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Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011 Procedure No. N/A Rev. B AUSTRALIAN PACKAGING COVENANT ACTION PLAN FOR JULY 2010 – JUNE 2014

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Page 1: Policies and Procedures AUSTRALIAN PACKAGING COVENANTdownload.microsoft.com/download/E/6/4/E64E9FA4-EFFA... · Safety, Compliance & Sustainability Policies and Procedures Title: Australia

1 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

AUSTRALIAN PACKAGING COVENANT

ACTION PLAN FOR JULY 2010 – JUNE 2014

Page 2: Policies and Procedures AUSTRALIAN PACKAGING COVENANTdownload.microsoft.com/download/E/6/4/E64E9FA4-EFFA... · Safety, Compliance & Sustainability Policies and Procedures Title: Australia

Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia National Packaging Covenant Action Plan for July 2010 – June 2013 March 16, 2011

Procedure No. N/A Rev. A Page 3 of 17

2

Title: Australia National Packaging Covenant Action Plan for July 2010 – June 2013 June 10, 2011

Procedure No. N/A Rev. A

Contents

1 RECORD OF REVISIONS ............................................................................................... 3

2 EXECUTIVE SUMMARY .................................................................................................. 5

3 MICROSOFT HISTORY ................................................................................................... 6

4 MICROSOFT IN AUSTRALIA .......................................................................................... 6

5 SCHEDULE FOR PACKAGING REVIEWS ....................................................................10

5.1 New Products .............................................................................................................10

5.2 Existing Products ........................................................................................................10

6 MICROSOFT WORLDWIDE COMMITMENT TO ENVIRONMENTAL SUSTAINABILITY 10

6.1 Microsoft Sustainable Packaging Innovation ...............................................................11

6.2 Use of Recycled Content and Design for Recycling ....................................................12

6.3 FY 2010 Achievements ...............................................................................................12

6.3.1 Elimination of PVC from packaging ......................................................................12

6.3.2 Personal Computer Hardware Peripherals ...........................................................12

6.3.3 Xbox 360® Retail Package Improvements ...........................................................13

7 SUMMARY OF INITIATIVES IN THIS PLAN ..................................................................14

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3 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

1 RECORD OF REVISIONS

Release

Letter Date Section Page

Summary of

Changes Author/Approver

A 03/31/2011 All All Initial Release

Joan Krajewski

General Manager of Safety,

Compliance and Sustainability

B 06/10/2011

Title

Page

2.0, 4.0

Update Title

Page, Update

Commitment

Approver;

Insert

packaging

materials and

formats used

by MS

Don Mattrick

Interactive Entertainment

Business (IEB) Management

President

Microsoft Corporation

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4 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

Document Control

Standard Operating Procedure

Document Owner:

Joan Krajewski

General Manager of Safety, Compliance &

Sustainability

Approval: Don Mattrick

Interactive Entertainment Business (IEB) Management

President

Signature: On file in office of General Manager (GM)

Approval Date: 6/10/2011

Update Requirements: The GM or its designee shall maintain this procedure. This procedure must be

reviewed and approved annually. This document and its revisions shall remain current for no more than

one year from the approval date. The GM or its designee must retain a log of document history with this

procedure.

References

1.

Attachments

N/A

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5 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

2 EXECUTIVE SUMMARY

Microsoft Corporation (Microsoft) has committed to continual improvement of environmentally sound

packaging by signing the Australia National Packaging Covenant (NPC) on March 25, 2009. We

continued our commitment to the now updated Australian Packaging Covenant (APC) by having signed

and submitted the APC Declaration form in August of 2010. By signing the Covenant we endorsed the

Environmental Code of Practice for Packaging that coincides with our corporate principles. At Microsoft,

we are committed to software and technology innovation that helps people and organizations around

the world improve the environment. Our goals are to reduce the impact of our operations and products

and to be a leader in environmental responsibility. We view this APC Action Plan (Action Plan) as a living

document that will evolve and change as our packaging products improve and reach goals annually. We

strive for measurable improvements over time which we will report annually for the July 1st through

June 30th reporting period the Microsoft fiscal year (FY)). We will submit the APC Annual Report by

October 31st of each FY.

