12, 2022, the European Union (EU) Member States agreed in principle on the introduction of a global minimum
tax rate (proposed 15% minimum tax rate). On December 15, 2022, the European Council formally adopted the Council
Directive on ensuring a global minimum level of taxation for multinational and large-scale domestic groups in the EU
Member States (the Directive), meaning that the Directive will have to be transposed into EU Member States’ national law
by the end of 2023, entering into effect beginning January 1, 2024. As a consequence, our global effective tax rate could
be materially impacted by such legislation, or any resulting local country legislation enacted in response to any potential
global minimum tax rates.
2022 Annual Report
23
PART I
In addition to the above, the European Commission has been very active in investigating whether various tax regimes or
private tax rulings provided by a country to particular taxpayers may constitute State Aid. We cannot predict the outcome
of any of these potential changes or investigations in any of the jurisdictions, but if any of the above occurs and impacts
us, this could materially increase our tax burden and/or effective tax rate and could have a material adverse impact on
our financial condition and results of operations.
While we monitor proposals and other developments that would materially impact our tax burden and/or effective tax
rate and investigate our options, we could still be subject to increased taxation on a going forward basis no matter what
action we undertake if certain legislative proposals or regulatory changes are enacted, certain tax treaties are amended
and/or our interpretation of applicable tax or other laws is challenged and determined to be incorrect. In particular, any
changes and/or differing interpretations of applicable tax law that have the effect of disregarding the shareholders’
decision to reorganize in Ireland, limiting our ability to take advantage of tax treaties between jurisdictions, modifying or
eliminating the deductibility of various currently deductible payments, or increasing the tax burden of operating or being
resident in a particular country could subject us to increased taxation.
In addition, tax authorities periodically review tax returns filed by us and can raise issues regarding our filing positions,
timing and amount of income or deductions, and the allocation of income among the jurisdictions in which we operate.
These examinations on their own, or any subsequent litigation related to the examinations, may result in additional taxes
or penalties against us. If the ultimate result of these audits differs from our original or adjusted estimates, they could
have a material impact on our tax provision.
RISKS RELATED TO OUR REVERSE MORRIS TRUST TRANSACTION
On the Distribution Date, we completed the Transaction with Gardner Denver, which changed its name to Ingersoll
Rand after the Transaction whereby we distributed common stock of Ingersoll-Rand U.S. Holdco, Inc., which contained
Ingersoll Rand Industrial, through the Distribution to the Spin-off Shareholders. Ingersoll Rand Industrial then merged
with a wholly-owned subsidiary of Ingersoll Rand. Upon close of the Transaction, the Spin-off Shareholders received
approximately 50.1% of the shares of Ingersoll Rand common stock on a fully-diluted basis and Gardner Denver
shareholders retained approximately 49.9% of the shares of Ingersoll Rand on a fully diluted basis. As a result, Spin-off
Shareholders received 0.8824 shares of Ingersoll Rand common stock with respect to each share of our stock owned
as of February 24, 2020. In connection with the Transaction, we received a special cash payment of $1.9 billion.
If the Distribution as part of our Reverse Morris Trust Transaction is determined to be taxable for Irish tax purposes,
significant Irish tax liabilities may arise for the Spin-off Shareholders.
We received an opinion from Irish Revenue regarding certain tax matters associated with the Distribution, as well as
a legal opinion from our Irish counsel Arthur Cox LLP, regarding certain Irish tax consequences of the Distribution for
the Spin-off Shareholders. For the Spin-off Shareholders who are not resident or ordinarily resident in Ireland for Irish
tax purposes and who do not hold their shares in connection with a trade or business carried on by such Spin-off
Shareholders through an Irish branch or agency, we consider, based on both opinions taken together, that no adverse
Irish tax consequences for such Spin-off Shareholders should have arisen. These opinions relied on certain facts
and assumptions and certain representations. Notwithstanding the opinion from Irish Revenue, Irish Revenue could
ultimately determine on audit that the Distribution is taxable for Irish tax purposes, for example, if it determines that any
of these facts, assumptions or representations are not correct or have been violated. A legal opinion represents the
tax adviser’s best legal judgment and is not binding on Irish Revenue or the courts and Irish Revenue or the courts
may not agree with the legal opinion. In addition, the legal opinion is based on current law and cannot be relied upon
if current law changes with retroactive effect. If the Distribution ultimately is determined to be taxable for Irish tax
purposes, we and the Spin-off Shareholders could have significant Irish tax liabilities as a result of the Distribution, and
there could be a material adverse impact on our business, financial condition, results of operations and cash flows in
future reporting periods.
24
PART I
If the Distribution together with certain related transactions do not qualify as tax-free under Sections 355 and
368(a) of the Code, including as a result of subsequent acquisitions of stock of the Company or Ingersoll Rand, then
the Company and the Spin-off Shareholders may be required to pay substantial U.S. federal income taxes, and
Ingersoll Rand may be obligated to indemnify the Company for such taxes imposed on the Company.
At the time of the Distribution, we received an opinion from our U.S. tax counsel Paul, Weiss, Rifkind, Wharton & Garrison LLP
(Paul Weiss) substantially to the effect that, for U.S. federal income tax purposes, the Distribution together with certain related
transactions undertaken in anticipation of the Distribution and taking into account the merger of Ingersoll Rand Industrial
with the wholly-owned subsidiary of Ingersoll Rand will qualify as a tax-free transaction under Sections 368(a), 361 and 355 of
the Code, with the result that we and the Spin-off Shareholders will not recognize any gain or loss for U.S. federal income tax
purposes as a result of the spin-off. The opinion of our counsel was based on, among other things, certain representations
and assumptions as to factual matters made by Ingersoll Rand, Ingersoll Rand Industrial and the Company. The failure of
any factual representation or assumption to be true, correct and complete in all material respects could adversely affect
the validity of the opinion of counsel. An opinion of counsel represents counsel’s best legal judgment, is not binding on the
Internal Revenue Service (IRS) or the courts, and the IRS or the courts may not agree with the opinion. In addition, an opinion
will be based on current law, and cannot be relied upon if current law changes with retroactive effect. If the Distribution,
and/or related internal transactions in anticipation of the Distribution ultimately are determined to be taxable, we could
incur significant U.S. federal income tax liabilities, which could cause a material adverse impact on our business, financial
condition, results of operations and cash flows in future reporting periods, although if this determination resulted from
certain actions taken by Ingersoll Rand Industrial or Ingersoll Rand, Ingersoll Rand would be required to bear the cost of any
resultant tax liability pursuant to the terms of the Tax Matters Agreement dated February 29, 2020, among Ingersoll-Rand Plc,
Ingersoll-Rand Lux International Holding Company S.à r.l, Ingersoll-Rand Services Company, Ingersoll-Rand U.S. HoldCo, Inc.,
and Gardner Denver Holdings, Inc. (Tax Matters Agreement).
The Distribution will be taxable to the Company pursuant to Section 355(e) of the Code if there is a 50% or greater
change in ownership of either the Company or Ingersoll Rand Industrial, directly or indirectly (including through such a
change in ownership of Ingersoll Rand), as part of a plan or series of related transactions that include the Distribution.
A Section 355(e) change of ownership would not make the Distribution taxable to the Spin-off Shareholders, but instead
may result in corporate-level taxable gain to certain of our subsidiaries. Because the Spin-off Shareholders will collectively
be treated as owning more than 50% of the Ingersoll Rand common stock following the merger, the merger alone should
not cause the Distribution to be taxable to our subsidiaries under Section 355(e). However, Section 355(e) might apply if
other acquisitions of stock of the Company before or after the merger, or of Ingersoll Rand before or after the merger, are
considered to be part of a plan or series of related transactions that include the Distribution together with certain related
transactions. If Section 355(e) applied, certain of our subsidiaries might recognize a very substantial amount of taxable
gain, although if this applied as a result of certain actions taken by Ingersoll Rand Industrial, Ingersoll Rand or certain
specified Ingersoll Rand stockholders, Ingersoll Rand would be required to bear the cost of any resultant tax liability
under Section 355(e) pursuant to the terms of the Tax Matters Agreement.
If the merger does not qualify as a tax-free reorganization under Section 368(a) of the Code, the Spin-off
Shareholders may be required to pay substantial U.S. federal income taxes.
On the Distribution Date, we have received an opinion from Paul Weiss, and Ingersoll Rand received an opinion from their
counsel Simpson Thacher & Bartlett LLP, substantially to the effect that the merger will qualify as a reorganization within
the meaning of Section 368(a) of the Code with the result that U.S. holders of Ingersoll Rand Industrial common stock
who received Ingersoll Rand common stock in the merger will not recognize any gain or loss for U.S. federal income
tax purposes (except with respect to cash received in lieu of fractional shares of Ingersoll Rand common stock). These
opinions were based upon, among other things, certain representations and assumptions as to factual matters made by
Ingersoll Rand, the Company, Ingersoll Rand Industrial and the merger subsidiary used by Ingersoll Rand. The failure of
any factual representation or assumption to be true, correct and complete in all material respects could adversely affect
the validity of the opinions. An opinion of counsel represents counsel’s best legal judgment, is not binding on the IRS
or the courts, and the IRS or the courts may not agree with the opinion. In addition, the opinions are based on current
law, and cannot be relied upon if current law changes with retroactive effect. If the merger were taxable, U.S. holders of
the common stock of Ingersoll Rand Industrial would be considered to have made a taxable sale of their Ingersoll Rand
Industrial common stock to Ingersoll Rand, and such U.S. holders of Ingersoll Rand Industrial would generally recognize
taxable gain or loss on their receipt of Ingersoll Rand common stock in the merger.
2022 Annual Report
25
PART I
RISKS RELATED TO OUR IRISH DOMICILE
Irish law differs from the laws in effect in the United States and may afford less protection to holders of
our securities.
The United States currently does not have a treaty with Ireland providing for the reciprocal recognition and enforcement
of judgments in civil and commercial matters. As such, there is some uncertainty as to whether the courts of Ireland
would recognize or enforce judgments of U.S. courts obtained against us or our directors or officers based on
U.S. federal or state civil liability laws, including the civil liability provisions of the U.S. federal or state securities laws, or
hear actions against us or those persons based on those laws.
As an Irish company, we are governed by the Irish Companies Act, which differs in some material respects from laws
generally applicable to U.S. corporations and shareholders, including, among others, differences relating to interested
director and officer transactions, indemnification of directors and shareholder lawsuits. Likewise, the duties of directors
and officers of an Irish company generally are owed to the company only. Shareholders of Irish companies generally
do not have a personal right of action against directors or officers of the company and may exercise such rights of
action on behalf of the company only in limited circumstances. Accordingly, holders of our securities may have more
difficulty protecting their interests than would holders of securities of a corporation incorporated in a jurisdiction of the
United States. In addition, Irish law does not allow for any form of legal proceedings directly equivalent to the class action
available in the United States.
Irish law allows shareholders to authorize share capital which then can be issued by a board of directors without
shareholder approval. Also, subject to specified exceptions, Irish law grants statutory pre-emptive rights to existing
shareholders to subscribe for new issuances of shares for cash but allows shareholders to authorize the waiver of
the statutory pre-emptive rights with respect to any particular allotment of shares. Under Irish law, we must have
authority from our shareholders to issue any shares, including shares that are part of the Company’s authorized but
unissued share capital. In addition, unless otherwise authorized by its shareholders, when an Irish company issues
shares for cash to new shareholders, it is required first to offer those shares on the same or more favorable terms to
existing shareholders on a pro-rata basis. If we are unable to obtain these authorizations from our shareholders or
are otherwise limited by the terms of our authorizations, our ability to issue shares or otherwise raise capital could be
adversely affected.
Dividends received by our shareholders may be subject to Irish dividend withholding tax.
In certain circumstances, we are required to deduct Irish dividend withholding tax (currently at the rate of 25%) from
dividends paid to our shareholders. In the majority of cases, shareholders resident in the United States will not be subject
to Irish withholding tax, and shareholders resident in a number of other countries will not be subject to Irish withholding
tax provided that they complete certain Irish dividend withholding tax forms. However, some shareholders may be subject
to withholding tax, which could have an adverse impact on the price of our shares.
Dividends received by our shareholders could be subject to Irish income tax.
Dividends paid in respect of our shares will generally not be subject to Irish income tax where the beneficial owner
of these dividends is exempt from dividend withholding tax, unless the beneficial owner of the dividend has some
connection with Ireland other than his or her shareholding in Trane Technologies plc.
Our shareholders who receive their dividends subject to Irish dividend withholding tax will generally have no further
liability to Irish income tax on the dividends unless the beneficial owner of the dividend has some connection with Ireland
other than his or her shareholding in Trane Technologies plc.
Item 1B. Unresolved Staff Comments
None.
26
PART I
Item 2. Properties
As of December 31, 2022, we owned or leased approximately 28 million square feet of space worldwide. Manufacturing
and assembly operations are conducted in 38 plants across the world. We also maintain various warehouses, offices
and repair centers throughout the world. The majority of our plant facilities are owned by us with the remainder under
long-term lease arrangements. We believe that our plants have been well maintained, are generally in good condition
and are suitable for conducting our business.
The locations by segment of our principal plant facilities at December 31, 2022 were as follows:
AMERICAS
Arecibo, Puerto Rico
Brampton, Ontario
Charlotte, North Carolina
Clarksville, Tennessee
Columbia, South Carolina
Curitiba, Brazil
Fairlawn, New Jersey
Fort Smith, Arkansas
Fremont, Ohio
EMEA
ASIA PACIFIC
Bangkok, Thailand
Taicang, China
Wujiang, China
Zhongshan, China
Barcelona, Spain
Bari, Italy
Charmes, France
Essen, Germany
Galway, Ireland
Golbey, France
Jettingen-Scheppach, Germany
King Abdullah Economic City, Saudi Arabia
Kolin, Czech Republic
Grand Rapids, Michigan
Wittenberg, Germany
Hastings, Nebraska
La Crosse, Wisconsin
Lynn Haven, Florida
Marietta, Ohio
Monterrey, Mexico
Newberry, South Carolina
Pueblo, Colorado
Rushville, Indiana
St. Paul, Minnesota
Trenton, New Jersey
Tyler, Texas
Vidalia, Georgia
Waco, Texas
Item 3. Legal Proceedings
In the normal course of business, we are involved in a variety of lawsuits, claims and legal proceedings, commercial
and contract disputes, employment matters, product liability and product defect claims, asbestos-related claims,
environmental liabilities, intellectual property disputes, and tax-related matters. In our opinion, pending legal matters are
not expected to have a material adverse impact on our results of operations, financial condition, liquidity or cash flows.
The most significant litigation facing the Company is the asbestos-related bankruptcy cases of Aldrich and Murray. For
detailed information on the bankruptcy cases of Aldrich and Murray, see Part I, Item 1, “Business – Asbestos-Related
Matters,” Part I, Item 1A, “Risk Factors – Risks Related to Litigation,” Part II, Item 7, “Management’s Discussion and Analysis of
Financial Condition and Results of Operations – Significant Events,” and Part II, Item 8, Consolidated Financial Statements,
Note 1, “Description of Company,” and Note 20, “Commitments and Contingencies.”
Item 4. Mine Safety Disclosures
None.
2022 Annual Report
27
Part II
Item 5. Market for Registrant’s Common Equity, Related
Stockholder Matters and Issuer Purchases of
Equity Securities
Information regarding the principal market for our ordinary shares and related shareholder matters is as follows:
Our ordinary shares are traded on the New York Stock Exchange under the symbol TT. As of February 3, 2023, the
approximate number of record holders of ordinary shares was 2,428.
ISSUER PURCHASES OF EQUITY SECURITIES
The following table provides information with respect to purchases by us of our ordinary shares during the quarter ended
December 31, 2022:
PERIOD
October 1 - October 31
November 1 - November 30
December 1 - December 31
Total
TOTAL NUMBER
OF SHARES
PURCHASED
(000’s)(a)(b)
AVERAGE
PRICE PAID PER
SHARE(a)(b)
TOTAL NUMBER OF
SHARES PURCHASED
AS PART OF PROGRAM
(000’s)(a)
APPROXIMATE DOLLAR
VALUE OF SHARES
STILL AVAILABLE TO BE
PURCHASED UNDER THE
PROGRAM ($000’s)(a)
0.2
$ 153.71
1,536.9
191.1
1,728.2
173.50
175.00
—
1,536.9
190.5
1,727.4
$ 499,776
233,111
199,776
(a) Share repurchases are made from time to time in accordance with management’s capital allocation strategy, subject to market
conditions and regulatory requirements. In February 2021, our Board of Directors authorized the repurchase of up to $2.0 billion of
our ordinary shares under a new share repurchase program (2021 Authorization). During the fourth quarter of 2022, we repurchased
and canceled $300.0 million of our ordinary shares leaving approximately $200 million remaining under the 2021 Authorization as of
December 31, 2022. In February 2022, our Board of Directors authorized the repurchase of up to $3.0 billion of our ordinary shares
under a new share repurchase program (2022 Authorization) upon completion of the 2021 Authorization.
(b) We may also reacquire shares outside of the repurchase program from time to time in connection with the surrender of shares to
cover taxes on vesting of share based awards. We reacquired 154 shares in October and 632 shares in December in transactions
outside the repurchase programs.
28
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on our ordinary shares with the cumulative
total return on (i) the Standard & Poor’s 500 Stock Index and (ii) the Standard & Poor’s 500 Industrial Index for the five
years ended December 31, 2022. The graph assumes an investment of $100 in our ordinary shares (adjusted for the
Transaction), the Standard & Poor’s 500 Stock Index and the Standard & Poor’s 500 Industrial Index on December 31, 2017
and assumes the reinvestment of dividends.
PART II
l
e
u
a
V
x
e
d
n
I
$350
$300
$250
$200
$150
$100
$50
2017
2018
2019
2020
2021
2022
Trane Technologies
S&P 500
S&P 500 Industrials Index
COMPANY/INDEX
Trane Technologies
S&P 500
S&P 500 Industrials Index
Item 6. [Reserved]
2017
100
100
100
2018
104
96
87
2019
155
126
112
2020
2021
2022
222
149
124
313
191
151
265
157
142
Item 7. Management’s Discussion and Analysis of Financial
Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations contains
forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from the results
discussed in the forward-looking statements. Factors that might cause a difference include, but are not limited to, those
discussed under Item 1A. Risk Factors in this Annual Report on Form 10-K. The following section is qualified in its entirety
by the more detailed information, including our financial statements and the notes thereto, which appears elsewhere in
this Annual Report.
This section discusses 2022 and 2021 significant items affecting our consolidated operating results, financial condition
and liquidity and provides a year-to-year comparison between 2022 and 2021. Discussions of 2020 significant items
and year-to-year comparisons between 2021 and 2020 have been excluded in this Form 10-K and can be found in
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our
Annual Report on Form 10-K for year ended December 31, 2021.
OVERVIEW
ORGANIZATIONAL
Trane Technologies plc is a global climate innovator. We bring sustainable and efficient solutions to buildings, homes and
transportation through our strategic brands, Trane® and Thermo King®, and our environmentally responsible portfolio of
products, services and connected intelligent controls.
2022 Annual Report
29
PART II
2030 SUSTAINABILITY COMMITMENTS
Our commitment to sustainability extends to the environmental and social impacts of our people, operations, products
and services. We have announced ambitious 2030 Sustainability Commitments, including our Gigaton Challenge to
reduce customers’ carbon emissions by a billion metric tons. We are one of a handful of companies whose emissions
reductions targets have been validated three times by the SBTi, and one of the very few companies worldwide whose
net-zero targets have also been validated. We are Leading by Example as we make progress toward carbon-neutral
operations and zero waste-to-landfill across our global footprint and net positive water use in water-stressed locations.
Our Opportunity for All commitment focuses on gender parity in leadership, workforce diversity reflective of our
communities, and a citizenship strategy that helps underserved communities through enhanced learning environments
and pathways to green and Science, Technology, Engineering and Math (STEM) careers.
RECENT ACQUISITIONS
On October 31, 2022, we completed the acquisition of AL-KO Air Technology (AL-KO). AL-KO brings complementary,
high-performing solutions to the comprehensive Trane Commercial HVAC product and services portfolios in Europe and
Asia. The results of the acquisition are reported within the EMEA and Asia Pacific segments.
On April 1, 2022, we completed a channel acquisition of a Commercial HVAC independent dealer to support our ongoing
strategy to expand our distribution network and service area. The results of the channel acquisition are reported within
the Americas segment.
SIGNIFICANT EVENTS
REORGANIZATION OF ALDRICH AND MURRAY
On June 18, 2020 (Petition Date), our indirect wholly-owned subsidiaries, Aldrich and Murray each filed a voluntary petition for
reorganization under the Bankruptcy Code. As a result of the Chapter 11 filings, all asbestos-related lawsuits against Aldrich
and Murray have been stayed due to the imposition of a statutory automatic stay applicable in Chapter 11 bankruptcy
cases. Only Aldrich and Murray have filed for Chapter 11 relief. Neither Aldrich’s wholly-owned subsidiary, 200 Park, Murray’s
wholly-owned subsidiary, ClimateLabs, nor the Trane Companies are part of the Chapter 11 filings.
The goal of these Chapter 11 filings is to resolve equitably and permanently all current and future asbestos-related claims in
a manner beneficial to claimants, Aldrich and Murray through court approval of a plan of reorganization that would create
a trust pursuant to section 524(g) of the Bankruptcy Code, establish claims resolution procedures for all current and future
asbestos-related claims against Aldrich and Murray and channel such claims to the trust for resolution in accordance with
those procedures.
Aldrich and its wholly-owned subsidiary 200 Park and Murray and its wholly-owned subsidiary ClimateLabs were
deconsolidated as of the Petition Date and their respective assets and liabilities were derecognized from our Consolidated
Financial Statements.
During the year ended December 31, 2021, in connection with the agreement in principle reached by Aldrich and Murray
with the FCR and the motion filed on September 24, 2021 to create a $270.0 million “qualified settlement fund” within the
meaning of the Treasury Regulations under Section 468B of the Internal Revenue Code (QSF), we recorded a charge
of $21.2 million to increase our Funding Agreement liability to $270.0 million. The corresponding charge was bifurcated
between Other income/ (expense), net of $7.2 million relating to Murray and discontinued operations of $14.0 million relating
to Aldrich.
On January 27, 2022, the Bankruptcy Court granted the request to fund the QSF, which was funded on March 2, 2022,
resulting in an operating cash outflow of $270.0 million in our Consolidated Statement of Cash Flows, of which $91.8 million
was allocated to continuing operations and $178.2 million was allocated to discontinued operations for the year ended
December 31, 2022. At this point in the Chapter 11 cases of Aldrich and Murray, it is not possible to predict whether the
Bankruptcy Court will approve the terms of the Plan, what the extent of the asbestos liability will be or how long the
Chapter 11 cases will last. The Chapter 11 cases remain pending as of February 10, 2023.
30
PART II
For detailed information on the bankruptcy cases of Aldrich and Murray, see Part I, Item 1, “Business – Asbestos-Related
Matters,” Part I, Item 1A, “Risk Factors – Risks Related to Litigation,” Part I, Item 3, “Legal Proceedings,” and Part II, Item 8,
Consolidated Financial Statements, Note 1, “Description of Company,” and Note 20, “Commitments and Contingencies.”
TRENDS AND ECONOMIC EVENTS
We are a global corporation with worldwide operations. As a global business, our operations are affected by worldwide,
regional and industry-specific economic factors as well as political and social factors wherever we operate or do
business. Our geographic diversity and the breadth of our product and services portfolios have helped mitigate the
impact of any one industry or the economy of any single country on our consolidated operating results.
Given our broad range of products manufactured and geographic markets served, management uses a variety of
factors to predict the outlook for the Company. We monitor key competitors and customers in order to gauge relative
performance and the outlook for the future. We regularly perform detailed evaluations of the different market segments
we are serving to proactively detect trends and to adapt our strategies accordingly, including potential triggers and
actions to be taken under recessionary scenarios. In addition, we believe our backlog and order levels are indicative of
future revenue and thus are a key measure of anticipated performance.
Current economic conditions remain mixed across our end markets. The COVID-19 global pandemic continues to impact
both the global Heating, Ventilation and Air Conditioning (HVAC) and Transport end markets as disruptions and delays
in the global supply chain and resource constraints continue to be experienced. However, despite these challenges,
overall end market demand remained healthy as we continued to proactively manage global supply chain and resource
constraints by working closely with our suppliers, customers and logistics providers to mitigate the impacts on our
business as we continue to sell, install and service our products.
We expect market conditions to remain mixed across the geographies where we serve our customers as the impact
from COVID-19 eases; however, macroeconomic events including the material cost, wage and energy inflation and
tightening financial conditions, as a result of higher interest rates, could increase the likelihood of deteriorating economic
conditions which could have a negative impact on our business. The extent to which the COVID-19 pandemic and other
macro economic conditions continue to impact the Company’s results of operations and financial condition will depend
on future developments that are highly uncertain and cannot be predicted. See Part I, Item 1A, “Risk Factors – Risks
Related to Economic Conditions,” for more information.
Furthermore, when Russia invaded Ukraine in February 2022, we immediately halted new orders and shipments into and
out of Russia and Belarus. As of December 31, 2022, we have exited all business activity within these markets. To date, the
Russia-Ukraine war has not had a material adverse effect on our business or financial performance. See Part I, Item 1A
Risk Factors for more information.
We believe we have a solid foundation of global brands that are highly differentiated in all of our major product lines. Our
geographic and product diversity coupled with our large installed product base provides growth opportunities within our
service and corresponding parts and replacement revenue streams. In addition, we are investing substantial resources
to innovate and develop new products and services which we expect will drive our future growth.
2022 Annual Report
31
PART II
RESULTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 2022 COMPARED TO THE YEAR ENDED DECEMBER 31, 2021 - CONSOLIDATED RESULTS
DOLLAR AMOUNTS IN MILLIONS
Net revenues
Cost of goods sold
Gross profit
Selling and administrative expenses
Operating income
Interest expense
Other income/(expense), net
Earnings before income taxes
Provision for income taxes
Earnings from continuing operations
Discontinued operations, net of tax
Net earnings
NET REVENUES
2022
2021
PERIOD
CHANGE
2022% OF
REVENUES
2021% OF
REVENUES
69.0%
31.0%
15.9%
15.1%
68.4%
31.6%
17.3%
14.3%
$ 15,991.7
$14,136.4
$ 1,855.3
(11,026.9)
(9,666.8)
(1,360.1)
4,964.8
4,469.6
(2,545.9)
(2,446.3)
2,418.9
2,023.3
(223.5)
(23.3)
(233.7)
1.1
2,172.1
1,790.7
(375.9)
(333.5)
1,796.2
1,457.2
(21.5)
(20.6)
495.2
(99.6)
395.6
10.2
(24.4)
381.4
(42.4)
339.0
(0.9)
$ 1,774.7
$ 1,436.6
$
338.1
Net revenues for the year ended December 31, 2022 increased by 13.1%, or $1,855.3 million, compared with the same
period of 2021.
The components of the period change were as follows:
Pricing
Volume
Acquisitions
Currency translation
Total
9.6%
4.9%
0.8%
(2.2)%
13.1%
The increase in Net revenues was primarily driven by inflation-based price increases, end customer demand within all our
reportable segments and incremental revenues from acquisitions, partially offset by an unfavorable impact from foreign
currency translation. Pricing and volume increases were experienced in all segments. Refer to “Results by Segment”
below for a discussion of Net revenues by segment.
GROSS PROFIT MARGIN
Gross profit margin for the year ended December 31, 2022 decreased 60 basis points to 31.0% compared to 31.6% for the
same period of 2021 primarily due to significant direct material, freight and other inflation, and unfavorable impacts to
productivity arising from supply chain, freight and logistics challenges, partially offset by inflation-based price increases.
SELLING AND ADMINISTRATIVE EXPENSES
Selling and administrative expenses for the year ended December 31, 2022 increased by 4.1%, or $99.6 million, compared
with the same period of 2021. The increase in Selling and administrative expenses was primarily driven by an increase
in human capital related costs as a result of investing in our people, travel costs and amortization due to acquisitions,
partially offset by favorable non-cash adjustments to contingent consideration of $46.9 million.
Selling and administrative expenses as a percentage of Net revenues for the year ended December 31, 2022 decreased
140 basis points from 17.3% to 15.9% primarily due to higher revenues year-over-year.
32
PART II
INTEREST EXPENSE
Interest expense for the year ended December 31, 2022 decreased by 4.4% or $10.2 million compared with the same
period of 2021 primarily due to the repayments of $125.0 million of 9.000% Debentures in August 2021 and $300.0 million of
2.900% Senior notes in February 2021.
OTHER INCOME/(EXPENSE), NET
The components of Other income/(expense), net, for the years ended December 31 were as follows:
IN MILLIONS
Interest income
Foreign currency exchange loss
Other components of net periodic benefit credit/(cost)
Other activity, net
Other income/(expense), net
2022
2021
$
9.2
$
4.0
(17.9)
(10.6)
(4.0)
$ (23.3)
$
(10.7)
(1.6)
9.4
1.1
Other income /(expense), net includes the results from activities other than normal business operations such as interest
income and foreign currency gains and losses on transactions that are denominated in a currency other than an entity’s
functional currency. In addition, we include the components of net periodic benefit credit/(cost) for pension and post
retirement obligations other than the service cost component. During the year ended December 31, 2022, we recorded a
$15.0 million settlement charge for a compensation related payment to a retired executive within other components of net
periodic benefit credit/(cost). Other activity, net primarily includes items associated with certain legal matters, as well as
asbestos-related activities of Murray. During the year ended December 31, 2021, we recorded a gain of $12.8 million related
to the release of a pension indemnification liability, partially offset by a charge of $7.2 million to increase our Funding
Agreement liability from asbestos-related activities of Murray.
PROVISION FOR INCOME TAXES
The 2022 effective tax rate was 17.3% which was lower than the U.S. Statutory rate of 21% due to a $48.2 million reduction in
valuation allowances primarily related to certain net state deferred tax assets resulting from U.S. legal entity restructurings
and deferred tax assets associated with foreign tax credits as a result of an increase in the current year amount of
creditable foreign source income. Additional tax benefits included in this year’s effective rate are $12.4 million, net related
to the current year’s effects of a prepayment of an intercompany obligation in 2021, excess tax benefits from employee
share-based payments and earnings in non-U.S. jurisdictions, which in aggregate have a lower effective tax rate. These
amounts were partially offset by U.S. state and local taxes and certain non-deductible employee expenses. Revenues
from non-U.S. jurisdictions accounted for approximately 28% of our total 2022 revenues, such that a material portion of
our pretax income was earned and taxed outside the U.S. at rates ranging from 0% to 38%. When comparing the results
of multiple reporting periods, among other factors, the mix of earnings between U.S. and foreign jurisdictions can cause
variability in our overall effective tax rate.
The 2021 effective tax rate was 18.6% which was lower than the U.S. Statutory rate of 21% due to a $21.4 million reduction
in valuation allowances on deferred tax assets primarily related to foreign tax credits as a result of an increase in current
year foreign source income, excess tax benefits from employee share-based payments, and earnings in non-U.S.
jurisdictions, which in aggregate have a lower effective tax rate. These amounts were partially offset by the recognition
of a net $11.6 million tax expense related to a prepayment of an intercompany obligation, U.S. state and local taxes and
certain non-deductible employee expenses. Revenues from non-U.S. jurisdictions accounted for approximately 29.0%
of our total 2021 revenues, such that a material portion of our pretax income was earned and taxed outside the U.S. at
rates ranging from 0% to 38%. When comparing the results of multiple reporting periods, among other factors, the mix of
earnings between U.S. and foreign jurisdictions can cause variability in our overall effective tax rate.
