PROPOSAL 1

Election of Directors

		We are seeking your support for the election of the thirteen individuals that the Board has nominated to serve on the Board of Directors for a one-year term beginning on the date of the Annual Meeting . We believe that the nominees have the qualifications consistent with our position as a large, diversified industrial corporation with worldwide operations. We also believe that the nominees have the experience and perspective to guide the Company as we separate into three independent companies, and as we adjust to rapidly changing technologies, business cycles and competitive environments.

Criteria for Board Membership

The Board and the Committee on Governance and Public Policy (the “Governance Committee”) believe that there are general attributes all directors must exhibit and that other key skills and expertise should be represented on the Board as a whole, but not necessarily by each director.

The following attributes are essential for all UTC directors and we believe that our current directors exhibit these attributes:

While we do not have a policy on Board diversity, a director’s ability to contribute to the diversity of perspectives necessary in Board deliberations is an attribute that is critical to the Company’s long-term success.

The Board and the Governance Committee have identified the following principal skills and expertise that are essential to effective oversight in light of the Company’s business requirements and strategy:

Financial	Leadership of a financial firm, management of an enterprise’s finance function or of a large P&L, resulting in proficiency in complex financial management, financial reporting processes, capital allocation, capital markets, and mergers and acquisitions — representing the importance we place on accurate financial reporting, and robust financial controls and compliance.
Government	Directors who have served in senior positions in the government or the military provide constructive insights about how significant government policies and public policy issues may affect our Company and how to effectively respond to those matters.

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International	UTC has operations around the world and a significant portion of our sales come from outside the United States. Directors with international experience thus provide valuable business, political and cultural perspectives.

Knowledge of Company/ Industry	Knowledge of or experience in UTC’s specific industries, whether acquired through service as a senior leader in one of these industries, as an institutional investor, through longer-term service on the UTC Board or through experience with an industrial company that transformed its portfolio of businesses.

Risk Management/ Oversight	This experience is critical to the Board’s role in overseeing and understanding major risk exposures, including significant financial, operational, compliance, reputational, strategic, country, political, and cybersecurity risks.

Senior Leadership	Extensive leadership experience with a significant enterprise, resulting in a practical understanding of organizations, processes and strategic planning, along with demonstrated strengths in developing talent, succession planning, and driving change and long-term growth.

Technology and Innovation	Experience in research and development, engineering, science, digital media or technology. This translates into an understanding of UTC’s technological innovations, development and marketing challenges, how to anticipate technological trends, and how to generate disruptive innovation — all of which helps us to execute our business objectives and strategy.

The chart below illustrates the diverse set of key skills and areas of expertise represented on our Board. Each director’s biography highlights the three key skills and areas of expertise upon which the Board particularly relies in addition to describing each director’s significant work experience and service.

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Director Orientation and Education

New directors participate in an orientation program to familiarize them with the roles and responsibilities of the Board, including topics tailored to each director’s committee assignments. New directors also learn about the Company’s strategy, our business units, financial statements, significant financial, accounting and risk management issues, and our compliance programs.

As part of the directors’ continuing education, the Board strives to visit at least one of UTC’s business units each year. This gives directors a firsthand understanding of the business unit’s operations and facilitates interactions with employees and key executives. For example, in 2018 directors visited two facilities in Florida (Carrier’s Center for Intelligent Buildings, a state-of-the-art building technology and customer experience center, and a Pratt & Whitney test facility) and two facilities in Connecticut (Pratt & Whitney’s new Engineering & Technology Center and the United Technologies Research Center).

Directors also are encouraged to attend outside continuing education programs. Additional presentations and materials, including updates on recent business developments and on topical and beneficial subjects, are provided from time to time to certain directors or to all directors, as appropriate.

Board Self-Evaluation Process

The Board appreciates that robust and constructive self-evaluation is an essential element of good corporate governance, Board effectiveness, and continuous improvement. To this end, the Board evaluates annually its own performance and that of the standing committees and individual directors.

The Governance Committee is responsible for and oversees the design and the manner in which the annual self-evaluation is completed.

The Lead Director or non-Executive Chairman (as applicable) and the Governance Committee Chair jointly lead the self-evaluation process.

The self-evaluation informs the Board’s consideration of the following:

As part of the 2018 evaluation process, each of the independent directors conferred with Mrs. Kullman, our Lead Director, or Mr. Rogers, the Chair of the Governance Committee, to provide practical feedback and allow for the candid assessment of peer contributions and performance. Afterwards, Mrs. Kullman and Mr. Rogers collaborated to provide a summary of the assessment, which the Board discussed in its private session.

