THE 2005 COMPUTER REPORT CARD 

Introduction

Silicon Valley Toxics Coalition (SVTC) and the Computer Take Back Campaign (CTBC) are pleased to release the 2005 Computer Report Card. The Computer Report Card, issued by SVTC since 2000, tracks the progress that computer and electronics companies are making on social and environmental indicators, including materials policy, supply chain management, take back programs, and end-of-life management of their products. By providing this information to the public, and to the companies themselves, we hope to improve the social and environmental performance of the brands. We believe that these companies must set and achieve the highest performance standards for labor rights, environmental protection, and human rights; just as they do for computing speed, functionality, size and product innovation.

This past year SVTC and CTBC created a survey for manufacturers of business and consumer electronics to measure the progress of these companies in protecting public health, worker safety and the environment. The scores of the report are limited to the companies that returned the survey.  During the span of this annual report card we have seen some limited progress in key indicators such as toxic materials reduction, recycled content, and recoverable content.  The greatest challenge has been creating standards that can adequately measure progress in a rapidly changing and chemically intensive industry with inadequate benchmarks of its own.   

The most alarming trends in the electronics industry in the United States continue to be staunch opposition to producer take back programs (with the exception of two responsible companies) and ongoing use and release of hazardous chemicals throughout the life cycle of electronic products.  This reluctance to adopt and support producer take back systems has impeded the growth of an environmentally and socially protective electronics recycling infrastructure.  In many parts of the United States, depending on where you live in, electronic waste from your community is still being land-filled, incinerated, dismantled in prisons, or shipped overseas where it is causing great environmental harm. Many of the chemicals used in electronic component manufacturing -- such as semiconductors, printed circuit boards, and disk drives -- have not been adequately tested, and workers exposed to these chemicals in these manufacturing plants continue to have high rates of occupational illnesses.

CTBC was formed in Spring 2001 to promote "clean and green" electronics production and responsible end-of-life management through producer responsibility in the US.  Our goal has been to raise the standards in the U.S. to become at least comparable to European and Japanese standards. In that year, the CTBC developed the Electronics TakeBack Platform.  The criteria used to grade the companies' performance are derived from the principles in the platform. (See Appendix I)

Companies graded in this Report Card produce and sell consumer electronics products including desktop computers, laptop computers, televisions, monitors and/or printers.

Background

The high-tech electronics industry is the world's largest and fastest growing manufacturing sector. The current production of electronic products typically uses thousands of toxic chemicals, including solvents, gases, heavy metals and acids:

• lead and cadmium are used in circuit boards;
• lead oxide and barium are found in cathode ray tube monitors ;
• mercury is found in switches and flat screen monitors;
• brominated flame retardants are found on printed circuit boards, plastic casings; and
• polyvinylchloride is found in electronic cables and wires.

Thirty years of irresponsible manufacturing of electronic equipment across the U.S. has resulted in highly contaminated groundwater sites, workers suffering from miscarriages, cancer, and other illnesses, and children born with birth defects. Like the processes used to manufacture electronics, electronic waste (e-waste) poses a significant threat to human and ecological health and worker safety due to both the volume of waste produced and the hazardous materials contained therein. E-waste has become one of the fastest growing and most toxic waste streams in the industrialized world.

While there has been some progress in some states and counties in the United States to ban hazardous electronic waste -- such as Cathode Ray Tube Monitors and Televisions --from land-fills, this limited progress remains seriously inadequate to address the labor, environmental, health and human rights problems associated with electronic waste. The vast majority of discarded electronic waste is “recycled” improperly, compromising the health, livelihoods and human rights of communities around the world. Up to 80% of electronic waste is still exported from the US to countries such as China, India, Thailand and Nigeria , where low-wage workers, including children, manually dismantle waste to recover some valuable materials. This results in extreme toxic exposure to the waste workers as well as in serious soil and water contamination.

