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A Message from Claudia Toussaint, Chief People and Sustainability Officer

“Sustainability really is who we are. In 2021, we took significant steps forward and also turned our attention to — how do we raise the bar even further? And what does Sustainability at Xylem look like after 2025?”

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In 2021, we took important steps forward in executing our sustainability strategy and advancing our 2025 Sustainability Goals, built to reinforce the UN Sustainable Development Goals (SDGs). Three years ago, when we introduced our strategy and objectives, it was a significant advancement for us as a company, and the way we consider Sustainability as core to our business strategy and long-term growth.

The past two years were about acting on those commitments and truly operationalizing sustainability efforts into and across the organization. We built more robust internal reporting and controls, established subject matter expertise across functional areas like product development, operations and supply chain, and we integrated Sustainability into all that we do — from factory floor to the boardroom.

This last year, our attention turned to — how do we raise the bar even further? And what does Sustainability at Xylem look like after 2025? In his CEO letter, Patrick outlines three pillars of focus where we believe we have the most powerful opportunity to make an impact, and where we are concentrating our efforts to help our customers and their communities solve their urgent water and climate challenges. These areas of focus include: advancing water stewardship, fostering climate change mitigation through decarbonization, and championing diversity, equity and inclusion within our company, across the water sector and beyond.

Throughout this report we provide highlights and learnings from this past year. As always, our progress reflects the collaborative efforts from our partnerships across our global organization and across our ecosystem of customers, suppliers, distributors, innovation, educational and nonprofit partners.

Some highlights include:

  • Power of Partnership: With our customers, prevented over 1.9 billion cubic meters of polluted water from entering our waterways
  • Executive Compensation and Accountability: Expanded accountability for Sustainability progress by integrating a set of 2025 Goals into a special onetime PSU grant for leaders
  • Financing Strategies: Continued to integrate sustainability into our financing strategies by launching an ESG-linked demand deposit account
  • Climate Action Commitments: Further advanced our commitment to climate action by announcing our commitment to reach Net-Zero before 2050 and engaging the water utilities sector to commit to setting Net-Zero targets
  • Mission and Purpose: Reached almost 80% of employee participation in Watermark — a company record by over 20%
  • Youth Engagement: Engaged over 700 students in our first annual Xylem Ignite Innovation Challenge

2021 was also a year of reinforcing our focus on our people. Like many other companies, we are emerging from the COVID-19 pandemic having learned many lessons about the viability of alternate work styles, the benefits of flexibility, and the importance of transparent communication and need for employee connection. We are also keenly aware that for many, the abrupt transition over the last two years, combined with a host of personal and societal challenges, have been stressful to manage. These insights are informing our “return to work” transition and how we support our employee experience across the employee lifecycle.

Developing people and creating space for them to bring their most authentic self to work and achieving their personal and professional goals has always been extremely rewarding for me. Now, perhaps more than ever, how we take care of our people — ensuring we structure our workplace and resources in a way that best supports their personal growth and Xylem’s growth — is critically important. To better illustrate our approach, we have enhanced the way we communicate our Culture, Talent and Diversity, Equity and Inclusion (DEI) efforts in this year’s report, to focus on each stage of the employee experience — from how we attract, recruit and onboard, to how we develop, promote and ultimately strive to retain our talent.

Some highlights across those career stages this year include:

  • Bolstering talent attraction efforts focused on new, next generation and globally diverse talent
  • Setting goals for increasing the diversity of candidate slates and providing resources for inclusive hiring practices
  • Providing development opportunities through formal leadership training and special projects
  • Creating new opportunities for mentorship with our reverse mentoring program

You’ll notice throughout the report that we’ve added summaries: What we did. What we learned. Where we’re going. As we’ve said many times before, Sustainability is a journey. It’s about reflection on your actions, partnering with stakeholders and improving with each iteration.

We appreciate your interest in Xylem and our holistic approach to Sustainability. It really is who we are. 2021 was a great year for us and 2022 is shaping up to be a continuation of that progress. Thank you, as always, for your partnership.

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Claudia Toussaint
Chief People and Sustainability Officer
Xylem