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Caring & Giving
Greenhouse Gas Emissions

Human health and environmental health go hand in hand.

Climate change is the biggest global health threat of the 21st century, according to Managing the Health Effects of Climate Change, a recent report by the Lancet/UCL Commission on Health and Climate Change, a collaboration of dozens of experts from around the world.

Johnson & Johnson began its formal energy management program more than 30 years ago. In 2000, we established our first enterprise-wide, public commitment to reduce CO2 emissions. In just the past 10 years, our energy and CO2 emissions reduction projects have reduced both our energy costs and carbon footprint by approximately 15 percent. We are proud of the solid progress we have made to reduce our carbon footprint, protect our environment and conserve our natural resources. And, we are committed to doing even more.

As part of the Citizenship & Sustainability 2020 Goals we launched in 2016, we extended our commitments with two new energy and climate goals based on the latest climate science. Across Johnson & Johnson, we aim to:

• Reduce absolute carbon emissions (Scope 1&2) 20 percent by 2020 and 80 percent by 2050
• Produce/procure 20 percent of electricity from clean/renewable sources by 2020 and aspire to power all our facilities with renewable energy by 2050

Facility CO2 Emissions 1

We have set a Healthy Future goal to achieve a 20 percent absolute reduction of our facility CO2 emissions by 2020 compared to our 2010 baseline. In 2015, we realized a 0.7 percent decrease in CO2 emissions, from 1,122,888 metric tons in 2014 to 1,114,764 metric tons in 2015. Since 2010, we have realized a 9.8 percent decrease in CO2 emissions at our facilities globally. These reductions are the result of energy efficiency and clean energy projects, the electricity grid becoming cleaner across the globe, and portfolio optimization. Our emissions intensity (including Scope 1 & 2 emissions) per revenue since 2010 has decreased by more than 20 percent, from 20.1 MT CO2/million USD in 2010 to 15.9 MT CO2/million USD in 2015. We currently do not use carbon offsets to reduce our global emissions footprint.

Worldwide CO2 Emissions vs. SalesFacility-related Scope 1 & 2 emissions, 1990-2015

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Worldwide Facility CO2e Emissions (Scope 1 and Scope 2) 2 in thousand metric tons 3

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Worldwide Aviation and Sales Fleet Scope 1 Emissions in metric tons

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We follow the Greenhouse Gas Protocol issued by the World Business Council for Sustainable Development and the World Resources Institute, and three of our sites are subject to the European Union Emissions Trading System program. We track and report our Scope 1 & 2 emissions sources. In launching our new science-based 2020 CO2 reduction goal, we also expanded the scope of the goal to include our aviation fleet and sales fleet. The Scope 3 emissions currently tracked include employee business travel, electricity-related transmission and distribution losses, and limited downstream (U.S. only) transportation emissions. Evaluation of opportunities for engagement and improvement within our Scope 3 footprint continue, and an input/output analysis has been performed to identify emissions hot spots within our value chain. We continue to engage with our external supply chain in an effort to collect meaningful data on our material Scope 3 emissions sources, and collaborate with them on reducing their carbon footprint. We continue to participate in the CDP supply chain program where we ask our largest suppliers to report energy and emissions data on our behalf.

Scope 3 Emissions EN17 2 EN30 (metric tons CO2)4

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Business Travel includes global flights via American Express reporting and personal vehicles miles via gXRS internal reporting. Downstream Product Transportation includes downstream shipping-related emissions for U.S. operations as compiled by U.S. Environmental Protection Agency’s (EPA) SmartWay program. Fuel- and Energy-Related Activities includetransportation and distribution losses in the electricity grids globally per EPA data in the U.S. and World Bank data globally.

Our CO2 reduction capital funding process provides a $40 million annual budget for energy and greenhouse gas reduction projects across the Company. Over the last 11 years, 202 energy reduction projects have been approved, and 166 have been completed. These completed projects will collectively reduce CO2 emissions by approximately 228,000 metric tons per year. equivalent 5 to removing 48,000 cars from the road. In 2015, 14 new projects were approved and 15 projects were completed, with year-end total spend of $26.5 million. To date, the energy reduction projects completed since 2005 have reduced our annual energy costs by approximately $64 million. For more information, see the Climate Change section of our 2015 Citizenship & Sustainability Report.

Hydrochlorofluorocarbons (HCFCs)

We have eliminated chlorofluorocarbons (CFCs) from use in our facilities. We recognize that hydrochlorofluorocarbon (HCFC) gases, currently the most readily available substitute for CFC use, can have implications for global warming; therefore, we will be eliminating the use of HCFCs by the end of 2025 or earlier where required by government regulations. In selecting 2025 as our target to complete HCFC phase-out, we are balancing our concerns about ozone protection and climate change. By 2025, we expect that new technologies will have been developed and commercialized, offering viable replacement options for both HCFCs and CFCs. As part of our plans to phase our HCFC use, all Johnson & Johnson manufacturing sites were required to prepare an HCFC phase-out plan. In 2015, emissions of ODS were 3.64 metric tons. We do not produce, import or export ODS.

1 Recalculation for Emission Factors: It is standard for reporting on Scope 2 GHG emissions to use electricity factors with a two-year lapse time due to the delay in the availability of grid and country emission factors for a specific year. For this reason we use the most recent emission factors available when reporting emissions, and then recalculate emissions for prior years when the actual factors become available.

2 Facility CO2 emissions numbers were third party-assured in 2010-2015, but prior year values are being restated due to updates in electricity grid emission factors and the addition and removal of acquisitions and divestitures, which is in line with guidance from the World Resource Institute’s Greenhouse Gas Protocol Corporate Standard. Johnson & Johnson does not currently use purchases, sales, or transfers of offsets or allowances. Gases included in these calculations include only CO2, as that is how our goal was originally written, but we have calculated methane and nitrous oxide emissions from 2010 forward, and these are included in our new goal. Hydrofluorocarbons (CFCs) are tracked by EHS&S. Perfluorinated chemicals, sulfur hexafluoride, and nitrogen trifluoride do not result from our operations. We do not calculate or report biogenic CO2 emissions in metric tons of CO2 equivalent separately from the gross direct (Scope 1) GHG emissions. Base year is 2010, included in table. Emissions in base year have been recalculated to adjust for acquisitions and divestitures in accordance with guidance from World Resources Institute Corporate Accounting and Reporting Standard. We follow the World Resources Institute Corporate Accounting and Reporting Standard. Electricity emission factors are obtained from the International Energy Agency’s CO2 Emissions from Fuel Combustion Report and the U.S. Environmental Protection Agency’s eGRID publication. Fuel emission factors are obtained from the EPA Climate Leaders publication. Global Warming Potentials are obtained from the Intergovernmental Panel on Climate Change Fifth Assessment Report. The chosen consolidation approach for emissions is operational control.

3 Emissions data are adjusted for prior years due to divestitures, acquisitions and updated emissions factors. As a result, data presented here will not correspond to the figures in the 2014 Report or those submitted to CDP in the respective years. For information on how data from acquisitions and divestitures is managed, please see the Report Profile section of this report.

4 Facility CO2 emissions numbers were third party-assured in 2010–2015, but prior year values are being restated due to updates in electricity grid emission factors and the addition and removal of acquisitions and divestitures, which is in line with guidance from the World Resource Institute’s Greenhouse Gas Protocol Corporate Standard.

5 http://www.epa.gov/energy/greenhouse-gas-equivalencies-calendar

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