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HP sustainability reports are always a meaty read which provide an interesting insight on the performance and impact of one of the world’s largest tech companies. 2010 marks HP’s 10th annual report and while it doesn’t disappoint as an interesting read it does cause pause for both admiration and concern in almost equal measure.

First the good news: HP delivers 2.5% reduction in energy consumption and 9% reduction in greenhouse gas emissions from direct operations. The improvements were driven by efficiencies associated with the EDS integration, other corporate initiatives and the purchase of green credits. Frustratingly though, HP is unable to report 2010 supplier manufacturing energy and greenhouse gas data and existing estimates for this and transportation appear to be just this - estimates.  HP have had really stellar results in their operating performance but we really have no idea if the carbon & energy savings have just been merely displaced elsewhere on the value chain. HP also reported that the Carbon Disclosure Project had marked down its score in the CDP leader index to 66% from 89% the prior year.

Now the not so hot news: Investment in social innovation does not seem to be keeping pace with the rest of the business which reduces HP’s ability to showcase its technology and inspire on how technology can change the world. For instance, technology donations collapsed by a whopping 50% in 2010 and yet cash donations increased by 23%. Finding the ways and means to distribute technology, provide after donation support and monitoring is more challenging than writing a fat check but its the most relevant and appropriate social intervention HP can make. Rate of supplier ethics audit has declined 29% since 2008 but HP reports that excessive working hours at supplier facilities remains a high concern. With the intensification of supplier engagement and the additional publicity associated with key HP supplier Foxconn one might expect supplier ethical audit activity to increase rather than shrink.  At a rate of just 92 audits a year it will be difficult for HP to stay abreast of manufacturing labor issues let alone start to get to grips with the emerging issue of conflict resources. Supplier transparency - as previously posted here HP is to be applauded for publishing a list of suppliers. But prioritizing transparency by spend volume rather than risk rather missed the point for the needed transparency. For example, HP publishes a case study on its remedial work to help Foxconn improve its performance yet Foxconn does not appear on the list of strategic suppliers published. This picture has become more muddied over time. When HP first started publishing its supplier details in 2007 it said that its list represented 95% of spend but just 25% of suppliers. We are no longer told what percentage of suppliers are declared and whether they are high risk or not but somehow I doubt if listed Intel, Microsoft, Seagate or Sony are deemed high risk on social responsibility.