2022 Annual Report
33
PART II
YEAR ENDED DECEMBER 31, 2022 COMPARED TO THE YEAR ENDED DECEMBER 31, 2021 - SEGMENT RESULTS
We operate under four regional operating segments designed to create deep customer focus and relevance in markets
around the world. The Company determined that its two Europe, Middle East and Africa (EMEA) operating segments
meet the aggregation criteria based on similar operating and economic characteristics, resulting in one reportable
segment. Therefore, the Company has three regional reportable segments, Americas, EMEA and Asia Pacific.
• Our Americas segment innovates for customers in North America and Latin America. The Americas segment
encompasses commercial heating, cooling and ventilation systems, building controls, and energy services and
solutions; residential heating and cooling; and transport refrigeration systems and solutions.
• Our EMEA segment innovates for customers in the Europe, Middle East and Africa region. The EMEA segment
encompasses heating, cooling and ventilation systems, services and solutions for commercial buildings, and transport
refrigeration systems and solutions.
• Our Asia Pacific segment innovates for customers throughout the Asia Pacific region. The Asia Pacific segment
encompasses heating, cooling and ventilation systems, services and solutions for commercial buildings and transport
refrigeration systems and solutions.
Management measures segment operating performance based on net earnings excluding interest expense, income
taxes, depreciation and amortization, restructuring, non-cash adjustments for contingent consideration, insurance
settlement on property claim in Q3 2022, merger and acquisition-related costs, unallocated corporate expenses and
discontinued operations (Segment Adjusted EBITDA). Segment Adjusted EBITDA is not defined under accounting
principles generally accepted in the United States of America (GAAP) and may not be comparable to similarly-titled
measures used by other companies and should not be considered a substitute for net earnings or other results
reported in accordance with GAAP. We believe Segment Adjusted EBITDA provides the most relevant measure of
profitability as well as earnings power and the ability to generate cash. This measure is a useful financial metric to assess
our operating performance from period to period by excluding certain items that we believe are not representative of
our core business and we use this measure for business planning purposes. Segment Adjusted EBITDA also provides a
useful tool for assessing the comparability between periods and our ability to generate cash from operations sufficient
to pay taxes, to service debt and to undertake capital expenditures because it eliminates non-cash charges such as
depreciation and amortization expense.
The following discussion compares our results for each of our three reportable segments for the year ended
December 31, 2022 compared to the year ended December 31, 2021.
DOLLAR AMOUNTS IN MILLIONS
2022
2021
Americas
Net revenues
Segment Adjusted EBITDA
Segment Adjusted EBITDA as a percentage of net revenues
EMEA
Net revenues
Segment Adjusted EBITDA
Segment Adjusted EBITDA as a percentage of net revenues
Asia Pacific
Net revenues
Segment Adjusted EBITDA
Segment Adjusted EBITDA as a percentage of net revenues
Total Net revenues
Total Segment Adjusted EBITDA
Total Segment Adjusted EBITDA as a percentage of net revenues
34
%
CHANGE
15.4%
15.8%
$ 12,640.8
$ 10,957.1
2,326.3
2,008.8
18.4%
18.3%
$
2,034.5
$
1,944.9
4.6%
338.1
16.6%
359.2
(5.9)%
18.5%
$
1,316.4
$
1,234.4
248.3
18.9%
228.5
18.5%
$ 15,991.7
$ 14,136.4
2,912.7
2,596.5
18.2%
18.4%
6.6%
8.7%
13.1%
12.2%
AMERICAS
Net revenues for the year ended December 31, 2022 increased by 15.4% or $1,683.7 million, compared with the same
period of 2021.
The components of the period change were as follows:
PART II
Pricing
Volume
Acquisitions
Currency translation
Total
10.7%
4.2%
0.7%
(0.2)%
15.4%
The increase in Net revenues was primarily driven by inflation-based price increases, higher volumes driven by increased
end-customer demand and incremental revenues from acquisitions.
Segment Adjusted EBITDA margin for the year ended December 31, 2022 increased by 10 basis points to 18.4% compared to
18.3% for the same period of 2021 primarily due to favorable pricing, volume and productivity largely offset by higher material
costs, other inflation and higher costs to serve customers arising from supply chain, freight and logistics challenges.
EMEA
Net revenues for the year ended December 31, 2022 increased by 4.6% or $89.6 million, compared with the same period
of 2021.
The components of the period change were as follows:
Pricing
Volume
Acquisitions
Currency translation
Total
7.1%
7.4%
1.2%
(11.1)%
4.6%
The increase in Net revenues was primarily driven by higher volumes driven by increased end-customer demand,
inflation-based price increases and incremental revenues from acquisitions, partially offset by the unfavorable currency
translation. Excluding the impact of foreign currency translation and acquisitions, Net revenues increased by 14.5%
Segment Adjusted EBITDA margin for the year ended December 31, 2022 decreased by 190 basis points to 16.6%
compared to 18.5% for the same period of 2021 primarily due to favorable pricing, volume and productivity, more than
offset by higher material costs, other inflation and higher costs to serve customers arising from supply chain, freight
and logistics challenges.
ASIA PACIFIC
Net revenues for the year ended December 31, 2022 increased by 6.6% or $82.0 million, compared with the same period
of 2021.
The components of the period change were as follows:
Pricing
Volume
Acquisitions
Currency translation
Total
3.4%
8.4%
0.7%
(5.9)%
6.6%
2022 Annual Report
35
PART II
The increase in Net revenues was primarily driven by higher volumes related to increased end-customer demand.
Inflation-based price increases and incremental revenues from acquisitions were partially offset by an unfavorable impact
from foreign currency translation. Excluding the impact of foreign currency translation and acquisitions, Net revenues
increased by 11.8%.
Segment Adjusted EBITDA margin for the year ended December 31, 2022 increased by 40 basis points to 18.9%
compared to 18.5% for the same period of 2021 primarily due to favorable pricing, volume and productivity, partially offset
by higher material costs, other inflation and higher costs to serve customers arising from supply chain, freight and
logistics challenges.
LIQUIDITY AND CAPITAL RESOURCES
We assess our liquidity in terms of our ability to generate cash to fund our operating, investing and financing activities.
In doing so, we review and analyze our current cash on hand, the number of days our sales are outstanding, inventory
turns, capital expenditure commitments and income tax payments. Our cash requirements primarily consist of the
following:
• Funding of working capital
• Debt service requirements
• Funding of capital expenditures
• Dividend payments
• Funding of acquisitions, joint ventures and equity investments
• Share repurchases
Our primary sources of liquidity include cash balances on hand, cash flows from operations, proceeds from debt
offerings, commercial paper, and borrowing availability under our existing credit facilities. We earn a significant amount of
our operating income in jurisdictions where it is deemed to be permanently reinvested. Our most prominent jurisdiction
of operation is the U.S. We expect existing cash and cash equivalents available to the U.S. operations, the cash generated
by our U.S. operations, our committed credit lines as well as our expected ability to access the capital and debt markets
will be sufficient to fund our U.S. operating and capital needs for at least the next twelve months and thereafter for the
foreseeable future. In addition, we expect existing non-U.S. cash and cash equivalents and the cash generated by our
non-U.S. operations will be sufficient to fund our non-U.S. operating and capital needs for at least the next twelve months
and thereafter for the foreseeable future. The maximum aggregate amount of unsecured commercial paper notes
available to be issued, on a private placement basis, under the commercial paper program is $2.0 billion, of which we
had no outstanding balance as of December 31, 2022.
As of December 31, 2022, we had $1,220.5 million of cash and cash equivalents on hand, of which $814.5 million was
held by non-U.S. subsidiaries. Cash and cash equivalents held by our non-U.S. subsidiaries are generally available for
use in our U.S. operations via intercompany loans, equity infusions or via distributions from direct or indirectly owned
non-U.S. subsidiaries for which we do not assert permanent reinvestment. As a result of the Tax Cuts and Jobs Act in
2017, additional repatriation opportunities to access cash and cash equivalents held by non-U.S. subsidiaries have been
created. In general, repatriation of cash to the U.S. can be completed with no significant incremental U.S. tax. However, to
the extent that we repatriate funds from non-U.S. subsidiaries for which we assert permanent reinvestment to fund our
U.S. operations, we would be required to accrue and pay applicable non-U.S. taxes. As of December 31, 2022, we currently
have no plans to repatriate funds from subsidiaries for which we assert permanent reinvestment.
Share repurchases are made from time to time in accordance with management’s balanced capital allocation strategy,
subject to market conditions and regulatory requirements. In February 2022, the Company’s Board of Directors authorized
the repurchase of up to $3.0 billion of its ordinary shares (2022 Authorization) upon the completion of its current
share repurchase program of up to $2.0 billion of its ordinary shares which was authorized in 2021 (2021 Authorization).
During the year ended December 31, 2022, we repurchased and canceled $1,200.0 million of ordinary shares leaving
approximately $200 million remaining under the 2021 Authorization as of December 31, 2022.
36
PART II
We expect to pay a competitive and growing dividend. Since the launch of Trane Technologies in March 2020, we
have increased our quarterly share dividend by 26%, from $0.53 to $0.67 per ordinary share, or $2.12 to $2.68 per share
annualized. All four 2022 quarterly dividends were paid during the year ended December 31, 2022. In February 2023, our
Board of Directors declared an increase in our quarterly share dividend by 12%, from $0.67 to $0.75 per ordinary share, or
$2.68 to $3.00 per share annualized starting in the first quarter of 2023.
We continue to actively manage and strengthen our business portfolio to meet the current and future needs of our
customers. We achieve this partly through engaging in research and development and sustaining activities and partly
through acquisitions. Sustaining activities include costs incurred to reduce production costs, improve existing products,
create custom solutions for customers and provide support to our manufacturing facilities. Our research and development
and sustaining costs account for approximately two percent of annual Net revenues. Each year, we make investments in
new product development and new technology innovation as they are key factors in achieving our strategic objectives
as a leader in the climate sector. In addition, we make investments in technology and business for our operational
sustainability programs. For example, during the year ended December 31, 2022, we invested in onsite solar energy
generation systems at our Pueblo, Colorado and Monterrey, Mexico facilities to generate electricity to offset fossil based
electricity purchased from the grid. We ramped up operations of the onsite solar system at our Zhongshan, China facility.
Two key factories in China (Taicang and Zhongshan) recently entered into supply agreements to receive a significant
quantity of electricity generated from 100 percent renewable sources. We also transitioned to a next generation refrigerant
with low global warming potential (GWP) for transport equipment manufactured at our Arecibo, Puerto Rico facility and are
actively working to transition to low GWP refrigerant on our first commercial product at our Pueblo, Colorado factory. We
also completed a major step to decarbonize our Charmes, France facility by shifting from a natural gas fueled hot water
heating system to Trane Technologies’ latest heat pump system. This project is a dual benefit of reducing Scope 1 carbon
and serving as a heat pump system showcase for our customer engagement. These actions represent important steps to
reduce our Scope 1 and Scope 2 carbon emissions and improve our customer’s carbon performance over the operating
life of Trane Technologies’ cooling equipment. Furthermore, during the year ended December 31, 2022, we also completed
implementation of processing equipment for our Tyler, Texas facility to fully achieve zero waste to landfill. These Leading by
Example successes did not result in material expenditures for the year ended December 31, 2022.
In pursuing our business strategy, we routinely conduct discussions, evaluate targets and enter into agreements
regarding possible acquisitions, divestitures, joint ventures and equity investments. Since 2020, we acquired several
businesses, entered into joint ventures and invested in companies that complement existing products and services
further enhancing our product portfolio. During the years ended December 31, 2022 and December 31, 2021, we deployed
capital of approximately $256 million and $340 million, respectively attributable to acquisitions and equity investments.
We incur costs associated with restructuring initiatives intended to result in improved operating performance, profitability
and working capital levels. Actions associated with these initiatives may include workforce reductions, improving
manufacturing productivity, realignment of management structures and rationalizing certain assets. Post separation,
we have reduced costs by approximately $240 million through December 31, 2022 and expect to reduce costs by an
additional $60 million by 2023 for a total of $300 million in total annual savings under our transformation initiatives. In
order to achieve these cost savings, we anticipate to incur costs up to $150 million through 2023. We have incurred
approximately $130 million of costs cumulatively through December 31, 2022. We believe that our existing cash flow,
committed credit lines and access to the capital markets will be sufficient to fund share repurchases, dividends,
research and development, sustaining activities, business portfolio changes and ongoing restructuring actions.
Certain of our subsidiaries entered into Funding Agreements with Aldrich and Murray pursuant to which those
subsidiaries are obligated, among other things, to pay the costs and expenses of Aldrich and Murray during the
pendency of the Chapter 11 cases to the extent distributions from their respective subsidiaries are insufficient to do so
and to provide an amount for the funding for a trust established pursuant to section 524(g) of the Bankruptcy Code, to
the extent that the other assets of Aldrich and Murray are insufficient to provide the requisite trust funding. During the
third quarter of 2021, Aldrich and Murray filed a motion with the Bankruptcy Court to create a $270.0 million QSF. The funds
held in the QSF would be available to provide funding for the Section 524(g) Trust upon effectiveness of the Plan. On
January 27, 2022, the Bankruptcy Court granted the request to fund the QSF, which was funded on March 2, 2022.
2022 Annual Report
37
PART II
As the COVID-19 global pandemic impacts both the broader economy and our operations, we will continue to assess
our liquidity needs and our ability to access capital markets. A continued worldwide disruption could materially affect
economies and financial markets worldwide, resulting in an economic downturn that could affect demand for our products,
our ability to obtain financing on favorable terms and otherwise adversely impact our business, financial condition and
results of operations. See Part I, Item 1A, “Risk Factors – Risks Related to Economic Conditions” for more information.
LIQUIDITY
The following table contains several key measures of our financial condition and liquidity at the periods ended
December 31:
IN MILLIONS
Cash and cash equivalents
Short-term borrowings and current maturities of long-term debt
Long-term debt
Total debt
Total Trane Technologies plc shareholders’ equity
Total equity
Debt-to-total capital ratio
DEBT AND CREDIT FACILITIES
2022
2021
$ 1,220.5
$ 2,159.2
1,048.0
3,788.3
4,836.3
6,088.6
6,105.2
350.4
4,491.7
4,842.1
6,255.9
6,273.1
44.2%
43.6%
As of December 31, 2022, our short-term obligations primarily consist of current maturities of $699.7 million of long-term
debt that matures in June 2023 and $340.8 million of fixed rate debentures that contain a put feature that the holders
may exercise on each anniversary of the issuance date. If exercised, we are obligated to repay in whole or in part, at
the holder’s option, the outstanding principal amount (plus accrued and unpaid interest) of the debentures held by
the holder. We also maintain a commercial paper program which is used for general corporate purposes. Under the
program, the maximum aggregate amount of unsecured commercial paper notes available to be issued, on a private
placement basis, is $2.0 billion as of December 31, 2022. We had no commercial paper outstanding at December 31, 2022
and December 31, 2021. See Note 7, “Debt and Credit Facilities”, to the Consolidated Financial Statements for additional
information regarding the terms of our short-term obligations.
Our long-term obligations primarily consist of long-term debt with final maturity dates ranging between 2024 and 2049.
In addition, we maintain two $1.0 billion senior unsecured revolving credit facilities, one of which matures in June 2026 and
the other which matures in April 2027. The facilities provide support for our commercial paper program and can be used
for working capital and other general corporate purposes. Total commitments of $2.0 billion were unused at December 31,
2022 and December 31, 2021. See Note 7, “Debt and Credit Facilities”, to the Consolidated Financial Statements and
further below in Supplemental Guarantor Financial Information for additional information regarding the terms of our
long-term obligations and their related guarantees.
CASH FLOWS
The following table reflects the major categories of cash flows for the years ended December 31, respectively. For
additional details, please see the Consolidated Statements of Cash Flows in the Consolidated Financial Statements.
IN MILLIONS
Net cash provided by continuing operating activities
Net cash used in continuing investing activities
Net cash used in continuing financing activities
2022
2021
$
1,698.7
$
1,594.4
(539.8)
(1,852.2)
(545.7)
(2,127.6)
38
PART II
Operating Activities
Net cash provided by continuing operating activities for the year ended December 31, 2022 was $1,698.7 million,
of which net income provided $2,248.8 million after adjusting for non-cash transactions. Net cash provided by
continuing operating activities for the year ended December 31, 2021 was $1,594.4 million, of which net income
provided $1,837.5 million after adjusting for non-cash transactions. The year-over-year increase in net cash provided
by continuing operating activities was primarily due to higher net earnings, partially offset by higher working capital
balances in the current year, the funding of the continuing operations component of the QSF for $91.8 million and a
compensation related payment to a retired executive.
Investing Activities
Cash flows from investing activities represents inflows and outflows regarding the purchase and sale of assets. Primary
activities associated with these items include capital expenditures, proceeds from the sale of property, plant and
equipment, acquisitions, investments in joint ventures and divestitures. During the year ended December 31, 2022, net cash
used in investing activities from continuing operations was $539.8 million. The primary drivers of the usage was attributable
to capital expenditures of $291.8 million and acquisition of businesses, which totaled $234.7 million, net of cash acquired.
During the year ended December 31, 2021, net cash used in investing activities from continuing operations was $545.7
million. The primary drivers of the usage was attributable to the acquisition of businesses, which totaled $269.2 million, net
of cash acquired, $223.0 million of capital expenditures and other investing activities of $68.6 million, primarily related to
investment in several companies that complement existing products and services further enhancing our product portfolio.
Financing Activities
Cash flows from financing activities represent inflows and outflows that account for external activities affecting equity and
debt. Primary activities associated with these actions include paying dividends to shareholders, repurchasing our own
shares, issuing our stock and debt transactions. During the year ended December 31, 2022, net cash used in financing
activities from continuing operations was $1,852.2 million. The primary drivers of the outflow related to the repurchase of
$1,200.2 million in ordinary shares and dividends paid to ordinary shareholders of $620.2 million. During the year ended
December 31, 2021, net cash used in financing activities from continuing operations was $2,127.6 million. The primary driver
of the outflow related to the repurchase of $1,100.3 million in ordinary shares, dividends paid to ordinary shareholders of
$561.1 million and the repayment of long-term debt of $432.5 million.
Free Cash Flow
Free cash flow is a non-GAAP measure and defined as Net cash provided by (used in) continuing operating activities
adjusted for capital expenditures, cash payments for restructuring, transformation costs, the continuing operations
component of the QSF funding and payout of executive compensation less an insurance settlement on a property
claim in Q3 2022. This measure is useful to management and investors because it is consistent with management’s
assessment of our operating cash flow performance. The most comparable GAAP measure to free cash flow is Net cash
provided by (used in) continuing operating activities. Free cash flow may not be comparable to similarly-titled measures
used by other companies and should not be considered a substitute for Net cash provided by (used in) continuing
operating activities in accordance with GAAP.
A reconciliation of Net cash provided by (used in) continuing operating activities to free cash flow the years ended
December 31 is as follows:
IN MILLIONS
Net cash provided by (used in) continuing operating activities
Capital expenditures
Cash payments for restructuring
Transformation costs paid
QSF funding (continuing operations component)
Compensation related payment to a retired executive
Insurance settlement on property claim in Q3 2022
Free cash flow(1)
(1) Represents a non-GAAP measure.
2022
2021
$
1,698.7
$
1,594.4
(291.8)
(223.0)
17.9
9.6
91.8
64.3
(25.0)
38.1
21.4
—
—
—
$
1,565.5
$
1,430.9
2022 Annual Report
39
PART II
PENSION PLANS
Our investment objective in managing defined benefit plan assets is to ensure that all present and future benefit
obligations are met as they come due. We seek to achieve this goal while trying to mitigate volatility in plan funded
status, contribution and expense by better matching the characteristics of the plan assets to that of the plan liabilities.
Our approach to asset allocation is to increase fixed income assets as the plan’s funded status improves. We monitor
plan funded status and asset allocation regularly in addition to investment manager performance. In addition, we
monitor the impact of market conditions on our defined benefit plans on a regular basis. None of our defined benefit
pension plans have experienced a significant impact on their liquidity due to market volatility. See Note 11, “Pension
and Postretirement Benefits Other Than Pensions”, to the Consolidated Financial Statements for additional information
regarding pensions.
CAPITAL RESOURCES
Based on historical performance and current expectations, we believe our cash and cash equivalents balance, the cash
generated from our operations, our committed credit lines and our expected ability to access capital markets will satisfy
our working capital needs, capital expenditures, dividends, share repurchases, upcoming debt maturities, and other
liquidity requirements associated with our operations for the foreseeable future.
Capital expenditures were $291.8 million, $223.0 million and $146.2 million for the years ended December 31, 2022, 2021 and
2020, respectively. Our investments continue to improve manufacturing productivity, reduce costs, provide environmental
enhancements, upgrade information technology infrastructure and security and advanced technologies for existing
facilities. The capital expenditure program for 2023 is estimated to be approximately 1.5% to 2.0% of revenues, including
amounts approved in prior periods. Many of these projects are subject to review and cancellation at our option without
incurring substantial charges.
For financial market risk impacting the Company, see Part II, Item 7A, “Quantitative and Qualitative Disclosure About
Market Risk.”
CAPITALIZATION
In addition to cash on hand and operating cash flow, we maintain significant credit availability under our Commercial
Paper Program. Our ability to borrow at a cost-effective rate under the Commercial Paper Program is contingent upon
maintaining an investment-grade credit rating. As of December 31, 2022, our credit ratings were as follows, remaining
unchanged from 2021:
Moody’s
Standard and Poor’s
SHORT-TERM
LONG-TERM
P-2
A-2
Baa2
BBB
The credit ratings set forth above are not a recommendation to buy, sell or hold securities and may be subject to revision
or withdrawal by the assigning rating organization. Each rating should be evaluated independently of any other rating.
Our public debt does not contain financial covenants and our revolving credit lines have a debt-to-total capital covenant
of 65%. As of December 31, 2022, our debt-to-total capital ratio was significantly beneath this limit.
CONTRACTUAL OBLIGATIONS
Our contractual cash obligations include required payments of long-term debt principal and interest, purchase
obligations and expected obligations under our pension and postretirement benefit plans. In addition, we have required
payments of operating leases, income taxes and expected obligations under the Funding agreement, environmental and
product liability matters. For additional information regarding leases, income taxes, including unrecognized tax benefits,
and contingent liabilities, see Note 10 “Leases”, Note 16 “Income Taxes” and Note 20 “Commitments and Contingencies”,
respectively, to the Consolidated Financial Statements. Our material cash requirements include the following contractual
and other obligations.
40
PART II
DEBT
At December 31, 2022, we had outstanding aggregate long-term debt principal payments of $4,863.0 million, with
$1,048.3 million payable within 12 months. The amount payable within 12 months includes $340.8 million of debt
redeemable at the option of the holder. The scheduled maturities of these bonds range between 2027 and 2028. Future
interest payments on long-term debt total $2,186.5 million, with $199.7 million payable within 12 months. See Note 7, “Debt
and Credit Facilities”, to the Consolidated Financial Statements for additional information regarding debt.
PURCHASE OBLIGATIONS
Purchase obligations include commitments under legally enforceable contracts or purchase orders. At December 31,
2022, we had purchase obligations of $1,239.2 million, which are primarily payable within 12 months.
PENSIONS
It is our objective to contribute to the pension plans to ensure adequate funds are available in the plans to make benefit
payments to plan participants and beneficiaries when required. We currently expect that we will contribute approximately
$69 million to our enterprise plans worldwide in 2023. The timing and amounts of future contributions are dependent
upon the funding status of the plan, which is expected to vary as a result of changes in interest rates, returns on
underlying assets, and other factors. See Note 11, “Pensions and Postretirement Benefits Other Than Pensions”, to the
Consolidated Financial Statements for additional information regarding pensions.
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
We fund postretirement benefit costs principally on a pay-as-you-go basis as medical costs are incurred by covered
retiree populations. Benefit payments, which are net of expected plan participant contributions and Medicare Part D
subsidy, are expected to be approximately $35 million in 2023. See Note 11, “Pensions and Postretirement Benefits Other
Than Pensions”, to the Consolidated Financial Statements for additional information regarding postretirement benefits
other than pensions.
SUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION
Trane Technologies plc (Plc or Parent Company) and certain of its 100% directly or indirectly owned subsidiaries provide
guarantees of public debt issued by other 100% directly or indirectly owned subsidiaries of Plc. The following table shows
our guarantor relationships as of December 31, 2022:
PARENT, ISSUER OR GUARANTORS
Trane Technologies plc (Plc)
Trane Technologies Irish Holdings
Unlimited Company (TT Holdings)
Trane Technologies Lux International
Holding Company S.à.r.l.
(TT International)
Trane Technologies Global Holding
Company Limited (TT Global)
Trane Technologies Financing Limited
(TTFL)
Trane Technologies HoldCo Inc.
(TTC HoldCo)
NOTES ISSUED
NOTES GUARANTEED
None
None
None
None
3.550% Senior notes due 2024
3.500% Senior notes due 2026
3.800% Senior notes due 2029
4.650% Senior notes due 2044
4.500% Senior notes due 2049
4.250% Senior notes due 2023
3.750% Senior notes due 2028
5.750% Senior notes due 2043
4.300% Senior notes due 2048
All registered notes and debentures
All notes issued by TTFL and TTC
HoldCo
All notes issued by TTFL and TTC
HoldCo
All notes issued by TTFL and TTC
HoldCo
All notes and debentures issued by TTC
HoldCo and TTC
All notes issued by TTFL
Trane Technologies Company LLC
(TTC)
7.200% Debentures due 2023-2025
6.480% Debentures due 2025
Puttable debentures due 2027-2028
All notes issued by TTFL and TTC
HoldCo
2022 Annual Report
41
PART II
Each subsidiary debt issuer and guarantor is owned 100% directly or indirectly by the Parent Company. Each guarantee
is full and unconditional, and provided on a joint and several basis. There are no significant restrictions of the Parent
Company, or any guarantor, to obtain funds from its subsidiaries, such as provisions in debt agreements that prohibit
dividend payments, loans or advances to the parent by a subsidiary. The following tables present summarized financial
information for the Parent Company and subsidiary debt issuers and guarantors on a combined basis (together, “obligor
group”) after elimination of intercompany transactions and balances based on the Company’s legal entity ownerships
and guarantees outstanding at December 31, 2022. Our obligor groups as of December 31, 2022 were as follows: Obligor
group 1 consists of Plc, TT Holdings, TT International, TT Global, TTFL, TTC HoldCo and TTC; Obligor group 2 consists of
Plc, TTFL and TTC.
SUMMARIZED STATEMENTS OF EARNINGS
IN MILLIONS
Net revenues
Gross profit (loss)
Intercompany interest and fees
Earnings (loss) from continuing operations
Discontinued operations, net of tax
Net earnings (loss)
Less: Net earnings attributable to noncontrolling interests
Net earnings (loss) attributable to Trane Technologies plc
SUMMARIZED BALANCE SHEET
IN MILLIONS
ASSETS
Intercompany receivables
Current assets
Intercompany notes receivable
Noncurrent assets
LIABILITIES
Intercompany payables
Current liabilities
Intercompany notes payable
Noncurrent liabilities
YEAR ENDED DECEMBER 31, 2022
OBLIGOR GROUP 1
OBLIGOR GROUP 2
$
—
—
(44.2)
(644.3)
(14.4)
(658.7)
—
$
—
—
224.5
(28.9)
(19.5)
(48.4)
—
$ (658.7)
$ (48.4)
DECEMBER 31, 2022
OBLIGOR GROUP 1
OBLIGOR GROUP 2
$
860.0
$
1,092.1
1,011.6
1,831.9
2,582.3
3,303.5
4,851.8
2,400.0
6,789.8
1,231.7
4,781.6
5,383.1
1,792.1
2,611.9
2,400.0
5,433.4
CRITICAL ACCOUNTING ESTIMATES
Management’s Discussion and Analysis of Financial Condition and Results of Operations are based upon our
Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally
accepted in the United States (GAAP). The preparation of financial statements in conformity with those accounting
principles requires management to use judgment in making estimates and assumptions based on the relevant
information available at the end of each period. These estimates and assumptions have a significant effect on reported
amounts of assets and liabilities, revenue and expenses as well as the disclosure of contingent assets and liabilities
because they result primarily from the need to make estimates and assumptions on matters that are inherently uncertain.
Actual results may differ from these estimates. If updated information or actual amounts are different from previous
estimates, the revisions are included in our results for the period in which they become known.
42
PART II
The following is a summary of certain accounting estimates and assumptions made by management that we consider critical.
• Goodwill and indefinite-lived intangible assets – We have significant goodwill and indefinite-lived intangible assets on
our balance sheet related to acquisitions. These assets are tested and reviewed annually during the fourth quarter for
impairment or when there is a significant change in events or circumstances that indicate that the fair value of an asset is
more likely than not less than the carrying amount of the asset. In addition, an interim impairment test is completed upon
a triggering event or when there is a reorganization of reporting structure or disposal of all or a portion of a reporting unit.
The determination of estimated fair value requires us to make assumptions about estimated cash flows, including
profit margins, long-term forecasts, discount rates and terminal growth rates. We developed these assumptions based
on the market and geographic risks unique to each reporting unit. The estimates of fair value are based on the best
information available as of the date of the assessment, which primarily incorporates management assumptions about
expected future cash flows.
Annual Goodwill Impairment Test
Impairment of goodwill is tested at the reporting unit level. The test compares the carrying amount of the reporting
unit to its estimated fair value. If the estimated fair value of a reporting unit exceeds its carrying amount, goodwill of the
reporting unit is not impaired. To the extent that the carrying value of the reporting unit exceeds its estimated fair value,
an impairment loss would be recognized for the amount by which the reporting unit’s carrying amount exceeds its fair
value, not to exceed the carrying amount of goodwill in that reporting unit.
As quoted market prices are not available for our reporting units, the calculation of their estimated fair value is
determined using three valuation techniques: a discounted cash flow model (an income approach), a market-adjusted
multiple of earnings and revenues (a market approach), and a similar transactions method (also a market approach).
The discounted cash flow approach relies on our estimates of future cash flows and explicitly addresses factors such
as timing, growth and margins, with due consideration given to forecasting risk. The multiple of earnings and revenues
approach reflects the market’s expectations for future growth and risk, with adjustments to account for differences
between the guideline publicly traded companies and the subject reporting units. The similar transactions method
considers prices paid in transactions that have recently occurred in our industry or in related industries. These
valuation techniques are weighted 50%, 40% and 10%, respectively.
Under the income approach, we assumed a forecasted cash flow period of five years with discount rates ranging from
10.0% to 12.0% and a terminal growth rate of 3.0% Under the guideline public company method, we used an adjusted
multiple ranging from 9.0 to 17.5 of projected earnings before interest, taxes, depreciation and amortization (EBITDA)
based on the market information of comparable companies. Additionally, we compared the estimated aggregate
fair value of our reporting units to our overall market capitalization. For all reporting units, the excess of the estimated
fair value over carrying value (expressed as a percentage of carrying value) exceeded 200%. A significant increase in
the discount rate, decrease in the long-term growth rate, or substantial reductions in our end markets and volume
assumptions could have a negative impact on the estimated fair value of these reporting units
OTHER INDEFINITE-LIVED INTANGIBLE ASSETS
Other intangible assets with indefinite useful lives are tested for impairment on an annual basis. The fair value of
intangible assets with indefinite useful lives is determined on a relief from royalty methodology (income approach)
which is based on the implied royalty paid, at an appropriate discount rate, to license the use of an asset rather than
owning the asset. The present value of the after-tax cost savings (i.e., royalty relief) indicates the estimated fair value of
the asset. Any excess of the carrying value over the estimated fair value would be recognized as an impairment loss
equal to that excess.
