Yes. 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.


Our supplier audit process is an essential component of our risk assessment framework and a key mechanism for improvement with our suppliers. Supplier audits measure conformance with all provisions of the HP Supplier Code of Conduct in the areas of labor, health and safety, environmental, ethics, and management systems.


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.


We also work with our final assembly suppliers to confirm they are conducting risk assessments of companies in their own supply chains that represent approximately 80% of their spend and assuring 25% of sites determined to be high risk, based on the RBA Code of Conduct.


In addition to the audit process, we engage with suppliers through:

  • The supplier self-assessment questionnaire (SAQ). This includes detailed questions around social and environmental management and practices. As well as assisting HP to evaluate risk, identify areas for improvement, and determine a firm’s inclusion in our audit program, self-assessment helps suppliers become more familiar with HP’s expectations of conformance to our supplier code of conduct. During 2020, 167 production suppliers and 13 nonproduction suppliers completed SAQs.
  • Coaching, specialized training, data collection, and ongoing dialogue. Using these mechanisms, we aim to help suppliers develop robust management systems to address root causes of key risks and challenges; 
  • Key performance indicator (KPI) monitoring program. We collect data from high-risk suppliers weekly on key issues such as working hours, day of rest, and student workers, and collaborate to drive ongoing improvement.
  • Supplier audits. Our supplier audit process is an essential component of our risk assessment framework and a key mechanism for identifying opportunities for sustained improvement with our suppliers. Supplier audits measure conformance with all provisions of the HP Supplier Code of Conduct in the areas of labor, health and safety, environmental, ethics, and management systems. We also worked with our final assembly suppliers to confirm they are conducting risk assessments of companies in their own supply chains that represent approximately 80% of their spend and auditing 25% of sites determined to be high risk, based on the RBA Code of Conduct.
  •  Supplier sustainability assessments. 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) and health and safety (including fire safety and emergency preparedness).

 

In 2021, we completed 189 audits of production suppliers, product reuse and recycling vendors, and nonproduction suppliers, as well as 24 other assessments of production suppliers. Travel and factory restrictions, as well as office closures related to COVID-19, decreased our ability to conduct these activities. During the year, 88% of production supplier audits were third-party certified RBA Validated Assessment Program (VAP) audits.


We see a wide range of maturity levels in our audits, which are scored on a scale of 0–200. In the RBA Factory Lead Certification Program, suppliers with scores from 160 to 180 are eligible for a Silver certification, and those with scores above 180 for a Gold certification (including 36% of supplier facilities audited in 2021). Over time, we have seen supplier audit scores increase. From 2019 to 2021, the percentage of production supplier initial audits and full re-audits that scored above 160 increased from 45% to 50%. The average score during that period rose from 140 to 149. Twenty-three audits during 2021 were of final assembly supplier sites. Of these, 14 (61%) scored over 160, eight (35%) scored between 100 and 160, and one (4%) scored under 100. The other 103 audits during 2021 were of commodity supplier sites. Of these, 63% scored over 160, 27% scored between 100 and 160, and 10% scored under 100. (Segments do not add up to 100% due to rounding.)


We periodically increase our expectations of suppliers, so suppliers must continually improve to maintain a consistent audit score. For example, in 2021 we adopted version 7.0 of the RBA Code of Conduct, which includes requirements related to worker voice and training, pregnant and nursing women, process chemicals, and water management. During that year, we also added new environmental requirements to our Supplier Responsibility Scorecard.


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 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 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

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