IBM implements its environmental, energy and chemical management programs through a global environmental management system that integrates corporate directives governing IBM’s operations worldwide.
Global environmental management system
IBM’s corporate environmental policy calls for environmental leadership in all of the company’s business activities. This leadership is achieved through implementation of a global environmental management system (EMS) that puts IBM’s corporate directives into action. These directives cover areas such as energy conservation and climate protection, product stewardship, pollution prevention, chemical and waste management, and environmental evaluation of suppliers, as well as incident prevention, preparedness, response and reporting. Through the consistent implementation of this EMS, IBM ensures operations are executed with the same protective standards for the environment in every country where we conduct business. Highlights of our management system and resulting environmental performance are outlined throughout the sections that follow.
As noted in IBM’s Business Conduct Guidelines, all IBMers have a role to play in protecting the environment. Every employee is expected to follow IBM’s corporate environmental policy and report any environmental, health or safety concerns to IBM management. Managers are expected to take prompt action when faced with a potential violation of the policy or directives. IBM executives are responsible for the environmental performance of their businesses functions or locations.
Our environmental programs and performance are routinely monitored and results are reviewed annually by all levels of management, up to the Directors and Corporate Governance Committee of IBM’s Board of Directors. This ensures the ongoing suitability, adequacy and effectiveness of IBM’s EMS for IBM’s activities, products and services. Formed in 1993, the Directors and Corporate Governance Committee reviews IBM’s position and practices on significant issues of corporate responsibility, including protection of the environment.
Environmental goals are an important part of IBM’s EMS. We maintain a range of environmental goals designed to address significant environmental aspects and impacts of our operations and to drive continual improvement of our environmental performance. These include goals on energy and water conservation, renewable electricity sourcing, carbon dioxide emissions reduction, product stewardship and waste management. IBM’s voluntary goals and our performance against them are discussed in their respective sections of this report, and a summary of key goals and their outcomes are provided in the listing of IBM’s environmental key performance indicators.
In 1997, IBM became the first major multinational company to earn a single global registration to the International Organization for Standardization (ISO) 14001 environmental management systems standard. We achieved this credential within just one year of the finalization of the first edition of the standard. This was in part due to the results already delivered under our environmental policy, first issued in 1971, and the early implementation of our environmental management programs.
The initial registration covered IBM’s manufacturing, product design and hardware development operations across our business units worldwide. We have since expanded our global ISO 14001 registration to include additional entities such as our research locations that use chemicals, several IBM organizations at a country level, as well as our Procurement and Supply Chain, and Global Asset Recovery Services organizations.
As our business has evolved to include more services offerings, we have updated our EMS to address environmental opportunities and challenges in the services area. IBM’s single global ISO 14001 EMS accreditation, with a complete list of registered entities worldwide, can be viewed on IBM’s ISO 14001 webpage.
IBM is currently working to update its management system to achieve conformity with the latest ISO 14001:2015 standard.
IBM issued a formal corporate policy in 1974 that called for the conservation of energy and materials in all of IBM’s activities. Over the intervening years, we improved our global energy management program and integrated it into the company’s global EMS.
When ISO issued the ISO 50001 standard on energy management systems in June 2011, IBM set forth a strategy to achieve verification of conformity of our EMS against this newly published standard.
Within one year of the issuance of the ISO standard, we achieved ISO 50001 registration of our energy management program at the corporate level as an integral component of IBM’s global EMS. Our approach recognizes and leverages the fact that IBM’s existing EMS addresses both environmental and energy management.
Following our successful ISO 50001 registration at the corporate level, many of IBM’s major energy-consuming locations and one country organization received registration of their specific energy programs under IBM’s single global ISO 50001 certification. As of year-end 2016, 16 entities were registered under IBM’s global ISO 50001 certification — 12 in the Americas, three in Europe and one in the Asia Pacific region.
IBM’s Corporate Policy on Environmental Affairs also calls for the company to publicly disclose information on our environmental programs and performance. This report marks IBM’s 27th consecutive year of annual corporate environmental reporting.
In addition to providing information on our environmental programs and performance in this report, we provide a report based on the Global Reporting Initiative and supply information through a number of other voluntary reporting programs and tools, such as CDP, EcoVadis and OneReport. For more details on IBM’s environmental reporting, see the IBM environmental reporting, disclosure and verification webpage.
At IBM, engaging and collaborating with stakeholders from a cross-section of nongovernmental organizations, governments, investors and other interested parties is integral to our worldwide EMS. We publicly disclose information on our environmental strategy, goals and targets, performance, and continual improvement activities widely through our voluntary reporting programs discussed above. In addition, IBM has a formal system for tracking and responding to inquiries from interested parties on environmental issues.
IBM’s community outreach programs include support of and participation in local environmental projects and education efforts including Earth Hour, Earth Day, and World Environment Day, as well as site environmental awareness events and local clean air activities focused on the use of public transportation options.
IBM also engages its supply chain on environmental initiatives. For example, IBM is a founding member of the Electronic Industry Citizenship Coalition (EICC), a nonprofit industry group which helps manufacturers support continuous improvement in the social, environmental and ethical responsibility of their supply chains. IBM requires its suppliers to adhere to the EICC Code of Conduct, which contains environmental requirements, as well as provisions on labor, health and safety, ethics, and management systems.
Another important element of IBM’s stakeholder engagement strategy is our collaborative work with business partners, clients, universities and other organizations to apply IBM technologies and solutions to solve many of the world’s most challenging environmental problems. You will find examples of IBM’s collaborative innovation throughout this report and in the section on solutions for environmental sustainability.
Voluntary partnerships and initiatives
IBM is strongly committed to participation in voluntary programs, and we have founded or joined many voluntary initiatives and partnerships with governments and environmental nongovernmental organizations (eNGOs) over the years.
