Executive Briefings

IBM to Require Suppliers to Measure Carbon Footprint

IBM recently said that it will require its 28,000 suppliers in more than 90 countries to install management systems to gather data on their energy use, greenhouse gas emissions and waste and recycling.

Those companies in turn must ask their subcontractors to do the same if their products or services end up as a significant part of IBM's $40bn global supply chain. The suppliers must also set environmental goals and make public their progress in meeting those objectives.

"It's clear that there's real financial benefits to be had for procurers across the world to get innovative with their suppliers," said John Paterson, vice president for IBM's global supply and chief procurement officer,. "In the long term, as the Earth's resources get consumed, prices are going to go up. We've already seen large price increases and problems with water."

The initiative follows Wal-Mart's announcement in February that it would require its suppliers to eliminate 20 million metric tons of greenhouse gas emissions from the life cycle of the products it sells.

IBM is not setting numerical goals for its suppliers to achieve. Rather, the goal is to institutionalize data-gathering systems that will collect information on a variety of measures of environmental performance, according to Wayne Balta, the company's vice president for corporate environmental affairs and product safety.

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IBM recently said that it will require its 28,000 suppliers in more than 90 countries to install management systems to gather data on their energy use, greenhouse gas emissions and waste and recycling.

Those companies in turn must ask their subcontractors to do the same if their products or services end up as a significant part of IBM's $40bn global supply chain. The suppliers must also set environmental goals and make public their progress in meeting those objectives.

"It's clear that there's real financial benefits to be had for procurers across the world to get innovative with their suppliers," said John Paterson, vice president for IBM's global supply and chief procurement officer,. "In the long term, as the Earth's resources get consumed, prices are going to go up. We've already seen large price increases and problems with water."

The initiative follows Wal-Mart's announcement in February that it would require its suppliers to eliminate 20 million metric tons of greenhouse gas emissions from the life cycle of the products it sells.

IBM is not setting numerical goals for its suppliers to achieve. Rather, the goal is to institutionalize data-gathering systems that will collect information on a variety of measures of environmental performance, according to Wayne Balta, the company's vice president for corporate environmental affairs and product safety.

Read Full Article