© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
HP 2011 Supply Chain Social & Environmental Responsibility
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.2
HP supply chain SER firsts2002 First IT company to develop and implement a supplier SER code2004 One of the first IT manufacturers to perform on-site supplier SER audits2004 Founding member of the Electronic Industry Citizenship Coalition (EICC)2007 First electronics company to publish a list of our suppliers2008 First major IT company to publish its aggregated supply chain greenhouse gas (GHG) emissions
Promoting responsible practices and helping our suppliers improve social and environmental performance
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.3
SC SER MilestonesHP’s supply chain SER program launchedHP’s first supplier audit performedHP's first supplier SER forum held in ChinaCapability building program launchedFirst capability building effort to directly train supplier employeesComprehensive list of HP suppliers disclosedConflict minerals program launchedFirst joint Validated Audit Process (VAP) audits performedFirst HP nonproduction supplier audit performed
2007
20092008
2010
2006
2000
2011
20052004
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.4
Four-phase supplier management systemOur approach
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.5
Risk-based approach to supply chain SEROur approach
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.6
760 supplier site audits performed, 2005-2011Global audits
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.7
Nonconformances reduced by section of HP’s EICC Code, 2005-2011Supplier audit performance
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.8
Collaboration within our industry and across others
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.9
HP works with suppliers to deliver substantial and lasting SER performanceimprovements on a broad range of issues
Capability building
Since 2006, HP has:• Carried out 19 programs in 9 countries on topics such as
antidiscrimination, energy efficiency, labor rights, and women’s health• Engaged about 60% of production suppliers (by spend)• Impacted approximately 2,500 managers and 136,000 workers• Trained about 150 second-tier suppliers• Confirmed performance improvements by suppliers engaging in capability
building programs, as verified by audits
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.10
Addresses the general and reproductive health needs of womenHealth Enables Return (HER) project
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.11
Helps workers better understand their labor rights and how they can raise grievances about their working environment
Worker Management Communications
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.12
We are proud of our progress to date, but our work is ongoingMoving forward
• We continually seek innovative ways to extend the impact of our efforts• Auditing and capability building will remain central to our approach, but we will
continue to innovate beyond traditional programs to effect lasting change• We plan to extend our engagement with multi-stakeholder organizations to
improve supplier management systems and worker-manager dialogue• We expect suppliers to provide increasing levels of transparency
We strive to make our program even more effective in pursuit of our values: to protect workers’ rights and dignity, to ensure strong health and safety
standards, to reduce environmental impacts, and to uphold the highest standards of
business ethics
© Copyright 2012 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice.
Thank you
Supply Chain EnvironmentalSustainability Scorecard
Scorecard Objectives1. Enhance supply chain collaboration 2. Improve key environmental indicators3. Encourage the sharing of ideas and capabilities
to deliver more sustainable products and services to consumers
• Show same Filled In Scorecard page but with a couple NA Measures highlighted
Todd Stark, President
Technology Enabled Supply Chain Transparency
Global Mobile PenetrationMobile phone ownership has doubled since 2006Now more than 6 billion mobile subscriptions globally
Direct Communication with Workers
• Spread of mobile technology means workers now have phones
• Enables true two- way communication
Step 2: Responses are captured by
a central server. Data isaggregated and analyzed.
Step 1: Workers place a free phone call.
They answer questions using their keypad.
Step 3: Information is visualized on a web-
based interface. Users access the data from a personal computer.
IVR
SMS
Analysis
Data
Collection Analysis Visualization
Labor Link makes communicating with workers:
Reliable, Affordable, Scalable
Using Labor LinkOur partners use Labor Link to engage workers and monitor their working conditions between audits
Business Partner Goals of Labor Link
• Surveying worker needs and job satisfaction
Increase Retention / Reduce Absenteeism
• Sending SMS alerts on worker incentive programs, holidays and benefitsBoost Productivity
• Sending SMS alerts on best practices and recognizing star performersIncrease Quality
• Automating and centralizing the collection of worker data Satisfy Customers
Case Study: FactoryEileen Fisher is using Labor Link to deliver two surveys in India that measure…
• Recruitment; worker-mngmt comms; labor standards awareness; training; job satisfaction
• Questions on community needs
Working Conditions
• Progress Out of Poverty Index developed by Grameen Foundation
• Comparison to 44 countriesLivelihoods
• 50% response rate on initial surveys• Deployed in 4 languages
Case Study: CommunityLevel Works is using Labor Link to deliver a community-based survey in India that measures…
• Heath & Social Security benefits• Awareness of minimum wage• Number of rupees earned per day
Wages & Benefits
• “How did you find your job?”• “Why did you choose this job?”• “Why did you leave your last job?”
Recruitment & Turnover
• Targeted 1,000 workers in Tirupur • 80% response rate on initial survey• Deployed in 2 languages
Worker Turnover
26
Case Study: FarmFair Trade USA used Labor Link to measure the impact of a USAID-funded coffee sustainability program in Brazil on two topics…
• Use of pesticides, herbicides, and chemical fertilizers
• Compared practices in 2012 vs. 2009
Agrochemical Use
• Nitrogen fixing and soil analysis - trusted sources of agronomic information
Sustainability Practices
• 3,000 farmers targeted in 16 cooperatives• Deployed in Portuguese
10 Clear Steps to Engagement
1. Survey Purpose & Questions
2. Survey Sites & Number of Targeted Workers
3. Supplier Engagement
4. Languages Required
5. Timeframe for Survey
6. Incentives to Motivate Workers
7. Educational / Informational Content (Optional) 8. Reporting Format & Frequency
9. Conclusions from Data Analysis
10. How to Use Data to Inform Decision-Making
Implementation Process is Collaborative
Labor Link posters for the factory floor
Discussing worker needs and survey design
Workers receive a card with survey
instructions
Then place a free call with their mobile phone
Data Reporting & Analysis is Tailored On Line
Sectors Using Labor Link Mobile Surveys 6. If you have a problem, is there someone other than your supervisor to whom you can speak? Agriculture
Apparel
ElectronicsArtisan
Additional Opportunities Underway 6. If you have a problem, is there someone other than your supervisor to whom you can speak?
Department Stores - Hardlines
Sporting Goods
BeveragesToys
Where is Labor Link Operating?Currently operational in Brazil, China, India and Peru. Expanding to additional countries like Mexico, Sri Lanka, & Indonesia.