In today's innerconnected world, global companies are working to ensure their extended supply chains are acting in a socially responsible manner. The following information outlines for our suppliers IBM's requirements relating to supply chain social responsibility.
From its inception over a century ago, IBM has been based on a set of fundamental values. IBM's values shape and define our company and permeate all of our relationships--between our company's people and our shareholders, our clients, the communities where our people live and work, and among our network of suppliers.
Within our supply chain relationships, we know that our company's sizable purchasing power is a unique resource that we must manage responsibly, and we do. IBM spends over $3 billion a year with diverse suppliers, for example--greater than any other technology company. Yet more than managing our spend, we have a responsibility to hold ourselves--and our suppliers--to high standards of behavior. This means complying with all applicable laws and regulations. But it goes beyond that. It entails a strong commitment to work with suppliers to encourage sound practices and develop sound global markets.
We have always maintained an open channel of communications with suppliers to set expectations. Today, in an increasingly interconnected world market, the expectations for all players across the entire supply chain are high. The electronics sector (including the supply chain of goods and services) remains the center of attention with regard to supply chain social responsibility. Expectations and legislation are increasing, such as the growing concerns about conflict minerals, anti-slavery and human trafficking, and other important social responsibility issues.
Effective March 2013, IBM is using the Electronic Industry Citizenship Coalition (EICC) Code of Conduct (hereby called the EICC Code) as the single code with our supply base. The EICC Code supersedes the IBM Supplier Conduct Principles, which was used from 2004-2013. The EICC Code establishes for our suppliers the minimum social responsibility standards we expect from them as a condition of doing business with IBM.
Our goal is to work with our suppliers to foster full compliance as they, in turn, apply these standards to their extended sources of supply engaged in the production of goods and services for IBM. We will consider these standards and adherence to them in our selection process and will seek ongoing compliance by actively monitoring performance. IBM reserves the right to take action with suppliers that do not comply with the EICC Code and may consider measures such as reducing or ending business in accordance with contract terms.
No company is an island. We know this very well when it comes to business collaboration--but it applies especially to areas of social responsibility. Business leadership in today's interconnected global marketplace requires finding a way to positively influence all supply chains--not just your own--to adopt a common set of standards for socially responsible behavior.
That's why IBM and nearly ninety electronic goods, software, and services companies have created and endorsed an Electronic Industry Code of Conduct. This establishes a standards-based approach to setting objectives and measuring compliance across several areas of social responsibility, including labor, health, safety, protection of the environment, ethics, and management systems.
A core activity of the EICC is working with companies across multiple tiers in the supply chain to foster a common understanding of what socially responsible business practices are and then aligning the interests of all constituents around industry standards to encourage sound practices of social responsibility in the global marketplace. As a participant in the industry group that developed the code, we want our suppliers to know that IBM fully endorses this code and invites our extended supply chain to adopt the EICC Code and to consider joining the organization to take full advantage of its resources.
For more information, please contact:
John Gabriel, manager of supply chain social responsibility and chair emeritus of EICC
The linked presentation was created to provide additional information relating to IBM's supply chain social responsibility program and supplier compliance audits. This information is intended to help suppliers understand IBM's activities in these areas and to provide the means for successful code compliance demonstration.
IBM recognizes the adverse impacts associated with mining in conflict regions. We will not tolerate products in our supply which contain minerals that directly or indirectly finance or benefit armed groups in the Democratic Republic of Congo or adjoining countries. IBM expects our suppliers and, in turn, their suppliers to adhere to the EICC code of conduct and only source minerals from responsible sources. We seek to participate in industry initiatives to create and deploy supply chain verification processes (such as EICC/GeSI Due Diligence Tool and Conflict-Free Smelter Program) to confirm that the minerals in our supply chain come from responsible sources.
Parties may use the IBM Global Procurement Ombudsman office to confidentially communicate concerns to IBM regarding circumstances of mineral extraction, trade, handling, and export in a conflict-affected area that may not have been uncovered through conventional means of supply chain due diligence.
For additional information on conflict minerals and resources available from the Electronic Industry Citizenship Coalition (EICC), please visit the EICC Web site (select 'Minerals Extraction' from 'Tools and Resources' menu).