Item 1. Business

3M Company was incorporated in 1929 under the laws of the State of Delaware to continue operations begun in 1902. The Company’s ticker symbol is MMM. As used herein, the term “3M” or “Company” includes 3M Company and its subsidiaries unless the context indicates otherwise. In this document, for any references to Note 1 through Note 21, refer to the Notes to Consolidated Financial Statements in Item 8.

Available Information: 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 https://www.sec.gov. 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 (https://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.

General: 3M is a diversified technology company with a global presence in the following businesses: Safety and Industrial; Transportation and Electronics; Health Care; and Consumer. 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). 3M is among the leading manufacturers of products for many of the markets it serves. Most 3M products involve expertise in product development, manufacturing and marketing, and are subject to competition from products manufactured and sold by other technologically oriented companies.

Business Segments: 3M manages its operations in four business segments. The reportable segments are Safety and Industrial, Transportation and Electronics, Health Care, and Consumer. 3M’s 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

Underlying divisions/businesses

Refer to Note 2 for disaggregated revenue information

• Abrasives

• Automotive aftermarket

• Closure and masking systems

• Electrical markets

• Industrial adhesives and tapes

• Personal safety

• Roofing granules

• Advanced materials

• Automotive and aerospace

• Commercial solutions

• Display materials and systems

• Electronics materials solutions

• Transportation safety

• Health information systems

• Medical solutions

• Oral care

• Separation and purification sciences

• Food safety (divested in 2022)

• Construction and home improvement markets

• Home, health and auto care

• Stationery and office

Representative revenue-generating activities, products or services

• Industrial abrasives and finishing for metalworking applications

• Autobody repair solutions

• Closure systems for personal hygiene products, masking, and packaging materials

• Electrical products and materials for construction and maintenance, power distribution and electrical original equipment manufacturers (OEMs)

• Structural adhesives and tapes

• Respiratory, hearing, eye and fall protection solutions

• Natural and color-coated mineral granules for shingles

• Advanced ceramic solutions

• Attachment/bonding, films, sound and temperature management for transportation vehicles

• Premium large format graphic films for advertising and fleet signage

• Light management films and electronics assembly solutions

• Chip packaging and interconnection solutions

• Semiconductor production materials

• Solutions for data centers

• Reflective signage for highway, and vehicle safety

• Health care procedure coding and reimbursement software

• Skin, wound care, and infection prevention products and solutions

• Dentistry and orthodontia solutions

• Filtration and purification systems

• Consumer bandages, braces, supports and consumer respirators

• Cleaning products for the home

• Retail abrasives, paint accessories, car care DIY products, picture hanging and consumer air quality solutions

• Stationery products

Some seasonality impacts this business segment related to back-to-school, generally in the third quarter of each year

Example brands/offerings

• 3M™ Cubitron™ II abrasives

• Scotch-Brite™ Abrasives

• Scotch & Temflex Vinyl Tapes, Scotchkote Coatings, Dynatel locators, Scotchcast resins

• Collision repair and paint spray products

• Reclosable fasteners; tapes and label materials for durable goods

• Electrical infrastructure products; medium voltage cable accessories and insulation tapes

• 3M ™ VHB™ Bonding tapes; Scotch® masking, packaging and filament tapes

• Disposable respirators and fall protection products

• Scotchgard™ Protector for shingles

• 3M™ Nextel™ Ceramic fibers and textiles

• Thinsulate™ Acoustic Insulation products and automotive components

• 3M™ Novec™ Engineered Fluids

• 3M™ Scotchlite™ graphic films, 3M™ Scotchcal™ and 3M™ Controltac™ Commercial graphics

• Electronic display enhancement films and optically clear adhesives

• Electronic interconnect products

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

• 3M™ 360 Encompass™ medical coding systems

• 3M ™ Tegaderm™ wound dressings, V.A.C.® Therapy Systems and disposable respirators in the health care channel

• 3M™ Filtek™ and 3M™ RelyX™ dental filing materials and cements; 3M™ Clarity™ aligners

