{"id":21701,"date":"2017-11-12T22:14:49","date_gmt":"2017-11-13T03:14:49","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/supply-chain-sustainability-at-intel\/"},"modified":"2017-11-12T22:14:49","modified_gmt":"2017-11-13T03:14:49","slug":"supply-chain-sustainability-at-intel","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/supply-chain-sustainability-at-intel\/","title":{"rendered":"Supply Chain Sustainability at Intel"},"content":{"rendered":"

Rising pressures from climate change present an array of strategic and operational risks for companies and their supply chain. According to the World Economic Forum, the environmental risks of highest concern in the next ten years are water shortage, weak climate change response, and extreme weather [1]. In 2016, 40% of filed shareholder resolutions related to environmental and sustainability issues, demonstrating the rising concern of companies related to climate change [2]. In addition to climate-related risks, there is increasing social instability and unemployment. These social trends exasperate the impact of environmental disasters.<\/p>\n

\"\"<\/a><\/p>\n

Climate change presents unique challenges for companies as decisions made today tie directly to future risks as the impact of climate change is cumulative. Carbon dioxide and other greenhouse gases can stay in the atmosphere for hundreds of years and higher concentrations of these gases lead to increased global temperatures and shifts in weather patterns [3]. However, it is difficult for companies to assess how they should respond to such risks. Two challenges that complicate climate change responses are the sheer magnitude of change required and the inherent \u201cfree rider\u201d problem [4]. It is unclear who should help foot the cost the climate change initiatives and if regulatory or market forces should help address the problem.<\/p>\n

Intel is a technology company, specializing in semiconductors, with a global footprint and vast supply chain. Semiconductor production requires the use of fluorinated gases, which is frequently targeted in climate change policies and restrictions for its impact on global warming [5]. As such, climate change and supply chain sustainability is a critical risk and concern for Intel. Intel\u2019s management believes global climate change is a serious environmental, economic and social challenge and has set forth efforts and plans to respond accordingly [6]. In the short term, Intel has instituted a Supply Chain Responsibility program, to reduce risks associated with climate change in the supply chain. To support these efforts, Intel has established key performance indicators for environmental sustainability and supply chain responsibility. Metrics include total water withdrawn (billions of gallons), energy use (billion kWh) and greenhouse gas emissions (million metric tonnes of CO2 <\/sub>equivalent).<\/p>\n

An additional component of Intel\u2019s efforts is its Program to Accelerate Supplier Sustainability (PASS). PASS includes commitments to compliance, transparency and capability-building. All suppliers are given access to educational resources, including webinars on a range of critical topics. As of 2016, Intel reported participating suppliers represented over 69% of its supply chain spending [7]. As part of PASS, suppliers are asked to participate in a supply chain survey that assesses their climate change risk and opportunities to improve transparency.\u00a0 PASS includes Responsible Mineral Sourcing for Tin, Tantalum, Tungsten and Gold [8]. To ensure these efforts are honestly represented and communicated, Intel completes on-site audits for its 75 top suppliers with assessments on 300 factors. In the next two years, Intel aims to have 90% of its suppliers in PASS meeting advanced expectations. Additional short term goals include 85% \u201cgreen\u201d Intel ground transportation fleet and continue 100% green power in U.S. operations [9].<\/p>\n

In the medium term, management has set corporate goals to further environmental sustainability and supply chain responsibility. Climate change-related goals include [10]:<\/p>\n