Our vision is for sustainable packaging following these several strategies:

Light-weighting of packaging and minimizing of materials in packaging

Elimination of packaging using technologies such as electronic distribution

Elimination of unfavorable materials

Shrinkage of packaging manufacturing footprint

Use of recycled materials

Use of materials friendly to recycling again at end of life

Design for recycling: Make materials easily separable

Ensure that all recyclable packaging is clearly labeled for recycling

Long life use packaging

Designing packaging for environmental efficiencies in the supply chain

Using the above strategies, Microsoft is committed to an improvement of 5% between each successive

launch of a product for one or more of the following criteria:

Microsoft packaging enviro score (Wal-Mart Scorecard)

Reduction in total package weight

Reduction in package component material

Reduction in package to product volume ratio

Increased use of recycled materials

Microsoft has gathered the relevant baseline data and reported it in our first Annual Report submitted,

October 31, 2010. The sustainability strategies listed above will be integrated into our product

development process which is a phase and gate driven hardware production life cycle tool called end to

end (e2e), our internal development process.

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6 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

This Action Plan is endorsed by Senior Management at Microsoft. Please see Section 7 for signature.

Formal Commitment to Implement Action Plan

Don Mattrick

Interactive Entertainment Business (IEB) Management President

Microsoft Corporation

One Microsoft Way

Redmond, WA 98052

Contact Person

Joan Krajewski

General Manager of Safety, Compliance and Sustainability

Microsoft Corporation

One Microsoft Way

Redmond, WA 98052

[email protected]

3 MICROSOFT HISTORY

Microsoft was founded in 1975, and is a worldwide leader in software; services and solutions that help

people and businesses realize their full potential. Microsoft is a multinational computer technology

corporation that develops, manufactures, licenses, and supports a wide range of software and hardware

products for computing devices. Headquartered in Redmond, Washington, USA, our best selling

products are Microsoft® Windows® operating system and the Microsoft® Office® suite of productivity

software.

Microsoft was originally founded to develop and sell BASIC interpreters for Altair 8800, then developed

home computer operating systems with MS-DOS in the mid-1980s, followed by the Windows® line of

operating systems. Microsoft’s original mission was “a computer on every desk and in every home,

running Microsoft software.” The current Microsoft mission statement is “to help people and businesses

throughout the world realize their full potential.” Microsoft possesses footholds in other markets; with

assets such as the MSNBC cable television network, the MSN® network of Internet services and the

Microsoft® Encarta® multimedia encyclopedia.

Microsoft is a brand owner of products including Microsoft® Windows®, Office®, Servers, Developer

Tools, Expression®, Business Solutions, and computer hardware products including mice keyboards and

webcams and home entertainment products such as Xbox®, Xbox 360® and Zune®.

4 MICROSOFT IN AUSTRALIA

Microsoft is a “brand owner” as defined by the Australia APC and operates one warehouse and

distribution facility in Australia. Microsoft Regional Sales Corporation (MRSC) operations in Australia

include an outsourced national distribution warehouse in Sydney, Australia. MRSC sells its brand

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Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

finished products by shipping to the Sydney warehouse and selling the products to its authorized

distributor(s) who then sells them to retailers and resellers nationally. Currently, the Microsoft brand

products sold in Australia, are served from the warehouse in Sydney, include the Xbox 360® video game

and entertainment system, games and accessories, personal computing hardware (PCHW) such as mice,

keyboards, and webcams. MRSC does not sell products directly to consumers in Australia.

The Xbox 360® video game console and the new Kinect® sensor controller entertainment system

packaging (launched in 2010) consists primarily of corrugated fiberboard. Ethylene-vinyl acetate (EVA)

foam cushioning inserts are used for product protection. Secondary packaging material used to protect

the product components include: foam sheet, molded pulp and polypropylene bags. The games

packaging consists of polypropylene plastic DVD case and paper inserts. Figure 1 depicts the Xbox 360®

entertainment system packaging.