• Biopharma and other filtration systems, bags, capsules and components

• ACE™ , FUTURO™ and Nexcare™ personal health care products

• Scotch-Brite™ cleaning supplies, sponges, brushes, and scouring pads; Scotchgard™ products

• Scotch® tapes and other products, Filtrete™ filters and Command™ adhesive products

• Post-it® products

Representative market trends or opportunities

• Personal safety

• Connected bodyshop

• Grid modernization

• Robotics and automation

• Automotive electrification

• Data center solutions

• Extended reality

• Semiconductor

• Graphic and architectural films

• Wound care

• Healthcare IT

• Biopharma filtration

• Home improvement

• Consumer safety & well-being

• Package protection & shipping

• Appearance auto care

Distribution: 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.

Resources

Human Capital: On December 31, 2023, the Company employed approximately 85,000 people (full-time equivalents), with approximately 34,000 employed in the United States and 51,000 employed internationally. The ability to recruit, retain, develop, protect, and fairly compensate its global workforce are enablers of 3M’s success. This includes four general categories of focus: Health and Safety; Development; Diversity, Equity and Inclusion; and Compensation and Benefits.

Health and Safety:

3M is committed to the safety, health, and well-being of its employees. The Company continuously evaluates opportunities to raise safety and health standards, training site leaders and conducting site visits to identify and manage environmental health and safety risks; evaluating compliance with regulatory requirements and 3M policy; and maintaining a global security operation for the protection of facilities and people on 3M sites. 3M also promotes a culture of health and well-being through disease prevention programs, on-site clinical services, employee assistance programs, and comprehensive health care benefits.

Development:

Developing employees contributes to growing 3M’s business. 3M maintains talent and succession planning processes, including regular review by the Company’s chief executive officer (CEO) and reporting up through the Board of Directors. The Company provides leadership development experiences through job-based or project-based assignments, assessment and coaching, and targeted skill-development where leaders are given the opportunity to learn, apply, and share their skills. 3M also has prioritized learning journeys for managers and supervisors and provides opportunities for all employees to learn, in addition to regular coaching and support from their supervisor. With the Company’s global online employee learning platform, employees are able to access unique, just-in-time development resources in over 15 languages to support their career aspirations and advance their skills.

Diversity, Equity and Inclusion:

A diverse, global workforce and inclusive culture that provides fair and equitable opportunities helps 3M remain competitive, advance its innovation culture, and serve customers. 3M has gender, race/ethnicities pay parity in all geographies, and processes in place to ensure this is maintained. Additionally, 3M focuses on attracting and advancing top talent and has publicly committed to advance global diversity in management across all dimensions, with additional specific goals to increase the Company’s diversity with underrepresented groups. 3M supports these values with an internal CEO Inclusion Council, a forum led by senior management to advance diversity, equity, and inclusion initiatives. The Company also plans to invest $50 million over 2020 to 2025 to address racial opportunity gaps through workforce development initiatives in the communities in which its employees live and 3M business operates. The Company is on pace, having delivered over $39 million through 2023.

Compensation and Benefits:

3M has a trust-based approach to work that empowers employees to work where and when they can best achieve their goals, which supports attraction and retention of talent around the globe. In addition to a professional and flexible work environment that promotes innovation, well-being, and rewards performance, 3M’s total compensation for employees includes a variety of components that support sustainable employment and the ability to build a strong financial future, including competitive market-based pay and comprehensive benefits. In addition to earning a base salary, eligible employees are compensated for their contributions to the Company’s goals with both short-term cash incentives and long-term equity-based incentives. Through its global pay philosophy, principles and consistent implementation, 3M is committed to providing fair and equitable pay for employees. Eligible full-time employees in the United States also have access to medical, dental, and vision plans; savings and retirement plans; a 3M employee stock purchase plan; and other resources. Some of these benefits can also be available to regular part-time employees who work at least 20 hours a week. Programs and benefits differ internationally for a variety of reasons, such as local legal requirements, market practices, and negotiations with works councils, trade unions, and other employee representative bodies.

Raw Materials: In 2023, global supply chains moved towards greater balance, with disruptions driven from more isolated factors than in the prior year. Overall, 3M experienced year-over-year market inflation in 2023 driven by the carryover of 2022 impacts, and effects of a historically strong labor market. Market price risks were partially mitigated via negotiated supply contracts.

