Responsibility at IBM

2012 Corporate Responsibility Report

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Overview

In this section, Chairman, President and Chief Executive Officer Ginni Rometty’s letter describes how IBM’s goal to unite its business and citizenship strategies is taking shape. We take a thoughtful, comprehensive approach to corporate responsibility and corporate citizenship at IBM, and we integrate that approach into many aspects of our company. In this section you will also find a high-level overview of some of our major activities.

Communities

It’s not enough to develop world-class technology, services and expertise—at IBM we realize we must directly apply these things to the communities in which we live and work in order to have a positive impact. In this section, you will find examples of the ways we practiced this approach over the course of 2012 and into 2013.

The IBMer

A great company is forever evolving and growing. At IBM, we make it a top priority to hire, support and retain the people who make us a great company. In this section, you will find examples of the ways we support both the personal and professional development of our employees.

Environment

IBM’s unwavering commitment to environmental protection is evidenced across all of our business activities, from our research, development, products and services to the solutions we provide our clients that help them be more protective of the environment. In this section of IBM’s Corporate Responsibility Report, you will find information on our environmental programs, performance and solutions during 2012.

Supply Chain

Social and environmental responsibility is an important part of our business relationships with our suppliers. We work closely with them to encourage sustained improvement throughout our global supply chain and across various aspects of corporate responsibility. In this section you will find examples of how we set requirements for the companies we do business with, grow the global diversity of our supply base and collaborate with industry groups and stakeholders.

Governance

IBM’s culture of ethics and integrity is guided by a rigorous system of corporate governance. In this section, you will find examples of the many ways we govern the conduct of the company, manage risk and contribute our expertise to public discourse.

Awards & Metrics

Many of our corporate responsibility efforts received recognition from others in 2012. The most significant of these are listed in “Awards and Recognition.” We rely on a number of metrics to measure our corporate responsibility efforts. Our Key Performance Indicators and other significant metrics can be found in “Performance Summary.”

Product Stewardship

IBM’s Product Stewardship program was established in 1991 as a proactive and strategic approach to the environmental design and management of our products. The program’s mission is to develop, manufacture and market products that are increasingly energy efficient; can be upgraded and reused to extend product life; incorporate recycled content and environmentally preferable materials and finishes; and can be recycled and disposed of safely.

Framework

IBM’s product stewardship objectives and requirements are implemented through IBM’s Global Environmental Management System (EMS), internal standards, product specifications and other requirements in IBM’s Integrated Product Development process. Product environmental attributes such as energy efficiency, materials content, chemical emissions testing, design for recycling, end-of-life management plans and packaging data must be documented and reviewed in IBM’s Product Environmental Profile (PEP) tool at various checkpoints during the development process.

Compliance management tools like the Product Content Declaration for IBM Suppliers support the assessments required for a complete PEP prior to product release. IBM’s design and compliance controls, including a specification for Baseline Environmental Requirements for Supplier Deliverables to IBM, Product Content Declarations and compliance assessment protocols are managed by an interdisciplinary team with representatives from all IBM organizations that design, manufacture, procure, deliver and service our product offerings. The team’s activities are coordinated by IBM’s Center of Excellence for Product Environmental Compliance.

Planning and Design

IBM’s System z® development engineers are designing products that will be offered in 2016 and beyond. This requires anticipation of future environmental requirements and proactive partnerships with our suppliers to develop technology roadmaps with sound material selection strategies.

In advance of regulatory developments, IBM imposed prohibitions on benzyl butyl phthalate (BBP), dibutyl phthalate (DBP) and bis (2-ethylhexyl) phthalate (DEHP) above 0.1 percent in our suppliers’ deliverables. These substances were identified by the European Union (EU)’s Registration, Evaluation, Authorization and Restriction of Chemicals (REACH) Directive as Substances of Very High Concern (SVHCs), and their continued use in cables and other IT components would require authorization under the directive. Rather than pursue continued authorization to use the substances, IBM’s hardware organization modified the internal PEP tool to incorporate mandatory transition plans for products containing these compounds. All new requirements for development were reflected in updates of IBM’s environmental product specifications for suppliers.

In product specifications related to the requirements of the EU’s Restriction of Hazardous Substances (RoHS) Directive, IBM Engineering Specifications 53P6233 and 97P3864 were updated to reflect new provisions of the recast RoHS Directive (2011/65/EC) and to proactively prohibit several exemptions well ahead of their official expiration dates.