The use of prison work programs to dismantle electronics is a continuing and disturbing trend in domestic US handling of e-waste. As with export dumping, prison e-waste recycling facilities, such as UNICOR, the Federal Prison Industries, operate in substandard conditions, far removed from public scrutiny.   Publicly subsidized prison facilities, exempt from minimum wage laws, unemployment insurance, adequate health and safety oversight and worker protections, operate as high-tech sweatshops in the US. Prison workers are often forced to use inferior tools, denied adequate safety equipment and the right to organize, paid pennies an hour, and experience retaliation for speaking out about working conditions. 

The high-tech companies who’s billions in profits are generated from the sale of these products, must take responsibility for their impacts from production through disposal. 

Findings

Double Standards within the Same Company

The Report Card results illustrate several things.  One is that companies maintain disparate practices by meeting required higher standards outside of the U.S., yet these same companies do not follow those practices within the U.S..  Europe and Japan have adopted national producer responsibility waste management laws and systems, and all of the companies that participated in this survey abide by the laws in those countries.  As you will see in the results section, many of the companies continue to fight producer responsibility in the US, while some have taken the lead in practicing it here.  The two largest producers of personal computers, Dell and HP, have taken an important step by endorsing the Statement of Principles on Producer Responsibility for US Electronic Waste (See Appendix II).  This Statement calls for aggressive reduction of toxic materials, as well as adoption of Producer Responsibility for electronic waste. While these companies have endorsed the Principles, they are not yet providing universal, free take back of their products. While HP has actively supported producer takeback legislation, Dell has not. The other companies evaluated have not endorsed the statement, and, in fact, have been actively promoting a “public pays” system in which the burden for managing the hazardous waste they produce is placed on consumers through a tax-like fee on new purchases. Unlike Producer Responsibility, this model, called an Advanced Recycling Fee (ARF), provides no incentives for the companies to design products which are less-toxic or easier to recycle properly.

Double Standards Among States

This past year, as we have seen in previous years, the U.S. has failed to establish a comprehensive national strategy to deal with electronic waste.  California has recently implemented the Advanced Recovery Fee (ARF) system, which charges the consumer a fee on the purchase that is used to fund the recovering and processing of the equipment.  Maine, on the other hand, has recently implemented a producer responsibility model, where companies are financially responsible to recover and process used electronic equipment.     

There have been a number of companies that have come out in support of the ARF system.  They are promoting the idea that consumers and the government must take responsibility for e-waste, effectively passing the toxic buck onto the public.  The companies that participated in the report card who are part of a trade coalition actively lobbying in favor of the ARF system include; IBM, Panasonic, Sony, and JVC.  While Apple has testified in favor of an ARF system in the past,  they are not currently part of this coalition.

Companies that did not participate in the annual report card but are also in the ARF lobbying coalition include; Samsung, Canon, LG, Hitachi, Mitsubishi, Philips, RCA, Sanyo, and Sharp. 

The Companies:

Eight companies returned the 2004 survey; Apple, Dell, Gateway, HP, IBM, JVC, Panasonic, and Sony. 

Apple, Dell, HP, IBM, and Gateway represent the US based manufacturers while JVC, Panasonic and Sony are based in Japan. 

IBM has recently sold it’s brand name for its personal computers to Lenovo, a Chinese company, but it is still the largest provider of servers and business information services in the world.  

HP, Dell, and Gateway are computer companies that now also sell big screen DLP and LCD TV’s, as do the more traditional consumer electronics companies, JVC, Panasonic and Sony.  There are no known recycling techniques for these televisions.       

The Categories:

This year's Report Card evaluated several categories of corporate responsibility related to the following environmental, health and safety concerns:

• Materials Use
• Extended Producer Responsibility/Manufacturer Take-Back
• End of Life Management/Disposal Chai

Overall Results

COMPANY	TAKE BACK	DISPOSAL CHAIN	MATERIAL USE	Final Score
HP	21	11	3	35
Dell	15	10	5	30
View Sonic	9	9	4	22
IBM	8	9	1	18
Sony	7	6	5	18
Apple	4	10	3	17
JVC	4	6	2	12
Panasonic	4	6	2	12
Gateway	6	5	1	12
Acer	7	3	2	12
Total Points	25	11	11	47

Companies Did Not Respond

• Fujitsu                                                  
• NEC                                                    
• Philips                                                  
• Samsung                                                           
• Sharp                                                   

Take Back

HP and Dell separated themselves from the rest of the manufacturers through their commitment to producer responsibility in the US.  Both HP and Dell have consumer and business take back programs.  Both companies have endorsed the CTBC Statement of Principles that prohibits the waste they collect in these programs from being exported or sent into the prison industry system.  HP has partnered with Office Depot to run collection events and they have also experimented with collection through large retailers. 