In testing our other indefinite-lived intangible assets for impairment, we assumed forecasted revenues for a period
of five years with discount rates ranging from 10.0% to 14.0%, terminal growth rates of 3.0%, and royalty rates ranging
from 0.5% to 4.5%. For all indefinite-lived intangible assets, the excess of the estimated fair value over carrying value
(expressed as a percentage of carrying value) exceeded 25%. A significant increase in the discount rate, decrease
in the long-term growth rate, decrease in the royalty rate or substantial reductions in our end markets and volume
assumptions could have a negative impact on the estimated fair values of any of our tradenames.
2022 Annual Report
43
PART II
• Business combinations – Acquisitions that meet the definition of a business combination are recorded using the
acquisition method of accounting. We include the operating results of acquired entities from their respective dates
of acquisition. We recognize and measure the identifiable assets acquired, liabilities assumed, including contingent
consideration relating to potential earnout provisions. and any non-controlling interest as of the acquisition date fair
value. The valuation of intangible assets is determined using an income approach methodology. We use assumptions
to value the intangible assets including projected future revenues, customer attrition rates, royalty rates, tax rates and
discount rates. The excess, if any, of total consideration transferred in a business combination over the fair value of
identifiable assets acquired, liabilities assumed, and any non-controlling interest is recognized as goodwill. Costs
incurred as a result of a business combination other than costs related to the issuance of debt or equity securities
are recorded in the period the costs are incurred.
Contingent consideration
We assess any contingent consideration included in the consideration paid of a business combination. The value
recorded is based on estimates of future financial projections on revenue under various potential scenarios, in which
a Monte Carlo simulation model runs many iterations based on comparable companies’ revenue growth rates and
their implied revenue volatilities. These cash flow projections are discounted with a risk adjusted rate. Each quarter
until such contingent amounts are earned, the fair value of the liability is remeasured at each reporting period and
adjusted as a component of operating expenses based on changes to the underlying assumptions. The estimates
used to determine the fair value of the contingent consideration liability are subject to significant judgment, specifically
revenue growth rates, implied revenue volatilities and discount rates.
• Asbestos matters – Prior to the Petition Date, certain of our wholly-owned subsidiaries and former companies were
named as defendants in asbestos-related lawsuits in state and federal courts. We recorded a liability for our actual and
anticipated future claims as well as an asset for anticipated insurance settlements. We performed a detailed analysis
and projected an estimated range of the total liability for pending and unasserted future asbestos-related claims. We
recorded the liability at the low end of the range as we believed that no amount within the range is a better estimate
than any other amount. Our key assumptions underlying the estimated asbestos-related liabilities included the number
of people occupationally exposed and likely to develop asbestos-related diseases such as mesothelioma and lung
cancer, the number of people likely to file an asbestos-related personal injury claim against us, the average settlement
and resolution of each claim and the percentage of claims resolved with no payment. Asbestos-related defense costs
were excluded from the asbestos claims liability and were recorded separately as services were incurred. None of our
existing or previously-owned businesses were a producer or manufacturer of asbestos. We recorded certain income
and expenses associated with our asbestos liabilities and corresponding insurance recoveries within Discontinued
operations, net of tax, as they related to previously divested businesses, except for amounts associated with asbestos
liabilities and corresponding insurance recoveries of Murray and its predecessors, which were recorded within
continuing operations.
• Revenue recognition – Revenue is recognized when control of a good or service promised in a contract (i.e.,
performance obligation) is transferred to a customer. Control is obtained when a customer has the ability to direct the
use of and obtain substantially all of the remaining benefits from that good or service. A majority of our revenues are
recognized at a point-in-time as control is transferred at a distinct point in time per the terms of a contract. However,
a portion of our revenues are recognized over time as the customer simultaneously receives control as we perform
work under a contract. For these arrangements, the cost-to-cost input method is used as it best depicts the transfer of
control to the customer that occurs as we incur costs.
The transaction price allocated to performance obligations reflects our expectations about the consideration we
will be entitled to receive from a customer. To determine the transaction price, variable and non-cash consideration
are assessed as well as whether a significant financing component exists. We include variable consideration in
the estimated transaction price when it is probable that significant reversal of revenue recognized would not occur
when the uncertainty associated with variable consideration is subsequently resolved. We consider historical data in
determining our best estimates of variable consideration, and the related accruals are recorded using the expected
value method.
44
PART II
We enter into sales arrangements that contain multiple goods and services. For these arrangements, each good or
service is evaluated to determine whether it represents a distinct performance obligation and whether the sales price
for each obligation is representative of standalone selling price. If available, we utilize observable prices for goods or
services sold separately to similar customers in similar circumstances to evaluate relative standalone selling price. List
prices are used if they are determined to be representative of standalone selling prices. Where necessary, we ensure
that the total transaction price is then allocated to the distinct performance obligations based on the determination of
their relative standalone selling price at the inception of the arrangement.
We recognize revenue for delivered goods or services when the delivered good or service is distinct, control of the
good or service has transferred to the customer, and only customary refund or return rights related to the goods or
services exist. For extended warranties and long-term service agreements, revenue for these distinct performance
obligations are recognized over time on a straight-line basis over the respective contract term.
• Income taxes – Deferred tax assets and liabilities are determined based on temporary differences between financial
reporting and tax bases of assets and liabilities, applying enacted tax rates expected to be in effect for the year in
which the differences are expected to reverse. We recognize future tax benefits, such as net operating losses and tax
credits, to the extent that realizing these benefits is considered in our judgment to be more likely than not. We regularly
review the recoverability of our deferred tax assets considering our historic profitability, projected future taxable income,
timing of the reversals of existing temporary differences and the feasibility of our tax planning strategies. Where
appropriate, we record a valuation allowance with respect to a future tax benefit.
The provision for income taxes involves a significant amount of management judgment regarding interpretation of
relevant facts and laws in the jurisdictions in which we operate. Future changes in applicable laws, projected levels of
taxable income, and tax planning could change the effective tax rate and tax balances recorded by us. In addition, tax
authorities periodically review income tax returns filed by us and can raise issues regarding our filing positions, timing
and amount of income or deductions, and the allocation of income among the jurisdictions in which we operate.
A significant period of time may elapse between the filing of an income tax return and the ultimate resolution of an
issue raised by a revenue authority with respect to that return. We believe that we have adequately provided for any
reasonably foreseeable resolution of these matters. We will adjust our estimate if significant events so dictate. To the
extent that the ultimate results differ from our original or adjusted estimates, the effect will be recorded in the provision
for income taxes in the period that the matter is finally resolved.
• Employee benefit plans – We provide a range of benefits to eligible employees and retirees, including pensions,
postretirement and postemployment benefits. Determining the cost associated with such benefits is dependent on
various actuarial assumptions including discount rates, expected return on plan assets, compensation increases,
mortality, turnover rates and healthcare cost trend rates. Actuarial valuations are performed to determine expense
in accordance with GAAP. Actual results may differ from the actuarial assumptions and are generally accumulated
and amortized into earnings over future periods. We review our actuarial assumptions at each measurement date
and make modifications to the assumptions based on current rates and trends, if appropriate. The discount rate,
the rate of compensation increase and the expected long-term rates of return on plan assets are determined as of
each measurement date. We believe that the assumptions utilized in recording our obligations under our plans are
reasonable based on input from our actuaries, outside investment advisors and information as to assumptions used
by plan sponsors.
Changes in any of the assumptions can have an impact on the net periodic pension cost or postretirement benefit
cost. Estimated sensitivities to the expected 2023 net periodic pension cost of a 0.25% rate decline in the two basic
assumptions are as follows: the decline in the discount rate would increase expense by $0.4 million and the decline in
the estimated return on assets would increase expense by $4.9 million. A 0.25% rate decrease in the discount rate for
postretirement benefits would increase expected 2023 net periodic postretirement benefit cost by $0.3 million.
RECENT ACCOUNTING PRONOUNCEMENTS
See Note 2, “Summary of Significant Accounting Policies” to the Consolidated Financial Statements for a discussion of
recent accounting pronouncements.
2022 Annual Report
45
PART II
Item 7A. Quantitative and Qualitative Disclosure About Market Risk
We are exposed to fluctuations in currency exchange rates, interest rates and commodity prices which could impact our
results of operations and financial condition.
FOREIGN CURRENCY EXPOSURES
We have operations throughout the world that manufacture and sell products in various international markets. As a result,
we are exposed to movements in exchange rates of various currencies against the U.S. dollar as well as against other
currencies throughout the world.
Many of our non-U.S. operations have a functional currency other than the U.S. dollar, and their results are translated into
U.S. dollars for reporting purposes. Therefore, our reported results will be higher or lower depending on the weakening
or strengthening of the U.S. dollar against the respective foreign currency. Our largest concentration of revenues from
non-U.S. operations as of December 31, 2022 are in Euros and Chinese Yuan. A hypothetical 10% unfavorable change in the
average exchange rate used to translate Net revenues for the year ended December 31, 2022 from either Euros or Chinese
Yuan-based operations into U.S. dollars would result in a decline of approximately $140 million and $60 million, respectively.
We use derivative instruments to hedge those material exposures that cannot be naturally offset. The instruments utilized
are viewed as risk management tools, primarily involve little complexity and are not used for trading or speculative
purposes. To minimize the risk of counterparty non-performance, derivative instrument agreements are made only
through major financial institutions with significant experience in such derivative instruments.
We evaluate our exposure to changes in currency exchange rates on our foreign currency derivatives using a sensitivity
analysis. The sensitivity analysis is a measurement of the potential loss in fair value based on a percentage change in
exchange rates. Based on the currency derivative instruments in place at December 31, 2022, a hypothetical change
in fair value of those derivative instruments assuming a 10% adverse change in exchange rates would result in an
unrealized loss of approximately $7.5 million, as compared with $18.1 million at December 31, 2021. These amounts, when
realized, would be offset by changes in the fair value of the underlying transactions.
COMMODITY PRICE EXPOSURES
We are exposed to volatility in the prices of commodities used in some of our products and we use commodity hedge
contracts in the financial derivatives market and fixed price purchase contracts to manage this exposure. Commodity
risks are systematically managed pursuant to policy guidelines. As a cash flow hedge, gains and losses resulting from
the hedging instruments mitigate a portion of our exposures to changes in commodity prices. The maturities of the
commodity hedge contracts coincide with the expected purchase of the commodities. Based on the commodity
derivative instruments in place at December 31, 2022, a hypothetical change in fair value of those derivative instruments
assuming a 10% decrease in commodity prices would result in an unrealized loss of approximately $9.0 million, as
compared with $7.5 million at December 31, 2021. These amounts, when realized, would be offset by changes in the fair
value of the underlying commodity purchases.
INTEREST RATE EXPOSURE
Our debt portfolio mainly consists of fixed-rate instruments, and therefore any fluctuation in market interest rates is not
expected to have a material effect on our results of operations.
Item 8. Financial Statements
(a) The following Consolidated Financial Statements and the report thereon of PricewaterhouseCoopers LLP dated
February 10, 2023, are presented in this Annual Report on Form 10-K beginning on page F-1.
Consolidated Financial Statements:
Report of Independent Registered Public Accounting Firm
Consolidated Statements of Earnings for the years ended December 31, 2022, 2021 and 2020
Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020
Consolidated Balance Sheets at December 31, 2022 and 2021
Consolidated Statements of Equity for the years ended December 31, 2022, 2021 and 2020
Consolidated Statements of Cash Flows for the years ended December 31, 2022, 2021 and 2020
Notes to Consolidated Financial Statements
46
PART II
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
(a) Evaluation of Disclosure Controls and Procedures
The Company’s management, including its Chief Executive Officer and Chief Financial Officer, have conducted an
evaluation of the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)), as of the end of the
period covered by this Annual Report on Form 10-K. Based on that evaluation, the Chief Executive Officer and Chief
Financial Officer concluded as of December 31, 2022, that the Company’s disclosure controls and procedures were
effective in ensuring that information required to be disclosed by the Company in reports that it files or submits under
the Exchange Act has been recorded, processed, summarized and reported, within the time periods specified in the
Commission’s rules and forms, and that such information has been accumulated and communicated to the Company’s
management including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions
regarding required disclosure.
(b) Management’s Report on Internal Control Over Financial Reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over financial
reporting as such term is defined under Exchange Act Rules 13a-15(f) and 15d-15(f). Internal control over financial reporting
is a process designed by, or under the supervision of, the Chief Executive Officer and Chief Financial Officer and
effected by the Company’s Board of Directors to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may
deteriorate.
Management has assessed the effectiveness of internal control over financial reporting as of December 31, 2022. In
making its assessment, management has utilized the criteria set forth by the Committee of Sponsoring Organizations
(COSO) of the Treadway Commission in Internal Control – Integrated Framework (2013). Management concluded that
based on its assessment, the Company’s internal control over financial reporting was effective as of December 31, 2022.
The effectiveness of the Company’s internal control over financial reporting as of December 31, 2022 has been audited
by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which
appears herein.
(c) Changes in Internal Control Over Financial Reporting
There were no changes in internal control over financial reporting (as defined by Rules 13a-15(f) and 15d-15(f) under
the Exchange Act) that occurred during the quarter ended December 31, 2022 that have materially affected, or are
reasonably likely to materially affect, the Company’s internal control over financial reporting.
Item 9B. Other Information
None.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent
Inspections
Not Applicable.
2022 Annual Report
47
Part III
Item 10. Directors, Executive Officers and Corporate Governance
The information regarding our executive officers is included in Part I under the caption “Executive Officers of Registrant.”
The other information required by this item is incorporated herein by reference to the information contained under the
headings “Item 1. Election of Directors”, “Delinquent Section 16(a) Reports” and “Corporate Governance” in our definitive
proxy statement for the 2023 annual general meeting of shareholders (2023 Proxy Statement).
Item 11. Executive Compensation
The other information required by this item is incorporated herein by reference to the information contained under the
headings “Compensation Discussion and Analysis,” “Compensation of Directors,” “Executive Compensation,” “Human
Resources and Compensation Committee Report” and “Human Resources and Compensation Committee Interlocks
and Insider Participation” in our 2023 Proxy Statement.
Item 12. Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters
The other information required by this item is incorporated herein by reference to the information contained under
the headings “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan
Information” in our 2023 Proxy Statement.
Item 13. Certain Relationships and Related Transactions, and
Director Independence
The other information required by this item is incorporated herein by reference to the information contained
under the headings “Corporate Governance” and “Certain Relationships and Related Person Transactions” in our
2023 Proxy Statement.
Item 14. Principal Accountant Fees and Services
The information required by this item is incorporated herein by reference to the information contained under the caption
“Fees of the Independent Auditors” in our 2023 Proxy Statement.
48
Part IV
Item 15. Exhibits and Financial Statement Schedules
(a) 1.
2.
3.
Financial Statements
See Item 8.
Financial Statement Schedules
Schedules have been omitted because the required information is not applicable or because
the required information is included elsewhere in this Annual Report on Form 10-K.
Exhibits
The exhibits listed on the accompanying index to exhibits are filed as part of this Annual Report
on Form 10-K.
2022 Annual Report
49
Part IV
PART IV
TRANE TECHNOLOGIES PLC
INDEX TO EXHIBITS
(Item 15(a))
DESCRIPTION
Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), Trane Technologies plc (the
“Company”) has filed certain agreements as exhibits to this Annual Report on Form 10-K. These agreements may contain
representations and warranties by the parties. These representations and warranties have been made solely for the
benefit of the other party or parties to such agreements and (i) may have been qualified by disclosures made to such
other party or parties, (ii) were made only as of the date of such agreements or such other date(s) as may be specified
in such agreements and are subject to more recent developments, which may not be fully reflected in our public
disclosure, (iii) may reflect the allocation of risk among the parties to such agreements and (iv) may apply materiality
standards different from what may be viewed as material to investors. Accordingly, these representations and warranties
may not describe our actual state of affairs at the date hereof and should not be relied upon.
On July 1, 2009, Ingersoll-Rand Company Limited, a Bermuda company, completed a reorganization to change the
jurisdiction of incorporation of the parent company from Bermuda to Ireland. As a result, Ingersoll-Rand plc replaced
Ingersoll-Rand Company Limited as the ultimate parent company effective July 1, 2009. All references related to the
Company prior to July 1, 2009 relate to Ingersoll-Rand Company Limited. On March 2, 2020, Ingersoll-Rand plc changed
its name to Trane Technologies plc.
(a) Exhibits
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
Agreement and Plan of Merger, dated as of April 30,
2019, by and among the Company, Gardner Denver
Holdings, Inc., Ingersoll-Rand U.S. HoldCo, Inc. and
Charm Merger Sub Inc.
Incorporated by reference to Exhibit 2.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on May 6, 2019.
Separation and Distribution Agreement, dated as of
April 30, 2019, by and between Ingersoll-Rand plc and
Ingersoll-Rand U.S. HoldCo, Inc.
Incorporated by reference to Exhibit 2.2 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on May 6, 2019).
Constitution of the Company, as amended and
restated on June 2, 2016
Incorporated by reference to Exhibit 3.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on June 7, 2016.
Amendment to the Constitution of the Company dated
March 2, 2020
The Company and its subsidiaries are parties to
several long-term debt instruments under which, in
each case, the total amount of securities authorized
does not exceed 10% of the total assets of the
Company and its subsidiaries on a consolidated basis.
Indenture, dated as of June 20, 2013, by and among
Ingersoll-Rand Global Holding Company Limited, as
issuer, Ingersoll-Rand plc, Ingersoll-Rand Company
Limited and Ingersoll-Rand International Holding
Limited, as guarantors and The Bank of New York
Mellon, as Trustee.
First Supplemental Indenture, dated as of June 20,
2013, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Company Limited and Ingersoll-Rand
International Holding Limited, as guarantors and The
Bank of New York Mellon, as Trustee, relating to the
2.875% Senior Notes due 2019.
Incorporated by reference to Exhibit 3.2 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Pursuant to paragraph 4 (iii)(A) of Item 601 (b) of
Regulation S-K, the Company agrees to furnish
a copy of such instruments to the Securities and
Exchange Commission upon request.
Incorporated by reference to Exhibit 4.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on June 26, 2013.
Incorporated by reference to Exhibit 4.2 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on June 26, 2013.
2.1
2.2
3.1
3.2
4.1
4.2
50
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
PART IV
4.3
4.4
4.5
4.6
4.7
4.8
4.9
Second Supplemental Indenture, dated as of June 20,
2013, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Company Limited and Ingersoll-Rand
International Holding Limited, as guarantors and The
Bank of New York Mellon, as Trustee, relating to the
4.250% Senior Notes due 2023.
Third Supplemental Indenture, dated as of June 20,
2013, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Company Limited and Ingersoll-Rand
International Holding Limited, as guarantors and The
Bank of New York Mellon, as Trustee, relating to the
5.750% Senior Notes due 2043.
Fourth Supplemental Indenture, dated as of November
20, 2013, among Ingersoll-Rand Global Holding
Company Limited, a Bermuda company, Ingersoll-
Rand Company Limited, a Bermuda company,
Ingersoll-Rand International Holding Limited, a
Bermuda company, Ingersoll-Rand plc, an Irish public
limited company, Ingersoll-Rand Company, a New
Jersey corporation, and The Bank of New York Mellon,
as Trustee, to the Indenture dated as of June 20, 2013.
Fifth Supplemental Indenture, dated as of October 28,
2014, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand Company,
as co-obligor, Ingersoll-Rand plc, Ingersoll-Rand
Company Limited, Ingersoll-Rand International Holding
Limited, Ingersoll-Rand Luxembourg Finance S.A.,
as guarantors, and The Bank of New York Mellon, as
Trustee, to an Indenture, dated as of June 20, 2013.
Sixth Supplemental Indenture, dated as of December
18, 2015, by and among Ingersoll-Rand Global
Holding Company Limited, as issuer, Ingersoll-Rand
Company, as co-obligor, Ingersoll-Rand plc, Ingersoll-
Rand International Holding Limited, Ingersoll-Rand
Luxembourg Finance S.A., and Ingersoll-Rand Lux
International Holding Company S.à.r.l. as guarantors,
and The Bank of New York Mellon, as Trustee, to an
Indenture, dated as of June 20, 2013.
Seventh Supplemental Indenture, dated as of
April 5, 2016, by and among Ingersoll-Rand Global
Holding company Limited, as issuer, Ingersoll-Rand
Company, as co-obligor, Ingersoll-Rand plc, Ingersoll-
Rand International Holding Limited, Ingersoll-Rand
Luxembourg Finance S.A., Ingersoll-Rand Lux
International Holding Company S.à r.l., and Ingersoll-
Rand Irish Holdings Unlimited Company, as guarantors,
and The Bank of New York Mellon, as Trustee, to an
indenture, dated as of June 20, 2013.
Eighth Supplemental Indenture, dated as of May 1,
2020, by and among Ingersoll-Rand Global Holding
Company Limited, Ingersoll-Rand Company, Trane
Technologies plc, Trane Technologies Luxembourg
Finance S.A., Trane Technologies Lux International
Holding Company S.à.r.l., Trane Technologies Irish
Holdings Unlimited Company, Trane Technologies
HoldCo Inc., and The Bank of New York Mellon, as
Trustee, to an indenture dated as of June 20, 2013.
Incorporated by reference to Exhibit 4.3 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on June 26, 2013.
Incorporated by reference to Exhibit 4.4 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on June 26, 2013.
Incorporated by reference to Exhibit 4.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on November 26, 2013.
Incorporated by reference to Exhibit 4.5 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on October 29, 2014.
Incorporated by reference to Exhibit 4.21 to the
Company’s Form 10-K for the fiscal year ended 2015
(File No. 001-34400) filed with the SEC on February
12, 2016.
Incorporated by reference to Exhibit 4.19 to the
Company’s Form 10-K for the fiscal year ended 2016
(File No. 001-34400) filed with the SEC on February
13, 2017.
Incorporated by reference to Exhibit 4.9 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
2022 Annual Report
51
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
Ninth Supplemental Indenture, dated as of May 1,
2020, by and among Ingersoll-Rand Global Holding
Company Limited, Ingersoll-Rand Company, Trane
Technologies plc, Trane Technologies Luxembourg
Finance S.A., Trane Technologies Lux International
Holding Company S.à.r.l., Trane Technologies Irish
Holdings Unlimited Company, Trane Technologies
HoldCo Inc., and The Bank of New York Mellon, as
Trustee, to an indenture dated as of June 20, 2013.
Tenth Supplemental Indenture, dated as of May 1,
2020, by and among Trane Technologies HoldCo Inc.,
Ingersoll-Rand Global Holding Company Limited,
Ingersoll-Rand Company, Trane Technologies plc,
Trane Technologies Luxembourg Finance S.A., Trane
Technologies Lux International Holding Company
S.à.r.l., Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies Company LLC, and The
Bank of New York Mellon, as Trustee, to an indenture
dated as of June 20, 2013.
Eleventh Supplemental Indenture, dated as of May
1, 2020, by and among Trane Technologies HoldCo
Inc., Ingersoll-Rand Global Holding Company Limited,
Ingersoll-Rand Company, Trane Technologies plc,
Trane Technologies Luxembourg Finance S.A., Trane
Technologies Lux International Holding Company
S.à.r.l., Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies Company LLC, and The
Bank of New York Mellon, as Trustee, to an indenture
dated as of June 20, 2013.
Twelfth Supplemental Indenture, dated as of April 30,
2021, by and among Trane Technologies HoldCo Inc.,
Trane Technologies Company LLC, Trane Technologies
Global Holding Company Limited, Trane Technologies
plc, Trane Technologies Lux International Holding
Company S.à r.l., Trane Technologies Irish Holdings
Unlimited Company and Trane Technologies Financing
Limited and The Bank of New York Mellon, as Trustee.
Indenture, dated as of October 28, 2014, by and among
Ingersoll-Rand Luxembourg Finance S.A., as issuer,
and Ingersoll-Rand plc, Ingersoll-Rand Company
Limited, Ingersoll-Rand International Holding Limited,
Ingersoll-Rand Company and Ingersoll-Rand Global
Holding Company Limited, as guarantors, and The
Bank of New York Mellon, as Trustee.
First Supplemental Indenture, dated as of October
28, 2014, by and among Ingersoll-Rand Luxembourg
Finance S.A., as issuer, and Ingersoll-Rand plc,
Ingersoll-Rand Company Limited, Ingersoll-Rand
International Holding Limited, Ingersoll-Rand Company
and Ingersoll-Rand Global Holding Company Limited,
as guarantors, and The Bank of New York Mellon, as
Trustee, relating to the 2.625% Senior Notes due 2020.
Second Supplemental Indenture, dated as of October
28, 2014, by and among Ingersoll-Rand Luxembourg
Finance S.A., as issuer, and Ingersoll-Rand plc,
Ingersoll-Rand Company Limited, Ingersoll-Rand
International Holding Limited, Ingersoll-Rand Company
and Ingersoll-Rand Global Holding Company Limited,
as guarantors, and The Bank of New York Mellon, as
Trustee, relating to the 3.550% Senior Notes due 2024.
Incorporated by reference to Exhibit 4.10 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.11 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.12 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.13 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
Incorporated by reference to Exhibit 4.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on October 29, 2014
Incorporated by reference to Exhibit 4.2 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on October 29, 2014.
Incorporated by reference to Exhibit 4.3 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on October 29, 2014.
4.10
4.11
4.12
4.13
4.14
4.15
4.16
52
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
4.17
4.18
4.19
4.20
4.21
4.22
4.23
Third Supplemental Indenture, dated as of October
28, 2014, by and among Ingersoll-Rand Luxembourg
Finance S.A., as issuer, and Ingersoll-Rand plc,
Ingersoll-Rand Company Limited, Ingersoll-Rand
International Holding Limited, Ingersoll-Rand Company
and Ingersoll-Rand Global Holding Company Limited,
as guarantors, and The Bank of New York Mellon, as
Trustee, relating to the 4.650% Senior Notes due 2044.
Fourth Supplemental Indenture, dated as of December
18, 2015, by and among Ingersoll-Rand Luxembourg
Finance S.A., as issuer, and Ingersoll-Rand plc,
Ingersoll-Rand International Holding Limited, Ingersoll-
Rand Company, Ingersoll-Rand Global Holding
Company Limited, and Ingersoll-Rand Lux International
Holding Company S.à.r.l. as guarantors, and The Bank
of New York Mellon, as Trustee.
Fifth Supplemental Indenture, dated as of April 5, 2016,
by and among Ingersoll-Rand Luxembourg Finance
S.A., as Issuer, and Ingersoll-Rand plc, Ingersoll-Rand
Company Limited, Ingersoll-Rand Company, Ingersoll-
Rand International Holding Limited, Ingersoll-Rand Lux
International Holding Company S.à r.l., Ingersoll-Rand
Irish Holdings Unlimited Company, as guarantors, and
The Bank of New York Mellon, as Trustee.
Sixth Supplemental Indenture, dated as of May 1,
2020, by and among Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Ingersoll-Rand
Global Holding Company Limited, Ingersoll-Rand
Company, Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies HoldCo Inc., and the
Bank of New York Mellon, as Trustee.
Seventh Supplemental Indenture, dated as of May 1,
2020, by and among Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Ingersoll-Rand
Global Holding Company Limited, Trane Technologies
Irish Holdings Unlimited Company, Trane Technologies
HoldCo Inc., Trane Technologies Company LLC, and
the Bank of New York Mellon, as Trustee.
Eighth Supplemental Indenture, dated as of May 1,
2020, by and among Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Ingersoll-Rand
Global Holding Company Limited, Trane Technologies
Lux International Holding Company S.à.r.l., Trane
Technologies Irish Holdings Unlimited Company,
Trane Technologies HoldCo Inc., Trane Technologies
Company LLC, and the Bank of New York Mellon,
as Trustee.
Ninth Supplemental Indenture, dated as of May 1,
2020, by and among Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Ingersoll-Rand
Global Holding Company Limited, Trane Technologies
Lux International Holding Company S.à.r.l., Trane
Technologies Irish Holdings Unlimited Company,
Trane Technologies HoldCo Inc., Trane Technologies
Company LLC, and the Bank of New York Mellon,
as Trustee.
Incorporated by reference to Exhibit 4.4 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on October 29, 2014.
Incorporated by reference to Exhibit 4.27 to the
Company’s Form 10-K for the fiscal year ended 2015
(File No. 001-34400) filed with the SEC on February
12, 2016.
Incorporated by reference to Exhibit 4.25 to the
Company’s Form 10-K for the fiscal year ended 2016
(File No. 001-34400) filed with the SEC on February
13, 2017.
Incorporated by reference to Exhibit 4.19 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.20 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.21 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.22 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
2022 Annual Report
53
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
Tenth Supplemental Indenture dated as of April 30,
2021, by and among Trane Technologies Financing
Limited, Trane Technologies Global Holding Company
Limited, Trane Technologies plc, Trane Technologies
Lux International Holding Company S.à r.l., Trane
Technologies Irish Holdings Unlimited Company, Trane
Technologies HoldCo Inc., and Trane Technologies
Company LLC and The Bank of New York Mellon,
as Trustee.
Indenture, dated as of February 21, 2018, by and
among Ingersoll-Rand Global Holding Company
Limited, as issuer, Ingersoll-Rand plc, Ingersoll-
Rand Luxembourg Finance S.A., Ingersoll-Rand Lux
International Holding Company S.à r.l., Ingersoll-Rand
Irish Holdings Unlimited Company and Ingersoll-
Rand Company, as guarantors, and Wells Fargo Bank,
National Association, as Trustee.
First Supplemental Indenture, dated as of February
21, 2018, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Luxembourg Finance S.A., Ingersoll-
Rand Lux International Holding Company S.à r.l.,
Ingersoll-Rand Irish Holdings Unlimited Company and
Ingersoll-Rand Company, as guarantors, and Wells
Fargo Bank, National Association, as Trustee, relating
to the 2.900% Senior Notes due 2021.
Second Supplemental Indenture, dated as of February
21, 2018, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Luxembourg Finance S.A., Ingersoll-
Rand Lux International Holding Company S.à r.l.,
Ingersoll-Rand Irish Holdings Unlimited Company and
Ingersoll-Rand Company, as guarantors, and Wells
Fargo Bank, National Association, as Trustee, relating
to the 3.750% Senior Notes due 2028.
Third Supplemental Indenture, dated as of February
21, 2018, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Luxembourg Finance S.A., Ingersoll-
Rand Lux International Holding Company S.à r.l.,
Ingersoll-Rand Irish Holdings Unlimited Company and
Ingersoll-Rand Company, as guarantors, and Wells
Fargo Bank, National Association, as Trustee, relating
to the 4.300% Senior Notes due 2048.
Fourth Supplemental Indenture, dated as of March 21,
2019, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Luxembourg Finance S.A., Ingersoll-
Rand Lux International Holding Company S.à r.l.,
Ingersoll-Rand Irish Holdings Unlimited Company and
Ingersoll-Rand Company, as guarantors, and Wells
Fargo Bank, National Association, as Trustee, relating
to the 3.500% Senior Notes due 2026.
Incorporated by reference to Exhibit 4.24 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
Incorporated by reference to Exhibit 4.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on February 26, 2018.