These exemptions include lead (Pb) in linear incandescent lamps with silicate coated tubes (expiring September 2013), cadmium in certain color-converting LEDs for display systems (expiring July 2014), and cadmium in photoresistors for analog optocouplers in professional audio equipment (expiring December 2013).

In addition, the specifications inform suppliers that IBM will eliminate lead (Pb) in solders that complete a viable electrical connection between the semiconductor die and carrier within integrated circuit flip chip packages by July 1, 2014, though this exemption currently has no expiration date in the law. These and other exemptions from the materials restrictions were officially included in the RoHS Directive because reliable alternatives were not available when the Directive was published. IBM and our suppliers continue to work to eliminate the exempted uses where practical, and ahead of official expiration dates.

In 2012, all of our product brands also successfully completed the phase-out of uses for lead (Pb) in compliant pin connector systems other than c-press connectors and lead (Pb) in dielectric ceramic for capacitors in more than 200 distinct product offerings. IBM’s development organizations gained experience with a custom, smart data management interface called the Exemption Tracking Tool, designed by IBM to assess the need for any critical exemptions and drive conversions toward RoHS exemption-free parts in all of IBM’s current and future product materials. The Exemption Tracking Tool consolidates documentation on the parts and suppliers affected by each expiring exemption of the RoHS Directive, along with documentation on the conversion plans for those parts and the qualification status of the corresponding exemption-free replacement parts.

Orchestration and Execution

The rapid pace of new requirements for electrical and electronic equipment in global markets is reflected by IBM’s need to notify suppliers of 91 new or modified laws affecting our hardware and/or chemical product offerings in 2012. More than 6,000 individual communications to suppliers covered topics like the EU’s REACH Directive, new requirements for implementing the recast RoHS Directive and the US Toxic Substances Control Act.

To address the increasing demands of due diligence, IBM’s Integrated Supply Chain organization enhanced its Quality Management System to integrate product environmental compliance reviews into its supplier audit processes. The objective of these enhanced audits is to ensure that suppliers keep pace with the cadence of worldwide regulations and can provide all necessary technical documentation to substantiate conformance to environmental requirements.

2012 Product Stewardship Goals and Performance

Recycled Plastics

Recycled plastic used in IBM’s products can range from 25 to 100 percent by weight of the commercial resin. In 2012, 25.5 percent of the total weight of plastic resins procured by IBM and its suppliers through IBM’s corporate contracts for use in IBM’s products were resins that contained between 25 and 100 percent recycled content. Comparing only the weight of the recycled fraction of these resins to the total weight of plastics (virgin and recycled) purchased, 12.6 percent of IBM’s total weight of plastic purchases in 2012 was recycled plastic versus the corporate goal of 5 percent recyclate.

Use of Landfills

IBM’s product end-of-life management operations worldwide processed 36,100 metric tons of end-of-life products and product waste, and sent only 0.3 percent of the total to landfills or to incineration facilities for treatment, versus IBM’s corporate goal of minimizing its combined landfill and incineration rate to no more than 3 percent of the total amount processed.



Product Energy Efficiency*

Servers*

IBM System p®: IBM released two models of Power Systems™ servers, the Power® 770 and 780, for which previous models or generations existed. These new servers provide reductions of 10 to 58 percent in the typical power consumption per unit of relative performance compared to their previous generation system. In addition, the power supplies were upgraded from 80 PLUS® Gold to 80 PLUS Platinum certified power supplies.

IBM System x®: The 11 System x servers announced in 2012 for which comparison models existed provide reductions in watts/MTOPS** (the Japan Energy Saving Law metric) of 18 to 93 percent over the previous generation. All servers were announced with 80 PLUS Platinum certified power supplies. Five of the servers reduced power use by 50 percent or more when idle, and 10 servers by 32 percent or more.

IBM System z: IBM announced the new IBM zEnterprise® EC12 with a radiator-based air-cooled system and optional water cooling. The air-cooled system delivers a 48 percent improvement in capacity per watt and the water cooling option delivers a 57 percent improvement as compared to the previous generation z196. The system also offers a high-voltage DC power option which improves system efficiency by 3 percent through the elimination of two power conversions.

