Foxconn Bags 50% of HP's AIO PC Orders for 2014

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Date: Thursday February 20, 2014 11:55:15 am
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    Foxconn Bags 50% of HP's AIO PC Orders for 2014
    These extra orders will raise Foxconn's share in PC segment

    by CIOL Bureau

    MUMBAI, INDIA: Foxconn, leading manufacturer of computer components and systems, today announced that, it has bagged 50 per cent of Hewlett-Packard's (HP) AIO PC orders for 2014.

    HP has moved all-in-one PC orders from Quanta Computer, Pegatron Technology and Wistron to Foxconn Electronics for 2014.

    The extra orders are expected to raise Foxconn's all-in-one PC shipments to 1.5-2 million units in 2014.

     

    Encouraging Supplier ‘Ownership.’

    Hewlett-Packard, which sells imaging and printing systems, computing systems and information technology services worldwide, recently adopted a similar scorecard system for measuring suppliers' social and environmental responsibility (SER).

    HP has been working with its suppliers on SER issues for more than a decade. The company assesses social and environmental risks in its supply chain based on location, procurement category, company information and external stakeholder reports, including a pollution database run by the nonprofit Institute of Public & Environmental Affairs in China.

    HP's supply chain program has traditionally focused on audits, but that approach “has not necessarily encouraged a sense of ownership by suppliers of SER performance,” HP said in a report on its approach to supply chain responsibility.

    In 2013, the company began trying to encourage more ownership of SER issues by requiring suppliers to schedule and pay for third-party audits and remediation efforts on a regular basis. HP also introduced a five-tier SER rating system that draws on the results of those audits and other SER performance indicators.

    Suppliers that receive higher scores on the SER scorecard will receive more business from HP, while poor ratings could results in a reduction of business.
    Supply Chain Emissions Goal

    Greenhouse gas emissions, which are one of the environmental indicators considered in the scorecard, have been identified by HP as one of five persistent SER issues in the supply chain that require extra attention and investment.

    The company is also starting to place a stronger emphasis on improving environmental performance in other areas, including reducing waste and water use in its supply chain.

    In September, HP became the first company in the IT industry to set an emissions reduction goal for its supply chain.

    By 2020, HP's goal is to drive a 20 percent reduction in first-tier manufacturing and product transportation-related GHG emissions intensity among suppliers, compared with 2010. HP calculates intensity by dividing suppliers' emissions by HP's annual revenue.

    Since the goal was announced, HP has been educating its suppliers about the goal and the company's expectations for how to reach it, starting with China and Southeast Asia, according to Zoe McMahon, HP's director of global social and environmental responsibility.

    “An important thing about the goal from our perspective is it's not something we're putting out there and letting our suppliers abide by,” McMahon told Bloomberg BNA.

    Suppliers also need to understand what good emissions management looks like, she said.

    HP has laid out a series of first steps for helping suppliers meet the emissions goal, including an expansion of its energy efficiency program for manufacturers. HP works with the groups Business for Social Responsibility (BSR) and World Wide Fund for Nature (WWF) to develop energy efficiency programs at supplier factories in Asia.

    The company will also develop new efficiency programs for product transportation and suggest emissions reductions projects for suppliers that have especially GHG-intensive operations, such as LCD panel manufacturers.
    Driving Industry Alignment

    HP's supply chain emissions reduction goal does not include supplier- or country-specific targets, but the goal was set to be consistent with the emissions reduction target included in China's most recent five-year plan, McMahon said.

    “It's about complementing the regulatory regime” in countries like China that have targets, or being a bit more aggressive in countries that don't have targets, she said.

    While local regulations for greenhouse gas emissions and other environmental impacts have a role to play in supplier oversight, McMahon said harmonized approaches from industry can have more impact.

    “What's interesting about environmental standards is that, unlike labor standards, where you have often contested but at least internationally agreed upon standards, you don't have internationally agreed upon environmental limits or standards,” McMahon said. For environmental impacts, there's a range of policies around the world and a range of enforcement, she said.

    “What's more helpful for us as a company is to work with what we consider best practice,” she said.

    HP is currently working with other businesses in the Electronic Industry Citizenship Coalition (EICC) to develop an industry standard for reporting on suppliers' greenhouse gas emissions.

    McMahon said she hopes to drive more industry alignment on the issue because many of HP's suppliers are common to other electronic or IT companies.

    “We're not just influencing our suppliers,” she said. “We're influencing the whole ecosystem of supplier.”

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