The self-evaluation process has generated improvements to our corporate governance practices and the Board’s effectiveness, including:

Board Refreshment and Nominating Process

The Governance Committee regularly reviews with the Board the key skills and expertise that are most important in selecting candidates to serve as directors, taking into account UTC’s varied operations and the mix of capabilities and experience represented on the Board already. As part of the Board’s annual evaluation of its overall effectiveness, the Board considers the following with regard to its composition:

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Our Governance Guidelines require that directors retire at the annual meeting after reaching age 72, unless the Board makes an exception to the policy in special circumstances. The Governance Guidelines and Bylaws, however, do not impose term limits because the Board believes that a director who serves for an extended period develops a deep understanding of the Company’s history, practices and strategy, and is therefore uniquely positioned to provide insight and perspective regarding UTC’s current operations and strategic direction. Nonetheless, the Board’s self-evaluation process, including individual director evaluations, contributes to the Governance Committee’s consideration of each incumbent’s skills and experience as part of the nomination and refreshment process.

The Governance Committee considers candidates recommended by directors, Management and shareowners who meet the qualifications UTC seeks in its directors. A shareowner may recommend a director candidate by submitting a letter addressed to the UTC Corporate Secretary (see page 81 for contact information). The Governance Committee also may engage search firms to assist in identifying and evaluating qualified candidates and to ensure that the Committee is considering a larger and diverse pool of potential candidates.

Nominees

The Board, upon the recommendation of the Governance Committee, has nominated for election to the Board the thirteen individuals listed in this Proxy Statement. All are current directors of UTC and were elected by the shareowners at the 2018 Annual Meeting, except for Mr. Kearney and Ms. Ramos who joined the Board in December 2018.

Christine Todd Whitman is not standing for re-election. Having reached the mandatory retirement age in the Governance Guidelines, she will retire from the Board on April 29, 2019. Management and the directors extend their sincere appreciation to Governor Whitman for her years of dedicated service to UTC.

Mr. Kearney and Ms. Ramos possess particularly relevant experience in light of UTC’s intention to separate into three independent companies, as discussed on page 1. Among other attributes, Mr. Kearney brings to the Board and its committees (Audit and Finance) skills and expertise in Senior Leadership, Risk Management/Oversight, and Knowledge of the Company/Industry (see pages 6-7 for descriptions of these skills). Moreover, Mr. Kearney served as Chairman, President & CEO at the industrial company SPX Corporation. In that role, he led the company through a portfolio transformation resulting in the spin-off of SPX FLOW, where he served in a similar position until his recent retirement. Ms. Ramos brings to the Board and its committees (Audit and Compensation) skills and expertise in Senior Leadership, Technology and Innovation, and Knowledge of the Company/Industry, among other desired attributes. Ms. Ramos has served as the chief financial officer of two companies, including ITT Corporation, which, during her tenure as CFO, separated into three publicly traded companies. One of these companies was ITT Inc., a diversified manufacturer of industrial products where Ms. Ramos recently served as President & CEO.

If, prior to the 2019 Annual Meeting, any nominee becomes unavailable to serve, the Board may select a replacement nominee or reduce the number of directors to be elected. If the Board selects a replacement nominee, the proxy holders will vote the shares for which they serve as proxy for that replacement nominee.

The Board of Directors recommends a vote FOR each of the following nominees:

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Experience:

●	Chief Operating Officer, Google Cloud (technology and innovation), 2017-2018
●	Group President, Data Center Group, Intel Corporation (advanced technology, enterprise, cloud and communications infrastructure), 2017
●	Executive Vice President and General Manager, Data Center Group, Intel Corporation, 2012-2017
●	Corporate Vice President and Chief Information Officer, Intel Corporation, 2008-2012

Other Current Directorships:

●	Broadcom Inc., since 2019

Other Leadership Experience and Service:

●	Chancellor’s Board of Advisors, University of California-Davis
●	Dean’s Executive Committee, University of California-Davis College of Engineering
●	Former Executive Sponsor, Network of Intel African American Employees
●	Former Member, Anita Borg Institute Technical Board
●	Established Diane Bryant Endowed Scholarship Fund for Diversity in Engineering at the University of California-Davis

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Experience:

