On behalf of Grainger, thank you for your interest in our Corporate Social Responsibility (CSR) program. This 2019 report is designed to provide you with an update on our key CSR initiatives. During the last 12 months, we achieved key goals, formed new partnerships and met with several stakeholders, including investors and customers, about their expectations of us and our social purpose.

We continue to see a growing number of shareholders express interest in our environmental, social and governance (ESG) programs. I cover the topic frequently when I meet with investors. The Lead Director of Grainger’s Board, Stuart Levenick, also regularly seeks out ESG-specific conversations with the investment community on behalf of the company. I encourage you to read Stu’s Q&A, immediately following this letter.

In addition, our activities and conversations with customers around CSR continue to reinforce the fact that we are uniquely positioned to serve them in new ways. Much like Grainger, our customers are becoming more sustainable, and are looking to us to provide the best products and services to meet these goals.

Grainger offers more than 100,000 environmentally preferable products that help customers reduce energy consumption, conserve water, reduce waste and improve indoor air quality. We also offer services, such as KeepStock® inventory management and safety expertise, that help customers save time and money, and stay safe.

Equally important are the communities where we live and work. In 2018, hundreds of team members volunteered approximately 8,500 hours in our communities throughout the U.S. Some of these efforts took place in conjunction with the American Red Cross. For the past few years, Grainger has donated $250,000 worth of smoke detectors and team members volunteered to support the American Red Cross Sound the Alarm program. This fire safety campaign provides people in need with smoke detectors and fire prevention instruction. These efforts have helped save hundreds of lives and we applaud the American Red Cross for its ongoing focus in this area.

Our team members lend a hand to communities devastated by the growing number of natural disasters as well. Grainger mobilizes volunteers during these significant times of need and is proud to support the American Red Cross Annual Disaster Giving Program. Last year, we also donated more than $120,000 worth of products to Team Rubicon, a veteran-led group that helps communities worldwide get back on their feet after disasters.

Education continues to be an important focus of ours. Our Tools for Tomorrow scholarship program assists students studying skilled trades, public safety and supply chain management. Grainger also partners with Folds of Honor in offering scholarships to dependents of those in the U.S. Armed Forces who lost their lives or were severely injured in the line of duty. Beyond this, we are exploring programs to increase our focus on science, technology, engineering and mathematics (STEM) education, given the growing need that exists in these vital areas of study.

While we have accomplished much in 2018, we know there is more to do. Significant opportunity exists in helping the world work more effectively. Whether it is a team member volunteering at a local food bank, or a business working toward emissions targets, we all play a part in making our world better. I am proud of the role Grainger plays and look forward to our ongoing progress and success.

D.G. Macpherson
Chairman of the Board and Chief Executive Officer