HP measures supplier performance in order to understand issues at the supplier level and identify trends across our supplier base. We track supplier issues and trends through our assurance program, which includes both comprehensive audits using HP’s Supplier Code of Conduct and focused assessments in specific high-risk areas such as the use of foreign migrant workers. We also collect specific metrics around working hours, day of rest, student workers, and other labor indicators with key suppliers in our KPI (Key Performance Indicator) program.
Supplier audits are an essential component of our risk assessment framework. Audits measure conformance with the HP Supplier Code of Conduct and help drive ongoing improvements in our suppliers’ social and environmental performance.
Every year, we evaluate a list of suppliers that make up 95% of HP’s production supplier spend. We then look at geography, type of manufacturing, and external information sources such as news and NGO reports to determine which suppliers require an on-site audit. The audit format follows the Validated Audit Process (VAP), a collaborative approach that reduces the burden on our suppliers by avoiding multiple audits. The VAP meets the need for a high-quality, consistent, and cost effective standard industry assessment of labor, health and safety, environmental, and ethics practices based on the Responsible Business Alliance (RBA) Code of Conduct and relevant laws and regulations.
In 2018, we completed 150 audits and other assessments of production, nonproduction, and product transportation suppliers. Supplier audits cover all provisions of our Supplier Code of Conduct in the areas of labor, health and safety, environmental, ethics, and management systems. They are scored on a scale of 0–200.
The RBA considers scores above 160 to be in near full conformance with the RBA code. In the newly developed RBA Factory LEAD Certification Program, suppliers with scores from 160 to 180 are eligible for a Silver certification, and scores above 180 for a Gold certification.
RBA Online is an online sustainability data management system designed to help RBA members and their suppliers manage and share sustainability data, including from audits and self-assessment questionnaires that assess risk at the corporate, facility and supplier level. Please see the HP Code of Conduct and RBA Validated Audit Program (VAP) Operations Manual.
In addition to comprehensive audits, we conduct targeted assessments to supplement our comprehensive audits, focusing on specific risk areas including:
• Vulnerable workers, such as student, dispatch, and foreign migrant workers
• Health and safety, including fire safety and emergency preparedness
• Supplier sustainability management system maturity
• Supplier environmental performance
Through our Key Performance Indicator (KPI) program, we require our high-risk suppliers to provide data on working hours, vulnerable workers, and other labor metrics weekly. We share this information with supply chain executives and procurement managers for quick identification and correction of issues as needed.
Finally, we view input from external stakeholders as a valuable additional source of information.
For more information about progress achieved in our supply chain please see our Sustainable Impact Report and website at: http://www8.hp.com/us/en/hp-information/global-citizenship/index.html