●	Chairman of the Board of Directors (non-executive), Idorsia Pharmaceuticals Ltd. (biopharmaceuticals), since 2017
●	Operating Partner, Advent International (global private equity), since 2011
●	Actelion Ltd., Chairman of the Board of Directors (non-executive), 2011-2017
●	Chief Executive Officer, Pierre Fabre S.A. (pharmaceuticals), 2008-2010
●	Chief Executive Officer and Executive Member of the Board of Directors, GlaxoSmithKline plc (pharmaceuticals), 2000-2008
●	Chief Executive Officer, SmithKline Beecham plc (pharmaceuticals), 2000

 

●	Chief Operating Officer and Executive Member of the Board of Directors, SmithKline Beecham plc, 1996-2000

Other Current Directorships:

●	Chairman of the Board of Directors (non-executive), CARMAT, since December 2018
●	Radius Health, Inc., since 2015

Former Public Company Directorships:

●	Renault S.A., 2009-2016

Other Leadership Experience and Service:

●	Advisory Board, Newman’s Own Foundation
●	Board of Trustees, Max Planck Florida Institute for Neuroscience
●	Knight Commander of the Order of the British Empire
●	Officier de la Légion d’Honneur of France

Experience:

●	Chairman & Chief Executive Officer, United Technologies Corporation, since 2016
●	President, Chief Executive Officer and Director, United Technologies Corporation, 2014-2016
●	Senior Vice President and Chief Financial Officer, United Technologies Corporation, 2008-2014

●	Various senior positions since joining UTC in 1999 through the merger with Sundstrand Corporation, including Vice President, Accounting and Finance, and responsibility for UTC’s Corporate Strategy function

Former Public Company Directorships:

●	Nucor Corporation, 2014-2018

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Experience:

●	Managing Partner, Eagle Marsh Holdings, LLC (business and real estate investments), since 2016
●	Chairman, SPX FLOW, Inc. (global supplier of highly engineered flow components, process equipment and turnkey solutions for the power and energy, food and beverage, and industrial markets), 2016-2017
●	Chairman, President & Chief Executive Officer, SPX FLOW, Inc., 2015
●	Chairman, President & Chief Executive Officer, SPX Corporation (global multi-industry manufacturer), 2007-2015

●	President & Chief Executive Officer, SPX Corporation, 2004-2007
●	Vice President, Secretary and General Counsel, SPX Corporation, 1997-2004

Other Current Directorships:

●	Nucor Corporation, since 2008

Former Public Company Directorships:

●	Polypore International Inc., 2012-2015

Other Leadership Experience and Service: 

●	Advisory Board, Warburg Pincus, LLC
●	Former Chairman, Foundation for the Carolinas

Experience:

●	Chair & Chief Executive Officer, E. I. du Pont de Nemours and Company (provider of basic materials and innovative products and services for diverse industries), 2009-2015
●	President, E. I. du Pont de Nemours and Company, 2008
●	Executive Vice President, E. I. du Pont de Nemours and Company, 2006-2008
●	Group Vice President, E. I. du Pont de Nemours and Company, 1998-2006

Other Current Directorships:

●	Amgen Inc., since 2016

●	Goldman Sachs, since 2016
●	Dell Technologies Inc., since 2016 (public company since December 2018)
●	Carbon3D, Inc. (non-public)

Other Leadership Experience and Service:

●	Co-Chair, Paradigm for Parity
●	National Academy of Engineering
●	Board of Advisors, Tufts University School of Engineering
●	Board of Trustees, Northwestern University
●	The Business Council
●	North American Advisory Council, Temasek Holdings

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Experience:

●	Chairman, President & Chief Executive Officer, Goodrich Corporation (supplier of systems and services to the aerospace and defense industry), 2003-2012
●	President, Chief Operating Officer and Director, Goodrich Corporation, 2002-2003
●	Executive Vice President, Goodrich Corporation, and President and Chief Operating Officer, Goodrich Aerospace, 1995-2002

Other Current Directorships:

●	Air Lease Corporation, since 2014
●	Becton, Dickinson and Company, since 2007
●	Lowe’s Companies, Inc., since 2004

Other Leadership Experience and Service:

●	Dean’s Advisory Council, Krannert School of Management, Purdue University

Experience:

●	Chairman Emeritus, S&P Global Inc. (formerly McGraw Hill Financial, Inc.) (ratings, benchmarks and analytics for financial reports), since 2015
●	Chairman, McGraw Hill Financial, Inc., 1999-2015
●	President and Chief Executive Officer, The McGraw-Hill Companies, 1998-2013
●	President and Chief Operating Officer, The McGraw-Hill Companies, 1993-1998

Other Current Directorships:

●	Phillips 66 Company, since 2012

Other Leadership Experience and Service:

