IBM Establishes New Corporate Responsibility and Environmental Requirements to Advance Sustainability Across its Global Supply Chain

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Apr 21, 2010, 10:59 ET

ARMONK, N.Y., April 21 /PRNewswire-FirstCall/ -- IBM (NYSE: IBM) today announced new management system requirements to advance sustainability across the company's global network of suppliers. IBM's "first-tier" suppliers – those firms with which IBM holds a direct commercial relationship – will now be required to establish and follow a management system to address their corporate and environmental responsibilities.

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This is the latest move in IBM's decades-long commitment to working with suppliers around corporate responsibility initiatives. The company runs one of the largest, most complex supply chains in the world, spanning 28,000 first-tier suppliers in 90 countries.

IBM's suppliers are now required to:

define, deploy, and sustain a management system that addresses corporate responsibility, including supplier conduct and environmental protection;
measure performance and establish voluntary, quantifiable environmental goals;
publicly disclose results associated with these voluntary environmental goals and other environmental aspects of their management systems.

Often the greatest obstacle for a company trying to develop, integrate and sustain strong environmental and corporate responsibility programs is the absence of a strong management system that addresses responsibilities such as workplace safety, increasing energy efficiency and reducing waste. IBM, through its own practices, has long recognized that a strong management system is critical to an organization's ability to identify and manage its corporate responsibilities.

"IBM has always expected its suppliers to operate in an environmentally responsible manner, but now we're strengthening that focus with a management system requirement," said Wayne Balta, Vice President, Corporate Environmental Affairs and Product Safety, IBM. "This is not a 'one-size-fits-all' approach – we expect that each supplier will deploy a management system, measure performance, set goals and disclose results in a way that reflects their particular intersections with corporate responsibility and the environment." He added that IBM is also requiring its first-tier suppliers to communicate these new requirements to their own suppliers who perform work that is material to the products, parts or services supplied to IBM.

John Paterson, IBM Global Supply Chief Procurement Officer and Vice President, said, "Clearly there are financial benefits for procurement organizations around the world to choose suppliers that effectively manage their corporate and environmental responsibilities. For IBM, this helps contribute to our business success and that of our suppliers. Moreover, it's the right thing to do."

While many of IBM's suppliers have had such management systems in place for years, for others it will represent a new way of doing business. One of IBM's key objectives is to help suppliers effectively manage their environmental and corporate responsibility in a way that is long-term, sustainable and integral to their routine business operations. IBM believes that by holding each supplier accountable for improving their individual performance and results, the entire supply chain will benefit, as will the world.

IBM has been committed for decades to working with suppliers that operate in an environmentally responsible manner. The company's management system has included various environmental and supply chain social requirements for its suppliers since the early 1970s. In April 1998, IBM explicitly encouraged its suppliers to align their own environmental management systems with ISO 14001 and to pursue registration under this international standard. In June 2004, IBM published its Supplier Conduct Principles to articulate the company's overall supply chain social and environmental expectations.

For more information on IBM's supply chain and environmental practices, please visit here and here.