Storage Subsystems*

IBM announced the new IBM System Storage® DS8870 in 2012 that reduces energy use by 20 percent over the previous generation DS8800 system and reduces the power use per gigabyte of capacity by 35.9 percent. The system also incorporates a power supply which would qualify for the 80 PLUS Gold level but does not qualify because it is a multi-volt power supply. IBM continues to improve storage performance through the use of mixed-drive systems with capacity and throughput improvements and optimization driven by software capabilities such as Easy Tier,® thin provisioning and storage virtualization.

* IBM’s product energy goal is to continually improve the computing power delivered for each kilowatt-hour (kWh) of electricity used with each new generation or model of a product.
** MTOPS-million theoretical operations per second is a calculation of machine operations based on a specified formula.
Note: The above table no longer includes performance information for Point-of-Sale terminals as IBM sold the Retail Store Solutions division in 2012.

Product Energy Efficiency

Product energy efficiency has long been one of IBM’s environmental and climate protection objectives. It was formalized as one of the company’s corporate objectives when IBM’s Product Stewardship program was established in 1991. We have initiated and invested in innovations and integrated solutions through collaboration between IBM Research and our product development teams. These teams have combined hardware and software innovations to improve the energy efficiency of IT equipment and data centers.

IBM also actively assists in the development of external product energy efficiency standards. As we did in 1992 when we helped to develop and were a charter member of the United States Environmental Protection Agency (US EPA) ENERGY STAR® Computer program, IBM is currently participating in the development of the ENERGY STAR specifications for server, storage and network devices, and providing technical assistance and equipment-operating data to assist in the development of criteria.

In March 2013, the US EPA finalized Version 2 ENERGY STAR program requirements for computer servers; the requirements for products covered by Version 1 will go into effect in December 2013. Version 2 also creates new product categories for blade servers and resilient servers, and eligible systems can be qualified upon the publication of the Version 2 requirements.

As of April 2013, IBM had 19 Version 1 qualified server systems available on the market—four System p and 15 System x enterprise server systems. These servers meet the US EPA’s requirements for power supply efficiency, idle power limits or power management capability and data reporting. A list of IBM ENERGY STAR qualified servers may be found on the IBM and ENERGY STAR web page. IBM intends to qualify its System p and System x servers to the ENERGY STAR Version 2 requirements, including the addition of blade and resilient servers.

New advancements for increased product energy
efficiency performance

The following are examples of new IBM technologies, software and solutions that have enabled the increased energy efficiency of IBM’s servers and storage products:

IBM System x

IBM announced new server solutions designed to expand cloud and analytics capabilities, helping to make Smarter Computing a reality for IBM System x x86 server clients. IBM's new portfolio of x86 computing solutions includes the following:

  • The IBM BladeCenter® HS23 offers an integrated virtualization platform with built-in system management which ships preconfigured with servers, storage, and networking integrated into a BladeCenter chassis. BladeCenter Foundation for Cloud offers 62 percent more computer power and four times more memory compared to previous generation technologies enabling clients to run 20 percent more virtual machines, making more efficient use of the system hardware and reducing the energy needed to complete a given set of workloads.
  • The IBM System x3550 M4 delivers four times more memory, 33 percent more storage capacity, 18 percent better performance/power capability (as measured by the Japan Energy Law metric), and more virtual machines. The server has an 80 PLUS Platinum certified power supply and reduces energy consumption by 50 percent when no workload is present.

The energy use reduction benefit of IBM System x products is exemplified by an IBM System x3650 M3 server installation at a large UK financial services firm. IBM migrated 84 percent of the existing physical environment to a new virtualized server and storage environment, upgrading to energy efficient IBM System x3650 M3 servers. As a result, 66 physical servers were consolidated to just six servers across two sites, plus an additional nine IBM hosts to provide the new virtual environment. In the four weeks following completion of the project in April 2012, overall power consumption had been reduced by 37 percent. This equates to a projected savings of approximately $46,000 per year and the avoidance of almost 13 metric tons of CO2 emissions.

IBM PureSystems™

A completely new product offering for 2012, PureSystems combine automated systems management expertise and pre-loaded/pre-tuned application software with open, scalable hardware systems that help maximize system utilization and reduce the total number of servers required in the data center. By eliminating lower utilization servers, PureSystems allows companies to consolidate their IT operations and enable continued application/user growth without significant hardware system additions. Increased utilization leads to a smaller real-estate requirement, lower energy costs and lower systems management costs.