None of the manufacturers offered a completely free take-back program for all consumers, although several of the companies have experimented with pilot  consumer take back programs, and some have offered incentives to consumers who buy new products.  HP has collected the most consumer waste, far above any other manufacturer. 

None of the companies who scored on the bottom half of the report card met 30% of the criteria for a complete score on the Take Back section.  Many of the companies in the bottom half of the scoring, with the exception of Gateway belong to the ARF lobbying block.  Their scores reflect their opposition to producer responsibility models that have been proposed at the state and national level.  These companies have not developed take back programs to meet the need, and have stood as a political obstacle to developing a national solution based on domestic, responsible recycling infrastructure that provides clean, green jobs. 

Recycling         

The recycling section measures the accountability along the disposal chain to assess the auditing and precaution companies take to ensure that the waste they collect is properly recycled.   Again Dell and HP were at the top of the list.  While several of the companies responded that they audit their disposal chain regularly,  Gateway was the only brand name company that had not yet personally inspected their recycler’s facility, but stated that they are planning to do so.  Apple, Dell, Gateway, and HP are the companies that use recyclers that have signed the Electronic Recyclers Pledge of Stewardship.

The Supply Chain

As electronics companies have moved most of their manufacturing to China, India, Mexico and elsewhere, it has become critical to be able to track the environmental and health impacts of manufacturing throughout the supply chain, from the Original Equipment Manufacturers (OEMs) (Dell, HP, IBM, etc) through several levels of contract manufacturers,  (Solectron, SCI, .Sanmina, etc). Because of the lack of supply chain auditing by corporations, the complexity of the supply chain for each company, the proprietary nature of supply chain information and the burdensome expense to public interest organizations in obtaining independent data, we are required to rely on self-reporting from companies to get information about their global operations. While we attempted to phrase the questions for this year’s report card in a way that would elicit accurate, available and useful information, we unfortunately were unable to obtain sufficient information to rank the performance in this category.  We will be working with the companies in future years to re-think this important aspect of the report card and expect to be able to fully report on it in coming years. 

While it is clear that U.S. based computer companies, as well as some of their international competitors, have acknowledged that supply chain issues are important and that many of them have established internal policies to address environmental, worker and human rights issues, there is no recognized format for monitoring and publicly reporting compliance.  We will improve our efforts to obtain this information as the companies continue to improve their own implementation and overcome the many challenges that they are now acknowledging.

 Materials

Toxic Use Reduction

For the past few report cards, the materials grading section has largely been based on global compliance with the Restriction on Hazardous Substances Directive (RoHS). This European Directive, set for implementation in the summer of 2006, targets the phase out of lead, mercury and cadmium applications in addition to certain brominated flame retardants: polybrominated diphenyl ethers (PBDEs) and PBBs.  In previous report cards, it was unclear whether or not companies would create different products for the European Union, while continuing to use these hazardous substances in other non-regulated markets.  Company responses to this report card show that most US- and Japanese-based companies are committed to having all their products globally comply with the RoHS Directive.  Many companies are already on target to meet the requirements months prior to enforcement. 

Implementation of the RoHS Directive is an important wake up call to electronic manufacturers who have relied heavily on their supply chains to determine whether or not certain chemicals were safe in production, use and disposal of electronic products.  With that said, the RoHS Directive is limited in its scope, and after a contentious debate has been weakened in several respects, including a delay of the ban on decabromodiphenyl ether (Deca-BDE)—an inherently hazardous chemical building up in the environment and our bodies. We were pleased to see that most US and Japanese companies, in response to the mounting science on Deca-BDE, remain committed to replacing it with safer alternatives.  High scoring companies in this section, such as Dell and Sony have gone even further by working to replace all brominated flame retardants with halogen free alternatives. In doing so, new materials, like bio-based plastics are entering the market place, replacing materials reliant on persistent toxic chemicals that pose avoidable risks to human health and the environment.  Sony in particular stands out as a leader in its investment in bio-based plastics as they have started to experiment with its use in limited applications.

