Johnson Controls

In 1883, Warren S. Johnson, a professor at the Whitewater Normal School (now University of Wisconsin–Whitewater) in Whitewater, Wisconsin, received a patent for the first electric room thermostat. His invention helped launch the building control industry and was the impetus for a new company. Johnson and a group of Milwaukee investors led by William Plankinton incorporated the Johnson Electric Service Company in 1885 to manufacture, install and service automatic temperature regulation systems for buildings. After Johnson died in 1911, the company decided to focus on its temperature control business for non-residential buildings.

In 1970, the company took over clock manufacturer Standard Electric Time Company. The company was renamed Johnson Controls in 1974. In 1978, Johnson Controls acquired the battery company Globe-Union. That same year, the company divested itself of the Standard Electric Time Company and sold it to Faraday. In 1985, Johnson Controls acquired automotive seating companies Hoover Universal and Ferro Manufacturing.

In 1989, Johnson acquired Pan Am World Services, which provides facilities management for airports, military bases and the two space centers of the U.S. Government. The acquisition would more than double Johnson Controls' facilities management business and diversify away from the cyclical construction business. Revenue from facilities maintenance contributed about one-third of Johnson's in 1988.

During the 2007–2009 recession, the company's president, Keith Wandell, lobbied the U.S. Congress for a bailout of the companies that Johnson supplied. The Johnson Controls plant in Lakeshore, Ontario, closed in late March 2010 and the property was sold. In 2013, Stephen Roell retired and Alex Molinaroli took his position as CEO and chairman of the board.

Subsequent history

On 31 October 2016, the former Johnson Controls Automotive Experience division was spun off as a separate, publicly traded company, Adient, and began trading on the New York Stock Exchange. In March 2017, it was announced that Scott Safety, its safety gear business, would be bought by 3M for $2 billion.

On 1 September 2017, George Oliver was appointed as chairman and CEO, an acceleration by 6 months from the original plans.

On 12 May 2021, Johnson Controls completed the acquisition of Silent-Aire, a Canadian firm that specialized in data center cooling systems. The deal was structured as follows: Johnson Controls paid $630 million upfront, and additional payments were made contingent upon reaching certain milestones, with total price capped at $870 million.

In October 2021, it was announced that Johnson Controls had chosen Ava Robotics to power its new fully autonomous Tyco Security Robot.

Business units

The company's operations focus on Building Efficiency.

Building Technologies and Solutions

The Building Technologies and Solutions business unit designs, produces, installs and services heating, ventilation and air conditioning systems, industrial refrigeration, building management systems, fire and security systems and mechanical equipment for commercial and residential buildings. The brands produced under this business unit are York, TempMaster, Metasys, Panoptix, Frick and Sabroe. This unit also works with organizations to reduce the energy consumption and operating costs of their buildings. This includes retrofitting existing buildings such as the Empire State Building and working on maximizing efficiency in new construction such as the Burj Khalifa in Dubai. Building Technologies & Solutions is the company's longest-running business unit, dating to 1885 when Johnson founded the Johnson Electric Service Company after patenting the electric thermostat in 1883. As of 2012, the business unit operated from 700 branch offices in more than 150 countries.

Johnson Controls was one of the defendants in a multimillion-dollar federal court lawsuit in San Juan, Puerto Rico in a case where 98 people perished and 140 were injured in a fire at the DuPont Plaza Hotel and its casino on New Year's Eve, 31 December 1986. The plaintiffs claimed that Johnson Controls sold and installed an energy management system that failed to give early warning of the fire. After nine months of trial, the company and its energy management system were absolved of blame when the court issued a directed verdict. When the trial was completed the plaintiffs had accumulated approximately $220,908,549.00 in damages as a result of various settlements and a jury verdict against some other defendants.

Power Solutions

This unit was sold to Brookfield Business Partners and re-made into a new company, Clarios, as of 1 May 2019.

Controversies

Merger with Tyco

On 25 January 2016, Johnson Controls announced that it would merge with Tyco International to create Johnson Controls International plc, a company headquartered in Cork, Ireland. The merger was completed in September 2016. Merging with the Irish company allowed Johnson Controls to become an Irish company itself, and enjoy sharply lowered corporate taxes, a process known as a tax inversion. This restructuring came at great expense of the workforce which was reduced by 52% between 2016 and 2022. The same occurred after the takeover of York International in 2005, which led to a reduction of 76% of the workforce between 2005 and 2016.

Hillary Clinton condemned the company for wanting to escape United States taxes through the merger after having "begged" the government for financial help in 2008. The Johnson deal was termed "outrageous" by Fortune magazine. The firm estimated that it would save about US$150 million a year by avoiding American taxes.

Tyco international scandal

In 2002, former chairman and chief executive Dennis Kozlowski and former chief financial officer Mark H. Swartz were accused of the theft of more than US$150 million from the company. During their trial in March 2004, they contended the board of directors authorized it as compensation.

Kozlowski was tried twice. The first attempt was a ruled mistrial when one of the jurors was threatened by the public after being reported to have made an OK sign towards Kozlowski's lawyers. Kozlowski testified on his own behalf during the second trial, stating that his pay package was "confusing" and "almost embarrassingly big," but that he never committed a crime as the company's top executive.

On 17 June 2005, after a retrial, Kozlowski and Swartz were convicted on all but one of the more than 30 counts against them. The verdicts carry potential jail terms of up to 25 years in state prison. Kozlowski and Swartz were each sentenced to no less than eight years and four months and no more than 25 years in prison. Then in May 2007, New Hampshire Federal District Court Judge Paul Barbadoro approved a class action settlement whereby Tyco agreed to pay $2.92 billion (in conjunction with $225 million by Pricewaterhouse Coopers, their auditors) to a class of defrauded shareholders represented by Grant & Eisenhofer P.A., Schiffrin, Barroway, Topaz & Kessler, and Milberg Weiss & Bershad.

On 17 January 2014, Kozlowski was granted parole from Lincoln Correctional Facility in New York City.