The IBM PureFlex™ System, (part of the IBM PureSystems product family) combines computation, storage, networking, virtualization and management into a single infrastructure system. The table that follows illustrates the levels of facility space and energy use savings that can be achieved by consolidating older server/storage systems onto the integrated, virtualized PureFlex platform. The cost calculations are based on six user installations employing the full range of SAP applications. Results are based on a set of before and after calculations for each installation.

Examples of IBM PureFlex System Savings

PureFlex System % Less
InstallationConsolidation TypeFacilitiesEnergy
IT Services CompanyMixed Platforms92%87%
Manufacturing Company 1Unix Servers94%94%
Distribution CompanyUnix Servers80%78%
Retail CompanyMixed Platforms66%59%
Manufacturing Company 2x86 Servers80%71%
Diversified Companyx86 Servers65%68%
Average for All Installations89%85%
 

IBM System z:

IBM announced the zEnterprise EC12, our next generation System z server, in August 2012. System z servers offer a host of capabilities that can drive energy efficiency in the data center: high levels of virtualization and utilization, static power savings mode for idle processors, a DC power option and optional water cooling.

The zEC12 can help provide better control of energy usage in the data center, offering a selection of energy efficient infrastructure options to complement the ability to run many workloads at high utilization. A static power savings mode allows for turning off processors that are not being used. The Unified Resource Manager monitors power use and provides trend reporting of energy efficiency for the entire system infrastructure. The zEC12 and zBX (zEnterprise BladeCenter Extension) includes a water-cooling option that offers energy savings without compromising performance. Two general examples of System z’s energy efficiency benefits based on use of the previous generation systems are provided:

  • A large insurance firm consolidated 3,000 distributed, largely underutilized servers onto Linux virtual servers running on IBM System z mainframes. By consolidating their distributed infrastructure to a private cloud supported on a handful of z196 and z10 servers, the client achieved an 80 percent reduction in power, cooling and floor space requirements—even as its application landscape has grown considerably. The company also expects to manage the majority of its 30 percent annual growth in computing requirements by provisioning new virtual servers on the existing System z cloud infrastructure.
  • A major transportation operator wanted to upgrade its IT systems to meet the challenge of maintaining safe, secure and cost-effective air traffic control services in an increasingly busy airspace. To ensure 24/7 availability for these applications, the client migrated them to a private cloud environment hosted on an IBM zEnterprise 196 mainframe with the IBM zBX. The installation shrunk the data center footprint by 80 percent and reduced energy consumption by 58 percent.

Storage systems

IBM continues to enhance our portfolio of storage systems, utilizing and improving various software-based data management capabilities such as Easy Tier, thin provisioning and storage virtualization which can reduce the storage hardware and energy footprint and the number of terabytes required to accomplish a given storage task. IBM also disclosed the DS8870 metric results for the Storage Networking Industry Association (SNIA) Emerald™ Power Efficiency Measurement Specification, the first disclosure for a storage system under that specification.

In 2012, IBM made a significant step to incorporating solid state disk (SSD) storage systems into our product lines with the acquisition of Texas Memory Systems (TMS). We plan to incorporate TMS products into our PureSystems prepackaged hardware systems, as well as into other storage, server and software product lines. SSDs offer performance and reliability advantages over traditional spinning disk based systems and have a significantly smaller power profile, making for more energy efficient systems.

High Performance Computers (HPC)

IBM offers a full range of purpose built and “off-the-shelf” technical computing (supercomputer) solutions. IBM’s supercomputer solutions are prevalent on both the TOP500® and Green500™ supercomputer lists. As of November 2012, six of the top 10 and 21 of the top 25 most energy efficient supercomputers in the world are built on IBM high-performance computing technologies. IBM HPC systems also occupy six of the top 10 spots and 10 of the top 25 spots on the November 2012 TOP500 list of the world’s top supercomputers. Technologies developed through IBM’s HPC development efforts are leveraged across the entire IBM Systems and Technology Group product line to improve performance and energy efficiency.

