At a Glance

Our Commitments: Our Commitments define who we are and how we work. They focus our businesses and move us forward.

Performance

Our customers have a choice, and how we perform determines whether they choose us. We aim high, set ambitious goals and deliver results, and we use customer feedback to recalibrate when necessary. We move quickly and make timely, wellreasoned decisions because our future depends on them. We invest authority where it needs to be, in the hands of the people closest to the customer and the work.

Innovation

We are a company of ideas that are nurtured by a commitment to research and development. The achievements of our founders inspire us to reach always for the next innovative and powerful and marketable idea. We seek and share ideas openly and encourage diversity of experience and opinion.

Opportunity

Our employees' ideas and inspiration create opportunities constantly, and without limits. We improve continuously everything we do, as a company and as individuals. We support and pursue lifelong learning to expand our knowledge and capabilities and to engage with the world outside UTC. Confidence spurs us to take prudent risks, to experiment, to cooperate with each other and, always, to learn from the consequences of our actions.

Responsibility

Successful businesses improve the human condition. We maintain the highest ethical, environmental and safety standards everywhere, and we encourage and celebrate our employees' active roles in their communities.

Results

We are a preferred investment because we meet aggressive targets whatever the economic environment. We communicate honestly and forthrightly to investors, and deliver consistently what we promise. We are a company of realists and optimists, and we project these values in everything we do.

Board of Directors

Louis R. Chênevert

Chairman & Chief
Executive Officer
United Technologies Corporation
(Diversified Manufacturer)

John V. Faraci

Chairman and Chief
Executive Officer
International Paper
(Paper, Packaging and Distribution)

Jean-Pierre Garnier

Operating Partner
Advent International
(Global Private Equity Firm)
Retired Chief Executive Officer
GlaxoSmithKline

Jamie S. Gorelick

Partner
WilmerHale
(Law Firm)
Former Deputy Attorney
General of the United States
Former General Counsel of the
Department of Defense

Edward A. Kangas

Former Chairman and CEO
Deloitte, Touche, Tohmatsu
(Audit and Tax Services)

Ellen J. Kullman

Chair of the Board & CEO
DuPont
(Diversified Chemicals
and Materials)

Charles R. Lee

Retired Chairman and
Co-Chief Executive Officer
Verizon Communications
(Telecommunications)

Richard D. McCormick

Retired Chairman, President
and Chief Executive Officer
US West, Inc.
(Telecommunications)

Harold McGraw III

Chairman, President and
Chief Executive Officer
The McGraw-Hill Companies
(Global Information Services)

Richard B. Myers

General, U.S. Air Force (Ret.)
and former Chairman of the
Joint Chiefs of Staff
(Military Leadership)

H. Patrick Swygert

President Emeritus
Howard University
(Educational Institution)

André Villeneuve

Chairman, International
Regulatory Strategy Group
City of London
(Advisory Group)

Christine Todd Whitman

President
The Whitman Strategy Group
(Environment and Public
Policy Consulting)

Former EPA Administrator
Former Governor of New Jersey

Permanent Committees

Audit Committee

John V. Faraci, Chair
Edward A. Kangas
Richard D. McCormick
Richard B. Myers
H. Patrick Swygert
André Villeneuve

Committee on Compensation
and Executive Development

Jean-Pierre Garnier, Chair
Jamie S. Gorelick
Edward A. Kangas
Charles R. Lee
Richard D. McCormick
Harold McGraw III
H. Patrick Swygert

Executive Committee

Louis R. Chênevert, Chair
Charles R. Lee
Richard D. McCormick

Finance Committee

Charles R. Lee, Chair
Louis R. Chênevert
John V. Faraci
Jamie S. Gorelick
Ellen J. Kullman
Richard B. Myers
André Villeneuve
Christine Todd Whitman

Committee on Nominations
and Governance

Richard D. McCormick, Chair
John V. Faraci
Jean-Pierre Garnier
Charles R. Lee
Harold McGraw III
Christine Todd Whitman

Public Issues Review Committee

Christine Todd Whitman, Chair
Jean-Pierre Garnier
Jamie S. Gorelick
Ellen J. Kullman
Harold McGraw III
Richard B. Myers
H. Patrick Swygert
André Villeneuve

Leadership

Paul R. Adams

Senior Vice President,
Operations and Engineering,
Pratt & Whitney

David Adler

President,
Sikorsky Aerospace Services

David G. Appel

President, Transicold,
UTC Climate, Controls & Security

Mark J. Barry

President, Automation &
Controls Solutions,
UTC Climate, Controls & Security

Alain M. Bellemare

President &
Chief Operating Officer,
UTC Propulsion & Aerospace
Systems

Richard H. Bennett, Jr.