Some current government examples include the U.S. Environmental Protection Agency’s (EPA) ENERGY STAR and SmartWay programs, the European Union (EU) ENERGY STAR program, and the EU Code of Conduct for Energy Efficiency in Data Centres.
Examples of partnerships with eNGOs include our membership in the Center for Climate and Energy Solutions, our participation in Best Workplaces for Commuters, and our collaboration with The Nature Conservancy and the World Resources Institute. In 2016, we joined the Business Renewables Center and the Renewable Energy Buyers Alliance. We also work with and support organizations such as The Conservation Fund, the Environmental Law Institute, and the World Environment Center.
In addition, we partner with other companies and institutions to foster solutions for environmental sustainability. In 2016, IBM became a founding member of the SMARTer2030 Action Coalition. In 2017, IBM joined the U.S. Water Partnership.
IBM has been a longstanding member of the Wildlife Habitat Council (WHC), a nonprofit organization dedicated to protecting and enhancing wildlife habitat. The WHC helps large landowners, particularly corporations, manage their open lands in an ecologically sensitive manner for the benefit of wildlife. Five IBM sites in the United States currently have their wildlife habitat management and conservation education program certified by the WHC — our corporate headquarters in Armonk, New York; IBM’s site in Boulder, Colorado; IBM’s Research Triangle Park (RTP) site in North Carolina; and two sites in San Jose, California (IBM Research-Almaden and our Silicon Valley Laboratory). At our RTP site, IBM partnered with local Eagle Scouts in 2017 to build a community garden — including seven garden beds (totaling approximately 200 square feet) in an 880-square-foot dedicated space — in a courtyard between two buildings. The garden will provide an opportunity for employees to take an outdoor break to tend to the garden and harvest fresh vegetables. In addition, it will benefit the environment, as the blooms in the garden and the screening shrubs will provide a food source for pollinators. The site plans to donate unpicked produce from the garden to a local food bank.
Environmental investment and return
Over the past five years, IBM has spent $71.2 million in capital and $428.6 million in operating expense to build, maintain and upgrade the infrastructure for environmental protection at its locations, and to manage its worldwide environmental programs.
Environmental capital and expense worldwide
($ in millions)
IBM has tracked environmental expenses related to our facilities, corporate operations and site remediation efforts for 30 years, and began publicly disclosing this information in our environmental report for 1992. In 2016, total environmental expenditures associated with IBM’s operations were $75.9 million. Reductions in environmental expenditures were primarily a result of IBM’s divestiture of its semiconductor manufacturing operations in July 2015.
IBM also estimates savings it has realized from its environmental leadership practices. These include savings from recycling, packaging improvement initiatives, waste reductions, and from energy, material and water conservation. Ongoing savings from previous years’ initiatives are not carried over in this calculation, yielding conservative estimates.
In addition, IBM realizes avoidance of costs that likely would occur in the absence of its EMS. These savings are difficult to quantify, so a reasonable attempt has been made to estimate them. In 2016, IBM’s combined, estimated environmental savings and cost avoidance worldwide totaled $99.4 million.
IBM’s experience has shown that annual savings from its focus on conservation, pollution prevention and design for the environment consistently exceed environmental expenses, demonstrating the value of proactive environmental programs and leadership performance.
2016 environmental expenses worldwide
($ in millions)
|Superfund and former IBM site remediation||21.6|
|Waste and materials recycling||5.3|
|Waste treatment and disposal||4.3|
|Surface water and wastewater management operations||3.4|
|Consultant and legal fees||1.4|
|Product takeback and recycling costs||0.4|
|Groundwater protection operations||0.2|
|Other environmental operations||5.1|
2016 estimated environmental savings and cost avoidance worldwide
($ in millions)
|Energy conservation and cost avoidance||50.7|
|Location pollution prevention operations||20.0|
|Compliance cost efficiency*||13.7|
|Spill remediation cost avoidance***||4.9|
|Potential fines, penalty and litigation avoidance****||1.9|
|Superfund and site remediation efficiencies||0.8|
* Compliance cost efficiency considers costs avoided through proactive efforts to stay ahead of environmental regulations and requirements.
** Savings or costs avoided by having internal professional staff and tools versus using external consultants and tools.
*** These savings are estimated considering IBM’s actual experience with remediation costs.
**** The estimation for the avoidance of potential fines, penalties and litigation does not include cost avoidance of potential business interruption or fines related to noncompliance with product environmental laws and regulations (e.g., EU REACH or RoHS requirements).
Chairman’s Environmental Award Program
IBM established the Chairman’s Environmental Award Program in 1991 to encourage leadership and recognize achievement and progress in environmental affairs on the part of IBM’s organizations. For more than 25 years, the Chairman’s Environmental Award has promoted the contributions of IBM’s business units toward the objectives of IBM’s Corporate Policy on Environmental Affairs.
Recipients of the Chairman’s Environmental Award are selected based on their degree of leadership, initiative and results in contributing to IBM’s environmental policy objectives. Performance against these criteria is evaluated against each nominee’s opportunity to contribute given its mission and operations. IBM’s chairman presents the award to an executive from the recipient business unit at a gathering of IBM senior executives from all business units.
IBM’s Real Estate Strategy and Operations (RESO) organization received the 2016 Chairman’s Environmental Award. RESO manages IBM’s global real estate portfolio, made up of office, data center, manufacturing, development and lab space.
During the three years covered by the Chairman’s Environmental Award nomination, RESO achieved the following results:
While only one organization is selected each year to receive the Chairman’s Environmental Award, the competition highlights the company’s worldwide commitment to environmental leadership.