The speed and expandability of IBM’s HPC products have enabled business and the scientific community to address a wide range of complex problems and make more informed decisions in the life sciences, astronomy, climate, system simulations and modeling, and many other applications. The use of HPC systems also enable simulations of activities, such as crash testing, vehicle or airplane designs, and fuel burners, without the need to expend physical resources on prototypes or physical testing. IBM continues its leadership performance in a space-saving, power-efficient HPC package to address the most demanding performance applications. Two examples follow:

  • One of the world’s premier research universities implemented an IBM HPC solution to expand its computing capacity from 9 to 21.5 teraflops, increase the flexibility of the system to support and facilitate a more diverse range of research work beyond the previous, primary mission of climate research while also reducing power consumption and increasing efficiency. The upgraded system automatically powers on and off, depending on need and usage, reducing the power use and the CO2 emissions footprint of the system.
  • A major supercomputing center in Germany built an HPC system incorporating IBM System x iDataPlex Direct Water Cooled dx360 M4 servers with more than 150,000 cores to provide a peak performance of up to three petaflops. A revolutionary new form of hot-water cooling technology invented by IBM allows the system to be 10 times more compact, removes heat 4,000 times more efficiently than air, and substantially improves peak performance while consuming 40 percent less energy than a comparable air-cooled machine. The integration of hot-water cooling and IBM application-oriented, dynamic systems management software allows energy to be captured and reused to heat the buildings during the winter on the sprawling campus—and provides savings of $1.2 million per year.

Innovations in semiconductor manufacturing

IBM Research and IBM Systems & Technology Group continue to drive innovation in semiconductor technologies to increase computing and storage capacity while reducing the energy required for a given functionality. Two recent innovations:

  • IBM Research has developed flexible, low-power circuitry that can be built on metal oxides, referred to as strongly correlated materials. These materials can be induced to change their ability to transmit electricity, establishing the state of a cell by switching the material state from a conductor to an insulator or vice versa. The approach promises to be more energy efficient than standard silicon transistors as the resulting strongly correlated material transistors would not need to have power constantly applied to maintain their state.
  • IBM has developed a process to place more than 10,000 transistors made from carbon nanotubes (CNT) onto a single chip. While significantly below current silicon-based circuit densities of more than a billion circuits on a processor, the development is an important next step in commercializing CNT-based processor technologies. CNT circuits are smaller and can potentially carry higher current densities than silicon circuits and offer a potential replacement for silicon-based processors as silicon technologies reach their physical limits.

Product Recycling and Reuse

As part of our product end-of-life management (PELM) activities, IBM began offering product takeback programs in Europe in 1989, and has extended and enhanced them over the years. IBM’s Global Asset Recovery Services organization offers Asset Recovery Solutions to commercial customers in countries where we do business. These solutions include:

  • Management of data security and disk overwrite services
  • Worldwide remarketing network for product resale
  • State-of-the-art refurbishing and recycling capability for IT equipment
  • Optional logistic services, such as packing and transportation

In many countries and US states, we offer solutions to household consumers for the end-of-life management of computer equipment, either through voluntary IBM initiatives or programs in which we participate.

In 2012, IBM worldwide PELM operations processed 36,100 metric tons of end-of-life products for reuse or recycling. This represents 66 percent of the estimated 54,300 metric tons of new IBM IT equipment put on the market in 2012, up from 60 percent in 2011. The increase was primarily attributable to a reduction in the weight of equipment put on the market by IBM, due to the divestiture of our Retail Store Solutions business during 2012.

product end-of-life management operations; 36,100 metric tons total

Product End-of-Life Management (PELM)

3%

Goal
Reuse or recycle end-of-life products such that the amount of product waste sent by IBM’s PELM operations to landfills or to incineration for treatment does not exceed a combined 3 percent of the total amount processed

0.3%

Result
In 2012, IBM’s PELM operations sent only 0.3 percent to landfills or to incineration facilities for treatment

IBM’s voluntary environmental goal is to reuse or recycle end-of-life products such that the amount of product waste sent by our PELM operations to landfills or to incineration facilities for treatment does not exceed a combined 3 percent of the total amount processed. In 2012, IBM worldwide PELM operations continued to send less than 1 percent (approximately 0.3 percent) to be landfilled or incinerated for treatment worldwide.

Of the total processed by IBM’s worldwide PELM operations during this period, 53.1 percent was recycled as materials, 35.9 percent was resold as products, 8.2 percent was reused by IBM, 2.5 percent was incinerated for energy recovery, and 0.3 percent was sent to landfill or incinerated for final disposal.