●	Board of Trustees, Asia Society
●	Former Chairman, Business Roundtable
●	Board of Trustees, Carnegie Hall
●	Director Emeritus, Committee Encouraging Corporate Philanthropy
●	Board of Trustees, New York Public Library
●	Chairman, U.S. Council for International Business
●	U.S. Trade Representative’s Advisory Committee for Trade Policy and Negotiations

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Experience:

●	Jeane Kirkpatrick Professor of the Practice of International Affairs, Harvard University Kennedy School (higher education), since 2009
●	Director of the Geopolitics of Energy Project, Harvard University Kennedy School, since 2011
●	Lecturer and Senior Fellow, Harvard University Kennedy School, 2008-2009
●	Deputy National Security Advisor for Iraq and Afghanistan, National Security Council, 2005-2007
●	Special Assistant to the President, National Security Council, 2004-2007
●	Deputy Director (Governance), Iraq Coalition Provisional Authority, 2003-2004

●	Principal Advisor to the President’s Special Envoy to the Northern Ireland Peace Process, U.S. Department of State, 2001-2003
●	Fellow, The Brookings Institution, 1997-2001

Other Leadership Experience and Service:

●	Aspen Strategy Group
●	Adjunct Senior Fellow, Council on Foreign Relations
●	Advisory Council, George W. Bush Institute Women’s Initiative
●	Board of Trustees, The German Marshall Fund of the United States
●	Board of Trustees, The International Crisis Group
●	International Advisory Board, Linklaters LLP
●	Board of Directors, The Mission Continues
●	North America Chair, The Trilateral Commission

 

Experience:

●	Chief Executive Officer & President, ITT Inc. (formerly ITT Corporation – a diversified manufacturer of critical components and customized technology solutions), 2011-2018
●	Senior Vice President and Chief Financial Officer, ITT Corporation, 2007-2011
●	Chief Financial Officer, Furniture Brands International (home furnishings), 2005-2007

●	Senior Vice President & Corporate Treasurer, Yum! Brands, Inc., and Chief Financial Officer, KFC Corporation (U.S. Division), 2000-2005

Other Current Directorships:

●	Phillips 66 Company, since 2016

Former Public Company Directorships:

●	ITT Inc., 2011-2018
●	Praxair, Inc., 2014-2016

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Experience:

●	Executive Vice President and Chief Financial Officer, CBS Corporation (mass media), 2005-2009
●	President and Chief Executive Officer, Viacom Television Stations Group (CBS predecessor), 2001-2005
●	Executive Vice President and Chief Financial Officer, Viacom, Inc., 2000-2001
●	Executive Vice President and Chief Financial Officer, Westinghouse Electric Corporation, 1994-2000
●	Various positions at PepsiCo, Inc., 1982-1994

Other Current Directorships:

●	Hess Corporation, since 2013
●	Mondelēz International, Inc. (formerly Kraft Foods, Inc.), since 2007
●	MGM Holdings, Inc. (non-public)
●	NEP Group, Inc. (non-public)
●	Pinterest (non-public)

Former Public Company Directorships:

●	AOL, Inc., 2009-2015

Experience:

●	Chairman of the Board of Directors, T. Rowe Price Group, Inc. (investment management), 2007-2017
●	Chief Investment Officer, T. Rowe Price Group, Inc., 2004-2017
●	Various other senior leadership roles since joining T. Rowe Price Group, Inc., in 1982

Other Current Directorships:

●	Chairman of the Board (non-executive), T. Rowe Price Group, Inc., since 2017
●	Lowe’s Companies, Inc., since 2018

Other Leadership Experience and Service:

●	Chairman, Finance Committee, Archdiocese of Baltimore
●	Board of Directors, Harvard Management Company
●	Board of Trustees, Johns Hopkins Medicine

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Governance

Our Commitment to Sound Corporate Governance

UTC is committed to strong corporate governance practices that are designed to maintain high standards of oversight, accountability, integrity and ethics while promoting long-term growth in shareowner value.

Our governance structure enables independent, experienced and accomplished directors to provide advice, insight and oversight to advance the interests of the Company and our shareowners. UTC has long strived to maintain sound governance standards, as reflected in our Code of Ethics, Governance Guidelines, our systematic approach to risk management, and in our commitment to transparent financial reporting and strong internal controls.

We encourage you to visit the Corporate Governance section of our website (www.utc.com) where you can access information about corporate governance at UTC, including:

Shareowner Engagement

The Board and Management believe in transparent and open communication with investors. Over the years, those engagements have improved our corporate governance practices, increased shareowner rights, changed the Board’s composition, and improved the design of our executive compensation program and disclosure.