Figure 1: New Xbox 360® Console with Kinect & Games Packaging

To help standardize packaging used across various hardware devices, Microsoft developed a common

platform of package sizes for mice, webcam, and some keyboard packages. The common platform to

standardize sizes of packaging has improved manufacturing efficiency and materials efficiency. The

new design platform has reduced thermoformed polyethylene terephthalate (PET) plastic clamshell

packaging with a more sustainable paperboard based primary packaging. Figure 2 depicts examples

of the new paperboard landscape packaging.

Figure 2: Project Landscape PCHW Packaging

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Procedure No. N/A Rev. B

Microsoft product packaging by material type includes:

Paper products

o Corrugated cardboard

o Paperboard/paper

o Molded pulp

Plastic

o Polyethylene terephthalate (PET)

o Polypropylene (PP)

o Polystyrene (PS)

o Oriented-polypropylene (OPP) film and shrinkwrap

o Polyethylene bags

o Ethylene-vinyl acetate (EVA) foam

Microsoft is measuring its Packaging Sustainability strategies on the following APC Performance goals

and KPIs. Note: KPIs 2 and 5 are not applicable to individual signatories such as Microsoft according to

APC Action Plan Template.

Table 1: APC KPIs and Performance Goals

Performance goal Outcomes Key performance

indicators APC Targets

1. Design - optimise packaging to use resources efficiently and reduce environmental impact without compromising product quality and safety

Packaging designed to:

• avoid or minimise the use of

materials and other resources

• optimise its recyclability and

recycled content

• reduce litter impacts

KPI 1. Proportion of signatories in the supply chain implementing the Sustainable Packaging Guidelines for design or procurement of packaging

100% of

signatories in

the supply

chain by

2020

2. Recycling - efficient

collect and recycle

packaging

Improved recovery of packaging from households and away-from-home sources

KPI 2. N/A National

recycling rate for

packaging (Not

Applicable to Individual

Signatories)

KPI 3. Proportion of

signatories with on-site

recovery systems for

recycling used packaging

Continuous

improvement

in the

recycling rate

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Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

Performance goal Outcomes Key performance

indicators APC Targets

Increased secondary markets

for recovered packaging

materials

KPI 4. Proportion of signatories with a policy to buy products made from recycled packaging

KPI 5. N/A: Additional

tonnes of material

reprocessed in primary

and secondary markets

as a result of Covenant-

funded projects (Not

applicable to individual

signatories).

3. Product Stewardship

– demonstrate

commitment of all

signatories

Signatories in the supply chain working with others to improve packaging design and recycling

KPI 6. Proportion of signatories that have formal processes for working with others to improve packaging design and recycling. *

KPI 7. Proportion of signatories demonstrating other product stewardship outcomes for packaging

100% of

signatories

by 2020

Reduction in litter KPI 8. Reduction in the number of packaging items in litter

Continuous

reduction in

the number

of packaging

items in litter

* It is recognised that while the Packaging Covenant will contribute to the recycling rate there are many other drivers and

barriers. These include the strong and continuing commitment by local government to curbside collection of used packaging

and demand for commodities in local and export markets.1

1www.packagingcovenant.org.au, Australian Packaging Covenant Handbook for Signatories Table 1-1, September,

2010.

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10 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Title: Australia Packaging Covenant Action Plan for July 2010 – June 2014 June 10, 2011

Procedure No. N/A Rev. B

5 SCHEDULE FOR PACKAGING REVIEWS

5.1 New Products

Hardware and software Packaging platforms are reviewed by the packaging development team each

development cycle, which is annually for most products, every 3 years for specialty products such as

Xbox and accessories. There is a packaging development team assigned to each new product platform.