Incorporated by reference to Exhibit 4.2 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on February 26, 2018.
Incorporated by reference to Exhibit 4.4 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on February 26, 2018.
Incorporated by reference to Exhibit 4.6 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on February 26, 2018.
Incorporated by reference to Exhibit 4.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on March 26, 2019.
4.24
4.25
4.26
4.27
4.28
4.29
54
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
4.30
4.31
4.32
4.33
4.34
4.35
Fifth Supplemental Indenture, dated as of March 21,
2019, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Luxembourg Finance S.A., Ingersoll-
Rand Lux International Holding Company S.à r.l.,
Ingersoll-Rand Irish Holdings Unlimited Company and
Ingersoll-Rand Company, as guarantors, and Wells
Fargo Bank, National Association, as Trustee, relating
to the 3.800% Senior Notes due 2029.
Sixth Supplemental Indenture, dated as of March 21,
2019, by and among Ingersoll-Rand Global Holding
Company Limited, as issuer, Ingersoll-Rand plc,
Ingersoll-Rand Luxembourg Finance S.A., Ingersoll-
Rand Lux International Holding Company S.à r.l.,
Ingersoll-Rand Irish Holdings Unlimited Company and
Ingersoll-Rand Company, as guarantors, and Wells
Fargo Bank, National Association, as Trustee, relating
to the 4.500% Senior Notes due 2049.
Seventh Supplemental Indenture, dated as of May 1,
2020, by and among Ingersoll-Rand Global Holding
Company Limited, Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Ingersoll-Rand
Company, Trane Technologies Lux International
Holding Company S.à r.l., Trane Technologies Irish
Holdings Unlimited Company, Trane Technologies
HoldCo Inc. and Wells Fargo Bank, National
Association, as Trustee.
Eighth Supplemental Indenture, dated as of May 1,
2020, by and among Ingersoll-Rand Global Holding
Company Limited, Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Trane
Technologies Lux International Holding Company
S.à r.l., Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies HoldCo Inc., Trane
Technologies Company LLC and Wells Fargo Bank,
National Association, as Trustee.
Ninth Supplemental Indenture, dated as of May 1,
2020, by and among Ingersoll-Rand Global Holding
Company Limited, Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Trane
Technologies Lux International Holding Company
S.à r.l., Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies HoldCo Inc., Trane
Technologies Company LLC and Wells Fargo Bank,
National Association, as Trustee.
Tenth Supplemental Indenture, dated as of May 1,
2020, by and among Ingersoll-Rand Global Holding
Company Limited, Trane Technologies Luxembourg
Finance S.A., Trane Technologies plc, Trane
Technologies Lux International Holding Company
S.à r.l., Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies HoldCo Inc., Trane
Technologies Company LLC and Wells Fargo Bank,
National Association, as Trustee.
Incorporated by reference to Exhibit 4.3 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on March 26, 2019.
Incorporated by reference to Exhibit 4.5 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on March 26, 2019.
Incorporated by reference to Exhibit 4.30 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.31 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.32 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 4.33 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
2022 Annual Report
55
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
Eleventh Supplemental Indenture dated as of April 30,
2021, by and among Trane Technologies Financing
Limited, Trane Technologies Global Holding Company
Limited, Trane Technologies plc, Trane Technologies
Lux International Holding Company S.à r.l., Trane
Technologies Irish Holdings Unlimited Company, Trane
Technologies HoldCo Inc. and Trane Technologies
Company LLC and Wells Fargo Bank, National
Association.
Incorporated by reference to Exhibit 4.36 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
Description of Registrant’s Securities
Filed herewith.
Form of Global Stock Option Award Agreement
(February 2021).
Form of Global Restricted Stock Unit Award
Agreement (February 2021).
Form of Global Performance Stock Unit Award
Agreement (February 2021).
Incorporated by reference to Exhibit 10.1 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 10.2 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 10.3 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 10.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on June 24, 2021.
Credit Agreement dated June 18, 2021 among Trane
Technologies Holdco Inc., Trane Technologies Global
Holding Company Limited and Trane Technologies
Financing Limited, Trane Technologies plc, Trane
Technologies Lux International Holding Company S.à r.l.,
Trane Technologies Irish Holdings Unlimited Company,
Trane Technologies Company LLC, JPMorgan Chase
Bank, N.A., as Administrative Agent, Citibank, N.A., as
Syndication Agent, J.P. Morgan Securities LLC and BNP
Paribas, as Sustainability Structuring Agents, Deutsche
Bank Securities Inc., Goldman Sachs Bank USA, MUFG
Bank, Ltd. and U.S. Bank National Association as
Documentation Agents, and JPMorgan Chase Bank,
N.A., Citibank, N.A., BofA Securities, Inc., BNP Securities
Corp. and Mizuho Bank, Ltd., as joint lead arrangers and
joint bookrunners, and certain lending institutions from
time to time parties thereto.
First Amendment dated as of June 30, 2022, to the
Credit Agreement dated as of June 18, 2021, among
Trane Technologies Holdco Inc, Trane Technologies
Global Holding Company Limited, Trane Technologies
Financing Limited and JPMorgan Chase Bank N.A. as
Administrative Agent.
Incorporated by reference to Exhibit 10.3 to the
Company’s Q2 2022 Form 10-Q (File No. 001-34400)
filed with the SEC on August 3, 2022.
Incorporated by reference to Exhibit 10.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on April 28, 2022.
Credit Agreement dated April 25, 2022 among Trane
Technologies Holdco Inc., Trane Technologies Global
Holding Company Limited and Trane Technologies
Financing Limited, Trane Technologies plc, Trane
Technologies Lux International Holding Company
S.à r.l., Trane Technologies Irish Holdings Unlimited
Company, Trane Technologies Company LLC,
JPMorgan Chase Bank, N.A., as Administrative Agent,
Citibank, N.A., as Syndication Agent, J.P. Morgan
Securities LLC and BNP Paribas, as Sustainability
Structuring Agents, Bank of America, N.A., BNP Paribas,
Deutsche Bank Securities Inc., Goldman Sachs
Bank USA, MUFG Bank, Ltd. and U.S. Bank, N.A., as
Documentation Agents, and JPMorgan Chase Bank,
N.A., Citibank, N.A., BofA Securities, Inc., BNP Securities
Corp. and Mizuho Bank, Ltd., as joint lead arrangers
and joint bookrunners, and certain lending institutions
from time to time parties thereto.
4.36
4.37
10.1*
10.2*
10.3*
10.4
10.5
10.6
56
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
10.7
10.8
10.9*
10.10*
10.11*
10.12*
10.13*
10.14*
10.15*
10.16*
10.17*
10.18*
10.19*
10.20*
10.21*
Deed Poll Indemnity of Trane Technologies plc dated
August 2, 2022
Incorporated by reference to Exhibit 10.1 to the
Company’s Q2 2022 Form 10-Q (File No. 001-34400)
filed with the SEC on August 3, 2022.
Deed Poll Indemnity of Trane Technologies Lux
International Holding company S.à r.l. dated August 2,
2022
Incorporated by reference to Exhibit 10.2 to the
Company’s Q2 2022 Form 10-Q (File No. 001-34400)
filed with the SEC on August 3, 2022.
Trane Technologies Incentive Stock Plan of 2013
(amended and restated as of March 2, 2020).
Trane Technologies Incentive Stock Plan of 2018
(amended and restated as of March 2, 2020).
Trane Technologies Executive Deferred Compensation
Plan (as amended and restated effective May 4, 2020).
Incorporated by reference to Exhibit 10.9 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 10.10 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 10.11 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Executive Deferred Compensation
Plan II (as amended and restated effective May 4,
2020).
Incorporated by reference to Exhibit 10.13 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
Trane Technologies Director Deferred Compensation
and Stock Award Plan (as amended and restated
effective March 2, 2020).
Incorporated by reference to Exhibit 10.13 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Director Deferred Compensation
and Stock Award Plan II (as amended and restated
effective March 2, 2020).
Incorporated by reference to Exhibit 10.14 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Supplemental Employee Savings
Plan (amended and restated effective May 4, 2020).
Incorporated by reference to Exhibit 10.15 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Supplemental Employee Savings
Plan II (effective January 1, 2005 and amended and
restated through May 4, 2020).
Incorporated by reference to Exhibit 10.16 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Inc. Deferred Compensation Plan (as amended
and restated as of May 4, 2020, except where
otherwise stated).
Incorporated by reference to Exhibit 10.17 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Supplemental Pension Plan
(Amended and Restated Effective May 4, 2020).
Trane Technologies Supplemental Pension Plan II
(Amended and Restated Effective May 4, 2020).
Incorporated by reference to Exhibit 10.18 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Incorporated by reference to Exhibit 10.19 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Elected Officers Supplemental
Plan (Effective January 1, 2005 and Amended and
Restated effective May 4, 2020).
Incorporated by reference to Exhibit 10.20 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
Trane Technologies Key Management Supplemental
Program (Effective January 1, 2005 and Amended and
Restated effective May 4, 2020).
Incorporated by reference to Exhibit 10.22 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
10.22*
Description of Annual Incentive Matrix Program.
Incorporated by reference to Exhibit 10.23 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
10.23*
10.24*
Amendment One to the Trane Technologies Key
Management Supplemental Program (effective
October 11, 2022).
Filed herewith.
Trane Inc. Deferred Compensation Plan (as Amended
and Restated as of May 4, 2020).
Filed herewith
2022 Annual Report
57
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
10.25*
Form of Tier 1 Change in Control Agreement
(New Officers on or after May 19, 2009).
10.26*
Form of Tier 2 Change in Control Agreement (New
Officers on or after May 19, 2009).
Incorporated by reference to Exhibit 10.32 to the
Company’s Form 10-Q for the period ended June
30, 2009 (File No. 001-34400) filed with the SEC on
August 6, 2009.
Incorporated by reference to Exhibit 10.33 to the
Company’s Form 10-Q for the period ended June
30, 2009 (File No. 001-34400) filed with the SEC on
August 6, 2009.
10.27*
Amended and Restated Major Restructuring
Severance Plan (as amended and restated effective
May 4, 2020).
Incorporated by reference to Exhibit 10.27 to the
Company’s 2020 Form 10-K (File No. 001-34400)
filed with the SEC on February 9, 2021.
10.28*
David S. Regnery Letter, dated as of September 1, 2017.
10.29*
David S. Regnery Letter, dated as of December 9, 2019.
10.30*
David S. Regnery Letter, dated as of June 3, 2021.
10.31*
Christopher J. Kuehn Letter, dated as of December 10,
2019.
10.32*
Paul A. Camuti Letter, dated December 5, 2019.
10.33*
Mark Majocha Offer Letter dated October 12, 2022
Incorporated by reference to Exhibit 10.44 to the
Company’s Form 10-K for the year ended December
31, 2018 (File No. 001-34400) filed with the SEC on
February 12, 2019.
Incorporated by reference to Exhibit 10.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on December 11, 2019.
Incorporated by reference to Exhibit 10.1 to the
Company’s Form 8-K (Filed No. 001-34400) filed
with the SEC on June 4, 2021.
Incorporated by reference to Exhibit 10.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on December 10, 2019.
Incorporated by reference to Exhibit 10.42 to the
Company’s 2021 Form 10-K (File No. 001-34400) filed
with the SEC on February 7, 2022.
Incorporated by reference to Exhibit 10.1 to the
Company’s Form 8-K (File No. 001-34400) filed with
the SEC on October 14, 2022.
21
22.1
23.1
31.1
31.2
32
List of Subsidiaries of Trane Technologies plc.
List of Guarantors and Subsidiary Issuers of
Guaranteed Securities.
Consent of Independent Registered Public
Accounting Firm.
Certification of Chief Executive Officer Pursuant to
Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.
Certification of Chief Financial Officer Pursuant to
Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.
Certifications of Chief Executive Officer and Chief
Financial Officer Pursuant to Rule 13a-14(b) or Rule
15d-14(b) and 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
Filed herewith.
Filed herewith.
Filed herewith.
Filed herewith.
Filed herewith.
Furnished herewith.
58
PART IV
EXHIBIT NO.
DESCRIPTION
METHOD OF FILING
101
The following materials from the Company’s Annual
Report on Form 10-K for the year ended December 31,
2022, formatted in iXBRL (Inline Extensible Business
Reporting Language): (i) the Consolidated Statements
of Earnings, (ii) the Consolidated Statements of
Comprehensive Income, (iii) the Consolidated Balance
Sheets, (iv) the Consolidated Statements of Equity,
(v) the Consolidated Statements of Cash Flows, and
(vi) Notes to Consolidated Financial Statements.
Furnished herewith.
104
Cover Page Interactive Data File (embedded within
the iXBRL document and contained in Exhibit 101).
Filed herewith.
* Management contract or compensatory plan or arrangement.
Item 16. Form 10-K Summary
Not applicable.
2022 Annual Report
59
PART IV
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
TRANE TECHNOLOGIES PLC
(Registrant)
By:
/s/ David S. Regnery
David S. Regnery
Chair of the Board and Chief Executive Officer
(Principal Executive Officer)
Date: February 10, 2023
Pursuant to the requirement of the Securities Exchange Act of 1934, this report has been signed by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.
Signature
Title
/s/ David S. Regnery
(David S. Regnery)
Chair of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Christopher J. Kuehn
(Christopher J. Kuehn)
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
/s/ Mark A. Majocha
(Mark A. Majocha)
/s/ Kirk E. Arnold
(Kirk E. Arnold)
/s/ Ann C. Berzin
(Ann C. Berzin)
/s/ April Miller Boise
(April Miller Boise)
/s/ John Bruton
(John Bruton)
/s/ Jared L. Cohon
(Jared L. Cohon)
/s/ Gary D. Forsee
(Gary D. Forsee)
/s/ Mark R. George
(Mark R. George)
/s/ Linda P. Hudson
(Linda P. Hudson)
/s/ Myles P. Lee
(Myles P. Lee)
/s/ Melissa N. Schaeffer
(Melissa N. Schaeffer)
/s/ John P. Surma
(John P. Surma)
/s/ Tony L. White
(Tony L. White)
60
Vice President and Chief Accounting Officer
(Principal Accounting Officer)
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Date
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
February 10, 2023
Part IV
TRANE TECHNOLOGIES PLC
Index to Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID 238)
Consolidated Statements of Earnings
Consolidated Statements of Comprehensive Income
Consolidated Balance Sheets
Consolidated Statements of Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
PART IV
F-2
F-4
F-5
F-6
F-7
F-8
F-9
2022 Annual Report
F-1
PART IV
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders of Trane Technologies plc
OPINIONS ON THE FINANCIAL STATEMENTS AND INTERNAL CONTROL OVER
FINANCIAL REPORTING
We have audited the accompanying consolidated balance sheets of Trane Technologies plc and its subsidiaries (the
“Company”) as of December 31, 2022 and 2021 and the related consolidated statements of earnings, of comprehensive
income, of equity and of cash flows for each of the three years in the period ended December 31, 2022, including the
related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s
internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control –
Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial
position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each
of the three years in the period ended December 31, 2022 in conformity with accounting principles generally accepted
in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal
control over financial reporting as of December 31, 2022, based on criteria established in Internal Control – Integrated
Framework (2013) issued by the COSO.
BASIS FOR OPINIONS
The Company’s management is responsible for these consolidated financial statements, for maintaining effective
internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial
reporting, included in Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A. Our
responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal
control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company
Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was
maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of material
misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that
respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used
and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial
statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over
financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as
we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
DEFINITION AND LIMITATIONS OF INTERNAL CONTROL OVER FINANCIAL REPORTING
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company’s internal control over financial reporting includes those policies
and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in accordance with authorizations
of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely
F-2
PART IV
detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the
financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
CRITICAL AUDIT MATTERS
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial
statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts
or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging,
subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on
the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below,
providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
REVENUE RECOGNITION FROM CONTRACTS WITH CUSTOMERS
As described in Notes 2 and 12 to the consolidated financial statements, the Company recognized $16.0 billion of
consolidated revenue for the year ended December 31, 2022. Revenue is recognized when control of a good or service
promised in a contract (i.e., performance obligation) is transferred to a customer. Control is obtained when a customer
has the ability to direct the use of and obtain substantially all of the remaining benefits from that good or service. A
majority of the Company’s revenue is recognized at a point-in-time as control is transferred at a distinct point in time
per the terms of a contract. However, a portion of the Company’s revenue is recognized over-time as the customer
simultaneously receives control as the Company performs work under a contract. For these arrangements, management
uses the cost-to-cost input method as it best depicts the transfer of control to the customer that occurs as the Company
incurs costs. The transaction price allocated to performance obligations reflects the Company’s expectations about the
consideration it will be entitled to receive from a customer. To determine the transaction price, variable and non-cash
consideration are assessed as well as whether a significant financing component exists.
The principal considerations for our determination that performing procedures relating to revenue recognition from
contracts with customers is a critical audit matter are the high degree of auditor effort in performing procedures and
evaluating audit evidence related to the Company’s revenue recognition of point-in-time and over-time contracts with
customers.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our
overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls
relating to the revenue recognition process on the Company’s point-in-time and over-time contracts with customers.
These procedures also included, among others (i) evaluating revenue transactions on a sample basis by obtaining and
inspecting evidence of an arrangement with a customer, evidence of goods delivered or services provided and evidence
of consideration received in exchange for transferring those goods or services, and (ii) evaluating the completeness and
accuracy of data provided by management.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
February 10, 2023
We have served as the Company’s auditor since at least 1906. We have not been able to determine the specific year we
began serving as auditor of the Company.
2022 Annual Report
F-3
PART IV
Trane Technologies plc
Consolidated Statements of Earnings
In millions, except per share amounts
FOR THE YEARS ENDED DECEMBER 31,
2022
2021
2020
Net revenues
Products
Services
Costs and expenses
Cost of products sold
Cost of services sold
Selling and administrative expenses
Operating income
Interest expense
Other income/(expense), net
Earnings before income taxes
Provision for income taxes
Earnings from continuing operations
Discontinued operations, net of tax
Net earnings
Less: Net earnings from continuing operations attributable to noncontrolling
interests
Less: Net earnings from discontinuing operations attributable to noncontrolling
interests
$ 10,930.8 $
9,498.8 $
8,372.5
5,060.9
4,637.6
4,082.2
15,991.7
14,136.4
12,454.7
(7,935.2)
(6,843.1)
(6,146.3)
(3,091.7)
(2,823.7)
(2,505.0)
(2,545.9)
(2,446.3)
(2,270.6)
2,418.9
2,023.3
1,532.8
(223.5)
(23.3)
(233.7)
(248.7)
1.1
4.1
2,172.1
1,790.7
1,288.2
(375.9)
(333.5)
1,796.2
1,457.2
(21.5)
(20.6)
1,774.7
1,436.6
(296.8)
991.4
(121.4)
870.0
(18.2)
(13.2)
(14.2)
—
—
(0.9)
Net earnings attributable to Trane Technologies plc
$
1,756.5
$
1,423.4
$
854.9
Amounts attributable to Trane Technologies plc ordinary shareholders:
Continuing operations
Discontinued operations
Net earnings
Earnings (loss) per share attributable to Trane Technologies plc ordinary
shareholders:
Basic:
Continuing operations
Discontinued operations
Net earnings
Diluted:
Continuing operations
Discontinued operations
Net earnings
See accompanying notes to Consolidated Financial Statements.
$
1,778.0
$
1,444.0
$
977.2
(21.5)
(20.6)
(122.3)
$
1,756.5
$
1,423.4
$
854.9
$
$
$
$
7.65
$
6.05
$
(0.10)
(0.09)
7.55
$
5.96
$
7.57
$
5.96
$
(0.09)
(0.09)
7.48
$
5.87
$
4.07
(0.51)
3.56
4.02
(0.50)
3.52
F-4
PART IV
Trane Technologies plc
Consolidated Statements of Comprehensive Income
In millions
FOR THE YEARS ENDED DECEMBER 31,
Net earnings
Other comprehensive income (loss):
Currency translation
Cash flow hedges
Unrealized net gains (losses) arising during period
Net (gains) losses reclassified into earnings
Tax (expense) benefit
Total cash flow hedges, net of tax
Pension and OPEB adjustments:
Prior service costs for the period
Net actuarial gains (losses) for the period
Amortization reclassified into earnings
Net curtailment and settlement (gains) losses reclassified to earnings
Currency translation and other
Tax (expense) benefit
Total pension and OPEB adjustments, net of tax
Other comprehensive income (loss), net of tax
2022
2021
2020
$
1,774.7
$
1,436.6
$
870.0
(202.7)
(122.7)
261.5
(24.3)
10.2
2.5
(11.6)
(3.3)
54.2
21.6
15.0
12.7
(16.1)
84.1
(130.2)
1.6
(6.4)
1.1
(3.7)
0.3
111.4
38.6
8.0
5.2
(43.7)
119.8
(6.6)
3.3
1.9
—
5.2
(1.9)
(52.5)
43.4
(1.8)
(10.4)
(0.7)
(23.9)
242.8
Comprehensive income, net of tax
$
1,644.5
$
1,430.0
$
1,112.8
Less: Comprehensive income attributable to noncontrolling interests
(16.6)
(12.7)
(17.8)
Comprehensive income attributable to Trane Technologies plc
$
1,627.9
$
1,417.3
$
1,095.0
See accompanying notes to Consolidated Financial Statements.
2022 Annual Report
F-5
PART IV
Trane Technologies plc
Consolidated Balance Sheets
In millions, except share amounts
DECEMBER 31,
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
Accounts and notes receivable, net
Inventories
Other current assets
Total current assets
Property, plant and equipment, net
Goodwill
Intangible assets, net
Other noncurrent assets
Total assets
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
Accrued compensation and benefits
Accrued expenses and other current liabilities
Short-term borrowings and current maturities of long-term debt
Total current liabilities
Long-term debt
Postemployment and other benefit liabilities
Deferred and noncurrent income taxes
Other noncurrent liabilities
Total liabilities
Equity:
Trane Technologies plc shareholders’ equity
Ordinary shares, $1.00 par value (253,328,263 and 259,695,768 shares issued at
December 31, 2022 and 2021, respectively)
Ordinary shares held in treasury, at cost (24,500,868 and 24,500,935 shares at
December 31, 2022 and 2021, respectively)
Retained earnings
Accumulated other comprehensive income (loss)
Total Trane Technologies plc shareholders’ equity
Noncontrolling interest
Total equity
Total liabilities and equity
See accompanying notes to Consolidated Financial Statements.
F-6
2022
2021
$ 1,220.5
$ 2,159.2
2,780.1
1,993.8
384.8
6,379.2
1,536.1
5,503.7
3,264.0
1,398.6
2,429.4
1,530.8
351.5
6,470.9
1,398.8
5,504.8
3,305.6
1,379.7
$ 18,081.6
$ 18,059.8
$ 2,091.6
$ 1,787.3
541.2
2,006.0
1,048.0
5,686.8
3,788.3
667.0
680.1
1,154.2
11,976.4
544.8
2,069.9
350.4
4,752.4
4,491.7
810.9
581.5
1,150.2
11,786.7
253.3
259.7
(1,719.4)
(1,719.4)
8,320.9
(766.2)
6,088.6
16.6
6,105.2
8,353.2
(637.6)
6,255.9
17.2
6,273.1
$ 18,081.6
$ 18,059.8
Trane Technologies plc
Consolidated Statements of Equity
TRANE TECHNOLOGIES PLC SHAREHOLDERS’ EQUITY
ORDINARY SHARES ORDINARY
SHARES
HELD IN
TREASURY,
AT COST
AMOUNT
AT PAR
VALUE SHARES
TOTAL
EQUITY
CAPITAL IN
EXCESS OF
PAR VALUE
RETAINED
EARNINGS
IN MILLIONS, EXCEPT PER SHARE
AMOUNTS
Balance at December 31, 2019
Net earnings
Other comprehensive income
(loss)
Shares issued under incentive
stock plans
Repurchase of ordinary shares
Share-based compensation
Dividends declared to
noncontrolling interest
Investment by joint venture
partner
Cash dividends declared
($2.12 per share)
Separation of Ingersoll Rand
Industrial
Balance at December 31, 2020
Net earnings
Other comprehensive income
(loss)
Shares issued under incentive
stock plans
Repurchase of ordinary shares
Share-based compensation
Dividends declared to
noncontrolling interest
Cash dividends declared
($2.36 per share)
Separation of Ingersoll Rand
Industrial
Other
Balance at December 31, 2021
Net earnings
Other comprehensive income
(loss)
Shares issued under incentive
stock plans
Repurchase of ordinary shares
Share-based compensation
Dividends declared to
noncontrolling interest
Acquisition of noncontrolling
interest
Cash dividends declared
($2.68 per share)
Separation of Ingersoll Rand
Industrial
Other
Balance at December 31, 2022
$ 7,312.4 $ 262.8
—
870.0
242.8
—
64.5
(250.0)
66.3
(18.3)
7.0
(507.7)
2.3
(1.8)
—
—
—
—
(1,359.9)
—
$ 6,427.1 $ 263.3
—
1,436.6
(6.6)
—
78.3
(1,100.3)
63.6
(14.9)
(561.8)
2.3
(5.9)
—
—
—
(49.0)
0.1
—
—
$ 6,273.1 $ 259.7
—
1,774.7
(130.2)
—
2.6
(1,200.2)
54.3
(14.5)
(15.1)
(620.7)
1.1
(7.5)
—
—
—
—
(18.9)
0.1
—
—
$ 6,105.2 $ 253.3
262.8 $ (1,719.4) $
—
—
2.3
(1.8)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
263.3 $ (1,719.4) $
—
—
2.3
(5.9)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
259.7 $ (1,719.4) $
—
—
1.1
(7.5)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
253.3 $ (1,719.4) $
ACCUMULATED
OTHER
COMPREHENSIVE
INCOME (LOSS)
(1,006.6) $
—
240.1
—
—
—
—
—
—
135.0
(631.5) $
—
— $ 9,730.8 $
—
854.9
—
—
62.2
(135.6)
69.5
—
(112.6)
(3.2)
—
3.9
—
—
—
(507.7)
— (1,466.9)
— $ 8,495.3 $
— 1,423.4
—
—
(6.1)
76.0
(142.5)
66.4
—
—
—
(951.9)
(2.8)
—
(561.8)
—
—
—
—
—
(49.0)
—
—
0.1
— $ 8,353.2 $
— 1,756.5
—
—
(637.6) $
—
—
—
(128.6)
1.5
(45.4)
56.2
—
(1,147.3)
(1.9)
—
(12.4)
—
—
—
(620.7)
—
0.1
— $ 8,320.9 $
(18.9)
—
—
—
—
—
—
—
—
—
(766.2) $
PART IV
NONCONTROLLING
INTEREST
44.8
15.1
2.7
—
—
—
(18.3)
3.1
—
(28.0)
19.4
13.2
(0.5)
—
—
—
(14.9)
—
—
—
17.2
18.2
(1.6)
—
—
—
(14.5)
(2.7)
—
—
—
16.6
See accompanying notes to Consolidated Financial Statements.
2022 Annual Report
F-7
PART IV
Trane Technologies plc
Consolidated Statements of Cash Flows
In millions
FOR THE YEARS ENDED DECEMBER 31,
Cash flows from operating activities:
Net earnings
Discontinued operations, net of tax
Adjustments for non-cash transactions:
Depreciation and amortization
Pension and other postretirement benefits
Stock settled share-based compensation
Other non-cash items, net
Changes in other assets and liabilities, net of the effects of acquisitions:
Accounts and notes receivable
Inventories
Other current and noncurrent assets
Accounts payable
Other current and noncurrent liabilities
Net cash provided by (used in) continuing operating activities
Net cash provided by (used in) discontinued operating activities
Net cash provided by (used in) operating activities
Cash flows from investing activities:
Capital expenditures
Acquisitions and equity method investments, net of cash acquired
Proceeds from sale of property, plant and equipment
Deconsolidation of certain entities under Chapter 11
Other investing activities, net
Net cash provided by (used in) continuing investing activities
Net cash provided by (used in) discontinued investing activities
Net cash provided by (used in) investing activities
Cash flows from financing activities:
Payments of long-term debt
Debt issuance costs
Dividends paid to ordinary shareholders
Dividends paid to noncontrolling interests
Proceeds (payments) from shares issued under incentive plans, net
Repurchase of ordinary shares
Receipt of / (Settlement related to) special cash payment
Other financing activities, net
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents – beginning of period
Cash and cash equivalents – end of period
Cash paid during the year for:
Interest
Income taxes, net of refunds
See accompanying notes to Consolidated Financial Statements.
2022
2021
2020
$ 1,774.7
21.5
$ 1,436.6
20.6
$
870.0
121.4
323.6
55.6
56.3
17.1
(345.4)
(466.7)
(116.8)
317.9
60.9
1,698.7
(194.7)
1,504.0
(291.8)
(234.7)
9.7
—
(23.0)
(539.8)
(0.6)
(540.4)
299.4
50.8
66.5
(36.4)
(265.4)
(348.8)
(153.8)
275.3
249.6
1,594.4
(6.1)
1,588.3
(223.0)
(269.2)
15.1
—
(68.6)
(545.7)
—
(545.7)
294.3
68.8
69.5
(1.5)
5.9
109.0
29.7
75.8
123.3
1,766.2
(331.2)
1,435.0
(146.2)
(182.8)
0.1
(10.8)
1.2
(338.5)
(37.7)
(376.2)
(9.6)
(2.1)
(620.2)
(14.5)
2.6
(1,200.2)
(6.2)
(2.0)
(1,852.2)
(50.1)
(938.7)
2,159.2
$ 1,220.5
(432.5)
(2.7)
(561.1)
(14.9)
78.3
(1,100.3)
(49.5)
(44.9)
(2,127.6)
(45.7)
(1,130.7)
3,289.9
$ 2,159.2
(307.5)
(3.6)
(507.3)
(18.3)
64.5
(250.0)
1,900.0
6.5
884.3
68.2
2,011.3
1,278.6
$ 3,289.9
$
$
218.0
321.3
$
$
234.9
356.9
$
$
243.5
151.6
F-8
PART IV
Notes to Consolidated Financial Statements
NOTE 1. DESCRIPTION OF COMPANY
Trane Technologies plc, a public limited company, incorporated in Ireland in 2009, and its consolidated subsidiaries
(collectively we, our, the Company) is a global climate innovator. The Company brings sustainable and efficient solutions
to buildings, homes and transportation through the Company’s strategic brands, Trane® and Thermo King®, and its
environmentally responsible portfolio of products, services and connected intelligent controls. The Company generates
revenue and cash primarily through the design, manufacture, sales and service of solutions for Heating, Ventilation and
Air Conditioning (HVAC), transport refrigeration, and custom refrigeration solutions. As an industry leader with an extensive
global install base, the Company’s growth strategy includes expanding recurring revenue through services and rental
options. The Company’s unique business operating system, uplifting culture and highly engaged team around the world
are also central to its earnings and cash flow growth.
COMPLETION OF REVERSE MORRIS TRUST TRANSACTION
On February 29, 2020 (Distribution Date), the Company completed its Reverse Morris Trust transaction (the Transaction)
with Gardner Denver Holdings, Inc. (Gardner Denver) whereby the Company separated its former Industrial segment
(Ingersoll Rand Industrial) through a pro rata distribution to shareholders of record as of February 24, 2020 (Spin-off
Shareholders). Ingersoll Rand Industrial then merged into a wholly-owned subsidiary of Gardner Denver, which changed
its name to Ingersoll Rand Inc. (Ingersoll Rand). Upon close of the Transaction, the Spin-off Shareholders received 50.1%
of the shares of Ingersoll Rand common stock on a fully-diluted basis and Gardner Denver shareholders retained 49.9%
of the shares of Ingersoll Rand on a fully diluted basis. As a result, the Spin-off Shareholders received .8824 shares
of Ingersoll Rand common stock with respect to each share owned as of February 24, 2020. In connection with the
Transaction, the Company received a special cash payment of $1.9 billion.