Of the total 36,100 metric tons of product and product waste processed through IBM’s worldwide PELM operations, approximately:

  • 44 percent was processed in North America;
  • 30 percent in Europe, the Middle East and Africa;
  • 19 percent in Asia Pacific; and
  • 7 percent in Latin America

IBM’s corporate-wide requirement for the environmental evaluations of the company’s PELM suppliers was established in 1991, an expansion of our supplier environmental evaluation program introduced in 1972. We evaluate these suppliers prior to doing business with them and every three years thereafter. Our objective is to use only those suppliers that have a strong focus on environmental management, including complying with laws and regulations as well as sound management practices. More about IBM’s requirements for our PELM suppliers may be found in the Environmental Requirements in the Supply Chain section of this report.

From 1995, when we first began including product recovery in our annual corporate environmental report, through the end of 2012, IBM has documented the collection and processing of approximately 880,000 metric tons (over 1.9 billion pounds) of product and product waste worldwide.

880,000 metric tons

of product and product waste collected and processed for reuse and recycling from 1995 through 2012

IBM Worldwide PELM Operations:
Total Annual Quantity Processed

(Metric Tons)
YearTotal Processed
2008 42,600
2009 38,000
2010 36,700
2011 38,000
2012 36,100

Product Packaging

IBM has had a program focused on the environmental attributes of our product packaging since the late 1980s. Under the program, IBM packaging engineers design solutions that minimize toxic substances and packaging waste by specifying nontoxic materials and inks. We keep packaging to a minimum while continuing to provide protection to the product being shipped to clients, and collaborate with suppliers to use recycled and recyclable materials and promote reuse.

The design of rugged products and other optimization measures for the efficient use of product-protective packaging are addressed within IBM’s Product Stewardship program and associated engineering specifications. Efficient use of product packaging and less tangible environmental benefits associated with improvements in transportation efficiency are tracked through this program.

IBM’s environmental requirements for product packaging are included in our Environmental Packaging Guidelines, which were first published in 1990 and have been updated as needed over the years. Key elements of IBM’s Packaging Guidelines have also been embedded in various engineering specifications and procurement documents, which extend their reach beyond IBM to include our supply chain and other business partners. The following supplier environmental packaging requirements are accessible from the Information for suppliers website:

  • IBM Packaging requirements, 2006 as amended
  • Engineering Specification(ES) 5897661: Recyclable packaging materials, selection and identification, 2012
  • ES 5897660: Packaging materials, essential requirements, restricted heavy metals and other substances of very high concern, 2011
  • ES 37L8024: Wooden packing, materials treatment and marking requirements, 2009

IBM’s environmental packaging requirements incorporate a list of the most commonly used packaging materials. Each is evaluated on a variety of environmental criteria. Shippers are required to use materials that provide the best overall product protection and value, but when all else is equal they are required to choose the material that has the least possible adverse effect on the environment. The materials listed are based on practical and regulatory experience and customer feedback.

Other environmental areas addressed in the packaging requirements include:

  • Ozone depleting substances;
  • Restricted heavy metals and other materials of concern;
  • Source reduction;
  • Re-useable packaging systems;
  • Recyclable packaging; and
  • Conserving natural resources.

IBM’s Recyclable Packaging Materials Selection
and Identification specification

IBM's corporate Recyclable Packaging Materials Selection and Identification specification was updated in May 2012. The global specification applies to all primary, secondary and tertiary packaging for products, devices, parts, sub-assemblies, materials and supplies purchased by IBM for use in our manufacturing and distribution operations. It also applies to all packaging used in protecting, handling, or the marketing of IBM products, parts and supplies, including those manufactured by an original equipment manufacturer.

The objectives of the specification are:

  • To establish parameters for the recycled content to be included in corrugated and plastic packaging
  • To reduce or eliminate the use of non-recyclable materials or material compositions that prevent the recycling of IBM packaging after use
  • To promote recycling by providing information (in the form of markings) that will increase the likelihood that our packaging materials will be recycled

The specification applies, but is not limited to, the following type of packaging materials and components:

  • Molded and fabricated cushions (of any plastic resin)
  • Corrugated fiberboard and paperboard
  • Rigid and flexible plastics (bags and wraps)
  • Wooden pallets, crates and skids

Protective product packaging

In 2012, our integrated worldwide packaging engineering team saved an estimated 1,400 metric tons of packaging materials through the implementation of 50 packaging redesign projects for parts and assemblies shipped from suppliers to manufacturing operations, and for packaged finished products supplied to clients worldwide. All environmental project data are submitted into the IBM Packaging Savings Database to track overall performance and details of ongoing annual costs and environmental savings delivered. The total annual materials and transport cost savings reported in 2012 was nearly $17.3 million. The following are highlights of a few of the projects implemented:

  • The second-tier chassis supplier for IBM’s Power Systems servers ships packaged parts to the first-tier fabrication supplier for additional manufacturing value-add. In these shipments, the packaging from the first shipment was discarded and new packaging was used to subsequently transport the finished goods from the first-tier fabrication supplier to IBM for final customer configuration.