While it is important to recognize the advancements made with leading electronic manufacturers adopting RoHS globally, most companies fall short in offering more comprehensive material policies to avoid the use of persistent toxic chemicals.  In this year’s report card, to move beyond the substances targeted in RoHS, we included a question on phase-out plans for OSPAR Priority Action Chemicals. OSPAR targets chemical classes where the science is strong enough to conclude that these chemicals pose a significant risk to human health and the environment.  Sony was the only company to have in place a policy that seeks elimination of a broader set of harmful chemicals such as phthalates. 

As Europe implements REACH—a new far reaching chemical regulatory program—it will be much harder for companies to use chemicals that persist in environment, build up in our bodies or are toxic to human health.   The emergence of REACH, ongoing biomonitoring studies, and increased contamination of our food supply are all market indicators that continued use of persistent toxic chemicals will create liabilities for companies, particularly those selling consumer products. 

None of the companies provided sufficient answers to the survey question about whether or not they screen their chemicals to see if they are potentially carcinogenic, mutagenic or reproductive toxins.   This is a strong indicator that companies have yet to adopt comprehensive precautionary approaches to their chemical and material management programs to ensure the use of safer chemicals and materials.  As a result, many chemicals and materials of concern are still used in electronic products.  To transition towards a safer materials based economy, electronic manufacturers must hold their supply chains accountable to using safer materials based on key environmental and human health criteria, beginning with the phase-out of chemicals identified for priority action by international scientific bodies.  In the next year, we hope to see significant improvement in this area, particularly as REACH goes into effect. 

By the next report card, we expect companies to make firm commitments to move away from all persistent toxic chemicals by investing in innovation, Green Chemistry and the increased use of renewable materials sourced from sustainable resources. The sector as a whole needs better benchmarks that outline what continuous improvement looks like in of the use of more sustainable materials and safer chemicals. This is critical if companies are going to be prepared for the market changes that will result from emerging science and public outcry about contamination by chemicals never meant for human absorption. 

Recycled Content

The materials currently used in electronic products present many problems when it comes time to recycle the units.  Heavy metals, brominated flame retardants, and other chemicals of concern make it difficult to recycle and recover materials without exposing workers and communities to hazardous chemicals.   The lead used in CRT monitors is highly toxic, and can be processed in only one facility in the United States.  It is clear from the report card results that companies are not measuring the use of post-consumer recycled content across product sectors.  HP, and Sony provide information for specific products, which is a small first step.  It was very difficult to measure whether or not there have been any advances in this section, since companies do not set measurable public goals to drive increased recycled content.  Scores in this section were very low. Next year, we hope to report measurable targets that increase market demand for post-consumer recycled content.

Conclusion

We at Silicon Valley Toxics Coalition and the Computer TakeBack Campaign believe that it is the responsibility of electronics manufacturers to set and continuously improve the standards of social and environmental performance; just as they do with technical performance. The current model of high-tech growth prioritizes a narrow set of “performance” standards at the expense of human rights, labor rights, public health and environmental protection. The high-tech industry is able to get away with this because they are able to obscure from public view the damage caused throughout their supply and disposal chains. Because the companies have failed to set effective standards, we will continue to set the bar, expect them to strive to clear it and expect them to report on their performance in ways that are transparent to the public. We will also continue to disclose our findings to the public as a tool to encourage improved performance.

Appendix I

CTBC Statement of Principles

CTBC Statement of Principles We support the policy of producer responsibility in the U.S. for electronic products at the end of their useful lives, wherein brand-name manufacturers/producers work with consumers and state and local governments to properly collect and manage electronic products in an environmentally responsible fashion. Manufacturers and producers accept responsibility for continually improving the environmental aspects of the design of their products and for the end-of-life management of their products. This policy will have many benefits for consumers, electronics producers, local governments, the public health and the environment.