During the year ended December 31, 2022, the Company recorded a reduction to Retained earnings of $18.9 million
primarily related to tax matters associated with Ingersoll Rand Industrial and the settlement of certain items related to the
Transaction. During the year ended December 31, 2021, the Company paid Ingersoll Rand $49.5 million to settle certain
items related to the Transaction. This payment was related to working capital, cash and indebtedness amounts as of
the Distribution Date, as well as funding levels related to pension plans, non-qualified deferred compensation plans
and retiree health benefits. The Company recorded the settlement as a reduction to Retained earnings during the first
quarter of 2021.
DISCONTINUED OPERATIONS
After the Distribution Date, the Company does not beneficially own any Ingersoll Rand Industrial shares of common stock
and no longer consolidates Ingersoll Rand Industrial in its financial statements. The historical results of Ingersoll Rand
Industrial are presented as a discontinued operation in the Consolidated Statements of Earnings and Consolidated
Statements of Cash Flows.
REORGANIZATION OF ALDRICH AND MURRAY
On May 1, 2020, certain subsidiaries of the Company underwent an internal corporate restructuring that was effectuated
through a series of transactions (2020 Corporate Restructuring). As a result, Aldrich Pump LLC (Aldrich) and Murray
Boiler LLC (Murray), indirect wholly-owned subsidiaries of Trane Technologies plc, became solely responsible for the
asbestos-related liabilities, and the beneficiaries of the asbestos-related insurance assets, of Trane Technologies Company
LLC and Trane U.S. Inc, respectively. On a consolidated basis, the 2020 Corporate Restructuring did not have an impact
on the Consolidated Financial Statements. In connection with the 2020 Corporate Restructuring, certain subsidiaries of
the Company entered into funding agreements with Aldrich and Murray (collectively the Funding Agreements), pursuant to
which those subsidiaries are obligated, among other things, to pay the costs and expenses of Aldrich and Murray during
the pendency of the Chapter 11 cases to the extent distributions from their respective subsidiaries are insufficient to do so
and to provide an amount for the funding for a trust established pursuant to section 524(g) of the Bankruptcy Code, to the
extent that the other assets of Aldrich and Murray are insufficient to provide the requisite trust funding.
On June 18, 2020 (Petition Date), Aldrich and Murray filed voluntary petitions for relief under Chapter 11 of Title 11 of the
United States Code (the Bankruptcy Code) in the United States Bankruptcy Court for the Western District of North
Carolina (the Bankruptcy Court) to resolve equitably and permanently all current and future asbestos related claims in
2022 Annual Report
F-9
PART IV
a manner beneficial to claimants, Aldrich and Murray. As a result of the Chapter 11 filings, all asbestos-related lawsuits
against Aldrich and Murray have been stayed due to the imposition of a statutory automatic stay applicable in Chapter
11 bankruptcy cases. Only Aldrich and Murray have filed for Chapter 11 relief. Neither Aldrich’s wholly-owned subsidiary,
200 Park, Inc. (200 Park), Murray’s wholly-owned subsidiary, ClimateLabs LLC (ClimateLabs), Trane Technologies plc nor
its other subsidiaries (the Trane Companies) are part of the Chapter 11 filings. The Trane Companies are expected to
continue to operate as usual, with no disruption to their employees, suppliers, or customers globally. However, as of the
Petition Date, Aldrich and its wholly-owned subsidiary 200 Park and Murray and its wholly-owned subsidiary ClimateLabs
were deconsolidated and their respective assets and liabilities were derecognized from the Company’s Consolidated
Financial Statements. Refer to Note 20, “Commitments and Contingencies,” for more information regarding the Chapter 11
bankruptcy and asbestos-related matters.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A summary of significant accounting policies used in the preparation of the accompanying Consolidated Financial
Statements follows:
Basis of Presentation: The accompanying Consolidated Financial Statements reflect the consolidated operations
of the Company and have been prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP)
as defined by the Financial Accounting Standards Board (FASB) within the FASB Accounting Standards Codification
(ASC). Intercompany accounts and transactions have been eliminated. The results of operations and cash flows of all
discontinued operations have been separately reported as discontinued operations for all periods presented.
The Consolidated Financial Statements include all majority-owned subsidiaries of the Company. A noncontrolling interest
in a subsidiary is considered an ownership interest in a majority-owned subsidiary that is not attributable to the parent.
The Company includes Noncontrolling interest as a component of Total equity in the Consolidated Balance Sheets and
the Net earnings attributable to noncontrolling interests are presented as an adjustment from Net earnings used to arrive
at Net earnings attributable to Trane Technologies plc in the Consolidated Statements of Earnings.
Use of Estimates: The preparation of financial statements in conformity with GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent
assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses
during the reporting period. Estimates are based on several factors including the facts and circumstances available at
the time the estimates are made, historical experience, risk of loss, general economic conditions and trends, and the
assessment of the probable future outcome. Actual results could differ from those estimates. Estimates and assumptions
are reviewed periodically, and the effects of changes, if any, are reflected in the Consolidated Statements of Earnings in
the period that they are determined.
Currency Translation: Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar,
have been translated at year-end exchange rates, and income and expense accounts have been translated using average
exchange rates throughout the year. Adjustments resulting from the process of translating an entity’s financial statements
into the U.S. dollar have been recorded in the equity section of the Consolidated Balance Sheets within Accumulated other
comprehensive income (loss). Transactions that are denominated in a currency other than an entity’s functional currency
are subject to changes in exchange rates with the resulting gains and losses recorded within Other income/(expense), net.
Cash and Cash Equivalents: Cash and cash equivalents include cash on hand, demand deposits and all highly liquid
investments with original maturities at the time of purchase of three months or less. The Company maintains amounts
on deposit at various financial institutions, which may at times exceed federally insured limits. However, management
periodically evaluates the credit-worthiness of those institutions and has not experienced any losses on such deposits.
Allowance for Credit Losses: The Company maintains an allowance for credit losses which represents the best
estimate of expected loss inherent in the Company’s accounts receivable portfolio. This estimate is based upon
a two-step policy that results in the total recorded allowance for credit losses. The first step is to record a portfolio
reserve based on the aging of the outstanding accounts receivable portfolio and the Company’s historical experience
with the Company’s end markets, customer base and products. The second step is to create a specific reserve for
significant accounts as to which the customer’s ability to satisfy their financial obligation to the Company is in doubt
due to circumstances such as bankruptcy, deteriorating operating results or financial position. In these circumstances,
management uses its judgment to record an allowance based on the best estimate of expected loss, factoring in such
F-10
PART IV
considerations as the market value of collateral, if applicable. Actual results could differ from those estimates. These
estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the Consolidated
Statements of Earnings in the period that they are determined. The Company’s allowance for credit losses was $43.7
million and $39.9 million as of December 31, 2022 and 2021, respectively.
Inventories: Depending on the business, U.S. inventories are stated at the lower of cost or market using the last-in,
first-out (LIFO) method or the lower of cost and net realizable value (NRV) using the first-in, first-out (FIFO) method. Non-U.S.
inventories are stated at the lower of cost and NRV using the FIFO method. At December 31, 2022 and 2021, approximately
58% and 54%, respectively, of all inventory utilized the LIFO method.
Property, Plant and Equipment: Property, plant and equipment are stated at cost, less accumulated depreciation.
Assets placed in service are recorded at cost and depreciated using the straight-line method over the estimated useful
life of the asset except for leasehold improvements, which are depreciated over the shorter of their economic useful life
or their lease term. The range of useful lives used to depreciate property, plant and equipment is as follows:
Buildings
Machinery and equipment
Software
10 to 50 years
2 to 12 years
2 to 7 years
Major expenditures for replacements and significant improvements that increase asset values and extend useful lives are
also capitalized. Capitalized costs are amortized over their estimated useful lives using the straight-line method. Repairs
and maintenance expenditures that do not extend the useful life of the asset are charged to expense as incurred. The
carrying amounts of assets that are sold or retired and the related accumulated depreciation are removed from the
accounts in the year of disposal, and any resulting gain or loss is reflected within current earnings.
The Company assesses the recoverability of the carrying value of its property, plant and equipment whenever events or
changes in circumstances indicate that the carrying amount of the asset group may not be recoverable. Recoverability
is measured by a comparison of the carrying amount of an asset group to the future net undiscounted cash flows
expected to be generated by the asset group. If the undiscounted cash flows are less than the carrying amount of the
asset group, an impairment loss is recognized for the amount by which the carrying value of the asset group exceeds
the fair value of the asset group.
Goodwill and Intangible Assets: The Company records as goodwill the excess of the purchase price over the fair value
of the net assets acquired in a business combination. Measurement period adjustments may be recorded once a final
valuation has been performed. Goodwill and other indefinite-lived intangible assets are tested and reviewed annually for
impairment during the fourth quarter or whenever there is a significant change in events or circumstances that indicate
that the fair value of the asset is more likely than not less than the carrying amount of the asset. In addition, an interim
impairment test is completed upon a triggering event or when there is a reorganization of reporting structure or disposal
of all or a portion of a reporting unit.
Impairment of goodwill is tested at the reporting unit level. The test compares the carrying amount of the reporting
unit to its estimated fair value. If the estimated fair value of a reporting unit exceeds its carrying amount, goodwill of the
reporting unit is not impaired. To the extent that the carrying value of the reporting unit exceeds its estimated fair value,
an impairment loss would be recognized for the amount by which the reporting unit’s carrying amount exceeds its fair
value, not to exceed the carrying amount of goodwill in that reporting unit.
Intangible assets such as customer-related intangible assets and other intangible assets with finite useful lives are amortized
on a straight-line basis over their estimated economic lives. The weighted-average useful lives approximate the following:
Customer relationships
Other
16 years
7 years
The Company assesses the recoverability of the carrying value of its intangible assets with finite useful lives whenever
events or changes in circumstances indicate that the carrying amount of the asset group may not be recoverable.
Recoverability is measured by a comparison of the carrying amount of an asset group to the future net undiscounted
2022 Annual Report
F-11
PART IV
cash flows expected to be generated by the asset group. If the undiscounted cash flows are less than the carrying
amount of the asset group, an impairment loss is recognized for the amount by which the carrying value of the asset
group exceeds the fair value of the asset group.
Business Combinations: Acquisitions that meet the definition of a business combination are recorded using the
acquisition method of accounting. The Company includes the operating results of acquired entities from their
respective dates of acquisition. The Company recognizes and measures the identifiable assets acquired, liabilities
assumed, including contingent consideration relating to earnout provisions, and any non-controlling interest as of
the acquisition date fair value. The excess, if any, of total consideration transferred in a business combination over
the fair value of identifiable assets acquired, liabilities assumed and any non-controlling interest is recognized as
goodwill. Costs incurred as a result of a business combination other than costs related to the issuance of debt or
equity securities are recorded in the period the costs are incurred. Additionally, at each reporting period, contingent
consideration is remeasured to fair value, with changes recorded in Selling and administrative expenses in the
Consolidated Statements of Earnings.
Equity Investments: Partially-owned equity affiliates generally represent 20-50% ownership interests in equity investments
where the Company demonstrates significant influence, but does not have a controlling financial interest. Partially-owned
equity affiliates are accounted for under the equity method.
The Company invests in companies that complement existing products and services further enhancing its product
portfolio. The Company records equity investments for which it does not have significant influence and without a readily
determinable fair value at cost with adjustments for observable changes in price or impairment as permitted by the
measurement alternative. Investments for which the measurement alternative has been elected are assessed for
impairment upon a triggering event. Equity investments without a readily determinable fair value were $121.0 million and
$115.6 million for the years ended December 31, 2022 and December 31, 2021, respectively.
Employee Benefit Plans: The Company provides a range of benefits, including pensions, postretirement and
postemployment benefits to eligible current and former employees. Determining the cost associated with such benefits
is dependent on various actuarial assumptions, including discount rates, expected return on plan assets, compensation
increases, mortality, turnover rates, and healthcare cost trend rates. Actuaries perform the required calculations to
determine expense in accordance with GAAP. Actual results may differ from the actuarial assumptions and are generally
accumulated into Accumulated other comprehensive income (loss) and amortized into Net earnings over future
periods. The Company reviews its actuarial assumptions at each measurement date and makes modifications to the
assumptions based on current rates and trends, if appropriate.
Loss Contingencies: Liabilities are recorded for various contingencies arising in the normal course of business. The
Company has recorded reserves in the financial statements related to these matters, which are developed using
input derived from actuarial estimates and historical and anticipated experience data depending on the nature of the
reserve, and in certain instances with consultation of legal counsel, internal and external consultants and engineers.
Subject to the uncertainties inherent in estimating future costs for these types of liabilities, the Company believes its
estimated reserves are reasonable and does not believe the final determination of the liabilities with respect to these
matters would have a material effect on the financial condition, results of operations, liquidity or cash flows of the
Company for any year.
Environmental Costs: The Company is subject to laws and regulations relating to protecting the environment.
Environmental expenditures relating to current operations are expensed or capitalized as appropriate. Expenditures
relating to existing conditions caused by past operations, which do not contribute to current or future revenues, are
expensed. Liabilities for remediation costs are recorded when they are probable and can be reasonably estimated,
generally no later than the completion of feasibility studies or the Company’s commitment to a plan of action. The
assessment of this liability, which is calculated based on existing remediation technology, does not reflect any offset for
possible recoveries from insurance companies, and is not discounted.
Asbestos Matters: Prior to the Petition Date, certain of the Company’s wholly-owned subsidiaries and former companies
were named as defendants in asbestos-related lawsuits in state and federal courts. The Company recorded a liability for
actual and anticipated future claims as well as an asset for anticipated insurance settlements. Asbestos-related defense
costs were excluded from the asbestos claims liability and were recorded separately as services were incurred. None
F-12
PART IV
of the Company’s existing or previously-owned businesses were a producer or manufacturer of asbestos. The Company
recorded certain income and expenses associated with asbestos liabilities and corresponding insurance recoveries
within Discontinued operations, net of tax, as they related to previously divested businesses, except for amounts
associated with the predecessor of Murray’s asbestos liabilities and corresponding insurance recoveries, which were
recorded within continuing operations.
Product Warranties: Standard product warranty accruals are recorded at the time of sale and are estimated based
upon product warranty terms and historical experience. The Company assesses the adequacy of its liabilities
and will make adjustments as necessary based on known or anticipated warranty claims, or as new information
becomes available. The Company’s extended warranty liability represents the deferred revenue associated with its
extended warranty contracts and is amortized into revenue on a straight-line basis over the life of the contract, unless
another method is more representative of the costs incurred. The Company assesses the adequacy of its liability
by evaluating the expected costs under its existing contracts to ensure these expected costs do not exceed the
extended warranty liability.
Income Taxes: Deferred tax assets and liabilities are determined based on temporary differences between financial
reporting and tax bases of assets and liabilities, applying enacted tax rates expected to be in effect for the year in which
the differences are expected to reverse. The Company recognizes future tax benefits, such as net operating losses
and tax credits, to the extent that realizing these benefits is considered in its judgment to be more likely than not. The
Company regularly reviews the recoverability of its deferred tax assets considering its historic profitability, projected future
taxable income, timing of the reversals of existing temporary differences and the feasibility of its tax planning strategies.
Where appropriate, the Company records a valuation allowance with respect to a future tax benefit.
Revenue Recognition: Revenue is recognized when control of a good or service promised in a contract (i.e.,
performance obligation) is transferred to a customer. Control is obtained when a customer has the ability to direct the
use of and obtain substantially all of the remaining benefits from that good or service. A majority of the Company’s
revenue is recognized at a point-in-time as control is transferred at a distinct point in time per the terms of a contract.
However, a portion of the Company’s revenue is recognized over-time as the customer simultaneously receives control
as the Company performs work under a contract. For these arrangements, the cost-to-cost input method is used as it
best depicts the transfer of control to the customer that occurs as the Company incurs costs. See Note 12, “Revenue” to
the Consolidated Financial Statements for additional information regarding revenue recognition.
Research and Development Costs: The Company conducts research and development activities focused on product
and system sustainability improvements such as increasing energy efficiency, developing products that allow for use of
lower global warming potential refrigerants, reducing material content in products, and designing products for circularity.
These expenditures are expensed when incurred. For the years ended December 31, 2022, 2021 and 2020, these
expenditures amounted to $211.2 million, $193.5 million and $165.0 million, respectively.
RECENT ACCOUNTING PRONOUNCEMENTS
The FASB ASC is the sole source of authoritative GAAP other than the Securities and Exchange Commission (SEC)
issued rules and regulations that apply only to SEC registrants. The FASB issues an Accounting Standard Update (ASU)
to communicate changes to the codification. The Company considers the applicability and impact of all ASU’s. ASU’s not
listed below were assessed and determined to be either not applicable or are not expected to have a material impact on
the consolidated financial statements.
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS
In November 2021, the FASB issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities
about Government Assistance” (ASU 2021-10), which requires additional disclosures regarding government grants and
cash contributions. The additional disclosures required by this update include information about the nature of the
transactions and the related accounting policy used to account for the transaction, the financial statement line items
affected by the transactions and the amounts applicable to each financial statement line item and significant terms and
conditions of the transactions, including commitments and contingencies. ASU 2021-10 is effective for annual periods
beginning after December 15, 2021 with early adoption permitted. The Company adopted this standard on January 1, 2022
with no material impact on its financial statements.
2022 Annual Report
F-13
PART IV
In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets
and Contract Liabilities from Contracts with Customers” (ASU 2021-08), which requires contract assets and contract
liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition
date in accordance with ASC 606, “Revenue from Contracts with Customers” (ASC 606). ASU 2021-08 is effective for
fiscal years beginning after December 15, 2022 including interim periods therein with early adoption permitted. The
Company early adopted this standard during the fourth quarter of 2021 and applied it retrospectively to all business
combinations for which the acquisition date occurred on or after January 1, 2021 resulting in no material impact on its
financial statements.
In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income
Taxes” (ASU 2019-12), which simplifies certain aspects of income tax accounting guidance in ASC 740, reducing
the complexity of its application. Certain exceptions to ASC 740 presented within the ASU include: intraperiod tax
allocation, deferred tax liabilities related to outside basis differences, year-to-date loss in interim periods, among
others. ASU 2019-12 is effective for annual reporting periods beginning after December 15, 2020 including interim
periods therein with early adoption permitted. The Company adopted this standard on January 1, 2021 with no material
impact on its financial statements.
In October 2020, the FASB issued ASU 2020-09, “Debt (Topic 470): Amendments to SEC Paragraphs Pursuant to SEC
Release No. 33-10762” (ASU 2020-09), which amends Topic 470 and certain other topics to conform to disclosure
rules on guaranteed debt offerings in SEC Release No.33-10762. The SEC adopted amendments to the financial
disclosure requirements for guarantors and issuers of guaranteed securities registered or being registered in Rule
3-10 of Regulations S-X, and affiliates whose securities registered or being registered in Rule 3-16 of Regulation S-X. The
amended rules aim to improve disclosure, reduce compliance burdens for issuers and increase investor protection.
ASU 2020-09 is effective on January 4, 2021, pursuant to SEC Release No. 33-10762 with early application permitted. The
Company early adopted this standard during the first quarter of 2020 and elected to disclose summarized financial
information of the issuers and guarantors on a combined basis within Management’s Discussion and Analysis of
Financial Condition and Results of Operations.
In August 2018, the FASB issued ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud
Computing Arrangement that is a Service Contract” (ASU 2018-15), which aligns the requirements for capitalizing
implementation costs in a cloud-computing arrangement service contract with the requirements for capitalizing
implementation costs incurred to develop or obtain internal-use software. In addition, the guidance also clarifies the
presentation requirements for reporting such costs in the financial statements. ASU 2018-15 is effective for annual
reporting periods beginning after December 15, 2019 with early adoption permitted. The Company adopted this standard
on January 1, 2020 on a prospective basis with no material impact on its financial statements.
In June 2016, the FASB issued ASU 2016-13, which changes the impairment model for most financial assets and certain
other instruments from an incurred loss model to an expected loss model. In addition, the guidance also requires
incremental disclosures regarding allowances and credit quality indicators. ASU 2016-13 was adopted using the modified-
retrospective approach and is effective in fiscal years beginning after December 15, 2019, including interim periods within
those fiscal years, with early adoption permitted. The Company adopted this standard on January 1, 2020 with no material
impact on its financial statements.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
In September 2022, the FASB issued ASU 2022-04, “Liabilities – Supplier Finance Program (Subtopic 405-50):
Disclosure of Supplier Program Finance Obligations”, which requires that a company that enters into a supplier
finance program disclose sufficient information about the program to allow a user of financial statements to
understand the program’s nature, activity during the period, changes from period to period, and potential magnitude.
To achieve that objective, the company should disclose qualitative and quantitative information about its supplier
finance programs. ASU 2022-04 is effective for fiscal periods beginning after December 15, 2022, including interim
periods within those fiscal years, with early adoption permitted. This ASU is effective for fiscal years beginning after
December 15, 2022, except for the amendment on roll forward information which is effective for fiscal years beginning
after December 15, 2023. The Company does not expect the adoption of ASU 2022-04 to have a material impact to its
consolidated financial statements.
F-14
NOTE 3. INVENTORIES
At December 31, the major classes of inventory were as follows:
IN MILLIONS
Raw materials
Work-in-process
Finished goods
LIFO reserve
Total
PART IV
2022
2021
$
$
509.6
333.8
1,280.3
2,123.7
(129.9)
404.6
215.9
982.9
1,603.4
(72.6)
$ 1,993.8
$ 1,530.8
The Company performs periodic assessments to determine the existence of obsolete, slow-moving and non-saleable
inventories and records necessary provisions to reduce such inventories to the lower of cost and NRV. Reserve balances,
primarily related to obsolete and slow-moving inventories, were $94.3 million and $79.0 million at December 31, 2022 and
December 31, 2021, respectively.
NOTE 4. PROPERTY, PLANT AND EQUIPMENT
At December 31, the major classes of property, plant and equipment were as follows:
IN MILLIONS
Land
Buildings
Machinery and equipment
Software
Accumulated depreciation
Total
2022
2021
$
36.8
$
737.7
1,996.8
677.3
3,448.6
35.1
708.0
1,824.9
648.1
3,216.1
(1,912.5)
(1,817.3)
$
1,536.1
$
1,398.8
Depreciation expense for the years ended December 31, 2022, 2021 and 2020 was $176.5 million, $170.5 million and $172.8
million, which include amounts for software amortization of $42.1 million, $45.7 million and $50.2 million, respectively.
NOTE 5. GOODWILL
The changes in the carrying amount of goodwill are as follows:
IN MILLIONS
AMERICAS
EMEA
ASIA PACIFIC
TOTAL
Net balance as of December 31, 2020
$
3,980.0
$
793.5
$
569.3
$ 5,342.8
Acquisitions(1)
Currency translation
Net balance as of December 31, 2021
Acquisitions(1)
Currency translation
206.3
(1.1)
4,185.2
45.3
(3.7)
4.6
(57.3)
740.8
23.9
(49.8)
—
9.5
578.8
27.1
(43.9)
210.9
(48.9)
5,504.8
96.3
(97.4)
Net balance as of December 31, 2022
$
4,226.8
$
714.9
$
562.0
$ 5,503.7
(1) Refer to Note 17, “Acquisitions and Divestitures” for more information regarding acquisitions.
The net goodwill balances at December 31, 2022, 2021 and 2020 include $2,496.0 million of accumulated impairment,
primarily related to the Americas segment. The accumulated impairment relates entirely to a charge recorded in 2008.
2022 Annual Report
F-15
PART IV
NOTE 6. INTANGIBLE ASSETS
The following table sets forth the gross amount and related accumulated amortization of the Company’s intangible
assets at December 31:
IN MILLIONS
2022
2021
GROSS
CARRYING
AMOUNT
ACCUMULATED
AMORTIZATION
NET
CARRYING
AMOUNT
GROSS
CARRYING
AMOUNT
ACCUMULATED
AMORTIZATION
NET
CARRYING
AMOUNT
Customer relationships
$
2,183.7
$ (1,592.1) $
591.6 $
2,110.8
$ (1,475.3) $
635.5
Other
261.7
(213.4)
48.3
245.5
(201.3)
44.2
Total finite-lived intangible assets
$
2,445.4
$ (1,805.5) $
639.9 $
2,356.3
$ (1,676.6) $
679.7
Trademarks (indefinite-lived)
2,624.1
—
2,624.1
2,625.9
—
2,625.9
Total
$
5,069.5
$ (1,805.5) $ 3,264.0 $
4,982.2
$ (1,676.6) $ 3,305.6
Intangible asset amortization expense for 2022, 2021 and 2020 was $142.7 million, $123.6 million and $115.7 million, respectively.
Future estimated amortization expense on existing intangible assets in the next five years as of December 31, 2022
amounts to approximately:
IN MILLIONS
2023
2024
2025
2026
2027
$
143.0
141.0
110.0
57.0
31.0
NOTE 7. DEBT AND CREDIT FACILITIES
At December 31, Short-term borrowings and current maturities of long-term debt consisted of the following:
IN MILLIONS
Debentures with put feature
4.250% Senior notes due 2023
Other current maturities of long-term debt
Total
2022
2021
$
340.8 $
342.9
699.7
7.5
—
7.5
$ 1,048.0 $
350.4
The Company’s short-term obligations primarily consist of debentures with put features and current maturities of long-
term debt. The weighted-average interest rate for Short-term borrowings and current maturities of long-term debt at
December 31, 2022 and 2021 was 4.9% and 6.3%, respectively.
COMMERCIAL PAPER PROGRAM
The Company uses borrowings under its commercial paper program for general corporate purposes. The maximum
aggregate amount of unsecured commercial paper notes available to be issued, on a private placement basis, under
the commercial paper program is $2.0 billion as of December 31, 2022. Under the commercial paper program, the
Company may issue notes from time to time through Trane Technologies HoldCo Inc. or Trane Technologies Financing
Limited. Each of Trane Technologies plc, Trane Technologies Irish Holdings Unlimited Company, Trane Technologies
Lux International Holding Company S.à.r.l., Trane Technologies Global Holding Company Limited, Trane Technologies
Company LLC, Trane Technologies HoldCo Inc. and Trane Technologies Financing Limited provided irrevocable and
unconditional guarantees for any notes issued under the commercial paper program. The Company had no outstanding
balance under its commercial paper program as of December 31, 2022 and December 31, 2021.
F-16
PART IV
DEBENTURES WITH PUT FEATURE
At December 31, 2022 and December 31, 2021, the Company had $340.8 million and $342.9 million, respectively, of fixed
rate debentures outstanding which contain a put feature that the holders may exercise on each anniversary of the
issuance date. If exercised, the Company is obligated to repay in whole or in part, at the holder’s option, the outstanding
principal amount of the debentures plus accrued interest. If these options are not exercised, the final contractual maturity
dates would range between 2027 and 2028. Holders of these debentures had the option to exercise the put feature on
each of the outstanding debentures in 2022, subject to the notice requirement. No material exercises were made in 2022
or 2021.
At December 31, long-term debt excluding current maturities consisted of:
IN MILLIONS
4.250% Senior notes due 2023
7.200% Debentures due 2023-2025
3.550% Senior notes due 2024
6.480% Debentures due 2025
3.500% Senior notes due 2026
3.750% Senior notes due 2028
3.800% Senior notes due 2029
5.750% Senior notes due 2043
4.650% Senior notes due 2044
4.300% Senior notes due 2048
4.500% Senior notes due 2049
Total
2022
2021
$
— $
699.1
14.9
498.7
149.7
398.4
546.8
745.8
495.2
296.4
296.4
346.0
22.4
498.0
149.7
397.8
546.2
745.0
495.0
296.3
296.3
345.9
$
3,788.3 $ 4,491.7
Scheduled maturities of long-term debt, including current maturities, as of December 31, 2022 are as follows:
IN MILLIONS
2023
2024
2025
2026
2027
Thereafter
Total
$ 1,048.0
506.2
157.2
398.4
—
2,726.5
$ 4,836.3
OTHER CREDIT FACILITIES
On April 25, 2022, the Company entered into a new $1.0 billion senior unsecured revolving credit facility which matures
in April 2027 (2027 Credit Facility) and terminated its $1.0 billion credit facility that would have expired in April 2023. As
a result, the Company maintains two $1.0 billion senior unsecured revolving credit facilities, one of which matures in
June 2026 (2026 Credit Facility) and the other which matures in April 2027 (collectively, the Facilities) through its wholly-
owned subsidiaries, Trane Technologies HoldCo Inc., Trane Technologies Global Holding Company Limited and Trane
Technologies Financing Limited (collectively, the Borrowers). On June 30, 2022, the Company amended its 2026 Credit
Facility to include a Secured Overnight Financing Rate (SOFR) borrowing index provision and to eliminate the London
Interbank Offer Rate (LIBOR) index provision. These provisions are consistent with the 2027 Credit Facility. Additionally,
both Facilities include Environmental, Social, and Governance (ESG) metrics related to two of the Company’s sustainability
commitments: a reduction in greenhouse gas intensity and an increase in the percentage of women in management.
The Company’s annual performance against these ESG metrics may result in price adjustments to the commitment fee
and applicable interest rate.
2022 Annual Report
F-17
PART IV
The Facilities provide support for the Company’s commercial paper program and can be used for working capital and
other general corporate purposes. Trane Technologies plc, Trane Technologies Irish Holdings Unlimited Company, Trane
Technologies Lux International Holding Company S.à.r.l. and Trane Technologies Company LLC each provide irrevocable and
unconditional guarantees for these Facilities. In addition, each Borrower will guarantee the obligations under the Facilities of
the other Borrowers. Total commitments of $2.0 billion were unused at December 31, 2022 and December 31, 2021.
FAIR VALUE OF DEBT
The fair value of the Company’s debt instruments at December 31, 2022 and December 31, 2021 was $4.6 billion and $5.6
billion, respectively. The Company measures the fair value of its debt instruments for disclosure purposes based upon
observable market prices quoted on public exchanges for similar assets. These fair value inputs are considered Level 2
within the fair value hierarchy. See Note 9, “Fair Value Measurements” for information on the fair value hierarchy.
NOTE 8. FINANCIAL INSTRUMENTS
In the normal course of business, the Company is exposed to certain risks arising from business operations and
economic factors. These fluctuations can increase the cost of financing, investing and operating the business. The
Company uses various financial instruments, including derivative instruments, to manage the risks associated with
interest rate, commodity price and foreign currency exposures. These financial instruments are not used for trading or
speculative purposes. The Company recognizes all derivatives on the Consolidated Balance Sheets at their fair value as
either assets or liabilities.
On the date a derivative contract is entered into, the Company designates the derivative instrument as a cash flow
hedge of a forecasted transaction or as an undesignated derivative. The Company formally documents its hedge
relationships, including identification of the derivative instruments and the hedged items, as well as its risk management
objectives and strategies for undertaking the hedge transaction. This process includes linking derivative instruments that
are designated as hedges to specific assets, liabilities or forecasted transactions.
