HP raises the green bar

Most vendors are very uneasy about discussing the accumulated environmental harm in their backward supply chain (materials, manufacturing and assembly world-wide). The usual excuse is that it’s too difficult to lay their hands on the numbers. So they start counting from when they take responsibility for the inbound supplies.

Many will discuss the obligations they try to place on the supply chain but no-one, until now, has actually come up with any hard information. Perhaps they’re all poised to announce. Or maybe they know, but are shy of sharing. Who knows? But what we do know is that Hewlett Packard raised the bar yesterday by announcing real supply chain figures.

Rather than try to paraphrase the declaration, it’s probably best to quote HP directly, “In 2007, the aggregated carbon dioxide equivalent (CO2e) emissions associated with more than 80 percent of HP’s first-tier manufacturing expenditures totaled approximately 3.5 million metric tons.”

A clarifying paragraph added, “Aggregated CO2e emissions represent the sum of HP-allocated suppliers’ emissions and are calculated by factoring the total supplier emissions by the percentage of HP dollar volume to the suppliers’ total revenue.”

Sounds like a reasonable basis for calculation. And good for HP for doing something. It’s taken a macro view of the supplier and made an intelligent guess at the allocation due to HP. Perhaps this is a stop-gap method that others could consider. It certainly seems easier that trying to allocate emissions and other environmental harm product by product.

To set the figures in some kind of context, in 2007 HP’s own operational emissions were approximately 1.5 million tonnes. Business travel takes it up to a shade under two million tonnes. Contrasting the figures shows how significant the supply chain is when calculating an organisation’s overall impact on the planet.

You might be interested in HP’s suppliers list published earlier this year. This represents 95% of the company’s supplier expenditure. It probably won’t help you identify the top 80 percent, but it does give you an idea of who HP is prepared to deal with.

HP is a member – along with most of the other major vendors – of the Electronic Industry Citizenship Coalition (EICC) – which, among other things is working on a calculation tool to ensure consistency among suppliers’ self-reported emissions accounting. It also intends to participate in the Greenhouse Gas (GHG) Protocol Supply Chain Initiative, which will develop a methodology for quantifying and reporting product life cycle and supply chain GHG emissions.

It would be easy to hide behind the lack of standardised approaches to measuring and reporting supply chain emissions. So hats off to HP for seizing the initiative.

Will we hear cries of “foul”? Or will other manufacturers now follow suit?