    Working with both suppliers, IBM arranged for the packaging from the second-tier chassis supplier to be reused by the first-tier supplier to transport the completed assembly to IBM, thereby eliminating one set of packaging. In addition, the thickness of the polyethylene bag used to protect the equipment from moisture and scratching during shipment was reduced, while still retaining the protective quality. Total savings of 117 metric tons of packaging materials were delivered annually, with total materials and transport costs savings of $288,000 per year.

  • In collaboration with a supplier of planar sub-assemblies for IBM Power Systems, we determined that the corrugated fiberboard cushioning being used could be eliminated because the polyethylene foam was sufficient for cushioning the product. As a result, additional parts are now packed into the original corrugated fiberboard carton. The enhanced design saved nearly 19 metric tons per year in packaging materials, with a combined materials and transport cost savings of $246,000 per year.
  • The IBM System Storage DS2000 and DS3000 series models originally had been packed separately from the accessories on a pallet. After packaging design enhancements, the accessories were able to be combined into a single, smaller corrugated fiberboard carton for shipment to clients. This redesign saved 9.5 metric tons per year of packaging materials and provided a total materials and transport cost savings of $82,000 per year.
  • All IBM System x server switch assemblies were shipped from IBM’s manufacturing sites to customers in a corrugated fiberboard carton incorporating polyethylene (PE) cushioning. Our packaging design engineers were able to reduce the overall dimensions of the carton and replace the PE cushion with a lighter, but stronger, thermoformed PE cushion, made from 100 percent post-consumer recycled polyethylene. These design initiatives saved 3.4 metric tons per year of corrugated fiberboard and plastic packaging materials, with an annual combined materials and transport cost savings of $274,000. Similar projects were implemented globally across different products during the year.

Suppliers are also applying these types of new design specifications for IBM and with other customers to deliver tangible benefits across the integrated supply chain.

Over the last five years, IBM has reported combined environmental savings of over 6,200 metric tons of product packaging materials from redesign projects implemented by the engineering packaging team worldwide. The total materials and transportation cost savings was approximately $60.4 million over the same period, benefiting IBM, parts suppliers and clients globally.

IBM’s requirement for sourcing packaging materials

We established IBM’s voluntary environmental requirement for the responsible sourcing of paper and paper/wood-based packaging in 2002. It required that the paper- and wood-based packaging directly acquired by IBM be procured from suppliers that source from sustainably managed forests, where such sources exist.

When this goal was first established, sufficient quantities of sustainably sourced paper and packaging materials were not yet available for much of the company’s needs. With a continued focus on this objective by IBM and our suppliers over the years, since 2010, 99 percent of the paper/wood-based packaging IBM procured worldwide has come from suppliers that contractually warranted that the source was derived from forests managed in an ecologically sound and sustainable manner. This requirement is now incorporated into our standard supplier specification for paper/wood-based packaging.

1,400
metric tons

2012 savings in packaging materials through new or redesigned packaging solutions

$17.3 million

Associated savings in materials and transport costs

Product Safety and Hardware Compliance

IBM's product safety and hardware compliance requirements are integrated within various steps of the product development, test, manufacturing and delivery processes. Each product completes the required product safety, electromagnetic compatibility, telecom and wireless regulatory compliance reviews as part of IBM's Product Safety Review Board process, ensuring newly announced or modified products comply with applicable hardware compliance standards. The review board process also ensures that products comply with applicable national regulations, and that IBM obtains any third-party or national certifications required by law. Our Integrated Supply Chain organization helps us ensure that our suppliers provide hardware that is compliant with current international and national requirements.

Programs for continual improvement include both internal and third-party assessment of IBM’s product safety and hardware compliance design, development and product controls implementation. These assessment results are fed back into the development and conformity assessment process for future products. In addition, product safety and regulatory compliance incident review programs provide effective capture, investigation and remediation of product safety-related incidents.

IBM plays a leading role in the development of national, regional and international product safety, electromagnetic compatibility and conformity assessment standards for IT products.

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