Each fall we solicit feedback from our largest shareowners on changes that the Board (or a Committee) is considering regarding UTC’s executive compensation program and our corporate governance practices. In the spring, after the proxy statement is filed, our discussions generally focus on the clarity and effectiveness of our disclosures and on matters that are of interest to investors. We also have discussed other topics with investors, such as leadership structure, corporate social responsibility, and UTC’s diversity and sustainability initiatives.

In addition, Management and independent directors routinely engage with our shareowners on financial performance, capital allocation and business strategy. In 2018, Management hosted the Investor and Analyst Meeting, presented at five industry conferences, hosted shareowners at UTC’s Corporate Headquarters and visited shareowners in the Americas and Europe.

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Board Leadership Structure

The Governance Committee routinely reviews our governance practices and board leadership structure. Under our Corporate Governance Guidelines, the Board does not have a policy on whether the CEO also is permitted to serve as Chairman of the Board. Instead, the Board selects the structure that it believes will provide the most effective leadership and oversight for the Company in the circumstances. In making this decision at any given point in time, the Board considers a range of factors, including: the Company’s operating and financial performance; any recent or anticipated changes in the CEO role; the effectiveness of the processes and structures for Board interaction with and oversight of Management; and the importance of maintaining a single voice in leadership communications and Board oversight, both internally and with investors.

Under our Corporate Governance Guidelines, the Board designates a non-employee director to serve as Lead Director when the Chairman is not independent. The Lead Director’s responsibilities include the following and essentially mirror the non-executive Chairman’s responsibilities under UTC’s Guidelines and Bylaws:

The Board believes that a non-executive Chairman or Lead Director with well-defined responsibilities enhances the effectiveness of the independent directors, improves risk management and oversight, and provides a channel for independent directors to candidly raise issues or concerns for Board consideration.

UTC’s independent directors meet in regularly scheduled private sessions without Management and in additional sessions when requested. In practice, the private sessions occur before or after most Board meetings.

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Board Committees

Our Board has four standing committees: Audit, Governance and Public Policy, Compensation and Finance. Except for the Finance Committee (which includes our CEO as a member), each standing committee is composed exclusively of independent directors. Each standing committee has the authority to retain independent advisors to assist in the fulfillment of its responsibilities, to approve the fees paid to those advisors and to terminate their engagements.

All committee charters, which are reviewed by each committee annually, are available on the Corporate Governance section of UTC’s website (see page 17).

Fredric G. Reynolds (Chair) Lloyd J. Austin III Diane M. Bryant Christopher J. Kearney* Margaret L. O’Sullivan Denise L. Ramos* 2018 Meetings: 8

● Assists the Board in overseeing: the integrity of UTC’s financial statements; the independence, qualifications and performance of UTC’s internal and external auditors; the Company’s compliance with its policies and procedures, internal controls, Code of Ethics, and applicable laws and regulations; and policies and procedures relating to risk assessment and management ● Nominates, for appointment by shareowners, an accounting firm to serve as UTC’s independent auditor and maintains responsibility for compensation, retention and oversight of the auditor ● Pre-approves all auditing services and permitted non-audit services to be performed for UTC by its independent auditor ● Reviews and approves the appointment and replacement of the senior Internal Audit executive

The Board determined in 2018 that Messrs. Reynolds and Kearney, and Ms. Ramos each are “audit committee financial experts,” as that term is defined in the Securities and Exchange Commission (“SEC”) rules.

Brian C. Rogers (Chair) Lloyd J. Austin III Jean-Pierre Garnier Marshall O. Larsen Harold W. McGraw III Margaret L. O’Sullivan Christine Todd Whitman 2018 Meetings: 4

● Identifies and recommends qualified candidates for election to the Board ● Develops and recommends appropriate corporate governance guidelines ● Oversees the design and conduct of the annual self-evaluation of the Board, its committees and individual directors ● Recommends appropriate compensation of directors ● Submits to the Board recommendations for committee assignments ● Reviews and monitors the orientation of new Board members and the continuing education of all directors ● Reviews and oversees UTC’s positions on significant public issues and corporate social responsibility, including diversity, the environment and safety

* Appointed to the Committee effective December 10, 2018.