This statement refers to the responsibility for the environmentally responsible management of the electronic waste from products sold to all customers in the future. As for products sold in the past ("legacy" electronic waste, including "orphan" products for which the relevant producer/brand owner is no longer in business), we advocate that all due measures should be taken to allocate primary responsibility to those who manufactured and sold these products in the first instance. For that orphan waste which cannot be allocated to past producers, we support the principle that current electronics producers as well as those entering the market in the future should share in the responsibility of managing this electronic waste based on an equitable cost allocation related to historic market share. [See point 3 of alternative policy section below]

We support the objective of producer responsibility to create incentives for producers to improve the design of their products to minimize their life-cycle impacts on the environment. In particular, we support activities designed to:

• Phase out the use of potentially hazardous substances consistent with the recent European ROHS directive and other worldwide standards as they become law;
• Improve options to upgrade equipment over the course of the equipment's life; and
• Increase the integration of non-hazardous recovered materials into new products.

We believe that producer responsibility can operate most effectively through the competitive marketplace, but that all stakeholders - consumers, producers, governments, and the general public -- play an important role. All stakeholders need assurances that all producers are held to the same high environmental standards. Therefore, we support a public policy framework in the U.S. that provides for individual producer responsibility, through mechanisms that assure proper end of life management of producers' own products sold in the future. It is expected that individual producers may choose to cooperate with others in carrying out this responsibility in order to achieve efficiencies of scale. We do not advocate an "advanced recovery fee" approach to financing the management of electronic waste, such as has been adopted through SB20 in California and which is under consideration within the National Electronic Product Stewardship Initiative process. We support an alternative financing model which allows for responsible companies to avoid an Advanced Recovery Fee and provides for cost internalization of end of life management costs by producers for new products entering the marketplace combined with industry sponsored programs designed to offset the incremental costs borne by local governments and others to collect discarded electronic products.

We recognize that in order to be viable and effective, this preferred alternative policy approach includes:

1. Ambitious, workable and progressive goals and timetables to assure that both legacy and future electronic waste will be properly recovered and managed;

2. Effective and enforceable environmental standards to assure that hazardous electronic waste will be properly managed in strict compliance with international and domestic laws that govern export of hazardous electronic waste, worker safety, public health and environmental protection, and the use of market labor rather than incarcerated labor;

3. A convenient, fair and equitable system of collection that does not create economic disincentives for consumers to participate and is premised upon financial participation by producers so that taxpayers, local governments, or others do not shoulder all the financial burdens of recycling and disposing of electronic products. (Large institutions whose electronic waste is regulated by federal law may be subject to fees to cover the costs of proper recycling and disposal of their historic waste.)

4. Consumer awareness designed to optimize performance of the system;

5. Flexibility for producers to design and implement recovery and recycling systems that best suit their particular business model while complying with all applicable laws.

Appendix II:

2005 Electronics Report Card Survey Questions

(Prepared by the Silicon Valley Toxics Coalition, Clean Computer Campaign and the Computer TakeBack Campaign)

For purposes of this survey, “Take Back” is defined as: the act of brand name manufacturers and distributors of electronic equipment taking financial and/or physical responsibility for their products throughout the entire product lifecycle, including in particular appropriate collection and end-of-life management.

1. Does your company currently have any programs in place to take back electronics (including computers, peripherals, televisions etc.) sold to major customers (government, corporate, institutional) in the USA?

Yes____          No______

1a). If yes, are these programs fee-based or free?  Please explain.

1b). If yes, what percentage of your company’s products were returned in the USA during 2003 for reuse or recycling through your major customers take back system, when compared to your 2003 sales?

a) <2%      b) 3-5 %       c) 6-10 %      d) 11-25 %      e) 26-50 %      f) 50-100%  g) Don’t know

2. Does your company currently have in place any programs to take back electronics sold to individual and small business (retail) consumers in the USA?

Yes_____        No______

2a). If yes, are these fee-based or free programs?  Please explain.