The Company assesses at inception and at least quarterly thereafter, whether the derivatives used in cash flow
hedging transactions are highly effective in offsetting the changes in the cash flows of the hedged item. To the extent
the derivative is deemed to be a highly effective hedge, the fair market value changes of the instrument are recorded
to Accumulated other comprehensive income (loss) (AOCI). If the hedging relationship ceases to be highly effective,
or it becomes probable that a forecasted transaction is no longer expected to occur, the hedging relationship will be
undesignated and any future gains and losses on the derivative instrument will be recorded in Net earnings.
The fair values of derivative instruments included within the Consolidated Balance Sheets as of December 31 were as follows:
IN MILLIONS
Derivatives designated as hedges:
Currency derivatives
Commodity derivatives
Derivatives not designated as hedges:
Currency derivatives
Total derivatives
DERIVATIVE
ASSETS
DERIVATIVE
LIABILITIES
2022
2021
2022
2021
$ 2.0 $ 0.1 $ 1.6 $ 2.7
2.3
4.9
8.8
0.2
0.8
10.5
1.5
14.0
$ 5.1 $ 15.5 $ 11.9 $ 16.9
Asset and liability derivatives included in the table above are recorded within Other current assets and Accrued
expenses and other current liabilities, respectively.
F-18
PART IV
CURRENCY DERIVATIVE INSTRUMENTS
The notional amount of the Company’s currency derivatives was approximately $350 million and $500 million at
December 31, 2022 and 2021, respectively. At December 31, 2022 and 2021, a net gain of $0.3 million and net loss of
$2.2 million, net of tax, respectively, was included in AOCI related to the fair value of the Company’s currency derivatives
designated as accounting hedges. The amount expected to be reclassified into Net earnings over the next twelve
months is a gain of $0.3 million. The actual amounts that will be reclassified to Net earnings may vary from this amount
as a result of changes in market conditions. Gains and losses associated with the Company’s currency derivatives not
designated as hedges are recorded in Net earnings as changes in fair value occur. At December 31, 2022, the maximum
term of the Company’s currency derivatives was approximately 12 months.
COMMODITY DERIVATIVE INSTRUMENTS
At December 31, 2022 and 2021, a net loss of $4.9 million and a net gain of $3.5 million, net of tax, was included in AOCI
related to the fair market value of the Company’s commodity derivatives designated as accounting hedges. A change in
fair value of commodity derivative instruments deemed highly effective is included in AOCI and is reclassified to Cost of
goods sold in the period the purchase of the commodity impacts Net earnings. The amount expected to be reclassified
into Net earnings over the next twelve months is a net loss of $4.9 million. The actual amounts that will be reclassified to
Net earnings may vary from this amount as a result of changes in market conditions. At December 31, 2022, the maximum
term of the Company’s commodity derivatives was 12 months.
The Company had the following outstanding contracts to hedge forecasted commodity purchases:
COMMODITY
Aluminum
Copper
OTHER DERIVATIVE INSTRUMENTS
VOLUME OUTSTANDING AS OF
DECEMBER 31, 2022
DECEMBER 31, 2021
23,088 metric tons
16,488 metric tons
6,241,625 pounds
4,035,000 pounds
Prior to 2015, the Company utilized forward-starting interest rate swaps and interest rate locks to manage interest rate
exposure in periods prior to the anticipated issuance of certain fixed-rate debt. These instruments were designated as
cash flow hedges and had a notional amount of $1,250.0 million. Consequently, when the contracts were settled upon
the issuance of the underlying debt, any realized gains or losses in the fair values of the instruments were deferred
into AOCI. These deferred gains or losses are subsequently recognized in Interest expense over the term of the related
notes. The net unrecognized gain in AOCI was $4.0 million and $4.7 million at December 31, 2022 and at December 31,
2021. The net deferred gain at December 31, 2022 will continue to be amortized over the term of notes with maturities
ranging from 2023 to 2044. The amount expected to be amortized over the next twelve months is a net gain of
$0.3 million. The Company has no forward-starting interest rate swaps or interest rate lock contracts outstanding at
December 31, 2022 or 2021.
The following table represents the amounts associated with derivatives designated as hedges affecting Net earnings
and AOCI for the years ended December 31:
IN MILLIONS
AMOUNT OF GAIN (LOSS)
RECOGNIZED IN AOCI
2022
2021
2020
LOCATION OF GAIN
(LOSS) RECLASSIFIED
FROM AOCI AND
RECOGNIZED INTO NET
EARNINGS
AMOUNT OF GAIN (LOSS)
RECLASSIFIED FROM AOCI
AND RECOGNIZED INTO
NET EARNINGS
2022
2021
2020
Currency derivatives - continuing(1)
$ (7.2) $ (4.1) $ 3.3 Cost of goods sold
$ (9.2) $
Commodity derivatives
Interest rate swaps & locks
(17.1)
—
5.7
—
— Cost of goods sold
— Interest expense
Total
$ (24.3) $ 1.6 $ 3.3
(1.1)
0.7
$ (9.6) $
3.7
2.0
0.7
6.4
$ (2.6)
—
0.7
$ (1.9)
(1) Amounts excluded from effectiveness testing and recognized into Cost of goods sold based on changes in fair value and
amortization was a loss of $0.6 million, $0.7 million and $2.1 million for the years ended December 31, 2022, 2021 and 2020, respectively.
2022 Annual Report
F-19
PART IV
The following table represents the amounts associated with derivatives not designated as hedges affecting Net earnings
for the years ended December 31:
IN MILLIONS
LOCATION OF GAIN (LOSS) RECOGNIZED
IN NET EARNINGS
Currency derivatives - continuing
Other income (expense), net
Currency derivatives - discontinued
Discontinued operations
Total
AMOUNT OF GAIN (LOSS)
RECOGNIZED IN NET EARNINGS
2022
2021
2020
$ (8.0)
$
—
$ (8.0 )
$
7.9
—
7.9
$
$
7.5
(0.4)
7.1
The gains and losses associated with the Company’s undesignated currency derivatives are materially offset in Net
earnings by changes in the fair value of the underlying transactions.
CONCENTRATION OF CREDIT RISK
The counterparties to the Company’s forward contracts consist of a number of investment grade major international
financial institutions. The Company could be exposed to losses in the event of nonperformance by the counterparties.
However, the credit ratings and the concentration of risk in these financial institutions are monitored on a continuous
basis and present no significant credit risk to the Company.
NOTE 9. FAIR VALUE MEASUREMENTS
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. The fair value hierarchy that prioritizes information used in
developing assumptions when pricing an asset or liability is as follows:
• Level 1: Observable inputs such as quoted prices in active markets;
• Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
• Level 3: Unobservable inputs where there is little or no market data, which requires the reporting entity to develop its
own assumptions.
Observable market data is required to be used in making fair value measurements when available. When inputs used
to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is
categorized is based on the lowest level input that is significant to the fair value measurement.
The following table presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a
recurring basis as of December 31, 2022:
IN MILLIONS
Assets:
Derivative instruments
Liabilities:
Derivative instruments
Contingent consideration
FAIR VALUE MEASUREMENTS
FAIR VALUE
LEVEL 1
LEVEL 2
LEVEL 3
$ 5.1
$ —
$ 5.1
$ —
$ 11.9
$ —
$ 11.9
$ —
49.3
—
—
49.3
F-20
The following table presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a
recurring basis as of December 31, 2021:
PART IV
IN MILLIONS
Assets:
Derivative instruments
Liabilities:
Derivative instruments
Contingent consideration
FAIR VALUE MEASUREMENTS
FAIR VALUE
LEVEL 1
LEVEL 2
LEVEL 3
$ 15.5
$ —
$ 15.5
$ —
$ 16.9
$ —
$ 16.9
$ —
96.2
—
—
96.2
Derivative instruments include forward foreign currency contracts and instruments related to non-functional currency
balance sheet exposures. The fair value of the derivative instruments are determined based on a pricing model that uses
spot rates and forward prices from actively quoted currency markets that are readily accessible and observable. The fair
value of the commodity derivatives is valued under a market approach using publicized prices, where applicable, or
dealer quotes.
On October 15, 2021, the Company acquired 100% of Farrar Scientific Corporation’s (Farrar Scientific) assets. In connection
with the acquisition, the Company agreed to contingent consideration of up to $115.0 million to be paid in 2025, tied to the
attainment of key financial targets during the period January 1, 2022 through December 31, 2024. This additional payment,
to the extent earned, will be payable in cash. The fair value of the contingent consideration is determined using the
Monte Carlo simulation model based on projections of revenues for Farrar Scientific during the period of January 1, 2022
through December 31, 2024, implied revenue volatility and a risk adjusted discount rate. Each quarter, the Company is
required to remeasure the fair value of the liability as assumptions change and such non-cash adjustments are recorded
in Selling and administrative expenses in the Consolidated Statements of Earnings.
Contingent consideration related to acquisitions are measured at fair value each reporting period using Level 3
unobservable inputs. The changes in the fair value of the Company’s Level 3 liabilities during the years ended
December 31, 2022 and 2021 are as follows:
IN MILLIONS
Balance at beginning of period
Fair value of contingent consideration recorded in connection with acquisition
Change in fair value of contingent consideration
Balance at end of period
2022
$
96.2
$
—
2021
—
98.7
(46.9)
(2.5)
$
49.3
$
96.2
The following inputs and assumptions were used in the Monte Carlo simulation model to estimate the fair value of the
contingent consideration at December 31, 2022 and 2021:
Discount rate
Volatility
2022
2021
12.00%
20.00%
8.00%
20.00%
Refer to Note 17, “Acquisitions and Divestitures” for more information regarding the contingent consideration.
The carrying values of cash and cash equivalents, accounts receivable and accounts payable are a reasonable estimate
of their fair value due to the short-term nature of these instruments. There have been no transfers between levels of the
fair value hierarchy.
NOTE 10. LEASES
The Company’s lease portfolio includes various contracts for real estate, vehicles, information technology and other
equipment. At contract inception, the Company determines a lease exists if the contract conveys the right to control an
identified asset for a period of time in exchange for consideration. Control is considered to exist when the lessee has
2022 Annual Report
F-21
PART IV
the right to obtain substantially all of the economic benefits from the use of an identified asset as well as the right to
direct the use of that asset. If a contract is considered to be a lease, the Company recognizes a lease liability based
on the present value of the future lease payments, with an offsetting entry to recognize a right-of-use asset. Options to
extend or terminate a lease are included when it is reasonably certain an option will be exercised. As a majority of the
Company’s leases do not provide an implicit rate within the lease, an incremental borrowing rate is used which is based
on information available at the commencement date.
The following table includes a summary of the Company’s lease portfolio and Balance Sheet classification:
IN MILLIONS
Assets
CLASSIFICATION
DECEMBER 31, 2022
DECEMBER 31, 2021
Operating lease right-of-use assets(1)
Other noncurrent assets
$
462.5
$
436.8
Liabilities
Operating lease current
Other current liabilities
Operating lease noncurrent
Other noncurrent liabilities
Weighted average remaining lease term
Weighted average discount rate
155.8
313.5
147.3
296.0
3.9 years
3.9 years
3.0%
2.3%
(1) Prepaid lease payments and lease incentives are recorded as part of the right-of-use asset. The net impact was $6.8 million and
$6.5 million at December 31, 2022 and December 31, 2021, respectively.
The Company accounts for each separate lease component of a contract and its associated non-lease component as
a single lease component. In addition, the Company utilizes a portfolio approach for the vehicle, information technology
and equipment asset classes as the application of the lease model to the portfolio would not differ materially from the
application of the lease model to the individual leases within the portfolio.
The following table includes lease costs and related cash flow information for the years ended December 31:
IN MILLIONS
Operating lease expense
Variable lease expense
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
Right-of-use assets obtained in exchange for new operating lease liabilities
2022
2021
$ 179.4
$ 168.3
28.2
24.5
179.0
177.0
167.9
163.2
Operating lease expense is recognized on a straight-line basis over the lease term. In addition, the Company has certain
leases that contain variable lease payments which are based on an index, a rate referenced in the lease or on the actual
usage of the leased asset. These payments are not included in the right-of-use asset or lease liability and are expensed
as incurred as variable lease expense.
Maturities of lease obligations were as follows:
IN MILLIONS
Operating leases:
2023
2024
2025
2026
2027
After 2027
Total lease payments
Less: Interest
Present value of lease liabilities
F-22
DECEMBER 31, 2022
$ 168.9
129.4
87.4
61.4
31.2
30.3
$ 508.6
(39.3)
$ 469.3
PART IV
NOTE 11. PENSIONS AND POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
The Company sponsors several U.S. defined benefit and defined contribution plans covering substantially all of the
Company’s U.S. employees. Additionally, the Company has many non-U.S. defined benefit and defined contribution plans
covering eligible non-U.S. employees. Postretirement benefits other than pensions (OPEB) provide healthcare benefits,
and in some instances, life insurance benefits for certain eligible employees.
PENSION PLANS
The non-contributory defined benefit pension plans covering non-collectively bargained U.S. employees provide benefits
on a final average pay formula while plans for most collectively bargained U.S. employees provide benefits on a flat dollar
benefit formula or a percentage of pay formula. The non-U.S. pension plans generally provide benefits based on earnings
and years of service. The Company also maintains additional other supplemental plans for officers and other key or
highly compensated employees.
The following table details information regarding the Company’s pension plans at December 31:
IN MILLIONS
Change in benefit obligations:
2022
2021
Benefit obligation at beginning of year
$ 3,394.5
$ 3,662.8
Service cost
Interest cost
Employee contributions
Amendments
Actuarial (gains) losses(1)
Benefits paid
Currency translation
Curtailments, settlements and special termination benefits
Other, including expenses paid
Benefit obligation at end of year
Change in plan assets:
Fair value at beginning of year
Actual return on assets
Company contributions
Employee contributions
Benefits paid
Currency translation
Settlements
Other, including expenses paid
Fair value of assets end of year
Net unfunded liability
Amounts included in the balance sheet:
Other noncurrent assets
Accrued compensation and benefits
Postemployment and other benefit liabilities
Net amount recognized
(1) Actuarial (gains) losses primarily resulted from changes in discount rates.
47.5
70.3
0.9
—
(810.3)
(243.1)
(59.6)
(5.0)
(9.1)
50.9
58.6
0.9
(0.3)
(121.9)
(200.6)
(28.4)
(20.0)
(7.5)
$ 2,386.1
$ 3,394.5
$ 2,993.8
$ 3,114.6
(706.7)
90.5
0.9
73.5
55.9
0.9
(243.1)
(200.6)
(62.6)
(5.0)
(16.2)
(21.8)
(20.5)
(8.2)
$ 2,051.6
$ 2,993.8
$
$
(334.5)
$
(400.7)
61.0
$
82.2
(27.3)
(368.2)
(56.4)
(426.5)
$
(334.5)
$
(400.7)
2022 Annual Report
F-23
PART IV
It is the Company’s objective to contribute to the pension plans to ensure adequate funds, and no less than required by
law, are available in the plans to make benefit payments to plan participants and beneficiaries when required. However,
certain plans are not or cannot be funded due to either legal, accounting, or tax requirements in certain jurisdictions. As
of December 31, 2022, approximately seven percent of the Company’s projected benefit obligation relates to plans that
cannot be funded.
The pretax amounts recognized in Accumulated other comprehensive income (loss) were as follows:
IN MILLIONS
December 31, 2021
Current year changes recorded to AOCI
Amortization reclassified to earnings
Settlements/curtailments reclassified to earnings
Currency translation and other
December 31, 2022
PRIOR SERVICE
BENEFIT (COST)
NET ACTUARIAL
GAINS (LOSSES)
TOTAL
$ (26.3)
$ (559.8)
$ (586.1)
—
3.9
—
1.5
0.5
23.3
15.0
11.2
0.5
27.2
15.0
12.7
$ (20.9)
$ (509.8)
$ (530.7)
Weighted-average assumptions used to determine the benefit obligation at December 31 were as follows:
Discount rate:
U.S. plans
Non-U.S. plans
Rate of compensation increase:
U.S. plans
Non-U.S. plans
2022
2021
5.51% 2.88%
4.63% 1.74%
4.00% 4.00%
4.25% 4.00%
The accumulated benefit obligation for all defined benefit pension plans was $2,343.2 million and $3,311.0 million at
December 31, 2022 and 2021, respectively. The projected benefit obligation, accumulated benefit obligation, and fair value
of plan assets for pension plans with accumulated benefit obligations more than plan assets were $1,850.0 million, $1,847.0
million and $1,585.6 million, respectively, as of December 31, 2022, and $2,906.5 million, $2,831.5 million and $2,424.6 million,
respectively, as of December 31, 2021.
Pension benefit payments are expected to be paid as follows:
IN MILLIONS
2023
2024
2025
2026
2027
2028-2032
F-24
$
202.7
192.9
178.1
180.8
190.4
873.5
The components of the Company’s net periodic pension benefit costs for the years ended December 31 include the following:
PART IV
IN MILLIONS
Service cost
Interest cost
Expected return on plan assets
Net amortization of:
Prior service costs (benefits)
Plan net actuarial (gains) losses
Net periodic pension benefit cost
Net curtailment, settlement, and special termination benefits (gains) losses
Net periodic pension benefit cost after net curtailment and settlement (gains) losses
Amounts recorded in continuing operations:
Operating income
Other income/(expense), net
Amounts recorded in discontinued operations
Total
2022
2021
2020
$
47.5
$
50.9
$
58.3
70.3
58.6
83.8
(103.8)
(106.2)
(121.1)
3.9
23.3
41.2
15.0
56.2
43.2
9.2
3.8
$
$
5.0
35.6
43.9
8.0
51.9
47.1
(0.9)
5.7
$
$
5.3
43.7
70.0
(1.8)
68.2
51.7
11.7
4.8
$
$
$
56.2
$
51.9
$
68.2
Pension benefit cost for 2023 is projected to be approximately $54 million.
Weighted-average assumptions used to determine net periodic pension cost for the years ended December 31 were as follows:
Discount rate:
U.S. plans
Service cost
Interest cost
Non-U.S. plans
Service cost
Interest cost
Rate of compensation increase:
U.S. plans
Non-U.S. plans
Expected return on plan assets:
U.S. plans
Non-U.S. plans
2022
2021
2020
3.06% 2.75% 3.36%
2.36% 1.82% 2.78%
2.07% 1.56% 1.87%
1.62% 1.09% 1.51%
4.00% 4.00% 4.00%
4.00% 4.00% 3.75%
4.00% 4.00% 4.75%
2.50% 2.25% 2.75%
The expected long-term rate of return on plan assets reflects the average rate of returns expected on the funds invested
or to be invested to provide for the benefits included in the projected benefit obligation. The expected long-term rate
of return on plan assets is based on what is achievable given the plan’s investment policy, the types of assets held and
target asset allocations. The expected long-term rate of return is determined as of the measurement date. The Company
reviews each plan and its historical returns and target asset allocations to determine the appropriate expected long-term
rate of return on plan assets to be used.
The Company’s objective in managing its defined benefit plan assets is to ensure that all present and future benefit
obligations are met as they come due. It seeks to achieve this goal while trying to mitigate volatility in plan funded status,
contribution, and expense by better matching the characteristics of the plan assets to that of the plan liabilities. The
Company utilizes a dynamic approach to asset allocation whereby a plan’s allocation to fixed income assets increases as
the plan’s funded status improves. The Company monitors plan funded status and asset allocation regularly in addition to
investment manager performance.
2022 Annual Report
F-25
Part IV
PART IV
The fair values of the Company’s pension plan assets at December 31, 2022 by asset category were as follows:
IN MILLIONS
Cash and cash equivalents
Equity investments:
Registered mutual funds – equity specialty
Commingled funds – equity specialty
Fixed income investments:
U.S. government and agency obligations
Corporate and non-U.S. bonds(a)
Asset-backed and mortgage-backed securities
Registered mutual funds – fixed income specialty
Commingled funds – fixed income specialty
Other fixed income(b)
Derivatives
Real estate(c)
Other(d)
Total assets at fair value
Receivables and payables, net
Net assets available for benefits
FAIR VALUE MEASUREMENTS
LEVEL 1
LEVEL 2
LEVEL 3
NET
ASSET
VALUE
TOTAL
FAIR VALUE
$ 3.3
$
50.6
$
— $
— $
53.9
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
323.6
1,065.7
12.5
—
—
—
1,401.8
(1.5)
—
—
—
—
—
—
—
—
—
—
29.3
29.3
—
0.9
79.6
68.0
244.5
312.5
—
—
—
105.0
61.7
—
166.7
—
—
—
68.0
244.5
312.5
323.6
1,065.7
12.5
105.0
61.7
29.3
1,597.8
(1.5)
0.9
79.6
$ 3.3
$ 1,450.9
$ 109.8
$ 479.2
$ 2,043.2
8.4
$ 2,051.6
The fair values of the Company’s pension plan assets at December 31, 2021 by asset category were as follows:
IN MILLIONS
Cash and cash equivalents
Equity investments:
Registered mutual funds – equity specialty
Commingled funds – equity specialty
Fixed income investments:
U.S. government and agency obligations
Corporate and non-U.S. bonds(a)
Asset-backed and mortgage-backed securities
Registered mutual funds – fixed income specialty
Commingled funds – fixed income specialty
Other fixed income(b)
Derivatives
Real estate(c)
Other(d)
Total assets at fair value
Receivables and payables, net
Net assets available for benefits
FAIR VALUE MEASUREMENTS
LEVEL 1
LEVEL 2
LEVEL 3
NET
ASSET
VALUE
TOTAL
FAIR
VALUE
$ 1.6
$
50.5
$
— $
— $
52.1
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
551.4
1,453.6
63.7
—
—
—
2,068.7
(0.5)
—
—
—
—
—
—
—
—
—
—
32.0
32.0
—
2.1
106.1
107.5
362.5
470.0
—
—
—
191.4
77.7
—
269.1
—
—
—
107.5
362.5
470.0
551.4
1,453.6
63.7
191.4
77.7
32.0
2,369.8
(0.5)
2.1
106.1
$ 1.6
$ 2,118.7
$ 140.2
$ 739.1 $ 2,999.6
(5.8)
$ 2,993.8
(a) This class includes state and municipal bonds.
(b) This class includes group annuity and guaranteed interest contracts.
(c) This class includes a private equity fund that invests in real estate.
(d) This investment comprises the Company’s non-significant, non-US pension plan assets. It primarily includes insurance contracts.
F-26
PART IV
Cash equivalents are valued using a market approach with inputs including quoted market prices for either identical or
similar instruments. Fixed income securities are valued through a market approach with inputs including, but not limited
to, benchmark yields, reported trades, broker quotes and issuer spreads. Commingled funds are valued at their daily
net asset value (NAV) per share or the equivalent. NAV per share or the equivalent is used for fair value purposes as a
practical expedient. NAVs are calculated by the investment manager or sponsor of the fund. Private real estate fund
values are reported by the fund manager and are based on valuation or appraisal of the underlying investments. Refer
to Note 9, “Fair Value Measurements” for additional information related to the fair value hierarchy. There have been no
significant transfers between levels of the fair value hierarchy.
The Company made required and discretionary contributions to its pension plans of $90.5 million in 2022, $55.9 million in
2021, and $99.7 million in 2020 and currently projects that it will contribute approximately $69 million to its plans worldwide
in 2023. The contribution in 2020 included $24.4 million to fund Ingersoll Rand Industrial plans prior to the completion of
the Transaction. The Company’s policy allows it to fund an amount, which could be in excess of or less than the pension
cost expensed, subject to the limitations imposed by current tax regulations. However, the Company anticipates funding
the plans in 2023 in accordance with contributions required by funding regulations or the laws of each jurisdiction.
Most of the Company’s U.S. employees are covered by defined contribution plans. Employer contributions are
determined based on criteria specific to the individual plans and amounted to approximately $138 million, $126 million
and $111 million in 2022, 2021 and 2020, respectively. The Company’s contributions relating to non-U.S. defined contribution
plans and other non-U.S. benefit plans were $33.8 million, $34.9 million and $19.2 million in 2022, 2021 and 2020,
respectively.
MULTIEMPLOYER PENSION PLANS
The Company also participates in a number of multiemployer defined benefit pension plans related to collectively
bargained U.S. employees of Trane. The Company’s contributions are determined by the terms of the related collective-
bargaining agreements. These multiemployer plans pose different risks to the Company than single-employer
plans, including:
1. The Company’s contributions to multiemployer plans may be used to provide benefits to all participating employees
of the plan, including employees of other employers.
2.
In the event that another participating employer ceases contributions to a plan, the Company, together with other
remaining participating employers, may be responsible for any unfunded obligations of the employer that ceased
making contributions.
3.
If the Company chooses to withdraw from any of the multiemployer plans or if a partial withdrawal occurs, the
Company may be required to pay a withdrawal liability, based on the underfunded status of the plan.
As of December 31, 2022, the Company does not participate in any multiemployer plans that are individually significant.
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
The Company sponsors several postretirement plans that provide for healthcare benefits, and in some instances,
life insurance benefits that cover certain eligible employees. These plans are unfunded and have no plan assets,
but are instead funded by the Company on a pay-as-you-go basis in the form of direct benefit payments. Generally,
postretirement health benefits are contributory with contributions adjusted annually. Life insurance plans for retirees are
primarily non-contributory.
2022 Annual Report
F-27
PART IV
The following table details changes in the Company’s postretirement plan benefit obligations for the years ended
December 31:
IN MILLIONS
Benefit obligation at beginning of year
Service cost
Interest cost
Plan participants’ contributions
Actuarial (gains) losses (1)
Benefits paid, net of Medicare Part D subsidy (2)
Amendments
Other
2022
2021
$ 342.2
$ 389.1
1.8
6.9
5.7
(53.7)
(39.8)
3.3
—
2.1
5.5
5.6
(22.2)
(37.8)
—
(0.1)
Benefit obligations at end of year
$ 266.4
$ 342.2
(1) Actuarial (gains) losses primarily resulted from changes in discount rates.
(2) Amounts are net of Medicare Part D subsidy of $0.4 million and $0.5 million in 2022 and 2021, respectively.
The benefit plan obligations are reflected in the Consolidated Balance Sheets as follows:
IN MILLIONS
Accrued compensation and benefits
Postemployment and other benefit liabilities
Total
DECEMBER 31,
2022
DECEMBER 31,
2021
$
(34.2)
$
(33.8)
(232.2)
(308.4)
$ (266.4)
$ (342.2)
The pre-tax amounts recognized in Accumulated other comprehensive income (loss) were as follows:
IN MILLIONS
Balance at December 31, 2021
Current year changes recorded to AOCI
Amortization reclassified to earnings
Balance at December 31, 2022
PRIOR SERVICE
BENEFIT (COST)
NET ACTUARIAL
GAINS (LOSSES)
TOTAL
$ —
$ 72.4
$ 72.4
(3.3)
—
53.7
(5.6)
50.4
(5.6)
$ (3.3)
$ 120.5
$ 117.2
The components of net periodic postretirement benefit cost for the years ended December 31 were as follows:
IN MILLIONS
Service cost
Interest cost
Net amortization of net actuarial (gains) losses
Net periodic postretirement benefit cost
Amounts recorded in continuing operations:
Operating income
Other income/(expense), net
Amounts recorded in discontinued operations
Total
$
$
$
2022
2021
2020
1.8
6.9
$
2.1
5.5
$
2.4
9.7
(5.6)
(2.0)
(5.6)
3.1
$
5.6
$
6.5
$
1.8
1.4
(0.1)
$
3.1
$
2.1
2.5
1.0
5.6
$
$
2.4
3.0
1.1
6.5
Postretirement cost for 2023 is projected to be approximately $2 million. The amount expected to be recognized in net
periodic postretirement benefits cost in 2023 for net actuarial gains is approximately $13 million.
F-28
Weighted-average assumptions used to determine net periodic benefit cost for the years ended December 31 were
as follows:
PART IV
Discount rate:
Benefit obligations at December 31
Net periodic benefit cost
Service cost
Interest cost
Assumed health-care cost trend rates at December 31:
Current year medical inflation
Ultimate inflation rate
Year that the rate reaches the ultimate trend rate
2022
2021
2020
5.51% 2.73%
2.25%
2.82% 2.40%
2.33% 1.84%
3.18%
2.73%
6.50% 6.25%
5.00% 4.75%
6.50%
4.75%
2028
2028
2028
Benefit payments for postretirement benefits, which are net of expected plan participant contributions and Medicare
Part D subsidy, are expected to be paid as follows:
IN MILLIONS
2023
2024
2025
2026
2027
2028 — 2032
NOTE 12. REVENUE
PERFORMANCE OBLIGATIONS
$
35.1
30.0
28.6
27.2
25.6
106.1
A performance obligation is a distinct good, service or a bundle of goods and services promised in a contract. The
Company identifies performance obligations at the inception of a contract and allocates the transaction price to
individual performance obligations to faithfully depict the Company’s performance in transferring control of the promised
goods or services to the customer.
The following are the primary performance obligations identified by the Company:
Equipment. The Company principally generates revenue from the sale of equipment to customers and recognizes
revenue at a point in time when control transfers to the customer. Transfer of control is generally determined based on
the shipping terms of the contract.
Contracting and Installation. The Company enters into various construction-type contracts to design, deliver and
build integrated solutions to meet customer specifications. These transactions provide services that range from the
development and installation of new HVAC systems to the design and integration of critical building systems to optimize
energy efficiency and overall performance. These contracts have a typical term of less than one year and are considered
a single performance obligation as multiple combined goods and services promised in the contract represent a single
output delivered to the customer. Revenues associated with contracting and installation contracts are recognized over
time with progress towards completion measured using the cost-to-cost input method as the basis to recognize revenue
and an estimated profit. To-date efforts for work performed corresponds with and faithfully depicts transfer of control to
the customer.
2022 Annual Report
F-29
PART IV
Services and Maintenance. The Company provides various levels of preventative and/or repair and maintenance type
service agreements for its customers. The typical length of a contract is 12 months but can be as long as 60 months.
Revenues associated with these performance obligations are primarily recognized over time on a straight-line basis
over the life of the contract as the customer simultaneously receives and consumes the benefit provided by the
Company. However, if historical evidence indicates that the cost of providing these services on a straight-line basis
is not appropriate, revenue is recognized over the contract period in proportion to the costs expected to be incurred
while performing the service. Revenues for certain repair services that do not meet the criteria for over time revenue
recognition and sales of parts are recognized at a point in time.
Extended warranties. The Company enters into various warranty contracts with customers related to its products.
A standard warranty generally warrants that a product is free from defects in workmanship and materials under
normal use and conditions for a certain period of time. The Company’s standard warranty is not considered a distinct
performance obligation as it does not provide services to customers beyond assurance that the covered product is free
of initial defects. An extended warranty provides a customer with additional time that the Company is liable for covered
incidents associated with its products. Extended warranties are purchased separately and can last up to five years.
As a result, they are considered separate performance obligations for the Company. Revenue associated with these
performance obligations is primarily recognized over time on a straight-line basis over the life of the contract as the
customer simultaneously receives and consumes the benefit provided by the Company. However, if historical evidence
indicates that the cost of providing these services on a straight-line basis is not appropriate, revenue is recognized over
the contract period in proportion to the costs expected to be incurred while performing the service. Refer to Note 20,
“Commitments and Contingencies,” for more information related to product warranties.
The transaction price allocated to performance obligations reflects the Company’s expectations about the consideration
it will be entitled to receive from a customer. To determine the transaction price, variable and non-cash consideration are
assessed as well as whether a significant financing component exists. The Company includes variable consideration in
the estimated transaction price when it is probable that significant reversal of revenue recognized would not occur when
the uncertainty associated with variable consideration is subsequently resolved. The Company considers historical data
in determining its best estimates of variable consideration, and the related accruals are recorded using the expected
value method.