Vice President,
Environment, Health & Safety

Patrick Blethon

President, Pacific Asia, Otis

Carey E. Bond

President, Sikorsky Global
Helicopters, and Chief
Marketing Officer

J. Thomas Bowler, Jr.

Senior Vice President,
Human Resources and
Organization

Matthew F. Bromberg

Vice President, Corporate
Strategy and Development

Benoit Brossoit

Vice President, Operations

David B. Carter

Vice President,
Engineering and Technology,
Hamilton Sundstrand

Louis R. Chênevert

Chairman &
Chief Executive Officer

Peter C. Christman, Jr.

President, Pratt & Whitney
Power Systems

Bennett M. Croswell

President, Military Engines,
Pratt & Whitney

Geraud Darnis

President &
Chief Executive Officer,
UTC Climate, Controls & Security

Nancy M. Davis

Vice President and
Chief Information Officer

Pierre Dejoux

President, North Europe
and Africa, Otis

Philippe Delpech

President, EMEA,
UTC Climate, Controls & Security

John J. Doucette

President, Industrial,
Hamilton Sundstrand

Michael R. Dumais

President,
Hamilton Sundstrand

Charles D. Gill, Jr.

Senior Vice President and
General Counsel

David L. Gitlin

Vice President,
Integration, UTC Propulsion
& Aerospace Systems

Lindsay Harvey

President, United Kingdom,
Central and East Europe,
Otis

Gregory J. Hayes

Senior Vice President and
Chief Financial Officer

David P. Hess

President,
Pratt & Whitney

Kathleen M. Hopko

Vice President, Secretary and
Associate General Counsel

Todd J. Kallman

President, Commercial
Engines and Global Services,
Pratt & Whitney

Robert F. Leduc

President, 787, Space Systems
and U.S. Classified Programs,
Hamilton Sundstrand

Peter F. Longo

Vice President,
Controller

James G. Maser

President,
Pratt & Whitney Rocketdyne

Michael B. Maurer

President,
Sikorsky Military Systems

Robert J. McDonough

President, Americas,
UTC Climate, Controls & Security

J. Michael McQuade

Senior Vice President,
Science and Technology

Raymond J. Moncini

Senior Vice President,
Operations,
UTC Climate, Controls & Security

Michael A. Monts

Vice President,
Business Practices

David E. Parekh

Vice President, Research, and
Director, United Technologies
Research Center

Jeffrey P. Pino

President,
Sikorsky

Thomas I. Rogan

Vice President, Treasurer

John Saabas

President,
Pratt & Whitney Canada

Pedro Sainz de Baranda

President,
Otis

Ross B. Shuster

President, Asia,
UTC Climate, Controls & Security

Tobin J. Treichel

Vice President, Tax

Thomas R. Vining

President,
China, Otis

Gregg Ward

Senior Vice President,
Government Affairs

Randal E. Wilcox

President, North and
South America, Otis

Awards/Recognition

UTC named No. 1 Most Admired aerospace and defense company by Fortune magazine.

UTC included in World's Most Respected Companies by Barron's magazine.

UTC named to the Dow Jones sustainability indexes for the 13th consecutive year.

UTC given the highest rating in 2011 for workplace equality from the Human Rights Campaign.

UTC named one of the nation's most diverse companies on DiversityBusiness.com's list of the Top 50 Organizations for Multicultural Business Opportunities.

UTC ranked fourth in the Capital Goods category and 65th overall in the 2011 Green Rankings by Newsweek magazine.

UTC Chairman & Chief Executive Officer Louis R. Chênevert named Person of the Year by Aviation Week magazine for the steps he has taken to strengthen the company and the aerospace and defense industries.

UTC Chairman & Chief Executive Officer Louis R. Chênevert honored with the National Minority Supplier Development Council 2011 Minority Business Leadership Award for his ongoing commitment to developing a global network of diverse suppliers.

UTC's chief executive officer, chief financial officer and investor relations team given top rankings in the 2011 All-America Executive Team, Capital Goods/Industrials/Aerospace & Defense Electronics sector, Institutional Investor magazine.

Hamilton Sundstrand named a Thomson Reuters 2011 Top 100 Global Innovator, an honor given to companies that invent on a significant scale, work on developments that are acknowledged as innovative by others and whose inventions are globally protected due to their importance.