Patents, Trademarks and Licenses:The Company’s products are sold around the world under various trademarks. The Company also owns, or holds licenses to use, numerous U.S. and foreign patents. The Company’s research and development activities generate a steady stream of inventions that are covered by new patents or trade secrets. Patents applicable to specific products extend for varying periods according to the date of patent application filing or patent grant and the legal term of patents in the various countries where patent protection is obtained. The actual protection afforded by a patent, which can vary from country to country, depends upon the type of patent, the scope of its coverage and the availability of legal remedies in the country.

The Company believes that its trademarks, patents, and trade secrets provide an important competitive advantage in many of its businesses. In general, no single patent or group of related patents is in itself essential to the Company as a whole or to any of the Company’s business segments.

Government Regulation and Environmental Law Compliance: 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, health, and safety; tax; the U.S. 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. federal healthcare program-related laws and regulations, such as the False Claims Act, anti-kickback laws and the Sunshine Act.

3M’s manufacturing operations are affected by national, state and local environmental laws and regulations around the world. The Company places consistent emphasis on environmental responsibility. 3M has made, and plans to continue making, necessary expenditures for compliance with applicable laws and regulations. 3M is also involved in remediation actions relating to environmental matters from past operations at certain sites (refer to “Environmental Matters and Litigation” in Note 18, Commitments and Contingencies).

Environmental expenditures relating to existing conditions caused by past operations that do not contribute to current or future revenues are expensed. Reserves for liabilities for anticipated remediation costs are recorded on an undiscounted basis when they are probable and reasonably estimable, generally no later than the completion of feasibility studies, the Company’s commitment to a plan of action, or approval by regulatory agencies. Environmental expenditures for capital projects that contribute to current or future operations generally are capitalized and depreciated over their estimated useful lives.

In 2023, 3M expended approximately $316 million on capital projects for environmental purposes as defined below. Capital projects for environmental purposes include waste reduction and pollution control programs such as water usage reduction and water quality improvement equipment, scrubbers, containment structures, solvent recovery units and thermal oxidizers. Capital expenditures for similar projects are presently expected to approach approximately $365 million for 2024 and 2025 in aggregate.

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.

Information about our Executive Officers: Following is a list of the executive officers of 3M, and their age, present position, the year elected to their present position and other positions they have held during the past five years. No family relationships exist among any of the executive officers named, nor is there any undisclosed arrangement or understanding pursuant to which any person was selected as an officer. This information is presented in the table below as of the date of the 10-K filing (February 7, 2024).

Name

Age

Present Position

Year Elected to Present Position

Other Positions Held during 2019 - 2023

Michael F. Roman

64

Chairman of the Board and Chief Executive Officer

2019

Chief Executive Officer, 2018-2019

Monish Patolawala

54

President, Chief Financial Officer

2023

Executive Vice President, Chief Financial and Transformation Officer, 2021-2023

Senior Vice President and Chief Financial Officer 2020-2021

Chief Financial Officer, Health Care and Vice President, Operational Transformation, General Electric, 2019-2020

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

John P. Banovetz

56

Executive Vice President, Chief Technology Officer and Environmental Responsibility

2023

Senior Vice President, Chief Technology Officer and Environmental Responsibility, 2021Senior Vice President, Innovation and Stewardship and Chief Technology Officer, 2020Senior Vice President of Research and Development and Chief Technology Officer, 2017-2019

Karina Chavez

50

Group President, Consumer

2023

Senior Vice President and Chief Strategy Officer, 2021-2023

Senior Vice President, Customer Operations, 2020-2021

Global Business Director, Home Improvement Business, 2017-2020

Torie Clarke

64

Executive Vice President and Chief Public Affairs Officer

2023

Independent communications and crisis management consultant, 2017-2023

Board member, The Rumsfeld Foundation, 2016 - present

Senior Advisory Committee Member, John F. Kennedy School at Harvard University, 2007 - present