For projects financed through energy savings, the Company provides financial guarantees for in-process work and
financial commitments with end dates varying from the current fiscal year through the completion of such transactions
that could be triggered in the event of nonperformance. Additionally, the Company has performance guarantees related
to completed energy savings contracts that are provided under the maintenance portion of contracting and installation
agreements. These performance guarantees represent variable consideration and are estimated as part of the overall
transaction price. As of December 31, 2022, the Company has outstanding performance guarantees of approximately $1
billion related to these energy savings contracts that extend from 2023-2048. Since 1995, the Company has recognized
approximately $1 million in adjustments to the transaction price as a result of these performance guarantees.
The Company enters into sales arrangements that contain multiple goods and services. For these arrangements, each
good or service is evaluated to determine whether it represents a distinct performance obligation and whether the sales
price for each obligation is representative of standalone selling price. If available, the Company utilizes observable prices
for goods or services sold separately to similar customers in similar circumstances to evaluate relative standalone selling
price. List prices are used if they are determined to be representative of standalone selling prices. Where necessary, the
Company ensures that the total transaction price is then allocated to the distinct performance obligations based on the
determination of their relative standalone selling price at the inception of the arrangement.
The Company recognizes revenue for delivered goods or services when the delivered good or service is distinct,
control of the good or service has transferred to the customer, and only customary refund or return rights related to the
goods or services exist. The Company excludes from revenues taxes it collects from a customer that are assessed by a
government authority.
F-30
DISAGGREGATED REVENUE
Net revenues by geography and major type of good or service for the years ended at December 31 were as follows:
PART IV
IN MILLIONS
Americas
Equipment
Services
Total Americas
EMEA
Equipment
Services
Total EMEA
Asia Pacific
Equipment
Services
Total Asia Pacific
Total Net revenues
2022
2021
2020
$
8,575.1
$
7,319.8
$
6,479.0
4,065.7
3,637.3
3,206.9
$ 12,640.8
$ 10,957.1
$
9,685.9
$
1,420.9
$
1,328.0
$
1,119.9
613.6
616.9
528.2
$
2,034.5
$
1,944.9
$
1,648.1
$
934.8
$
851.0
$
381.6
383.4
773.6
347.1
$
1,316.4
$
1,234.4
$
1,120.7
$ 15,991.7
$ 14,136.4
$ 12,454.7
Revenue from goods and services transferred to customers at a point in time accounted for approximately 82%, 82% and
81% of the Company’s revenue for the years ended December 31, 2022, 2021 and 2020, respectively.
CONTRACT BALANCES
The opening and closing balances of contract assets and contract liabilities arising from contracts with customers for
the period ended December 31, 2022 and December 31, 2021 were as follows:
IN MILLIONS
LOCATION ON CONSOLIDATED BALANCE SHEET
2022
2021
Contract assets – current
Other current assets
Contract assets – noncurrent
Other noncurrent assets
Contract liabilities – current
Accrued expenses and other current liabilities
Contract liabilities – noncurrent
Other noncurrent liabilities
$
201.2
$ 164.8
239.6
1,010.6
471.4
218.5
805.4
446.6
The timing of revenue recognition, billings and cash collections results in accounts receivable, contract assets, and
customer advances and deposits (contract liabilities) on the Consolidated Balance Sheet. In general, the Company
receives payments from customers based on a billing schedule established in its contracts. Contract assets relate to
the conditional right to consideration for any completed performance under the contract when costs are incurred in
excess of billings under the percentage-of-completion methodology. Accounts receivable are recorded when the right to
consideration becomes unconditional. Contract liabilities relate to payments received in advance of performance under
the contract or when the Company has a right to consideration that is unconditional before it transfers a good or service
to the customer. Contract liabilities are recognized as revenue as (or when) the Company performs under the contract.
During the years ended December 31, 2022 and 2021, changes in contract asset and liability balances were not materially
impacted by any other factors.
Approximately 55% of the contract liability balance at December 31, 2021 was recognized as revenue during the year
ended December 31, 2022. Additionally, approximately 32% of the contract liability balance at December 31, 2022 was
classified as noncurrent and not expected to be recognized as revenue in the next 12 months.
2022 Annual Report
F-31
PART IV
NOTE 13. EQUITY
The authorized share capital of Trane Technologies plc is 1,185,040,000 shares, consisting of (1) 1,175,000,000 ordinary
shares, par value $1.00 per share, (2) 40,000 ordinary shares, par value EUR 1.00 and (3) 10,000,000 preference shares,
par value $0.001 per share. There were no Euro-denominated ordinary shares or preference shares outstanding at
December 31, 2022 or 2021.
The changes in ordinary shares and treasury shares for the year ended December 31, 2022 were as follows:
IN MILLIONS
December 31, 2021
Shares issued under incentive plans
Repurchase of ordinary shares
December 31, 2022
ORDINARY
SHARES ISSUED
ORDINARY
SHARES HELD IN
TREASURY
259.7
1.1
(7.5)
253.3
24.5
—
—
24.5
Share repurchases are made from time to time in accordance with management’s capital allocation strategy, subject to
market conditions and regulatory requirements. Shares acquired and canceled upon repurchase are accounted for as
a reduction of Ordinary Shares and Capital in excess of par value, or Retained earnings to the extent Capital in excess
of par value is exhausted. Shares acquired and held in treasury are presented separately on the balance sheet as a
reduction to Equity and recognized at cost.
In February 2022, the Company’s Board of Directors authorized the repurchase of up to $3.0 billion of its ordinary shares
(2022 Authorization) upon the completion of its current share repurchase program of up to $2.0 billion of its ordinary
shares which was authorized in 2021 (2021 Authorization). During the year ended December 31, 2022, the Company
repurchased and canceled approximately $1,200.0 million of its ordinary shares leaving approximately $200 million
remaining under the 2021 Authorization as of December 31, 2022.
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
The changes in Accumulated other comprehensive income (loss) were as follows:
IN MILLIONS
December 31, 2020
Other comprehensive income (loss) attributable to Trane
Technologies plc
December 31, 2021
Other comprehensive income (loss) attributable to Trane
Technologies plc
December 31, 2022
DERIVATIVE
INSTRUMENTS
PENSION AND
OPEB ITEMS
FOREIGN
CURRENCY
TRANSLATION
TOTAL
$ 10.8
$ (416.5)
$ (225.8)
$ (631.5)
(3.7)
118.6
(121.0)
(6.1)
$ 7.1
$ (297.9)
$ (346.8)
$ (637.6)
(11.6)
83.8
(200.8)
(128.6)
$ (4.5)
$ (214.1)
$ (547.6)
$ (766.2)
The amounts of Other comprehensive income (loss) attributable to noncontrolling interests for 2022, 2021 and 2020 were
$(1.9) million, $(1.7) million and $2.7 million, respectively, related to currency translation. Additionally, Other comprehensive
income (loss) attributable to noncontrolling interests for 2022 and 2021 includes $0.3 million and $1.2 million, respectively,
related to pension and postretirement obligation adjustments.
F-32
PART IV
NOTE 14. SHARE-BASED COMPENSATION
The Company accounts for share-based compensation plans under the fair-value based method. Fair value is measured
once at the date of grant and is not adjusted for subsequent changes. The Company’s share-based compensation
plans include programs for stock options, restricted stock units (RSUs), performance share units (PSUs), and deferred
compensation. Under the Company’s incentive share plan, the total number of ordinary shares authorized by the
shareholders is 23.0 million, of which 13.0 million remains available as of December 31, 2022 for future incentive awards.
In connection with the completion of the Transaction, the provisions of the Company’s existing share-based
compensation plans required adjustment to the terms of outstanding awards in order to preserve the intrinsic value of
the awards immediately before and after the separation. The outstanding awards will continue to vest over the original
vesting period, which is generally three years from the grant date. At the Distribution Date, the Company incurred less
than $0.1 million of incremental compensation costs related to the preservation of the share-based compensation
intrinsic value post-separation.
COMPENSATION EXPENSE
Share-based compensation expense related to continuing operations is included in Selling and administrative expenses.
The following table summarizes the expenses recognized:
IN MILLIONS
Stock options
RSUs
PSUs
Deferred compensation
Pre-tax expense
Tax benefit
After-tax expense
Amounts recorded in continuing operations
Amounts recorded in discontinued operations
Total
Grants issued during the years ended December 31 were as follows:
2022
2021
2020
$
14.1
$ 16.7
$ 17.9
19.7
20.7
1.2
55.7
21.9
26.1
3.0
67.7
23.3
26.7
3.9
71.8
(13.5)
(16.4)
(17.4)
$
42.2
$ 51.3
$ 54.4
42.6
(0.4)
51.3
—
52.7
1.7
$
42.2
$ 51.3
$ 54.4
2022
2021
2020
WEIGHTED-
AVERAGE FAIR
VALUE PER AWARD
NUMBER
GRANTED
WEIGHTED-
AVERAGE FAIR
VALUE PER AWARD
NUMBER
GRANTED
WEIGHTED-
AVERAGE FAIR
VALUE PER AWARD
$
35.96
589,417
$
29.62
1,021,628
$ 165.07
153,806
$ 154.33
213,142
$ 170.31
284,300
$ 181.84
278,468
$ 16.75
$ 104.76
$ 140.72
NUMBER
GRANTED
430,496
139,730
195,930
Stock options
RSUs
Performance shares(1)
(1)
The number of performance shares represents the maximum award level.
2022 Annual Report
F-33
PART IV
STOCK OPTIONS / RSUs
Eligible participants may receive (i) stock options, (ii) RSUs or (iii) a combination of both stock options and RSUs. The fair
value of each of the Company’s stock option and RSU awards is expensed on a straight-line basis over the required
service period, which is generally the 3-year vesting period. However, for stock options and RSUs granted to retirement
eligible employees, the Company recognizes expense for the fair value at the grant date.
The average fair value of the stock options granted is determined using the Black Scholes option pricing model. The
following assumptions were used during the year ended December 31:
Dividend yield
Volatility
Risk-free rate of return
Expected life in years
2022
2021
2020
1.60%
1.60%
2.01%
28.23% 27.90% 24.33%
1.56%
0.45%
0.56%
4.8
4.8
4.8
A description of the significant assumptions used to estimate the fair value of the stock option awards is as follows:
• Dividend yield – The Company determines the dividend yield based upon the expected quarterly dividend payments
as of the grant date and the current fair market value of the Company’s shares.
• Volatility – The expected volatility is based on a weighted average of the Company’s implied volatility and the most
recent historical volatility of the Company’s shares commensurate with the expected life.
• Risk-free rate of return – The Company applies a yield curve of continuous risk-free rates based upon the published
US Treasury spot rates on the grant date.
• Expected life in years – The expected life of the Company’s stock option awards represents the weighted-average of
the actual period since the grant date for all exercised or canceled options and an expected period for all outstanding
options.
Changes in options outstanding under the plans for the years 2022, 2021 and 2020 were as follows:
SHARES
SUBJECT TO
OPTION
WEIGHTED-
AVERAGE
EXERCISE
PRICE
AGGREGATE
INTRINSIC
VALUE
(MILLIONS)
WEIGHTED-
AVERAGE
REMAINING
LIFE (YEARS)
December 31, 2019
Granted
Exercised
Cancelled
Adjustment due to the Transaction
December 31, 2020
Granted
Exercised
Cancelled
December 31, 2021
Granted
Exercised
Cancelled
5,419,246
$
78.91
1,021,628
105.29
(1,767,782)
(49,539)
1,095,805
58.27
88.12
n/a
5,719,358
$
70.53
589,417
(1,872,069)
(25,706)
150.34
64.74
115.33
4,411,000
$
83.39
430,496
(633,962)
(57,050)
167.93
66.06
137.38
Outstanding December 31, 2022
Exercisable December 31, 2022
4,150,484
3,031,573
$
$
94.06
75.79
$ 308.0
$ 279.9
5.1
4.2
F-34
PART IV
WEIGHTED-
AVERAGE
EXERCISE
PRICE
$ 40.18
65.41
79.35
105.28
148.96
166.79
186.90
$ 75.79
2.2
3.5
4.9
6.1
6.9
4.8
8.6
4.2
The following table summarizes information concerning currently outstanding and exercisable options:
OPTIONS OUTSTANDING
OPTIONS EXERCISABLE
NUMBER
OUTSTANDING AT
DECEMBER 31,
2022
WEIGHTED-
AVERAGE
REMAINING
LIFE (YEARS)
NUMBER
EXERCISABLE AT
DECEMBER 31,
2022
WEIGHTED-
AVERAGE
REMAINING
LIFE (YEARS)
RANGE OF EXERCISE PRICE
$
25.01 — $
50.00
50.01 —
75.01 —
100.01 —
125.01 —
150.01 —
175.01 —
75.00
100.00
125.00
150.00
175.00
200.00
462,274
1,196,126
753,524
772,358
529,584
401,986
34,632
WEIGHTED-
AVERAGE
EXERCISE
PRICE
$ 40.18
65.41
79.35
105.25
148.68
167.14
189.59
2.2
3.5
4.9
6.2
7.1
9.0
8.7
5.1
462,274
1,196,126
753,524
445,716
163,945
2,277
7,711
$
32.68 — $ 195.00
4,150,484
$ 94.06
3,031,573
At December 31, 2022, there was $8.5 million of total unrecognized compensation cost from stock option arrangements
granted under the plan, which is primarily related to unvested shares of non-retirement eligible employees. The
aggregate intrinsic value of options exercised during the years ended December 31, 2022 and 2021 was $61.2 million and
$212.6 million, respectively. Generally, stock options expire ten years from their date of grant.
The following table summarizes RSU activity for the years 2022, 2021 and 2020:
Outstanding and unvested at December 31, 2019
Granted
Vested
Cancelled
Adjustment due to the Transaction
Outstanding and unvested at December 31, 2020
Granted
Vested
Cancelled
Outstanding and unvested at December 31, 2021
Granted
Vested
Cancelled
Outstanding and unvested at December 31, 2022
WEIGHTED-
AVERAGE
GRANT DATE
FAIR VALUE
RSUs
604,340
$
93.56
213,142
104.76
(338,952)
(11,356)
22,348
86.62
84.38
n/a
489,522
$
87.75
153,806
(266,041)
(6,257)
154.33
82.18
115.11
371,030
$ 118.88
139,730
(202,172)
(13,935)
165.07
107.29
136.89
294,653
$ 147.88
At December 31, 2022, there was $13.7 million of total unrecognized compensation cost from RSU arrangements granted
under the plan, which is related to unvested shares of non-retirement eligible employees.
2022 Annual Report
F-35
PART IV
PERFORMANCE SHARES
The Company has a Performance Share Program (PSP) for key employees. The program provides awards in the form
of PSUs based on performance against pre-established objectives. The annual target award level is expressed as a
number of the Company’s ordinary shares based on the fair market value of the Company’s stock on the date of grant.
All PSUs are settled in the form of ordinary shares.
PSU awards are earned based 50% upon a performance condition, measured by relative Cash Flow Return on Invested
Capital (CROIC) to the S&P 500 Industrials Index over a 3-year performance period, and 50% upon a market condition,
measured by the Company’s relative total shareholder return (TSR) as compared to the TSR of the S&P 500 Industrials
Index over a 3-year performance period. The fair value of the market condition is estimated using a Monte Carlo
simulation model in a risk-neutral framework based upon historical volatility, risk-free rates and correlation matrix.
The following table summarizes PSU activity for the maximum number of shares that may be issued for the years 2022,
2021 and 2020:
Outstanding and unvested at December 31, 2019
Granted
Vested
Forfeited
Adjustment due to the Transaction
Outstanding and unvested at December 31, 2020
Granted
Vested
Forfeited
Outstanding and unvested at December 31, 2021
Granted
Vested
Forfeited
Outstanding and unvested at December 31, 2022
PSUs
984,930
278,468
(340,400)
(56,430)
151,904
WEIGHTED-
AVERAGE GRANT
DATE FAIR VALUE
$ 103.12
140.72
93.63
89.94
n/a
1,018,472
$
99.53
284,300
(419,088)
(81,728)
801,956
195,930
(346,540)
(42,320)
609,026
181.84
82.93
160.86
$ 131.14
170.31
89.70
164.21
$ 165.02
At December 31, 2022, there was $16.5 million of total unrecognized compensation cost from PSU arrangements based
on current performance, which is related to unvested shares. This compensation will be recognized over the required
service period, which is generally the three-year vesting period.
DEFERRED COMPENSATION
The Company allows key employees to defer a portion of their eligible compensation into a number of investment
choices, including its ordinary share equivalents. Any amounts invested in ordinary share equivalents will be settled in
ordinary shares of the Company at the time of distribution.
F-36
PART IV
NOTE 15. OTHER INCOME/(EXPENSE), NET
The components of Other income/(expense), net for the years ended December 31, 2022, 2021 and 2020 were as follows:
IN MILLIONS
Interest income
Foreign currency exchange loss
Other components of net periodic benefit credit/(cost)
Other activity, net
Other income/(expense), net
2022
2021
2020
$
9.2 $
4.0 $
4.5
(17.9)
(10.7)
(10.0)
(10.6)
(1.6)
(14.7)
(4.0)
9.4
24.3
$ (23.3) $
1.1 $
4.1
Other income/(expense), net includes the results from activities other than core business operations such as interest
income and foreign currency gains and losses on transactions that are denominated in a currency other than an entity’s
functional currency. In addition, the Company includes the components of net periodic benefit credit/(cost) for pension
and post retirement obligations other than the service cost component. During the year ended December 31, 2022, the
Company recorded a $15.0 million settlement charge for a compensation related payment to a retired executive within
other components of net periodic benefit credit/(cost).
Other activity, net primarily includes items associated with certain legal matters, as well as asbestos-related activities.
During the year ended December 31, 2021, the Company recorded a gain of $12.8 million related to the release of a
pension indemnification liability, partially offset by a charge of $7.2 million to increase its Funding Agreement liability
from asbestos-related activities of Murray. Other activity, net for the year ended December 31, 2020, primarily includes
a $17.4 million adjustment to correct an overstatement of a legacy legal liability that originated in prior years and a gain
of $0.9 million related to the deconsolidation of Murray and its wholly-owned subsidiary ClimateLabs. Refer to Note 20,
“Commitments and Contingencies,” for more information regarding asbestos-related matters.
NOTE 16. INCOME TAXES
CURRENT AND DEFERRED PROVISION FOR INCOME TAXES
Earnings before income taxes for the years ended December 31 were taxed within the following jurisdictions:
IN MILLIONS
United States
Non-U.S.
Total
2022
2021
2020
$ 1,312.3 $
995.5 $
859.8
795.2
653.9
634.3
$ 2,172.1 $ 1,790.7 $ 1,288.2
The components of the Provision for income taxes for the years ended December 31 were as follows:
IN MILLIONS
Current tax expense (benefit):
United States
Non-U.S.
Total:
Deferred tax expense (benefit):
United States
Non-U.S.
Total:
Total tax expense (benefit):
United States
Non-U.S.
Total
2022
2021
2020
$ 180.4
$ 247.0 $
168.3
127.7
308.1
111.7
358.7
106.3
274.6
66.5
1.3
67.8
(42.5)
17.3
(25.2)
11.2
11.0
22.2
246.9
129.0
204.5
129.0
179.5
117.3
$ 375.9
$ 333.5 $
296.8
2022 Annual Report
F-37
PART IV
The Provision for income taxes differs from the amount of income taxes determined by applying the applicable U.S.
statutory income tax rate to pretax income, as a result of the following differences:
Statutory U.S. rate
Increase (decrease) in rates resulting from:
Non-U.S. tax rate differential
Tax on U.S. subsidiaries on non-U.S. earnings(a)
State and local income taxes(b)
Valuation allowances(c)
Stock based compensation
Expiration of carryforward tax attributes
Other adjustments
Effective tax rate
(a)
Net of foreign tax credits
(b) Net of changes in state valuation allowances
(c) Primarily federal and non-U.S., excludes state valuation allowances
PERCENT OF PRETAX INCOME
2022
2021
2020
21.0% 21.0%
21.0%
(2.8)
0.3
1.1
(0.7)
(0.8)
—
(0.8)
17.3% 18.6%
(2.8)
(0.3)
2.0
(1.1)
(1.8)
—
1.6
(1.1)
0.3
4.3
(1.1)
(1.7)
1.1
0.2
23.0%
Tax incentives, in the form of tax holidays, have been granted to the Company in certain jurisdictions to encourage
industrial development. The expiration of these tax holidays varies by country. The tax holidays are conditional on the
Company meeting certain employment and investment thresholds. The most significant tax holidays relate to the
Company’s qualifying locations in China, Puerto Rico and Panama. The benefit for the tax holidays for the years ended
December 31, 2022, 2021 and 2020 was $52.5 million, $32.6 million and $24.6 million, respectively.
DEFERRED TAX ASSETS AND LIABILITIES
A summary of the deferred tax accounts at December 31 were as follows:
IN MILLIONS
Deferred tax assets:
Inventory and accounts receivable
Fixed assets and intangibles
Operating lease liabilities
Postemployment and other benefit liabilities
Product liability
Funding liability
Other reserves and accruals
Net operating losses and credit carryforwards
Other
Gross deferred tax assets
Less: deferred tax valuation allowances
Deferred tax assets net of valuation allowances
Deferred tax liabilities:
Inventory and accounts receivable
Fixed assets and intangibles
Operating lease right-of-use assets
Postemployment and other benefit liabilities
Other reserves and accruals
Undistributed earnings of foreign subsidiaries
Other
Gross deferred tax liabilities
Net deferred tax assets (liabilities)
F-38
2022
2021
$
$
$
$
11.2
2.6
112.0
254.6
5.5
—
181.5
346.0
40.7
954.1
(199.8)
754.3
(50.7)
(1,069.0)
(110.4)
(15.7)
(5.5)
(28.0)
(1.6)
(1,280.9)
(526.6)
$
$
$
$
11.0
5.6
106.0
285.7
4.6
73.7
171.2
453.3
29.0
1,140.1
(258.6)
881.5
(18.6)
(1,135.4)
(104.4)
(21.3)
(5.2)
(27.8)
(6.9)
(1,319.6)
(438.1)
PART IV
At December 31, 2022, no deferred taxes have been provided for earnings of certain of the Company’s subsidiaries, since
these earnings have been and under current plans will continue to be permanently reinvested in these subsidiaries.
These earnings amount to approximately $3.4 billion which if distributed would result in additional taxes, which may be
payable upon distribution, of approximately $350.0 million.
At December 31, 2022, the Company had the following operating loss, capital loss and tax credit carryforwards available
to offset taxable income in prior and future years:
IN MILLIONS
U.S. Federal net operating loss carryforwards
U.S. Federal credit carryforwards
U.S. State net operating loss carryforwards
U.S. State credit carryforwards
Non-U.S. net operating loss carryforwards
Non-U.S. credit carryforwards
AMOUNT
EXPIRATION
PERIOD
$
355.2 2023-2033
105.4 2027-2030
2,813.4 2023-Unlimited
27.5 2023-Unlimited
511.0 2023-Unlimited
13.5 Unlimited
The U.S. state net operating loss carryforwards were incurred in various jurisdictions. The non-U.S. net operating loss
carryforwards were incurred in various jurisdictions, predominantly in Belgium, Brazil, Luxembourg, Spain and the
United Kingdom.
Activity associated with the Company’s valuation allowance is as follows:
IN MILLIONS
Beginning balance
Increase to valuation allowance
Decrease to valuation allowance
Other deductions
Write off against valuation allowance
Accumulated other comprehensive income (loss)
Ending balance
2022
2021
2020
$ 258.6
$ 320.5
$ 309.4
5.9
86.5
38.9
(65.1)
(113.5)
(22.8)
—
—
0.4
—
(33.0)
(1.9)
(0.1)
(3.7)
(1.2)
$ 199.8
$ 258.6
$ 320.5
During 2022, the Company recorded a $48.2 million reduction in valuation allowances primarily related to certain net
state deferred tax assets resulting from U.S. legal entity restructurings and deferred tax assets associated with foreign
tax credits as a result of an increase in current year and projected foreign source income. Additional reductions in the
valuation allowance related to deferred tax assets associated with foreign tax credits could be recognized in future
periods if foreign source income exceeds current projections for the periods 2023 through 2028, the remainder of the
carryforward period.
During 2021, the Company recorded a $21.4 million reduction in valuation allowance on deferred tax assets primarily
related to foreign tax credits as a result of an increase in current year foreign source income.
During 2020, the Company recorded a $22.3 million increase in valuation allowance on deferred tax assets primarily
related to certain state net deferred tax assets as a result of the Transaction. In addition, the Company recorded a
$16.0 million reduction in valuation allowances related to non-U.S. net operating losses, primarily as a result of a planned
restructuring in a non-U.S. tax jurisdiction, and foreign tax credits as a result of revised projections of future foreign
source income.
2022 Annual Report
F-39
PART IV
UNRECOGNIZED TAX BENEFITS
The Company has total unrecognized tax benefits of $82.4 million and $65.2 million as of December 31, 2022, and
December 31, 2021, respectively. The amount of unrecognized tax benefits that, if recognized, would affect the continuing
operations effective tax rate are $41.5 million as of December 31, 2022. A reconciliation of the beginning and ending
amount of unrecognized tax benefits is as follows:
IN MILLIONS
Beginning balance
Additions based on tax positions related to the current year
Additions based on tax positions related to prior years
Reductions based on tax positions related to prior years
Reductions related to settlements with tax authorities
Reductions related to lapses of statute of limitations
Translation (gain) loss
Ending balance
2022
2021
2020
$ 65.2
$
65.4
$
63.7
3.9
22.5
(5.9)
(0.9)
(0.6)
(1.8)
1.0
5.1
(2.4)
(0.1)
(1.0)
(2.8)
1.0
2.1
(1.5)
(0.7)
(1.7)
2.5
$ 82.4
$
65.2
$
65.4
The Company records interest and penalties associated with the uncertain tax positions within its Provision for income
taxes. The Company had reserves associated with interest and penalties, net of tax, of $11.3 million and $7.1 million at
December 31, 2022 and December 31, 2021, respectively. For the years ended December 31, 2022 and December 31, 2021,
the Company recognized a $3.7 million and $0.7 million tax expense, respectively, in interest and penalties, net of tax in
continuing operations related to these uncertain tax positions.
The total amount of unrecognized tax benefits relating to the Company’s tax positions is subject to change based on
future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes
of limitations. Although the outcomes and timing of such events are highly uncertain, it is reasonably possible that the
balance of gross unrecognized tax benefits, excluding interest and penalties, could potentially be reduced by up to
approximately $3.7 million during the next 12 months.
The provision for income taxes involves a significant amount of management judgment regarding interpretation of
relevant facts and laws in the jurisdictions in which the Company operates. Future changes in applicable laws, projected
levels of taxable income and tax planning could change the effective tax rate and tax balances recorded by the
Company. In addition, tax authorities periodically review income tax returns filed by the Company and can raise issues
regarding its filing positions, timing and amount of income or deductions, and the allocation of income among the
jurisdictions in which the Company operates. A significant period of time may elapse between the filing of an income
tax return and the ultimate resolution of an issue raised by a revenue authority with respect to that return. In the normal
course of business the Company is subject to examination by taxing authorities throughout the world, including such
major jurisdictions as Belgium, Brazil, Canada, China, France, Germany, Ireland, Italy, Luxembourg, Mexico, Spain, the
Netherlands, the United Kingdom and the United States. These examinations on their own, or any subsequent litigation
related to the examinations, may result in additional taxes or penalties against the Company. If the ultimate result of these
audits differ from original or adjusted estimates, they could have a material impact on the Company’s tax provision. In
general, the examination of the Company’s U.S. federal tax returns is complete or effectively settled for years prior to
2016. In general, the examination of the Company’s material non-U.S. tax returns is complete or effectively settled for the
years prior to 2013, with certain matters prior to 2013 being resolved through appeals and litigation and also unilateral
procedures as provided for under double tax treaties.
In connection with the Transaction, the Company and Ingersoll Rand entered into a tax sharing agreement for the
allocation of taxes. The Company has an indemnity payable to Ingersoll Rand, included within other non-current liabilities,
in the amount of $1.6 million of tax and interest primarily related to open audit years in non-U.S. tax jurisdictions.
F-40
PART IV
NOTE 17. ACQUISITIONS AND DIVESTITURES
ACQUISITIONS
On October 31, 2022, the Company acquired 100% of AL-KO Air Technology (AL-KO) for $118.5 million, net of cash acquired,
financed through cash on hand. AL-KO designs, engineers, manufactures, sells, installs, and services air handling and
extraction systems in commercial applications. Intangible assets associated with this acquisition totaled $49.4 million and
primarily relate to customer relationships. The excess purchase price over the estimated fair value of net assets acquired
was recognized as goodwill and totaled $52.0 million. The results of operations of AL-KO are reported within the EMEA and
Asia Pacific segments from the date of acquisition.
On April 1, 2022, the Company acquired a Commercial HVAC independent dealer, reported within the Americas segment
from the date of acquisition, to support the Company’s ongoing strategy to expand its distribution network and service
area. The aggregate cash paid, net of cash acquired, totaled $110.0 million and was financed through cash on hand.
Intangible assets associated with this acquisition totaled $52.7 million and primarily relate to customer relationships.
The excess purchase price over the estimated fair value of net assets acquired was recognized as goodwill and totaled
$42.5 million.
The preliminary amounts assigned to the major identifiable intangible asset classifications for both acquisitions were
as follows:
IN MILLIONS
Customer relationships
Other
Total intangible assets
WEIGHTED-AVERAGE
USEFUL LIFE (IN YEARS)
15
6
FAIR VALUE
$ 82.9
19.2
$ 102.1
The valuation of intangible assets was determined using an income approach methodology. The fair value of the
customer relationship intangible assets were determined using the multi-period excess earnings method based
on discounted projected net cash flows associated with the net earnings attributable to the acquired customer
relationships. These projected cash flows are estimated over the remaining economic life of the intangible asset and
are considered from a market participant perspective. Key assumptions used in estimating future cash flows included
projected revenue growth rates and customer attrition rates. The projected future cash flows are discounted to present
value using an appropriate discount rate. The Company has not included pro forma financial information for the
acquisitions as the pro forma impact was deemed not material.
On October 15, 2021, the Company acquired 100% of Farrar Scientific Corporation’s (Farrar Scientific) assets, including
its patented ultra-low temperature control technologies, a development and assembly operation in Marietta, Ohio, and
a specialized team of engineers, sales engineers, operators, and technicians. Farrar Scientific is a leader in ultra-low
temperature control for biopharmaceutical and other life science applications. The results of Farrar Scientific are reported
within the Americas segment from the date of acquisition.
The Company paid $251.2 million in initial cash consideration, financed through cash on hand, and agreed to contingent
consideration of up to $115.0 million to be paid in 2025, tied to the attainment of key revenue targets during the period
of January 1, 2022 through December 31, 2024. The purchase price for the acquisition was expected to be $349.9 million,
comprised of the upfront cash consideration of $251.2 million paid on October 15, 2021 and the fair value of the earnout
payment at the time of closing the acquisition of $98.7 million. See Note 9, “Fair Value Measurements” to the Consolidated
Financial Statements for additional information regarding fair value of contingent consideration.