Pratt & Whitney's PurePower PW1000G engine named by TIME magazine as one of The 50 Best Inventions of 2011, describing it as “the most important development in aviation in 2011.”

Sikorsky Aircraft Corp. X2 Technology demonstrator team named winner of the Robert J. Collier Trophy, awarded annually to recognize the greatest achievements in aeronautics or astronautics in the United States.

UTC Fire & Security awarded the National Safety Council's 2011 Robert W. Campbell Award, which recognizes organizations that achieve business excellence by integrating environmental, health and safety management into their business operating systems.

Stakeholder Engagement

For seven years, UTC has sought feedback on its corporate responsibility reporting and performance. Throughout 2011, across the globe, we engaged stakeholders in all our activities and efforts, which include, but are not limited to, environment; health and safety; ethics; governance; human rights; and overall community affairs. These relationships and partnerships help inform our approach and its integration with our business efforts.

This report and its associated Web content at www.utc.com provide detailed examples of how our approach to integrating responsibility into our operations fosters a culture of innovation and delivers results.

Your feedback is important to us. Please visit www.utc.com/responsibility and tell us what you think of our financial and corporate responsibility performance and reporting.

United Technologies Corporation and its subsidiaries' names, abbreviations thereof, logos, and product and service designators are all either the registered or unregistered trademarks or trade names of United Technologies Corporation and its subsidiaries.

Names of other companies, abbreviations thereof, logos of other companies, and product and service designators of other companies are either the registered or unregistered trademarks or trade names of their respective owners.

Dear Shareowner

2011 was another strong year for United Technologies. Solid execution across our business units allowed us to again deliver double-digit earnings growth. Our continued focus on improving productivity, investing in game-changing technologies and expanding our presence in fast-growing emerging markets has positioned us to continue to grow our base business in 2012 despite an uncertain global economic outlook. Looking beyond 2012, the major acquisitions we announced in 2011, involving Goodrich and IAE International Aero Engines, will transform our company, setting the foundation for strong earnings growth in 2013 and beyond.

Our focus on operating performance in 2011 drove organic growth across UTC, with all business segments achieving double-digit operating margins. Most notable, Carrier achieved its 12 percent margin goal in 2011, one year ahead of our target. This success was the result of strong operational focus, cost containment efforts and execution of its business transformation strategy.

Along with strong operating performance came strong cash generation, with cash flow from operations less capital expenditures again exceeding net income. Strong cash performance during the year enabled us to raise our dividend by 12.9 percent. This year also marked the 75th consecutive year that United Technologies has paid a dividend. Through dividend payments and share repurchase, United Technologies returned 67 percent of its cash flow to our shareowners.*

UTC's long-term total shareowner return continued to exceed that of peers and key market indices. For the period from December 31, 2001, through December 31, 2011, UTC delivered total shareowner return of 175 percent, more than three times the Dow Jones industrials and more than five times the S&P 500.

While the near-term global economic outlook remains challenging, we look to the future with confidence. We believe our announced agreement to acquire Goodrich, the largest acquisition in United Technologies' history, marks the start of a bright new chapter for UTC and will significantly strengthen our position in the fast-growing commercial aerospace market. Goodrich, a leading global supplier of systems and services to the aerospace and defense industry, will be an excellent strategic fit with UTC's existing aerospace portfolio. Goodrich has a well-established presence in areas where we do not, such as aircraft landing gear, braking systems and nacelles. Together, Goodrich and United Technologies will be well positioned to provide greater value to our customers with better, more integrated products and services for the next-generation aircraft at a more competitive price.

Since the agreement was announced, customer feedback has been overwhelmingly positive, and integration planning is progressing very smoothly. We anticipate closing the transaction in mid-2012 and are excited to welcome the Goodrich employees to United Technologies. We are also excited about the opportunity to bring together the complementary capabilities of our two great companies to provide additional value to our customers.

Further strengthening our position in the commercial aerospace market was the agreement to purchase Rolls-Royce's share of IAE, which produces the V2500 engine for the A320 family of aircraft. Upon closing, which is expected in mid-2012, UTC will become the majority shareholder of IAE. This new ownership structure positions Pratt & Whitney for strong growth in the important single-aisle aircraft segment, as IAE has more than 4,500 V2500 engines in service today and nearly 2,000 engines on order. The new structure will also allow customers to transition smoothly from the current V2500 engine to Pratt & Whitney's new Geared Turbofan engine for the Airbus A320neo aircraft family.

