What changed in this filing

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Item 1. Business

2023-02-08 compared with 2022-02-09 · 46 added, 55 removed, 211 unchanged (32% of the section changed)

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Available Information

The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers, including the Company, that file electronically with the SEC.

The Securities and Exchange Commission (SEC) maintains a website that contains reports, proxy and information statements, and other information regarding issuers, including the Company, that file electronically with the SEC.

The public can obtain any documents that the Company files with the SEC at http://www.sec.gov.

The Company files annual reports, quarterly reports, proxy statements and other documents with the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934 (Exchange Act).

The Company files annual reports, quarterly reports, proxy statements and other documents with the SEC under the Securities Exchange Act of 1934 (Exchange Act).

3M also makes available free of charge through its website (http://investors.3M.com) the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and, if applicable, amendments to those reports filed or furnished pursuant to the Exchange Act as soon as reasonably practicable after the Company electronically files such material with, or furnishes it to, the SEC.

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3M’s four business segments bring together common or related 3M technologies, enhancing the development of innovative products and services and providing for efficient sharing of business resources.

In July 2022, 3M announced its intention to spin off the Health Care business as a separate public company (see Note 3 for additional information).

Refer to segment descriptions summarized below (Financial information and other disclosures relating to 3M’s business segments and operations in major geographic areas are provided in the Notes to Consolidated Financial Statements):

Business Segment Safety and Industrial Transportation and

Electronics Health Care Consumer

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Business Segment Safety and Industrial Transportation and Electronics Health Care Consumer

Underlying divisions/businesses

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• Roofing granules

• Other safety and industrial

• Advanced materials

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• Transportation safety

• Other transportation and electronics

• Drug delivery (divested in 2020)

• Food safety

• Health information systems

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• Separation and purification sciences

• Other health care

• Food safety (divested in 2022)

• Consumer health and safety

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• Stationery and office

• Other consumer

Representative revenue-generating activities, products or services • Industrial abrasives and finishing for metalworking applications

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• Reflective signage for highway, and vehicle safety

• Food safety indicator solutions

• Health care procedure coding and reimbursement software

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• 3M™ Diamond Grade™ DG3 reflective sheeting for transportation safety

• 3M™ Petrifilm™ and 3M™ Allergen Testing

• 3M™ 360 Encompass™ medical coding systems

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• Post-it® products

Representative market trends or opportunities • Connected safety

• Structural bonding

• Surface finishing

• Respiratory protection

• Building components

• Automation and robotics

Representative market trends or opportunities • Personal safety

• Connected bodyshop

• Grid modernization

• Automotive electrification

• Sustainable packaging

• Automotive electrification

• Semiconductor fabrication and assembly

• Datacenter thermal management

• Advanced wound care

• Population health clinical care improvement platform

• Increased food safety

• Biopharma industry expansion

• Custom orthodontics

• Air quality

• Connected filters and other products

• Robotics and automation

• Automotive/mobility

• Electronic materials

• Semiconductor

• Graphic and architectural films

• Healthcare IT

• Biopharma filtration

• Home improvement

• Consumer safety & well-being

• Package protection & shipping

• Appearance auto care

3M products are sold through numerous distribution channels, including directly to users and through numerous e-commerce and traditional wholesalers, retailers, jobbers, distributors and dealers in a wide variety of trades in many countries around the world.

Management believes the confidence of wholesalers, retailers, jobbers, distributors and dealers in 3M and its products — a confidence developed through long association with skilled marketing and sales representatives — has contributed significantly to 3M’s position in the marketplace and to its growth.

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Human Capital

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Raw Materials

In 2021, the coronavirus (COVID-19) pandemic caused imbalances within global supply markets.

As markets re-opened and demand increased following COVID lockdowns, the Company experienced raw material price inflation and constrained supply.

Multiple weather, logistics and other disruptive events worsened global supply chain imbalances and contributed to higher costs.

The Company continued to deploy productivity projects to minimize the impact of raw material inflation and market supply challenges, including input management, reformulations, and multi-sourcing activities.

Overall, on a consolidated basis, 3M experienced net raw material price inflation in 2021.

To help manage disruption to its manufacturing operations, 3M deploys careful management of existing raw material inventories, strategic relationships with key suppliers, as well as qualification of additional supply sources.

It is difficult to predict future shortages of raw materials or the impact any such shortages would have.

In 2022, many geopolitical, logistics, and disruptive events caused imbalance in the global supply chain, similar to the past few years.

The Company experienced raw material price inflation and constrained supply throughout the global marketplace and continued to deploy productivity projects to minimize the impact.

To help manage disruption in its manufacturing operations, 3M deployed careful management of existing raw material inventories, strategic relationships with key suppliers, and qualification of additional supply sources.

3M manages spend category price risks through negotiated supply contracts and price protection agreements.

In addition, 3M evaluates suppliers’ conformance with environmental and social compliance requirements.

Overall, on a consolidated basis, 3M experienced net raw material price inflation in 2022.

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Patents, Trademarks and Licenses

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The Company’s business operations are subject to various governmental regulations in the U.S.

and internationally, including, among others, those related to product liability, antitrust, intellectual property, environmental, tax, the U.S.