Zoe Dickson

50

Executive Vice President and Chief Human Resources Officer

2021

Senior Vice President, Talent, Learning and Insights, 2021Vice President, Organization Effectiveness and Talent, Human Resources, 2020-2021 Vice President, Organization Effectiveness, Human Resources 2019-2020 Vice President, Global Human Resources Business Operations, Human Resources 2018-2019

Peter D. Gibbons

62

Group President, Enterprise Operations

2021

Chief Executive Officer, Tirehub, 2018-2021

Chris Goralski

52

Group President, Safety & Industrial

2023

President, Industrial Adhesives & Tapes Division, 2020-2023

Vice President, Environmental Stewardship, Research & Development, 2018-2020

Bryan Hanson

57

Chief Executive Officer, Healthcare

2023

Chairman of the Board and Chief Executive Officer, Zimmer Biomet, 2021-2023

Chief Executive Officer, Zimmer Biotmet, 2017-2021

Mark Murphy

55

Executive Vice President, Chief Information and Digital Officer

2021

Chief Information Officer, Abbott Laboratories, 2020-2021

Global Chief Information Officer and Vice President, BTS, Abbott Laboratories, 2018-2020

Kevin H. Rhodes

61

Executive Vice President, Chief Legal Affairs Officer

2022

Senior Vice President and Deputy General Counsel, 2021Vice President and Deputy General Counsel, 2019-2021President and Chief Intellectual Property Counsel, Office of Intellectual Property Counsel and 3M Innovative Properties 2008-2019

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 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 United States Securities and Exchange Commission ("SEC"), in materials delivered to shareholders and in press releases. In addition, the Company’s representatives may from time to time make oral forward-looking statements.

Forward-looking statements relate to future events and typically address the Company’s expected future business and financial performance. Words such as “plan,” “expect,” “aim,” “believe,” “project,” “target,” “anticipate,” “intend,” “estimate,” “will,” “should,” “could,” "would," “forecast” and other words and terms of similar meaning, typically identify such forward-looking statements. In particular, these include, among others, statements relating to:

• 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,

• 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,

• risks related to the proposed class-action settlement (“PWS Settlement”) to resolve claims by public water systems in the United States regarding PFAS, including whether court approval of the PWS Settlement will be obtained, whether the number of plaintiffs that opt out of the PWS Settlement will exceed current expectations or will exceed the level that would permit 3M to terminate the PWS Settlement (and whether 3M will elect to terminate the PWS Settlement if this occurs), whether the PWS Settlement is appealed, the timing and amount of payments made under the PWS Settlement, and the impact of the PWS Settlement on other PFAS-related matters,

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

• competitive conditions and customer preferences,

• foreign currency exchange rates and fluctuations in those rates,

• 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 implementation of an enterprise resource planning (ERP) system,

• security breaches and other disruptions to information technology infrastructure,

• the scope, nature or impact of acquisition, strategic alliance and divestiture activities,

• operational execution, including inability to generate productivity improvements and impact of organizational restructuring activities,

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

• 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,

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

• matters relating to Combat Arms Earplugs (“CAE”), including those related to the August 2023 settlement that is intended to resolve, to the fullest extent possible, all litigation and alleged claims involving the CAE sold or manufactured by the Company's subsidiary Aearo Technologies and certain of its affiliates (“Aearo Entities”) and/or 3M (“CAE Settlement”), including, but not limited to, whether the anticipated full participation by plaintiffs in the CAE Settlement will be achieved, whether the number of plaintiffs who participate in the CAE Settlement will meet the full participation expectations or will fall below the level that would permit 3M to terminate the CAE Settlement (and whether 3M will elect to terminate the CAE Settlement if this occurs), whether there will be a significant number of future claims by plaintiffs that decline to participate in the CAE Settlement, whether the CAE Settlement is appealed or challenged, the filing and outcome of additional litigation, if any, relating to the products that are the subject of the CAE Settlement, or changes in laws or regulations related to the CAE products or CAE settlement, 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.

Forward-looking statements are based on certain assumptions and expectations of future events and trends that are subject to risks and uncertainties. Actual future results and trends may differ materially from historical results or those reflected in any such forward-looking statements depending on a variety of factors. 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.

MMM - 3m Co

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