The case for CSR/ Sustainability Reporting Done Responsibly


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Home / case studies / Case study: How Micron promotes sustainability across its supply chain

Case study: How Micron promotes sustainability across its supply chain

Micron is an industry leader in innovative memory and storage solutions, serving customers with its innovative products through a wide range of partnerships with leading technology companies worldwide. Micron’s supply chain risk and resiliency programme has global processes, partners with a best-in-class, third-party risk service provider and resources in place that are continually maturing and improving to ensure a resilient, compliant and sustainable supply chain.

This case study is based on the 2020 Sustainability Report by Micron published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.

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Profiling and managing the relative risks of each of its strategic suppliers allows Micron to ensure a resilient supply chain  Tweet This! able to support continuous production and product delivery to Micron’s customers, while upholding industry and Micron standards relating to sustainability. In order to promote sustainability across its supply chain Micron took action to:
  • promote compliance
  • screen, assess and audit suppliers

What are the material issues the company has identified?

In its 2020 Sustainability Report Micron identified a range of material issues, such as employee development & engagement, operations & facility management, workplace health & safety, ethical conduct, human rights, diversity & inclusion. Among these, promoting sustainability across its supply chain stands out as a key material issue for Micron.

Stakeholder engagement in accordance with the GRI Standards              

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups Micron engages with:

To identify and prioritise material topics Micron engaged with its stakeholders through the following channels:

Stakeholder Group                Method of engagement
Employees

 

·      Ongoing supervisor interactions

·      Meetings hosted by senior leaders

·      Compliance hotline for reporting concerns

·      Intranet with global and local content where employees can share sustainability-related suggestions

Customers ·      Regular meetings

·      Customer scorecards

·      Customer requirement documents

·      Membership in industry organisations

Shareholders

 

 

·      Annual shareholder meeting

·      Quarterly financial calls

·      One-on-one analyst meetings

·      Annual report and sustainability report

·      Email

Policymakers

 

 

·      Membership in organisations where Micron operates, such as:

·      American Chamber of Commerce in Taipei

·      Business Council

·      Business Roundtable

·      European Automotive Technology Council

·      European Research Platform

·      Idaho Association of Commerce & Industry

·      Italy Industry Trade Association

·      Northern Virginia Technology Council

·      Silicon Valley Leadership Group

·      U.S. Chamber of Commerce

·      U.S.-China Business Council

·      U.S. Information Technology Office

·      U.S.-Taiwan Business Council

·      Virginia Manufacturers Association

Suppliers ·      Compliance hotline for reporting concerns

·      Reviews of supplier performance

·      Third-party audits

·      Responsible Business Alliance membership

·      Supplier quality requirements document

·      Trainings

·      Contract terms

·      Risk profiling

Communities

 

·      STEM education outreach

·      Grants toward education and basic human needs

·      Engagement in local, regional and national STEM education conversations

·      Employee volunteerism and matching gifts

What actions were taken by Micron to promote sustainability across its supply chain?

In its 2020 Sustainability Report Micron reports that it took the following actions for promoting sustainability across its supply chain:

  • Promoting compliance
  • Micron performs a supplier risk assessment that aligns with its own Code of Business Conduct and Ethics and the RBA (Responsible Business Alliance) code of conduct. In addition, Micron expects all suppliers to be able to provide evidence of compliance with the following:
    • An annual RBA self-assessment questionnaire (SAQ) for a company’s headquarters and all facilities or Micron’s sourcing compliance assessment (SCA)
    • An RBA audit or equivalent for any facility identified as high-risk
    • S. Foreign Corrupt Practices Act
    • K. Bribery Act
    • California Transparency in Supply Chains Act of 2010
    • K. Modern Slavery Act of 2015
    • An updated conflict minerals reporting template (CMRT) in case of addition of any new smelter or change of status of existing smelters
    • Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), updated and provided every six months or as any product change requires
    • Restriction of Hazardous Substances (RoHS), updated and provided every 12 months or as any product change requires
    • CDP (formerly the Carbon Disclosure Project)
    • A sustainability/corporate social responsibility or equivalent report
  • Micron also requests that suppliers provide transparency through supply visibility mapping and supplier assessments, including the following information:
    • Data points such as manufacturing locations, emergency contacts, manufacturing recovery time and locations of critical subtier suppliers
    • Business continuity processes and programmes at manufacturing locations
    • Event impact notification responses associated with Micron’s supply chain
    • Programmes and policies related to ethics, environment, forced labour and safety 
  • Screening, assessing and auditing suppliers
  • Micron’s sourcing risk and compliance group oversees supply chain risk management, which includes environmental, human rights and geopolitical risks. This team continues to mature its mission of enabling a resilient, compliant and sustainable global supply chain, including new and incumbent supplier screening, assessments, investigations, risk profiling, development and auditing. Each year, members of the sourcing risk and compliance group do the following:
    • Screen and assess: Micron initially assesses suppliers using inputs from business continuity processes, geographic location, type of commodity or service, Micron’s history with the supplier and third-party reviews. Micron conducts additional screening for new suppliers.
    • Score: Micron maps suppliers at the manufacturing level, focusing on business continuity planning processes, ethics, location, forced labour, environment and safety. Micron assigns an operational risk score that indicates risk associated with manufacturing or business disruption, as well as a score that indicates risk associated with responsibility and compliance. Each score may be high, medium or low.
    • Audit: Suppliers identified as high risk may be audited in person to make sure they comply with Micron’s code of conduct.
    • Improve and develop: Micron may develop a mitigation plan and request improvement actions of any suppliers found to be out of compliance or the suppliers may be removed from the supply base. Micron may establish corrective action plans, carry out in-person training or develop scorecard reviews or other plans to improve suppliers’ risk profiles.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 308-1 New suppliers that were screened using environmental criteria

2) Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken

3) Disclosure 414-1 New suppliers that were screened using social criteria

4) Disclosure 414-2 Negative social impacts in the supply chain and actions taken

 

Disclosure 308-1 New suppliers that were screened using environmental criteria does not correspond to any SDG.

Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken does not correspond to any SDG.

Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:

Disclosure 414-2 Negative social impacts in the supply chain and actions taken corresponds to:

 

80% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.



FBRH GRI Standards Certified, IEMA & CIM recognised Sustainability Course | Venue: London LSE

By registering for the next 2-day FBRH GRI Standards Certified, IEMA & CIM recognised course you will be taking the first step in gaining the many benefits of sustainability reporting.

Most importantly, you will gain the knowledge to use the GRI Standards, project manage your own first-class sustainability report and:

  • Identify your most important impacts on the Environment, Economy and Society
  • Begin taking solid, focused, all-round sustainability action ASAP

 

References:

1) This case study is based on published information by Micron, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) https://www.globalreporting.org/standards/gri-standards-download-center/

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