2014 Corporate Responsibility Report

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Our approach to corporate responsibility

IBM pursues the highest standards of corporate responsibility, from how we support and empower our employees, to how we work with our clients, to how we govern the corporation. In this section, you will find more detail about our approach to corporate responsibility and corporate citizenship.

IBM has been in business for more than 100 years, a length of time that speaks to the sustainability of our business practices and to our ability to transform ourselves as markets and industries change. We have nearly 400,000 employees and do business in more than 170 countries. And we have a supply chain of more than 18,000 suppliers. Our definition of corporate responsibility includes such diverse aspects as environmental responsibility; social responsibility to our workforce, clients and business partners; innovation to address critical societal needs in the communities in which we operate; and a culture of ethics and integrity — guided by a rigorous system of corporate governance — that promotes transparency on a global basis.

IBM’s large and complex operations involve a vast ecosystem of stakeholders, including shareholders, employees, suppliers, non-governmental organizations, public officials and community organizations. Exceeding the expectations of all of these varied interests is part of our corporate culture and integral to our business strategy. None of these stakeholders is considered secondary to another. They all are equally important, and we believe that all should benefit from IBM’s operations. Thomas Watson Jr., IBM’s second chairman and the son of its founder, put it this way: “Corporations prosper only to the extent that they satisfy human needs. Profit is only the scoring system. The end is better living for us all.”

IBM is pioneering many of the technologies that are driving global business and societal progress, from cloud computing to mobile technologies, and from big data to analytics. Our research and development organization, IBM Research, spends nearly $6 billion each year to fund research on technologies that address urgent human needs. IBM has led the US list of patent recipients for 22 straight years and in 2014 set a record for earning the most patents ever in a single year (7,534).

“IBM's patent leadership over more than two decades demonstrates our enduring commitment to the kind of fundamental R&D that can solve the most daunting challenges facing our clients and the world,” says IBM Chairman, President and CEO Ginni Rometty.

Guiding principles

We follow four guiding principles in our corporate responsibility efforts:

Alignment to values — A company must be true to its values in all of its activities — both internal and external. IBM’s core values have remained consistent and are embedded in all our citizenship activities. These values are:

  • Dedication to every client’s success
  • Innovation that matters, for our company and for the world
  • Trust and personal responsibility in all relationships

Our senior management is ultimately responsible for our economic, environmental and societal performance, as well as compliance with laws, regulations and the corporate policies that govern our operations and practices worldwide. This responsibility begins with our CEO and includes the IBM Board of Directors and its committees that regularly review performance and compliance.

A Corporate Responsibility Steering Committee, made up of executives from all relevant global functions across IBM, coordinates our corporate responsibility activities. Chaired by the vice president of Corporate Citizenship and Corporate Affairs, the Steering Committee includes members from human resources, employee well-being, corporate governance, environmental affairs, governmental programs, supply chain and corporate citizenship. Through all of our community efforts, as through our business pursuits, we seek to provide meaningful leadership in creating solutions, bringing them to scale and making them sustainable. We also believe that good corporate citizenship is good for business. For example, strong communities and strong schools go hand-in-hand with strong business enterprises, which are directly connected to jobs and economic growth. This is how our good corporate citizenship can produce real value for society and all of IBM’s stakeholders.

“To build a smarter planet — and to run a smarter enterprise — it turns out that your business and citizenship strategies must be more than aligned. They must become one. This is a fairly novel way to look at business — and at corporate responsibility. It’s very different from checkbook philanthropy or even traditional notions of ‘giving back’ or CSR. And speaking as an IBMer, I believe it comes from the core of our culture, values and purpose as an enterprise — to be essential to our clients and to the world,” says Rometty.

Cross-sector collaboration — We work closely with the public and private sectors, including local, regional and national governments, nonprofit organizations and school systems. We engage with highly qualified public and civic entities that are deeply committed to solving problems, finding solutions and bringing them to scale.

Solving problems by leveraging the full range of our company resources — Finding and implementing solutions that can help attack problems at their roots requires full utilization of IBM’s technologies and expertise. For this reason, we favor rolling up our sleeves and being intimately involved over just writing checks. We collaborate with people, companies and governments across sectors and silos to concentrate efforts on fewer, more comprehensive programs that can help address issues that no single entity can manage alone.

