Audit findings

In 2014, HP conducted 110 audits of our production suppliers, 17 non-production supplier audits, one SER management systems audit of recycling facilities, and 72 SER assessments targeting specific risks uncovered through audits, KPIs and external stakeholder feedback. The results of our nonproduction supplier and recycling audits as well as our SER assessments are not included in the charts below because the operations of these suppliers or scope of the assessments are different to those of traditional audits and cannot be compared. Learn more about our approach to supplier monitoring (PDF 1.33 MB).

Global findings

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Distribution of major nonconformances by section of HP’s Supplier Code of Conduct, 20141

Health and safety
Health and safety 31%
Labor
Labor 24%
Management system
Management system 22%
Ethics
Ethics 9%
Environmental
Environmental 14%

Our multiyear plan involves auditing all high-risk suppliers annually as well as conducting targeted assessments in special circumstances such as supplier onboarding or where a specific risk requires deeper investigation. In recent years we began expanding the scope of auditing to capture some suppliers not previously covered, such as nonproduction suppliers and suppliers deeper in our supply chain. Many of these may not have mature SER management systems.

We have observed an increase in nonconformances in some areas as suppliers new to our audits respond to the requirements, and previously audited suppliers adjust to tightening of our standards with new requirements, additional required proof of conformance, and more rigorous scoring criteria.

Zero-tolerance items

Zero-tolerance items are the most serious type of nonconformance. They include child labor, forced labor, severe forms of discrimination, health and safety issues posing immediate danger to life or risk of serious injury, and perceived violation of environmental laws posing serious and immediate harm to the community. Our zero-tolerance policy requires auditors to escalate such items immediately. Suppliers must cease any zero-tolerance practices and report their corrective action to HP no later than 30 days after the original audit. We will then re-examine the finding through a site visit to confirm resolution. Zero-tolerance items result in suppliers being downgraded on our SER scorecard. Our SER policy requires all suppliers to disclose a fatality, debilitating injury, or any other HP Supplier Code of Conduct zero-tolerance items related to manufacturing an HP product. See HP’s SER policy for details.

In 2014, we found no zero-tolerance violations related to core labor rights in our audits. We did find five zero-tolerance items related to health and safety issues at four commodity supplier sites. Most zero-tolerance findings were at new supplier sites that have not benefited from sustained engagement with HP’s Supply Chain Responsibility program.

  • Four of the findings related to emergency preparedness including lack of adequate fire detection/suppression systems, lack of appropriate evacuation drills, locked/blocked emergency exits, blocked fire extinguishers, and inadequate emergency evacuation preparedness.
  • The other zero-tolerance item related to industrial hygiene involving inadequate machine safeguarding.

As always, we work vigorously with our suppliers to correct all zero-tolerance findings, including visual verification of closure. We expect to see our work with these suppliers lead to long-term improvement and better working conditions and overall SER performance.

Greater China

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Distribution of major nonconformances by section of HP’s Supplier Code of Conduct, 20141

Health and safety
Health and safety 34%
Labor
Labor 27%
Management system
Management system 18%
Ethics
Ethics 13%
Environmental
Environmental 8%

HP’s supplier audit results vary by region due to inherent differences in local contexts. We tailor our risk identification methods, policies, assurance approach and capability-building programs to the unique risks in each region. To learn more about our approach see Supply chain responsibility: our approach. To find out more about HP’s programs see Capability building.

Audits conducted in 2014

Location Initial audits Follow-up
audits
Full re-audits
China 18 28 24
Total 18 28 24

Asia Pacific

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Distribution of major nonconformances by section of HP’s Supplier Code of Conduct, 20141

Health and safety
Health and safety 30%
Labor
Labor 34%
Management system
Management system 23%
Ethics
Ethics 11%
Environmental
Environmental 2%

HP’s supplier audit results vary by region due to inherent differences in local contexts. We tailor our risk identification methods, policies, assurance approach and capability-building programs to the unique risks in each region. To learn more about our approach see Supply chain responsibility: our approach. To find out more about HP’s programs see Capability building.

Audits conducted in 2014

Location Initial audits Follow-up
audits
Full re-audits
India 1 0 0
Republich of South Korea 1 1 0
Malaysia 4 3 1
Philippines 2 4 2
Singapore 1 1 2
Thailand 1 1 1
Vietnam 1 1 0
Total 11 11 6

Europe, Middle East, Africa

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Distribution of major nonconformances by section of HP’s Supplier Code of Conduct, 20141

Health and safety
Health and safety 24%
Labor
Labor 15%
Management system
Management system 33%
Ethics
Ethics 13%
Environmental
Environmental 15%

HP’s supplier audit results vary by region due to inherent differences in local contexts. We tailor our risk identification methods, policies, assurance approach and capability-building programs to the unique risks in each region. To learn more about our approach see Supply chain responsibility: our approach. To find out more about HP’s programs see Capability building.

Audits conducted in 2014

Location Initial audits Follow-up
audits
Full re-audits
Czech Republic 2 1 0
Hungary 1 0 1
Israel 1 2 0
South Africa 1 0 0
Turkey 0 1 1
Total 5 4 2

Americas

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Distribution of major nonconformances by section of HP’s Supplier Code of Conduct, 20141

Health and safety
Health and safety 32%
Labor
Labor 0%
Management system
Management system 31%
Ethics
Ethics 31%
Environmental
Environmental 6%

HP’s supplier audit results vary by region due to inherent differences in local contexts. We tailor our risk identification methods, policies, assurance approach and capability-building programs to the unique risks in each region. To learn more about our approach see Supply chain responsibility: our approach. To find out more about HP’s programs see Capability building.

Audits conducted in 2014

Location Initial audits Follow-up
audits
Full re-audits
Brazil 2 1 7
Mexico 4 5 0
Total 6 6 7

1Data reflect the results of HP’s initial audits and full re-audits conducted in 2014. Data excludes minor nonconformances that do not indicate a systemic problem but typically represent an isolated finding. Data is from audits; data from assessments is not included. Audit counts include all production supplier, nonproduction supplier, and one recycling vendor SER audit performed in 2014. The results of nonproduction and recycling vendor audits are not comparable with production supplier audits and are not included in performance reporting. Year-over-year data does not necessarily represent audits of the same supplier sites.