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CORPORATE GOVERNANCE

Jean-Pierre Garnier (Chair) John V. Faraci Ellen J. Kullman Harold W. McGraw III Denise L. Ramos* Brian C. Rogers 2018 Meetings: 5

● Reviews UTC’s executive compensation policies and practices to ensure that they adequately and appropriately align executive and shareowner interests ● Reviews and approves the design of and sets performance goals for the annual bonus and long-term incentive awards for executives ● Evaluates the performance of UTC, the business units and the NEOs relative to the pre-established performance goals set by the Committee for the annual and long-term incentive programs ● Approves compensation levels for ELG members and executive officers ● Reviews a risk assessment of UTC’s compensation policies, plans and practices

John V. Faraci (Chair) Diane M. Bryant Gregory J. Hayes Christopher J. Kearney* Ellen J. Kullman Marshall O. Larsen Fredric G. Reynolds Christine Todd Whitman 2018 Meetings: 5

● Reviews and monitors the management of UTC’s financial resources and financial risks ● Considers plans for significant acquisitions and divestitures and their potential financial impact, and monitors progress on pending and completed transactions ● Reviews significant financing programs in support of business objectives ● Reviews significant capital appropriations ● Reviews policies and programs related to: dividends and share repurchases; financing, working and long-term capital requirements; managing foreign exchange exposure, interest rates and raw material prices; investment of pension assets; and insurance and risk management

* Appointed to the Committee effective December 10, 2018.

Director Independence

Under UTC’s Director Independence Policy and New York Stock Exchange (“NYSE”) listing standards a majority of our directors must be independent; meaning, the director does not have a direct or indirect material relationship with UTC (other than as a director). The Director Independence Policy guides the independence determination and includes the categories of relationships that the Board has determined are not material relationships that would impair a director’s independence. The policy is available on our Company website (see page 17).

Before joining the Board and annually thereafter, each director completes a questionnaire seeking information about relationships and transactions that may require disclosure, that may affect the independence determination, or that may affect the heightened independence standards that apply to members of the Audit and Compensation Committees. The Governance Committee’s assessment of independence considers all known relevant facts and circumstances about those relationships bearing on the independence of a director or nominee. The assessment also considers sales and purchases of products and services, in the ordinary course of business, between UTC (including its subsidiaries) and other companies or charitable organizations where directors and nominees (and their immediate family members) may have relationships pertinent to the independence determination.

In each of the past three years, the annual payments UTC made or received for products and services as well as UTC’s charitable contributions fell well below the thresholds in our Independence Policy and NYSE listing standards (the greater of $1 million or 2% of the other company or organization’s total gross revenues). The Board has determined that each of the nominees for election at the 2019 Annual Meeting, other than Mr. Hayes, are independent under UTC’s Independence Policy and NYSE listing standard because none of the nominees, other than Mr. Hayes, has a business, financial, family or other relationship with UTC that is considered material.

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How We Manage Risk

UTC encounters a range of risks, including legal, financial, operational, strategic, and reputational. And among these broad categories, specific risks include human capital, market conditions, the overall political climate, and the impact of disruptive events, such as natural disasters.

To manage these risks, UTC has implemented a comprehensive enterprise risk management (“ERM”) program that conforms to the Enterprise Risk – Management Integrated Framework established by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). As part of UTC’s ERM program, each business unit president is responsible for identifying and reporting to the Chairman & CEO – as part of a mid-year compliance review – the notable business and compliance risks that could affect the business’ operating plan and strategic initiatives, assessing the likelihood and potential impact of the pertinent risks, and designing the mitigation plans. The Chairman & CEO, Chief Financial Officer, and General Counsel report to the Board at least annually on business unit risks, functional risks and the associated mitigation plans.

The full Board is responsible for the oversight of UTC’s risk management process and structure, while the Audit Committee oversees UTC’s overall policies and practices for enterprise risk management. In addition, responsibility for the oversight of specific risk categories is allocated among the Board and its committees as follows:

BOARD RISK OVERSIGHT: AREAS OF RESPONSIBILITY

Full Board of Directors ● Risk management program ● Major strategies and business objectives ● Most significant risks, such as major litigation ● Succession planning ● Government relations	Audit Committee ● Financial ● Operational ● Compliance ● Reputational ● Strategic ● Cybersecurity	Committee on Governance and Public Policy ● Corporate governance ● Director candidate review ● Conflicts of interest ● Director independence ● Environment ● Safety ● Equal employment opportunity ● Public policy issues	Compensation Committee ● Compensation and benefits policies, practices and plans ● Incentive plan performance metrics and goals ● Compensation levels for senior leaders ● Compensation plan design ● Executive retention	Finance Committee ● Capital structure ● Financing ● Pensions ● Capital transactions ● Foreign exchange, interest rates and raw material prices