Foreign Corrupt Practices Act and other anti-bribery laws, U.S.

trade sanctions, regulations of the U.S.

and internationally, including, among others, those related to product liability;

intellectual property;

environmental, health, and safety;

Foreign Corrupt Practices Act and other anti-bribery laws, international import and export requirements and trade sanctions compliance;

regulations of the U.S.

Food and Drug Administration (FDA) and similar foreign agencies, U.S.

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Although an estimate of certain nearer-term capital expenditures is provided above, 3M cannot predict with certainty whether future costs of compliance with government regulations (including environmental regulations) will have a material effect on its capital expenditures, earnings or competitive position.

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Information about our Executive Officers

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This information is presented in the table below as of the date of the 10-K filing (February 8, 2023).

Name Age Present Position Year

Position Other Positions Held during 2017 - 2021

Name Age Present Position Year Elected to Present Position Other Positions Held during 2018 - 2022

Roman 63 Chairman of the Board and Chief Executive Officer 2019 Chief Executive Officer, 2018-2019

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Senior Vice President, Research and Development, and Chief Technology Officer, 2014-2017

Lavers 58 Group President, Consumer Business Group 2021 Executive Vice President, Consumer Business Group, 2020-2021

Lavers 59 Group President, Consumer Business Group and Interim Group President, Health Care Business Group 2022 Executive Vice President, Consumer Business Group, 2020-2021

Vice President and General Manager, Automotive and Aerospace Solutions Division, 2019-2020

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Chief Financial Officer, Health Care, General Electric, 2015-2019

Mojdeh Poul 59 Group President, Health Care Business Group 2021 Executive Vice President, Health Care Business Group, 2019-2021

Executive Vice President, Safety and Graphics Business Group, 2018-2019

President and General Manager, 3M Canada, 2016-2018

Rhodes 60 Executive Vice President, Chief Legal Affairs Officer 2022 Senior Vice President and Deputy General Counsel, 2021

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Executive Vice President, Health Care Business Group, 2016-2019

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Cautionary Note Concerning Factors That May Affect Future Results

This Annual Report on Form 10-K, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

This Annual Report on Form 10-K, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

The Company may also make forward-looking statements in other reports filed with the Securities and Exchange Commission, in materials delivered to shareholders and in press releases.

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In particular, these include, among others, statements relating to:

• worldwide economic, political, regulatory, international trade, capital markets and other external conditions, such as interest rates, financial conditions of our suppliers and customers, trade restrictions such as tariffs in addition to retaliatory counter measures, inflation, and natural and other disasters or climate change affecting the operations of the Company or our suppliers and customers,

• risks related to public health crises such as the global pandemic associated with the coronavirus (COVID-19),

• liabilities related to certain fluorochemicals and the outcome of contingencies,

• worldwide economic, political, regulatory, international trade, geopolitical, capital markets and other external conditions, such as interest rates, monetary policy, financial conditions of our suppliers and customers, trade restrictions such as tariffs and retaliatory counter measures, inflation, recession, military conflicts, and natural and other disasters or climate change affecting the operations of the Company or our suppliers and customers,

• risks related to unexpected events such as the public health crises associated with the coronavirus (COVID-19) global pandemic,

• liabilities and the outcome of contingencies related to certain fluorochemicals known as "PFAS," as well as matters related to the Company's plans to discontinue the use of PFAS,

• the Company’s strategy for growth, future revenues, earnings, cash flow, uses of cash and other measures of financial performance, and market position,

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• foreign currency exchange rates and fluctuations in those rates,

• new business opportunities, product development, and future performance or results of current or anticipated products,

• new business opportunities, product and service development, and future performance or results of current or anticipated products and services,

• fluctuations in the costs and availability of purchased components, compounds, raw materials and energy,

• Information technology systems including ERP system roll-out and implementations,

• information technology systems including implementation of an enterprise resource planning (ERP) system,

• security breaches and other disruptions to information technology infrastructure,

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• future levels of indebtedness, common stock repurchases and capital spending,

• future availability of and access to credit markets,

• future access to credit markets and the cost of credit,

• pension and postretirement obligation assumptions and future contributions,

• asset impairments,

• tax liabilities and effects of changes in tax rates, laws or regulations, and

• legal and regulatory proceedings, legal compliance risks (including third-party risks) with regards to environmental, product liability and other laws and regulations in the United States and other countries in which we operate.

• tax liabilities and effects of changes in tax rates, laws or regulations,

• the proposed spin-off of the Company's Health Care business to establish two separate public companies,

• the voluntary chapter 11 proceedings initiated by the Company's Aearo Entities, and

• laws and regulations, as well as legal compliance risks (including third-party risks), and legal and regulatory proceedings related to the same, including with regards to environmental matters and product liability, in the United States and other countries in which we operate.

The Company assumes no obligation to update or revise any forward-looking statements.

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Important information as to these factors can be found in this document, including, among others, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the headings of “Overview,” “Financial Condition and Liquidity” and annually in “Critical Accounting Estimates.” Discussion of these factors is incorporated by reference from Part I, Item 1A, “Risk Factors,” of this document, and should be considered an integral part of Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” For additional information concerning factors that may cause actual results to vary materially from those stated in the forward-looking statements, see our reports on Form 10-K, 10-Q and 8-K filed with the SEC from time to time.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business