2b). If yes, what percentage of your company’s products were returned in the USA during 2003 for reuse or recycling through your retail customers take back system, when compared to your 2003 sales?

a) <2%      b) 3-5 %       c) 6-10 %      d) 11-25 %      e) 26-50 %      f) 50-100%  g) Don’t know

3. Has your company established any product re-use or recycling goals for 2005-06 that include target dates, timelines and/or volumes of materials?

Yes____          No_____

3a). If yes, please provide the recycling goals or provide weblink to your company’s recycling goals.

4. Does your company (or any of its contractors) export hazardous electronic waste (e.g. circuit boards, cathode ray tubes, or devices containing these materials or lead, cadmium or mercury) to non-OECD countries?

Yes_______    No______

5. Does  your company audit your recycling contractor’s downstream recycling supply chain?

Yes____          No______

5a). If, yes please explain the measures that you use to audit your recycling contractor’s supply chain.

5b). Has your company inspected all of your recycling contractor’s facilities and determined if they are demanufacturing the products, outsourcing all of the recycling or shredding the products themselves.

Yes____          No____

5c). Do your recycling contractors test all monitors before reselling?

Yes____          No___

5d). Are all of your monitors (that are collected in the US or North America) being processed in the United States or North America?

Yes____          No____          

5e). Do your recycling contractor(s) provide you with bills of lading justifying inbound and outbound volumes of materials?

Yes____          No____

5f). Do your recycling contractors or their subcontractors in the recycling supply chain use prison labor?

Yes____          No____

5g). Have any of your contract recyclers signed the Electronic Recycler’s Pledge of True Stewardship? (See http://www.ban.org/Index.html#Pledge)

Yes____          No____

If yes, please list the recycling ontractors

5h). If your contract recycler(s) has not signed the Electronic Recycler’s Pledge of True Stewardship, have they obtained another type of certification (for example, International Association of Electronic Recyclers certification).

Yes ____No___

If yes, please list recyclers and certification

7. Does your company publicly support state or federal legislative efforts to require brand owners and producers of computers and consumer electronics to bear financial responsibility for the collection and safe recycling of their products?

Yes_______    No______ Please explain your response and provide your policy.

8. In 2005 will your company support individual producer responsibility for products sold in the US?

Yes_____  No________

9. Did your company lobby for or against the following state recycling legislation?

Maine  HP1402                       For____           Against _____  Neutral ______Don’t know______

Massachusetts H-1533 For___             Against_____   Neutral _____  Don’t know_____

California AB2901       For___             Against _____  Neutral ______Don’t know_______

10. Will your company  publicly support the Joint Statement of Principles on Producer Responsibility (attached) for U.S. Electronic Waste, if it has not done so yet?

Yes_____        No_______

11. Does your company have policies and procedures on how to track the incidence rate of occupational illness in the workforce?

Yes_____        No________

11a) Please explain the measures that you use to track incident rates of occupational illness throughout your manufacturing supply chain.

12. Does your company audit the contractors and subcontractors in your supply chain to insure that they are performing routine air monitoring for pollutants in their facilities?

Yes_____        No_________

12a). If yes, please explain the measures that your company uses to audit your contractors and subcontractors in your supply chain to insure that they are performing routine air monitoring for pollutants in their facility.

13.  Please identify which chemicals on the OSPAR list (attached) are used in the production, contained in, or released during the life cycle of your products?

14. Does your company have phase out plans and target dates for chemicals on the OSPAR list?  

14a). If yes, please provide target dates for phase-outs

15. Does your company plan to use halogen-free substitutes for the following flame retardants?

Deca                Yes____No______

TBBP-A          Yes_____No____

HBCD             Yes_____No____

16.  Does your company have phase out plans and target dates for any chemicals in your products that are considered potentially mutagenic or carcinogenic?

17.  Have you contacted your suppliers to ask them about what chemicals they are using in the products they supply you with?   

17a). If yes, please explain the measures that your company uses to audit your contractors and subcontractors throughout your supply chain to determine the types of chemicals they are using in the production of your products.

18. What percentage of product contains on average a minimum of 10% post-consumer recycled resin, measured as a percentage of total resin (by weight) in the product?

19. What percentage of product contains on average a minimum of 25% post-consumer recycled resin, measured as a percentage of total resin (by weight) in the product?