Dionne highlights the commercial benefits to manufacturers of having strong environmental policies and requirements in place.
How can good environmental performance be good for business?
A good example of this is energy conservation. We all understand the environmental benefits of energy conservation. Not only do we reduce environmental impacts associated with extraction and burning of fossil fuels, but we also eliminate carbon-dioxide emissions that can contribute to global warming.
However, businesses have a much bigger motivation to reduce their energy consumption, and that is cost savings. In IBM’s case, we achieved a 3.4% energy saving in 2005 through energy-efficiency improvements. These efforts, along with use of renewable energy, avoided the emission of more than 156 000 tons of carbon dioxide and other combustion-related gases.
However, equally important to our business was the US$10.6 million IBM saved in energy costs as a result of these energy-efficiency improvements.
Similarly, efforts to reduce pollution through actions such as reducing waste and recycling can save tremendous amounts of money, as well as providing environmental benefits.
IBM estimates that over the last eight years, annual savings from its focus on pollution prevention and design for environment have exceeded environmental expenses by an average of two to one.
How has IBM managed to instil environmental responsibility into the culture of its corporation?
IBM has a long history of environmental leadership. The company first established a corporate policy on environmental protection in 1971, and it has been updated several times since then.
The policy is issued by our chief executive officer and is supported by a comprehensive global environmental management system. IBM’s corporate environmental affairs policy calls for environmental affairs leadership in all of the company’s business activities.
The policy objectives range from workplace safety, pollution prevention and energy conservation to product design for the environment, continual improvement of our management system and performance, and the application of IBM’s expertise to help address some of the world’s most pressing environmental problems.
The policy is supported by corporate directives that govern IBM’s operations worldwide. These directives cover areas such as chemical and waste management, energy management, environmental evaluation of suppliers, product stewardship, and incident prevention and reporting.
Every employee is expected to follow IBM’s environmental policy and report any environmental, health or safety concern to IBM management. Managers are expected to take prompt action.
In 1997, IBM became the world’s first major multinational to earn a single worldwide registration to the ISO 14 001 Environmental Management System standard.
The registration covered IBM’s manufacturing, product design and hardware development operations across its business units worldwide. IBM has since expanded its global ISO 14001 registration to include its chemical-using research locations.
What environmental challenges do you think manufacturers will face in the future? And what can they do about them now?
Manufacturers face a number of environmental challenges in the future, both in conventional environmental areas associated with production processes and sites, and with environmental issues associated with products.
Increasingly, manufacturers must deal not only with the environmental impacts of their own operations, but also understand and mitigate upstream environmental impacts associated with their suppliers, as well as downstream environmental impacts associated with product use and, ultimately, disposal.
This focus on the life-cycle environmental impacts of products and services results in real challenges for manufacturers as these impacts are often difficult to understand and quantify, and they are typically outside manufacturers’ normal operational control.
There are several ways these impacts can be addressed. First and foremost, we need to design products with a view toward their full life-cycle environmental impacts. By designing better products with environmentally preferable materials that can be re-used and recycled, we can have a direct effect on upstream and downstream impacts associated with our products and services.
In order to do this, we need better communication, both with our suppliers and our customers.
We need better information from our suppliers on the materials and processes that they use in making components that we purchase.
At the same time we need to communicate our requirements in a better and more understandable form, and reward those suppliers that help us accomplish environmental goals by giving them more of our business.
We also need better information from our customers on how they use our products, and what they do with them when they no longer need them. And we need to provide them with better information on how to minimise environmental impacts through proper use and disposal.
How do you balance the importance of environmental responsibility with the bottom line?
They are both equally important. Over the long term, you really can’t have one without the other.
Companies that ignore environmental responsibilities will ultimately be put out of business; through inefficiencies associated with pollution and polluting activities, through long-term costs of cleaning up pollution that could have been avoided, and by governments and customers who longer tolerate polluters.
Of course, we must pay attention to the bottom line of the corporation, too, or we will not have money to develop and promote new products and services that could result in even greater environmental improvements.
How have IBM’s environmental policies contributed to the company’s success?
By proactively addressing environmental issues, we not only save money today, but we avoid the longer term costs and liabilities that result from ignoring environmental responsibilities or doing the minimum necessary to comply with laws.
Our environmental record is also important to customers who want to do business with environmentally responsible companies – companies that they know are sustainable over the long term.
What are the most important aspects of environmental management for IBM?
I think that the key aspect of any management system (environmental or other) is making sure that all those involved understand their responsibilities. Essentially, you need to document a process and make sure that you follow that process. I think we do a pretty good job of that in the environmental area at IBM today.
I think the challenge is to continue to integrate environmental responsibilities and requirements further back into the business; to embed them in your normal everyday business. That is a bigger challenge that we continue to work to achieve.
How do you ensure that suppliers to IBM adhere to its environmental policies and standards (both in the US and offshore)?
IBM’s environmental management system includes requirements for its supply chain. IBM has a corporate directive designed to prevent the transfer of responsibility for environmentally sensitive operations to any company lacking the commitment or capability to manage them properly.
In accordance with this directive, IBM conducts substantive environmental evaluations of a relevant subset of its suppliers to focus on their environmental responsibility.
IBM conducts these evaluations for certain production-related suppliers, all of its hazardous waste treatment and disposal suppliers, and all of its product recycling and disposal suppliers world-wide.
The suppliers, and their facilities and methods, are evaluated prior to IBM approving them for use. In order to verify that their environmental operations remain satisfactory, suppliers are re-evaluated periodically.
Any concern during evaluation is addressed with the supplier and must be resolved to IBM’s satisfaction to obtain or maintain IBM approval. IBM’s conformance with these supplier evaluation requirements is part of its comprehensive audit programs.
To address new concerns about recycling operations in the extended supply chain, IBM has expanded the environmental evaluations of its product end-of-life management suppliers to include assessments and onsite evaluations of subcontractors in countries that are not members of the Organisation of Economic Cooperation and Development.
These evaluations are in addition to those conducted in conjunction with IBM’s Supplier Conduct Principles, which include environmental requirements. As part of its environmental management leadership, IBM also encourages its suppliers to pursue registration to the ISO 14 001 Environmental Management System standard.
For information on IBM’s environmental management system go to www.ibm.com/ibm/environment