Impact and measurement — Whether it’s taking on some of the unique and complex problems of the world’s cities or developing schools that prepare students for 21st-century careers, we endeavor to affect widespread, measurable and sustainable change. We measure that change by developing a set of comprehensive desired outcomes and key performance indicators for each program we initiate. To maximize the impact of our investments, we plan for the longevity and sustainability of our solutions by ensuring that they are scalable and transferable.

Stakeholder engagement

At IBM, stakeholder engagement is integral with business engagement and collaboration — working shoulder-to-shoulder with communities, governments, investors, and the social sector. Here are a few examples:

  • In education, IBM has forged key partnerships with governments, school districts, postsecondary education institutions and corporate partners in an innovative initiative to close the skills gap and blaze a clear pathway from high school to college and career. We understand that collaborations and partnerships are essential to overcoming societal challenges that are too big for any single entity or industry sector to manage alone. That's why IBM works with a variety of education stakeholders — including teachers, labor leaders, corporations and nonprofit organizations — to help bring about transformative and sustainable change to benefit the greater society. As a former deputy chancellor of the New York City Public Schools, and recent appointee as a trustee of the State University of New York, IBM Corporate Citizenship and Corporate Affairs Vice President Stanley S. Litow brings a unique set of skills and deep personal commitment to our education initiatives. Corporate Citizenship Director Maura Banta — formerly chair of the Massachusetts Board of Education for Elementary and Secondary Education, now serving on the Massachusetts Board of Higher Education — also leverages her knowledge and expertise in the education sector on behalf of IBM's initiatives.
  • IBM collaborates with a select group of entities in efforts to improve population health. Dr. Kyu Rhee represents IBM on the board of the Robert Wood Johnson Foundation and has worked closely with the foundation to build a multi-stakeholder collaboration that focuses on public health in the communities where we live and work. Dr. Rhee also provides consultation to the Institute of Medicine on various health issues. Dr. Lydia Campbell is a member of the Centers for Disease Control and Prevention Foundation Corporate Roundtable, where she focuses on building strong public-private partnerships to tackle challenges such as responding to the Ebola crisis.
  • IBM has continued its collaboration and partnership with the Nature Conservancy (TNC) in several ways, including partnering with it to develop and refine a technology system aimed at helping to preserve the Amazon rainforest. IBM also participates in the Latin American Conservation Council (LACC), which works with TNC to develop strategies for the design and implementation of projects aimed at addressing water security, sustainable food security and smart infrastructure. IBM Chairman, President and CEO Ginni Rometty is a member of the LACC of the Nature Conservancy.
  • Each year, IBM meets with representatives of the socially responsible investment community to discuss our corporate responsibility report. IBM's vice president of Corporate Citizenship and Corporate Affairs leads the discussion, which highlights IBM's service programs on specific societal issues, including the environment, community economic development, education, health, literacy, language, and culture. Mr. Litow also serves as president of the IBM International Foundation, a private foundation wholly owned and funded by IBM that is charged with developing and funding educational, cultural, and other initiatives on a global level.

IBM actively seeks to work with organizations that take similar approaches to local, national and global corporate citizenship and sustainability. We often play a leadership role in these organizations, which in turn influence our approach to corporate responsibility. Some of the organizations we work with are listed below:

  • Business for Social Responsibility
  • Carnegie Endowment for International Peace
  • Committee Encouraging Corporate Philanthropy
  • Center for Climate and Energy Solutions
  • Corporate Responsibility Association
  • Council on Foreign Relations
  • CSR Asia
  • CSR Europe
  • Electronic Industry Citizenship Coalition
  • European Academy of Business in Society
  • Meridian International Center
  • Points of Light Institute Corporate Council
  • The Conference Board
  • The Conservation Fund
  • The Environmental Law Institute
  • The Nature Conservancy
  • US Chamber Foundation Center for Corporate Citizenship
  • US Chamber of Commerce
  • United Way
  • Wildlife Habitat Council
  • World Environmental Center