The Compensation Committee believes that executive compensation payouts must align with the Company’s financial performance, be earned in a manner consistent with UTC’s Code of Ethics, promote long-term, sustainable value for shareowners, and strike a balance between appropriate levels of financial opportunity and risk. Through UTC’s ERM framework, the Compensation Committee identifies, monitors and mitigates compensation risk in the following ways:

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Public Policy Engagement

UTC’s government relations initiatives are intended to educate and inform officials and the public on a broad range of public policy issues that are important to our businesses. These initiatives are consistent with the interests of UTC’s shareowners and are not based on the personal agendas of individual directors, officers or employees. The Board reviews and monitors the Company’s government relations activities, including the activities of the United Technologies Corporation Federal Political Action Committee (“UTC PAC”), which is funded entirely by voluntary employee contributions.

UTC does not make political contributions to candidates for federal office. The UTC PAC is nonpartisan and supports candidates for federal office and the national political organizations of both major parties — thus providing employees, regardless of their political affiliations, with a legal and ethical way to speak with a unified voice on issues that are important to our Company. The UTC PAC’s contributions are available on our website (see page 17).

UTC does not contribute to candidates for state and local office or to state and local party committees. We also do not make contributions to fund communications to the public that expressly advocate the election or defeat of a federal candidate, nor do we provide funding to support or oppose ballot measures.

UTC’s federal lobbying activities and expenditures can be reviewed through the reports filed with Congress that can be accessed through our Company website (see page 17). UTC’s state lobbying activities, which also are available through our website, are generally limited to 10 states and involve issues such as building safety and related building codes, economic development, and various business regulation issues.

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Responsibility

Corporate Sustainability

UTC has long recognized the value of sustainable practices, and since 1992 has implemented sustainability initiatives throughout our value chain. We believe our operations should not compromise the environmental or economic health of future generations, and we also have seen firsthand how responsible management practices provide value to our operations, employees, customers, shareowners and the communities where we operate.

We believe that trends in urbanization and population growth will continue to increase demand for more sustainable products and behaviors. Each of UTC’s major businesses is critical to modern life and the continuing development of prosperous economies around the world. As a recognized leader in these sectors, UTC is well-positioned to reduce the impact of urbanization and population growth on the environment. We offer our customers the most cutting-edge, sustainable technologies, while continually working to reduce the environmental footprint of our manufacturing facilities. Some of these technologies are highlighted on the inside front cover of this Proxy Statement and others include:

Aerospace
● Since entering into service in early 2016, Pratt & Whitney’s Geared Turbofan (“GTF”) engine has demonstrated its ability to reduce fuel burn by 16%, NOx emissions by 50% to the regulatory standard and the noise footprint by 75%.		50 % reduction of NOx emissions
● Collins Aerospace’s next generation nacelle system, featuring a 360-degree acoustically smooth inlet, helps reduce noise from aircraft powered by engines like Pratt & Whitney’s GTF engine.		Less noise pollution
● Collins Aerospace’s SmartProbe Air Data System reduces the number of sensors and pneumatic pressure lines, resulting in weight savings of up to 50% when compared to traditional systems, thereby reducing fuel burn.		Reduces fuel burn

Commercial Buildings
● Otis’ Gen2 machine uses flexible polyurethane steel-reinforced belts in place of steel cables and features ReGen drive technology – innovations that reduce energy consumption by 75% under normal operation compared to conventional systems without regenerative technology.		75 % reduction in energy consumption
Food Transportation
● Carrier’s NaturaLINE unit combines a natural refrigerant CO 2 with energy-efficient technology to reduce the carbon footprint of marine container refrigeration by 28%, when compared to previous Carrier equipment using conventional synthetic refrigerants.		28 % reduction in carbon footprint

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CORPORATE RESPONSIBILITY

	Since 1997 we have achieved:
	35 %			62 %			all during a period when we nearly tripled our sales
	reduction in our greenhouse gas emissions			reduction in water consumption

We set five-year environmental sustainability goals for which we track progress on an annual basis. Our current goals are for the period between 2016 and 2020. We are committed to a targeted reduction in environmental impacts, irrespective of business growth. As a result, we measure our progress towards these goals in absolute terms, rather than adjusting for the opening or closing of manufacturing facilities. ⁽¹⁾ In 2018, we saw progress in all of our goals:

2018 Recognition for Sustainability Practices

CDP (formerly the Carbon Disclosure Project) The CDP rated UTC as a “leadership company” with an A- rating for our actions and performance to reduce greenhouse gas emissions and mitigate climate change.