In 2011, we also positioned UTC for long-term growth with the announcement of significant organizational changes that will group a number of UTC business units into new aerospace and commercial building organizations. This new structure will allow United Technologies to more efficiently serve our global customer base through greater integration across product lines and drive growth by taking full advantage of technology investments and the company's footprint in emerging markets.

On the aerospace side, we created UTC Propulsion & Aerospace Systems, which brings the Pratt & Whitney and Hamilton Sundstrand businesses under a new leadership structure. As we position ourselves for a growth phase in the aerospace cycle, this new organizational structure will allow us to leverage the long-term investments we have made in aerospace systems, including systems developed for the Boeing 787 and in the Geared Turbofan technology. Closer coordination by Pratt & Whitney and Hamilton Sundstrand, two world-class franchises, will also position UTC to win increased content on next-generation aircraft with more integrated propulsion and systems offerings. The anticipated integration of Goodrich into the new organizational structure will bring greater benefits, including increased opportunities for more highly integrated products and services for our customers, and additional cost synergies through leveraging a common supply base and low-cost source initiatives.

On the commercial side, the UTC Climate, Controls & Security organization consolidates the Carrier and UTC Fire & Security business units. This new organization creates a strategic growth platform that will better serve customers, increase field productivity and take full advantage of product-line synergies. The new structure also positions UTC to respond to a growing demand, especially in emerging markets, for more integrated solutions, including advanced building controls, climate systems, and enterprise fire and security systems. As the global economy recovers, and more skyscrapers, schools, airports, hospitals and stadiums are built in developing markets such as India, China and Brazil over the next decade, the increased interoperability of building systems will provide our global customers with better building management, efficiency and safety.

There were many notable successes across United Technologies in 2011. Among them was the commercial success of the Geared Turbofan engine with both existing and new customers. To date, Pratt & Whitney has received orders for more than 2,000 PurePower Geared Turbofan engines, including options, while successfully completing more than 1,500 hours of full engine testing, validating the expected improvements in fuel burn, emissions and noise. We anticipate continued market success for the Geared Turbofan engine in the years ahead as air travel between new and existing cities grows, and our aerospace customers seek quieter, cleaner and more fuel-efficient solutions.

United Technologies continues to receive outstanding third-party recognition for our performance. We were honored that TIME magazine recognized the Geared Turbofan engine as the most important development in aviation in 2011. We are also proud that in March 2011 Sikorsky's X2 Technology demonstrator was awarded the prestigious Collier Trophy.

On the military side, Pratt & Whitney's F135 engine for the Joint Strike Fighter (JSF) met or exceeded all performance and cost targets and achieved significant new milestones in 2011, including supporting flawless sea trials of the short takeoff and vertical landing (STOVL) variant aboard the USS Wasp. The outstanding performance of the F135 validates the decision of the U.S. Congress and Department of Defense to eliminate funding for an extra engine, choosing the F135 as the sole engine for the JSF.

In closing, 2011 was a year of positioning UTC for long-term earnings growth. We announced transformational acquisitions in our core businesses, and we are aligning our organizational structure to capitalize on emerging and growth markets. We also remain focused on productivity and improved our operational performance by driving ACE in our own facilities and in our supply chain. We delivered strong earnings growth and cash performance, and we raised our dividend. Simply put, 2011 was a very solid year for UTC.

As always, UTC's outstanding performance over the past year reflects the dedication and commitment of UTC's senior management team and our 200,000 employees around the world. On behalf of our shareowners, I thank our employees for their many contributions and for making United Technologies a truly amazing company.

I also thank our customers for the confidence and trust they have placed in us. We recognize that our future success depends on our ability to find better, faster and more efficient ways to deliver value. I'm confident we can do this and outperform peers in the years ahead. I know we will experience many more amazing successes and continue to develop innovative products that transform modern life — and perform as impressively as the United Technologies employees who make them.

Signature of Louis R. Chênevert

Louis R. Chênevert
Chairman & Chief Executive Officer

* This represents funds returned to shareowners as a percentage of a cash flow measure we call free cash flow. We define free cash flow as cash flow from operations less capital expenditures. In 2011, UTC generated cash flow from operations of $6.6 billion, and capital expenditures were $983 million, resulting in free cash flow of $5.6 billion. We returned approximately 57 percent of cash flow from operations to shareowners through dividends and share repurchases.