The aggregate purchase price has been allocated to the assets acquired and liabilities assumed based on the
estimate of fair market value of such assets and liabilities at the date of acquisition. Intangible assets associated with
the acquisition totaled $140.7 million and primarily relate to customer relationships. The excess purchase price over the
estimated fair value of net assets acquired was recognized as goodwill and totaled $203.6 million.
2022 Annual Report
F-41
PART IV
The Company recorded intangible assets based on their estimated fair value, which consisted of the following:
IN MILLIONS
Customer relationships
Other
Total intangible assets
WEIGHTED-AVERAGE
USEFUL LIFE (IN YEARS) OCTOBER 15, 2021
14
6
$ 105.2
35.5
$ 140.7
The goodwill is primarily attributable to the fair value of market share and revenue growth from Farrar Scientific. The
benefit of access to the workforce is an additional element of goodwill. For income tax purposes, the acquisition was an
asset purchase and the goodwill will be deductible for tax purposes. The Company has not included pro forma financial
information as the pro forma impact was deemed not material.
During 2020, the Company acquired two independent dealers, reported within the Americas segment, to support
the Company’s ongoing strategy to expand its distribution network and service area. The aggregate cash paid, net
of cash acquired, totaled $182.8 million and was financed through cash on hand. Intangible assets associated with
these acquisitions totaled $76.9 million and primarily relate to customer relationships. The customer relationships had a
weighted-average useful life of 16 years. The excess purchase price over the estimated fair value of net assets acquired
was recognized as goodwill and totaled $131.8 million. The Company has not included pro forma financial information as
the pro forma impact was deemed not material.
DIVESTITURES
The components of Discontinued operations, net of tax for the years ended December 31 were as follows:
IN MILLIONS
Net revenues
Cost of goods sold
Selling and administrative expenses
Operating income (loss)
Other income/ (expense), net
Pre-tax earnings (loss) from discontinued operations
Tax benefit (expense)
Discontinued operations, net of tax
2022
2021
2020
$
—
(3.4)
(1.9)
(5.3)
(21.6)
(26.9)
5.4
$
—
—
(3.0)
(3.0)
(36.3)
(39.3)
18.7
$
469.8
(315.8)
(234.4)
(80.4)
(55.9)
(136.3)
14.9
$
(21.5)
$
(20.6)
$
(121.4)
The table above presents the financial statement line items that support amounts included in Discontinued operations,
net of tax.
For the year ended December 31, 2022, Other income/(expense), net included a charge of $16.5 million to support
Aldrich’s ongoing legal costs in accordance with the Company’s Funding Agreement. For the year ended December 31,
2021, Other income/(expense), net included a charge of $14.0 million to increase the Company’s Funding Agreement
liability from asbestos-related activities of Aldrich as well as pension and post retirement obligations and environmental
costs related to businesses formerly owned by the Company. For the year ended December 31, 2020, Selling and
administrative expenses included pre-tax Ingersoll Rand Industrial separation costs of $114.2 million, which are primarily
related to legal, consulting and advisory fees. In addition, for the year ended December 31, 2021, Other income/ (expense),
net included a loss of $25.8 million related to the deconsolidation of Aldrich and its wholly-owned subsidiary 200 Park.
SEPARATION OF INDUSTRIAL SEGMENT BUSINESSES
On February 29, 2020, the Company completed the Transaction with Ingersoll Rand whereby the Company separated
Ingersoll Rand Industrial which then merged with a wholly-owned subsidiary of Ingersoll Rand. In accordance with
GAAP, the historical results of Ingersoll Rand Industrial are presented as a discontinued operation in the Consolidated
Statements of Earnings and Consolidated Statements of Cash Flows.
F-42
PART IV
Net revenues and earnings from operations, net of tax of Ingersoll Rand Industrial for the years ended December 31 were
as follows:
IN MILLIONS
Net revenues
Earnings (loss) attributable to Trane Technologies plc
Earnings (loss) attributable to noncontrolling interests
Earnings (loss) from operations, net of tax
2022
2021
2020
$
— $
— $ 469.8
(6.1)
—
$
(6.1) $
0.1
—
0.1
(85.8)
0.9
$
(84.9)
Earnings (loss) attributable to Trane Technologies plc includes Ingersoll Rand Industrial separation costs, net of tax
primarily related to legal, consulting and advisory fees of $96.2 million during the year ended December 31, 2020.
OTHER DISCONTINUED OPERATIONS
Other discontinued operations, net of tax related to retained obligations from previously sold businesses that primarily
include ongoing expenses for postretirement benefits, product liability and legal costs. In addition, the Company includes
its obligations under the Funding Agreement for the asbestos-related activities of Aldrich.
The components of Discontinued operations, net of tax for the years ended December 31 were as follows:
IN MILLIONS
Ingersoll Rand Industrial
Asbestos-related activities of Aldrich (post-Petition Date)
Other discontinued operations
Discontinued operations
2022
2021
2020
$
(6.1) $
0.1 $ (84.9)
(12.4)
(13.3)
(3.0)
(7.4)
(19.1)
(17.4)
$ (21.5) $ (20.6) $ (121.4)
Refer to Note 20, “Commitments and Contingencies,” for more information regarding the deconsolidation and asbestos-
related matters.
NOTE 18. EARNINGS PER SHARE (EPS)
Basic EPS is calculated by dividing Net earnings attributable to Trane Technologies plc by the weighted-average number
of ordinary shares outstanding for the applicable period. Diluted EPS is calculated after adjusting the denominator of
the basic EPS calculation for the effect of all potentially dilutive ordinary shares, which in the Company’s case, includes
shares issuable under share-based compensation plans. The following table summarizes the weighted-average number
of ordinary shares outstanding for basic and diluted earnings per share calculations:
IN MILLIONS
Weighted-average number of basic shares outstanding
Shares issuable under incentive share plans
Weighted-average number of diluted shares outstanding
Anti-dilutive shares
Dividends declared per ordinary share
2022
2021
2020
232.6
238.7
240.1
2.3
3.6
3.0
234.9
242.3
243.1
0.8
—
0.6
$ 2.68 $ 2.36 $ 2.12
2022 Annual Report
F-43
PART IV
NOTE 19. BUSINESS SEGMENT INFORMATION
The Company operates under four regional operating segments designed to create deep customer focus and relevance
in markets around the world. The Company determined that its two Europe, Middle East and Africa (EMEA) operating
segments meet the aggregation criteria based on similar operating and economic characteristics, resulting in one
reportable segment. Therefore, the Company has three regional reportable segments, Americas, EMEA and Asia Pacific.
Intercompany sales between segments are immaterial.
• The Company’s Americas segment innovates for customers in North America and Latin America. The Americas
segment encompasses commercial heating, cooling and ventilation systems, building controls, and energy services
and solutions; residential heating and cooling; and transport refrigeration systems and solutions.
• The Company’s EMEA segment innovates for customers in the Europe, Middle East and Africa region. The EMEA
segment encompasses heating, cooling and ventilation systems, services and solutions for commercial buildings, and
transport refrigeration systems and solutions.
• The Company’s Asia Pacific segment innovates for customers throughout the Asia Pacific region. The Asia Pacific
segment encompasses heating, cooling and ventilation systems, services and solutions for commercial buildings, and
transport refrigeration systems and solutions.
Management measures segment operating performance based on net earnings excluding interest expense, income
taxes, depreciation and amortization, restructuring, non-cash adjustments for contingent consideration, insurance
settlement on property claim in Q3 2022, merger and acquisition-related costs, unallocated corporate expenses and
discontinued operations (Segment Adjusted EBITDA). Segment Adjusted EBITDA is not defined under GAAP and may not
be comparable to similarly-titled measures used by other companies and should not be considered a substitute for net
earnings or other results reported in accordance with GAAP. The Company believes Segment Adjusted EBITDA provides
the most relevant measure of profitability as well as earnings power and the ability to generate cash. This measure is a
useful financial metric to assess the Company’s operating performance from period to period by excluding certain items
that it believes are not representative of its core business and the Company uses this measure for business planning
purposes. Segment Adjusted EBITDA also provides a useful tool for assessing the comparability between periods and
the Company’s ability to generate cash from operations sufficient to pay taxes, to service debt and to undertake capital
expenditures because it eliminates non-cash charges such as depreciation and amortization expense.
F-44
A summary of operations by reportable segment for the years ended December 31 were as follows:
PART IV
IN MILLIONS
Net revenues
Americas
EMEA
Asia Pacific
Total Net revenues
Segment Adjusted EBITDA
Americas
EMEA
Asia Pacific
Total Segment Adjusted EBITDA
Reconciliation of Segment Adjusted EBITDA to earnings before income taxes
Total Segment Adjusted EBITDA
Interest expense
Depreciation and amortization
Restructuring costs
Non-cash adjustments for contingent consideration
Insurance settlement on property claim in Q3 2022
Acquisition inventory step-up
Unallocated corporate expenses
Earnings before income taxes
Depreciation and Amortization
Americas
EMEA
Asia Pacific
Depreciation and amortization from reportable segments
Unallocated depreciation and amortization
Total depreciation and amortization
Capital Expenditures
Americas
EMEA
Asia Pacific
Capital expenditures from reportable segments
Corporate capital expenditures
Total capital expenditures
2022
2021
2020
$ 12,640.8
$ 10,957.1
$
9,685.9
2,034.5
1,316.4
1,944.9
1,234.4
1,648.1
1,120.7
$ 15,991.7
$ 14,136.4
$ 12,454.7
$ 2,326.3
$ 2,008.8
$
1,677.7
338.1
248.3
359.2
228.5
265.7
188.8
$ 2,912.7
$ 2,596.5
$
2,132.2
$ 2,912.7
$ 2,596.5
$
2,132.2
(223.5)
(323.6)
(20.7)
46.9
25.0
(0.8)
(233.7)
(299.4)
(27.0)
—
—
—
(248.7)
(294.3)
(75.7)
—
—
—
(243.9)
(245.7)
(225.3)
$ 2,172.1
$ 1,790.7
$
1,288.2
$
256.9
$
227.6
$
224.0
28.8
17.6
303.3
20.3
323.6
230.5
25.9
11.2
267.6
24.2
291.8
$
$
$
$
$
33.3
16.5
277.4
22.0
299.4
148.7
23.6
20.6
192.9
30.1
223.0
$
$
$
$
$
$
$
$
$
$
32.6
11.6
268.2
26.1
294.3
98.2
24.7
7.7
130.6
15.6
146.2
At December 31, a summary of long-lived assets by geographic area were as follows:
IN MILLIONS
United States
Non-U.S.
Total
2022
2021
$ 1,413.8
$ 1,287.5
584.8
548.1
$ 1,998.6
$ 1,835.6
2022 Annual Report
F-45
PART IV
NOTE 20. COMMITMENTS AND CONTINGENCIES
The Company is involved in various litigation, claims and administrative proceedings, including those related to the
bankruptcy proceedings for Aldrich and Murray and environmental and product liability matters. The Company records
accruals for loss contingencies when it is both probable that a liability will be incurred and the amount of the loss
can be reasonably estimated. Amounts recorded for identified contingent liabilities are estimates, which are reviewed
periodically and adjusted to reflect additional information when it becomes available. Subject to the uncertainties inherent
in estimating future costs for contingent liabilities, except as expressly set forth in this note, management believes that
any liability which may result from these legal matters would not have a material adverse effect on the financial condition,
results of operations, liquidity or cash flows of the Company.
ASBESTOS-RELATED MATTERS
Certain wholly-owned subsidiaries and former companies of the Company have been named as defendants in
asbestos-related lawsuits in state and federal courts. In virtually all of the suits, a large number of other companies
have also been named as defendants. The vast majority of those claims were filed against predecessors of Aldrich and
Murray and generally allege injury caused by exposure to asbestos contained in certain historical products sold by
predecessors of Aldrich or Murray, primarily pumps, boilers and railroad brake shoes. None of the Company’s existing or
previously-owned businesses were a producer or manufacturer of asbestos.
On June 18, 2020, Aldrich and Murray filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code to resolve
equitably and permanently all current and future asbestos related claims in a manner beneficial to claimants and to
Aldrich and Murray. As a result of the Chapter 11 filings, all asbestos-related lawsuits against Aldrich and Murray have
been stayed due to the imposition of a statutory automatic stay applicable in Chapter 11 bankruptcy cases. In addition,
at the request of Aldrich and Murray, the Bankruptcy Court has entered an order temporarily staying all asbestos-related
claims against the Trane Companies that relate to claims against Aldrich or Murray (except for asbestos-related claims
for which the exclusive remedy is provided under workers’ compensation statutes or similar laws). On August 23, 2021, the
Bankruptcy Court entered its findings of facts and conclusions of law and order declaring that the automatic stay applies
to certain asbestos related claims against the Trane Companies and enjoining such actions. As a result, all asbestos-
related lawsuits against Aldrich, Murray and the Trane Companies remain stayed.
The goal of these Chapter 11 filings is to resolve equitably and permanently all current and future asbestos-related claims
in a manner beneficial to claimants and to Aldrich and Murray through court approval of a plan of reorganization that
would create a trust pursuant to section 524(g) of the Bankruptcy Code, establish claims resolution procedures for all
current and future asbestos-related claims against Aldrich and Murray and channel such claims to the trust for resolution
in accordance with those procedures. Aldrich and Murray intend to seek an agreement with representatives of the
asbestos claimants on the terms of a plan for the establishment of such a trust.
Prior to the Petition Date, predecessors of each of Aldrich and Murray had been litigating asbestos-related claims
brought against them. No such claims have been paid since the Petition Date, and it is not contemplated that any such
claims will be paid until the end of the Chapter 11 cases.
From an accounting perspective, the Company no longer has control over Aldrich and Murray as of the Petition Date
as their activities are subject to review and oversight by the Bankruptcy Court. Therefore, Aldrich and its wholly-owned
subsidiary 200 Park and Murray and its wholly-owned subsidiary ClimateLabs were deconsolidated as of the Petition Date
and their respective assets and liabilities were derecognized from the Company’s Consolidated Financial Statements.
Amounts derecognized in 2020 primarily related to the legacy asbestos-related liabilities and asbestos-related insurance
recoveries and $41.7 million of cash.
F-46
PART IV
ACCOUNTING TREATMENT PRIOR TO THE PETITION DATE
Historically, the Company performed a detailed analysis and projected an estimated range of the Company’s total
liability for pending and unasserted future asbestos-related claims. The Company recorded the liability at the low end
of the range as it believed that no amount within the range was a better estimate than any other amount. Asbestos-
related defense costs were excluded from the liability and were recorded separately as services were incurred. The
methodology used to prepare estimates relied upon and included the following factors, among others:
•
the interpretation of a widely accepted forecast of the population likely to have been occupationally exposed to asbestos;
• epidemiological studies estimating the number of people likely to develop asbestos-related diseases such as
mesothelioma and lung cancer;
•
•
the Company’s historical experience with the filing of non-malignancy claims and claims alleging other types of malignant
diseases filed against the Company relative to the number of lung cancer claims filed against the Company;
the analysis of the number of people likely to file an asbestos-related personal injury claim against the Company based on
such epidemiological and historical data and the Company’s claims history;
• an analysis of the Company’s pending cases, by type of disease claimed and by year filed;
• an analysis of the Company’s history to determine the average settlement and resolution value of claims, by type of
disease claimed;
• an adjustment for inflation in the future average settlement value of claims, at a 2.5% annual inflation rate, adjusted downward
to 1.0% to take account of the declining value of claims resulting from the aging of the claimant population; and
• an analysis of the period over which the Company has and is likely to resolve asbestos-related claims against it in the future
(currently projected through 2053).
Prior to the Petition Date, over 73 percent of the open and active claims against the Company were non-malignant or
unspecified disease claims. In addition, the Company had a number of claims which had been placed on inactive or
deferred dockets and expected to have little or no settlement value against the Company.
Prior to the Petition Date, the costs associated with the settlement and defense of asbestos-related claims, insurance
settlements on asbestos-related matters and the revaluation of the Company’s liability for potential future claims and
recoveries were included in the Consolidated Statements of Earnings within continuing operations or discontinued
operations depending on the business to which they relate. Income and expenses associated with asbestos-related
matters of Aldrich and its predecessors were recorded within discontinued operations as they related to previously
divested businesses, primarily Ingersoll-Dresser Pump, which was sold by the Company in 2000. Income and expenses
associated with asbestos-related matters for Murray and its predecessors were recorded within continuing operations.
The year ended December 31, 2020 includes a $17.4 million adjustment to correct an overstatement of a legacy legal
liability that originated in prior years.
The net income (expense) associated with these pre-Petition Date transactions for the year ended December 31, 2020
was as follows:
IN MILLIONS
Continuing operations
Discontinued operations
Total
2020
$ 14.8
(11.2)
$
3.6
The amounts recorded by the Company for asbestos-related liabilities and insurance-related assets are based on
currently available information. Key assumptions underlying the estimated asbestos-related liabilities include the
number of people occupationally exposed and likely to develop asbestos-related diseases such as mesothelioma and
lung cancer, the number of people likely to file an asbestos-related personal injury claim against the Company, the
average settlement and resolution of each claim and the percentage of claims resolved with no payment. Furthermore,
predictions with respect to estimates of the liability were subject to greater uncertainty as the projection period
2022 Annual Report
F-47
PART IV
lengthens. Other factors that have affected the Company’s liability include uncertainties surrounding the litigation
process from jurisdiction to jurisdiction and from case to case, reforms that have been made by state and federal courts,
and the passage of state or federal tort reform legislation.
The aggregate amount of the stated limits in insurance policies available to Aldrich and Murray for asbestos-related
claims acquired, over many years and from many different carriers, is substantial. However, as a result of limitations in that
coverage, the projected total liability to claimants substantially exceeds the probable insurance recovery.
ACCOUNTING TREATMENT AFTER THE PETITION DATE
Upon deconsolidation in 2020, the Company recorded its retained interest in Aldrich and Murray at fair value within Other
noncurrent assets in the Consolidated Balance Sheet. In determining the fair value of its equity investment, the Company
used a market-adjusted multiple of earnings valuation technique. As a result, the Company recorded an aggregate equity
investment of $53.6 million as of the Petition Date.
Simultaneously, the Company recognized a liability of $248.8 million within Other noncurrent liabilities in the Consolidated
Balance Sheet related to its obligation under the Funding Agreements. The liability was based on asbestos-related
liabilities and insurance-related assets balances previously recorded by the Company prior to the Petition Date.
As a result of the deconsolidation, the Company recognized an aggregate loss of $24.9 million in its Consolidated
Statements of Earnings during the year ended December 31, 2020. A gain of $0.9 million related to Murray and its wholly-
owned subsidiary ClimateLabs was recorded within Other income/ (expense), net and a loss of $25.8 million related to
Aldrich and its wholly-owned subsidiary 200 Park was recorded within Discontinued operations, net of tax. Additionally, the
deconsolidation resulted in an investing cash outflow of $41.7 million in the Company’s Consolidated Statements of Cash
Flows, of which $10.8 million was recorded within continuing operations during the year ended December 31, 2020.
On August 26, 2021, the Company announced that Aldrich and Murray reached an agreement in principle with the court-
appointed legal representative of future asbestos claimants (the FCR) in the bankruptcy proceedings. The agreement
in principle includes the key terms for the permanent resolution of all current and future asbestos claims against
Aldrich and Murray pursuant to a plan of reorganization (the Plan). Under the agreed terms, the Plan would create a
trust pursuant to section 524(g) of the Bankruptcy Code and establish claims resolution procedures for all current and
future claims against Aldrich and Murray (Asbestos Claims). On the effective date of the Plan, Aldrich and Murray would
fund the trust with $545.0 million, comprised of $540.0 million in cash and a promissory note to be issued by Aldrich and
Murray to the trust in the principal amount of $5.0 million, and the Asbestos Claims would be channeled to the trust for
resolution in accordance with the claims resolution procedures. Following the effective date of the Plan, Aldrich and
Murray would have no further obligations with respect to the Asbestos Claims. The FCR has agreed to support such
Plan. The agreement in principle with the FCR is subject to final documentation and is conditioned on arrangements
acceptable to Aldrich and Murray with respect to their asbestos insurance assets. It is currently contemplated that the
asbestos insurance assets of Aldrich and Murray would be contributed to the trust, and that, in consideration of their
cash contribution to the trust, Aldrich and Murray would have the exclusive right to pursue, collect and retain all insurance
reimbursements available in connection with the resolution of Asbestos Claims by the trust. The committee representing
current asbestos claimants (the ACC) is not a party to the agreement in principle. Any settlement and its implementation
in a plan of reorganization is subject to the approval of the Bankruptcy Court, and there can be no assurance that the
Bankruptcy Court will approve the agreement on the terms proposed.
On September 24, 2021, Aldrich and Murray filed the Plan with the Bankruptcy Court. The Plan is supported by, and reflects
the agreement in principle reached with the FCR. On the same date, in connection with the Plan, Aldrich and Murray filed
a motion with the Bankruptcy Court to create a $270.0 million trust intended to constitute a “qualified settlement fund”
within the meaning of the Treasury Regulations under Section 468B of the Internal Revenue Code (QSF). The funds held in
the QSF would be available to provide funding for the Section 524(g) Trust upon effectiveness of the Plan.
During the year ended December 31, 2021, in connection with the agreement in principle reached by Aldrich and Murray
with the FCR and the motion to create a $270.0 million QSF, the Company recorded a charge of $21.2 million to increase
its Funding Agreement liability to $270.0 million. The corresponding charge was bifurcated between Other income/
(expense), net of $7.2 million relating to Murray and discontinued operations of $14.0 million relating to Aldrich.
F-48
PART IV
On January 27, 2022, the Bankruptcy Court granted the request to fund the QSF, which was funded on March 2, 2022,
resulting in an operating cash outflow of $270.0 million in the Company’s Consolidated Statements of Cash Flows, of
which $91.8 million was allocated to continuing operations and $178.2 million was allocated to discontinued operations
for the year ended December 31, 2022. On April 18, 2022, the Bankruptcy Court entered an order granting Aldrich and
Murray’s request to seek to estimate their aggregate liability for all current and future asbestos-related personal injury
claims. Aldrich and Murray are pursuing discovery and related matters in connection with the estimation proceedings.
On October 18, 2021, the ACC filed a motion seeking standing to pursue and investigate on behalf of the bankruptcy
estates of Aldrich and Murray, claims arising from or related to the 2020 Corporate Restructuring. Also on October 18,
2021, the ACC filed a complaint seeking to substantively consolidate the bankruptcy estates of Aldrich and Murray with
certain of the Company’s subsidiaries. On December 20, 2021, Aldrich, Murray and certain of the Company’s subsidiaries
filed motions to dismiss the ACC’s substantive consolidation complaint. On April 14, 2022, the Bankruptcy Court granted
the ACC’s standing motion and denied the motions to dismiss the substantive consolidation complaint. On June 18,
2022, the ACC filed complaints against the Company and other related parties asserting various claims and causes of
action arising from or related to the 2020 Corporate Restructuring. Additionally, the Bankruptcy Court denied motions
to dismiss the ACC’s substantive consolidation complaint. While the Company is vigorously opposing and defending
against these claims, it is not possible to predict whether it will be successful. At this point in the Chapter 11 cases of
Aldrich and Murray, it is not possible to predict whether the Bankruptcy Court will approve the terms of the Plan, what the
extent of the asbestos liability will be or how long the Chapter 11 cases will last. The Chapter 11 cases remain pending as
of February 10, 2023.
Furthermore, in connection with the 2020 Corporate Restructuring, Aldrich, Murray and their respective subsidiaries
entered into several agreements with subsidiaries of the Company to ensure they each have access to services
necessary for the effective operation of their respective businesses and access to capital to address any liquidity needs
that arise as a result of working capital requirements or timing issues. In addition, the Company regularly transacts
business with Aldrich and its wholly-owned subsidiary 200 Park and Murray and its wholly-owned subsidiary ClimateLabs.
As of the Petition Date, these entities are considered related parties and post deconsolidation activity between the
Company and them are reported as third party transactions and are reflected within the Company’s Consolidated
Statements of Earnings. Since the Petition Date, there were no material transactions between the Company and these
entities other than as described above.
ENVIRONMENTAL MATTERS
The Company continues to be dedicated to environmental and sustainability programs to minimize the use of natural
resources, reduce the utilization and generation of hazardous materials from our manufacturing processes and
remediate identified environmental concerns. As to the latter, the Company is currently engaged in site investigations
and remediation activities to address environmental cleanup from past operations at current and former manufacturing
facilities and off-site waste disposal facilities.
It is the Company’s policy to establish environmental reserves for investigation and remediation activities when it is
probable that a liability has been incurred and a reasonable estimate of the liability can be made. Estimated liabilities
are determined based upon existing remediation laws and technologies. Inherent uncertainties exist in such evaluations
due to unknown environmental conditions, changes in government laws and regulations, and changes in cleanup
technologies. The environmental reserves are updated on a routine basis as remediation efforts progress and new
information becomes available.
The Company is sometimes a party to environmental lawsuits and claims and has received notices of potential violations
of environmental laws and regulations from the Environmental Protection Agency and similar state and international
authorities. It has also been identified as a potentially responsible party (PRP) for cleanup costs associated with off-site
waste disposal at federal Superfund and state remediation sites. In most instances at multi-party sites, the Company’s
share of the liability is not material.
In estimating its liability at multi-party sites, the Company has assumed it will not bear the entire cost of remediation of
any site to the exclusion of other PRPs who may be jointly and severally liable. The ability of other PRPs to participate
has been taken into account, based on the Company’s understanding of the parties’ financial condition and probable
contributions on a per site basis.
2022 Annual Report
F-49
PART IV
Reserves for environmental matters are classified as Accrued expenses and other current liabilities or Other noncurrent
liabilities based on their expected term. As of December 31, 2022 and 2021, the Company has recorded reserves for
environmental matters of $42.4 million and $39.6 million, respectively. Of these amounts, $36.5 million and $36.3 million,
respectively, relate to investigation and remediation of properties and multi-waste disposal sites related to businesses
formerly owned by the Company.
WARRANTY LIABILITY
Standard product warranty accruals are recorded at the time of sale and are estimated based upon product warranty
terms and historical experience. The Company assesses the adequacy of its liabilities and will make adjustments as
necessary based on known or anticipated warranty claims, or as new information becomes available.
The changes in the standard product warranty liability for the years ended December 31, were as follows:
IN MILLIONS
Balance at beginning of period
Reductions for payments
Accruals for warranties issued during the current period
Changes to accruals related to preexisting warranties
Translation
Balance at end of period
2022
2021
$ 296.2
$ 282.7
(127.3)
(119.7)
156.6
133.7
1.2
(3.1)
1.3
(1.8)
$ 323.6
$ 296.2
Standard product warranty liabilities are classified as Accrued expenses and other current liabilities or Other noncurrent
liabilities based on their expected term. The Company’s total current standard product warranty reserve at December 31,
2022 and December 31, 2021 was $120.4 million and $106.6 million, respectively.
WARRANTY DEFERRED REVENUE
The Company’s extended warranty liability represents the deferred revenue associated with its extended warranty
contracts and is amortized into Net revenues on a straight-line basis over the life of the contract, unless another method
is more representative of the costs incurred. The Company assesses the adequacy of its liability by evaluating the
expected costs under its existing contracts to ensure these expected costs do not exceed the extended warranty liability.
The changes in the extended warranty liability for the years ended December 31, were as follows:
IN MILLIONS
Balance at beginning of period
Amortization of deferred revenue for the period
Additions for extended warranties issued during the period
Changes to accruals related to preexisting warranties
Translation
Balance at end of period
2022
2021
$
311.7
$ 304.4
(117.4)
(121.5)
125.1
0.3
(2.0)
119.4
10.7
(1.3)
$
317.7
$ 311.7
The extended warranty liability is classified as Accrued expenses and other current liabilities or Other noncurrent liabilities
based on the timing of when the deferred revenue is expected to be amortized into Net revenues. The Company’s total
current extended warranty liability at December 31, 2022 and December 31, 2021 was $110.5 million and $115.4 million,
respectively. For the years ended December 31, 2022, 2021 and 2020, the Company incurred costs of $54.8 million,
$58.5 million and $61.0 million, respectively, related to extended warranties.
F-50
ANNUAL GENERAL MEETING
The Notice of Internet Availability of Proxy Materials,
the Notice of 2023 Annual General Meeting of
Shareholders, the 2023 Proxy Statement and this
Annual Report are being sent or made available to
shareholders on or about April 21, 2023. We strongly
encourage all shareholders to submit proxy forms to
ensure they can vote and be represented at the 2023
Annual Meeting without attending in person.
Date and Time
Thursday, June 1, 2023, at 2:30 p.m. local time
Location
Adare Manor Hotel
Adare County, Limerick, Ireland
TRANSFER AGENT AND REGISTRAR
Telephone Inquiries: 866-229-8405
Website: www.computershare.com/Investor
Address shareholder inquiries with standard priority:
Computershare
P.O. Box 43078
Providence, RI 02940-3078
Address shareholder inquiries with overnight priority:
Computershare
150 Royall Street, Suite 101
Canton, MA 02021
2022 ANNUAL REPORT ON FORM 10-K
This 2022 Annual Report includes the Company’s
Annual Report on Form 10-K for the fiscal year ended
December 31, 2022. The Form 10-K filed with the U.S.
Securities and Exchange Commission includes the
exhibits to Form 10-K and is available to shareholders
without charge by contacting Investor Relations or
by accessing the investor section of our company’s
website at investors.tranetechnologies.com or by
going to the SEC’s website at www.sec.gov.
INVESTOR RELATIONS
Investors and financial analysts seeking information
about the company should contact:
Zac Nagle
Vice President – Investor Relations
1-704-990-3913
InvestorRelations@tranetechnologies.com
This annual report and online 2022 ESG Report at
www.tranetechnologies.com/sustainability-reports,
is produced in accordance with the G4 framework
established by the Global Reporting Initiative (GRI)
and reports on our financial and non-financial
performance for the 2022 fiscal year. For more
information on GRI, please visit www.globalreporting.
org. To ensure the quality of our environmental,
health and safety data, we assure selected data
with a third-party provider. The results of this
assurance can be found in our 2022 ESG Report at
www.tranetechnologies.com/sustainability-reports.
FORWARD-LOOKING STATEMENTS
This 2022 Annual Report includes “forward-looking
statements” which are statements that are not
historical facts, including statements that relate
to our commitments to climate, sustainability and
our people, and the impact of these commitments.
These forward-looking statements are based on
our current expectations and are subject to risks
and uncertainties, which may cause actual results
to differ materially from our current expectations.
Such factors include, but are not limited to,
our future financial performance and targets,
including revenue, EPS and operating income; our
business operations; demand for our products and
services, including bookings and backlog; capital
deployment, including the amount and timing of
our dividends, our share repurchase program,
including the amount of shares to be repurchased
and the timing of such repurchases and our capital
allocation strategy, including acquisitions, if any;
our projected free cash flow and usage of such
cash; our available liquidity; performance of the
markets in which we operate; restructuring activity
and cost savings associated with such activity; and
our effective tax rate. Additional factors that could
cause such differences can be found in our Form
10-K for the year ended December 31, 2022, as well
as our subsequent reports on Form 10-Q and other
SEC filings. We assume no obligation to update
these forward-looking statements.
About Trane Technologies
Trane Technologies is a global climate innovator. Through our strategic brands Trane® and
Thermo King®, and our portfolio of environmentally responsible products and services, we
bring efficient and sustainable climate solutions to buildings, homes and transportation.
For more on Trane Technologies, visit www.tranetechnologies.com.
We are committed to using environmentally conscious print practices.
©2023 Trane Technologies