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Corporate Citizenship

UTC takes great pride in building a diverse work environment, supporting lifelong employee learning, and contributing to charitable and community causes. In the same way that we set the highest standards for our business operations, we apply the highest corporate responsibility standards and rigorous performance measurements to these efforts.

We are committed to creating a diverse, inclusive workforce and nurturing an environment where all employees can be themselves and share ideas openly. Our efforts focus on advancing gender parity, encouraging employee-led engagement and enhancing opportunities for professionals who want to return to work after voluntary time away.

Advancing Gender Parity

UTC is committed to the advancement of women in leadership positions. In 2017, we joined the Paradigm for Parity (“P4P”) coalition and put this commitment into action by adopting the P4P five-point roadmap shown below. As a signatory to P4P, we set a goal to achieve 50% women in leadership roles by 2030. Several activities currently underway are advancing our efforts towards achieving our goal, including our Inclusive Leaders Curriculum training for managers and other employees. We also recognize that sponsorship is important to career advancement so we provide a framework for high-performing women to have that support and visibility.

Employee Engagement

We support and encourage our employees to join Employee Resource Groups (“ERGs”), which foster advocacy, professional development, education and mentoring, along with community outreach. We support nine global ERGs (African-American, Asian-American, Disability, Generational, Hispanic-American, LGBTQ Pride, Military Veterans, Professional and Women) with more than 100 chapters and an estimated 5,000 members.

Opportunities to Re-enter the Workforce

We understand that returning to work after a career break can be challenging. The UTC Re-Empower Program, launched in 2017, eases this transition by helping professionals bring their knowledge, experience and creativity back to the workforce after voluntary time off. This program offers on-the-job experience, career guidance and mentoring over a 16-week period.

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At UTC, we support a culture of lifelong learning in which our employees are encouraged to expand their knowledge and capabilities to maintain their competitive skills in an ever-changing world. We aspire to maintain a highly educated workforce capable of the innovation required of our technology-driven company.

Our Employee Scholar Program has been in place for more than 20 years and has been consistently recognized as one of the most comprehensive company-sponsored employee education programs in the world.

40,200+	$ 1.3 billion	6,000+	60+
degrees earned since 1996	invested since 1996	employees participated in 2018	countries with participating employees in 2018

At UTC, we are committed to enhancing the quality of life everywhere we do business because we believe positive engagement builds vibrant communities. Through financial contributions and employee volunteerism, UTC and our employees support thousands of civic, cultural, economic and social welfare organizations around the globe that share in our mission of making the world a better place.

Since 2012, we have invested more than $250 million in the communities where we operate, an amount that includes in excess of $20 million in employee contributions and company matching grants. UTC’s corporate responsibility commitments are bolstered by the impact that our employees have close to home and around the world. Whether mentoring students in STEM (science, technology, engineering and math) subjects, teaching lessons in environmental stewardship or providing disaster relief, our employees contribute their expertise, creativity and passion to help build resilient communities.

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of Directors

Pay Structure

The following chart shows annual retainers for non-employee directors for the April 2018 to April 2019 Board cycle. 40% is payable in cash and the remaining 60% is payable in deferred stock units (“DSUs”), although a director also may elect to receive 100% of the retainer in DSUs.

* Directors serving in multiple leadership roles receive incremental compensation for each role.

Directors do not receive additional compensation for attending regularly scheduled Board or committee meetings, but do receive an additional $5,000 for each special meeting attended in person. The directors did not attend any special Board or committee meetings in person during 2018.

Annual retainers are paid each year following the Annual Meeting. New directors joining the Board between the Annual Meeting and the end of September receive 100% of the annual retainer. Directors joining the Board between October and the next Annual Meeting receive 50% of the annual retainer. After a non-employee director leaves the Board, DSUs are converted into shares of UTC Common Stock, payable either in a lump-sum or in 10- or 15-year installments in accordance with the director’s prior elections.

Effective at the 2019 Annual Meeting, the total base retainer will be $310,000, comprised of $124,000 in cash and $186,000 in DSUs. There are no changes to the incremental role-based retainers.

Non-employee directors receive a one-time $100,000 RSU award when first elected to the Board. This award vests in equal portions over five years and is distributed in shares of UTC Common Stock upon termination of service. Mr. Kearney and Ms. Ramos each received this award when they joined the Board in December 2018.

When UTC pays a dividend on Common Stock, each director is credited with additional DSUs and RSUs equal in value to the dividend paid on the corresponding number of shares of UTC Common Stock.

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