HP Releases Living Progress Report Today

This post is sponsored by HP. Opinions are my own. 

For updates on HP's progress toward human, environmental and economic improvement, check out the video below:

Today HP releases its latest Living Progress report.

Living Progress is the name HP chose for its corporate social responsibility (CSR) reporting efforts. So, why living progress? The hardware giant issued its first Global Citizenship Report in 2001, but it felt that this terminology was not sufficient for what the company was trying to do.

At that time, CEO Meg Whitman wrote:

"This new framework builds on our commitment to global citizenship, which has been one of our corporate objectives for nearly six decades. Here at HP, we are committed to advancing the overall health and well-being of people, helping businesses and economies thrive, and strengthening the environment. It’s this focus on balancing all three elements of human, economic, and environmental progress that enables us to create true Living Progress."

The term living progress helps HP measure and manage people, planet and profit simultaneously, something we know a thing or two about around here.

In its first Living Progress report, HP shared its progress on carbon management (the carbon footprint was down 16 percent from 2012) and published its water footprint for the first time. On the human side, HP continued its efforts on human rights and led the charge to source conflict-free minerals for supply chain needs. HP also considered its customers through special privacy initiatives and its employees through a variety of wellness campaigns.

What's new in 2014?

The most impressive thing about this year's report is its increased focus on governance and stakeholder engagement. I love to see this because completing the communications loop in sustainability reporting is an important part of the reporting cycle, one many organizations neglect. The idea is to not just send out the sustainability report, but to seek continual feedback from stakeholders about whether or not the reported material is relevant, useful and timely and use this information to inform future reports.

HP has tackled this complicated issue -- receiving feedback, in a number of in-person and virtual engagements, from the highest levels like Chief Progress Officer Gabi Zedlmayer speaking at NYC's climate week, down to helping individual customers with their green procurement challenges.

We've seen this process in action at HP -- TriplePundit worked with HP on three separate Twitter chats with company stakeholders to discuss the Living Progress report (First in June of 2014, then October 2014 at SXSW Eco and finally this past April). It has been a pleasure to witness true stakeholder engagement over time and watch the process evolve.

When it comes to the human, environmental and economic commitments embodied in the Living Progress report, HP has a number of great stories to tell.

The human strand demonstrates a number of deeper engagements, from a new commitment to require direct employment of foreign migrant workers throughout the supply chain to a 15 percent improvement in Social Accountability International's Social Fingerprint benchmark, making HP among the top tier. HP also employed hundreds of thousands of people at supplier sites it audited through the Supply Chain Responsibility program. These efforts demonstrate how the Living Progress framework is helping HP find new ways to engage and protect workers throughout the supply chain.

Human commitments didn't stop with employees and supply chain workers. HP also invested in its customers, helping them meet new green procurement requirements. This engagement has a real financial return behind it: $24 billion in existing and potential business revenue.

On the environmental side, HP and all hardware manufacturers have a unique challenge: To grow means to sell more products, which can make it difficult to maintain or reduce carbon and water footprints. HP tackles this challenge on a per-product basis, with a focus on producing more energy-efficient products that help customers save energy. These include the water-cooled HP Apollo 8000 System, which uses 28 percent less energy than air-cooled servers, saving up to 3,800 tons of carbon dioxide equivalent annually. The company also released a new, thinner, paper produced from FSC-certified feedstocks. While this paper doesn't contain recycled content, the reduced weight lowers the carbon intensity of shipping. More importantly, the paper won't jam like many recycled paper products.

HP has also taken increased responsibility for safe recycling and reuse of its products, a very exciting update. This year the company added a new closed-loop process for polypropylene -- new inkjet cartridges are made entirely from material recycled by customers. There is now some recycled plastic in more than 75 percent of HP inkjet cartridges shipped for commercial sale. The hardware manufacturer also recovered 157,500 tons of hardware (including HP and non-HP products) and supplies. Of this amount, HP was able to repurpose 39,100 tons of hardware units, and it recycled the rest.

Another example of HP's triple-bottom-line approach is its partnership with Kiva, through which the HP Company Foundation provides every employee with a $25 credit to lend. Almost 120,000 employees used their credits through December 2014. Of course the HP Company Foundation could just give this money directly, and it did give additional funds to Kiva (a total of $5.9 million was given). But, by empowering employees to give, and give to causes they feel passionately about, HP engages its whole workforce in the giving process.

But how does it compare?

CSR reports should be judged not only against a company's past performance, but also how they stack up to the competition. Of course, one of the challenges facing all who seek to compare apples to apples in the sustainability space is that each company reports on its sustainability progress on its own terms, so direct comparisons are difficult. Nevertheless, it's important for any organization to understand what and how its closest competitors are managing sustainability.

Two of HP's key competitors (according to Yahoo Finance) are Dell and Accenture. Dell, another computer hardware manufacturer, make sense. Accenture, a consulting firm, was a surprise for me to see. Accenture calls itself the world’s largest independent technology services provider, which speaks to the connections between this firm and a hardware company like HP. As the hardware world becomes more and more competitive, companies like HP will differentiate themselves by offering enterprise solutions (servers, data management), and the increasing differences between these services and the printer-and-ink game are part of the reason HP is soon to split into two companies.

Accenture has rightly chosen to focus on its 323,000 employees in its sustainability report.  The company's marquee program is Skills to Succeed, a job-training program, which the consulting firm has offered to over 3 million people. The firm is also taking efforts to reduce its own environmental impact, mainly through reductions in employee travel, which is an appropriate place for a consulting firm to place its efforts.

Christiana Figueres, executive secretary of the United Nations Framework Convention on Climate Change (UNFCCC), has only good things to say about the firm:

"By exerting pressure on their suppliers, they have used their influence to improve the sustainability performance of entire supply chains. In turn, suppliers have come to realize that improved performance can confer competitive advantage – not only making them more efficient, but also more attractive to sustainability inclined customers."

Dell shares a remarkable amount about its sustainability performance, especially for a private company. While we can only estimate its market cap, Dell shares a great many details about its sustainability performance online. Dell tracks its 2014 performance against 2020 goals it set for itself. The 2020 Legacy of Good Plan is Dell's commitment to reach clear and measurable goals around sustainability and corporate social responsibility -- and this framework clearly galvanizes the organization in a similar way to Living Progress. I appreciate how easy it is to find Dell's numbers, and how close at hand they are.

Both Dell and HP use the GRI reporting guidelines to inform their reporting and use them well. It's interesting to see how different their reports are, given that they are in the same industry and use the same reporting guidelines. HP uses a PDF and videos to tell its story, listing highlights at the beginning and details down the line throughout the report. Dell, on the other hand, organizes its sustainability reporting through a website. Numbers good and bad are at the touch of a finger. The color and structure of each report speaks to the company's personality as much as to their sustainability performance.

While HP gears up for a split this year into two Fortune 50 companies --  Hewlett Packard Enterprise and HP Inc. -- at the present time both organizations are gearing up to continue the Living Progress program, at least in spirit if not in name.

"This shift also presents a unique opportunity to examine the full breadth of our Living Progress impact worldwide, and to streamline our strategy to optimize return on our citizenship investments. In 2014, we began conducting a strategic review of our Living Progress initiatives to ensure we are maximizing capacity, providing for future growth opportunities, and enabling continued contributions to society. Building on our 75 year heritage and more than a decade of reporting, citizenship will continue to be integral to both companies."

I've said it before and I'll say it again, sustainability programs must include some kind of tangible return, or they'll be cut as soon as the wind shifts. It's exciting to see HP focus on connecting economic return to social and environmental well-being. The Living Progress report certainly demonstrates the benefit of the integrated approach and one hopes that it will live on in both HP Inc. and Hewlett Packard Enterprise.