The environmental sustainability strategies are integrated into our product development process which

is a phase and gate driven production lifecycle process, e2e. Therefore, each new package is reviewed

for environmental sustainability concepts at product inception and throughout the development cycle.

Microsoft has made it a goal of KPI 6 (See Table 3) to document our formal phase and gate development

process which is currently electronically executed on the Microsoft internal intranet tool e2e. It will also

be enhanced to more closely follow the APC Sustainable Packaging Guidelines in FY 2011. We will

document the phase and gates in a report format that will then be included as an appendix to our next

Annual Report scheduled October 31, 2011.

5.2 Existing Products

Microsoft packaging for existing products is phased out every one to three years, depending on the

product type, and replaced with the new packaging innovation including our sustainability concepts. The

Microsoft review schedule occurs during each product packaging platform development lifecycle as

outlined in Table 2.

Table 2: Schedule of Review Period by Product Type

Product Type Review Period

Xbox and Accessories Each launch development cycle, usually every 3 years

Software and Games Each launch development cycle, usually annually

PC Hardware Each launch development cycle, usually annually

(Other) Multi-media devices Each launch development cycle, usually annually

Existing Packaging Existing packaging is phased out every 1 to 3 years and

replaced with new packaging innovation

6 MICROSOFT WORLDWIDE COMMITMENT TO ENVIRONMENTAL SUSTAINABILITY

Microsoft is committed to environmental sustainability and continuously works to explore and

implement new ways to preserve and improve the environment. Microsoft has further committed to

environmental sustainability by becoming certified by the International Organization of Standardization

(ISO) in ISO 14001 to formalize the processes for reducing the company environmental footprint.

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Microsoft uses this formal process as a model for our global environmental management system as well

as the APC implementation. The Microsoft European Operations Center has been ISO 14001:2004

certified since 1997 for the following activities: The management of the manufacture and distribution of

commercial full packaged products, entertainment and devices products, and the distribution of

associated hardware peripherals. The Microsoft Headquarters in Redmond, Washington, USA is working

towards ISO 14001 certification in FY 2011 for all of IEB global division operations including all Microsoft

hardware products and packaging.

Microsoft’s global environmental management system is focused in several key areas:

Applying Microsoft technology expertise to help solve environmental challenges

Reducing the company's environmental footprint

Addressing global e-waste

Creating sustainable consumer electronics, packaging and software

6.1 Microsoft Sustainable Packaging Innovation

Microsoft’s environmental specification for packaging is a public document. The specification is

identified as: Specification #S002689 “Material Restriction Requirements for Packaging and Software

Products.” We provide it to all suppliers and vendors via an electronic distribution tool: Release Services

Manager (RSM).

The specification identifies packaging component data required by Microsoft including, but not limited

to, material type, compliance information, and if applicable, recycled content. S002689 also outlines

vendor responsibilities and the process for reporting component substances. Microsoft policy requires

that its packaging suppliers submit full material declaration and chemical test reports for all packaging

components to ensure compliance to restricted substances. Microsoft utilizes a database tool called

Teamcenter Environmental Compliance (TCEC) to store the material declarations and make them

available to run reports for individual products itemizing component substances. TCEC and full material

declaration of 100% of substances in our packaging (as well as our products) allows Microsoft to monitor

substances of concern such as bisphenol-A, heavy metals and phthalates. S002689 also includes overall

targets for recycled content of packaging and targets for sustainable sourcing for wood based

components.

In addition to S002689 and to enhance the e2e lifecycle process tool, Microsoft is developing an

environmental Center of Excellence (CoE) in FY 2011. The team will be comprised of members of the

global packaging design teams, the Safety, Compliance and Sustainability team, the sourcing team and

management. The CoE is designed to share packaging design innovation throughout the company, to

advance packaging metrics and scoring, to improve reporting tools and to present one consistent

message for packaging sustainability. This group will enhance the e2e process to manage the innovative

ideas in order to verify the environmental benefit, identify best use of the ideas, and manage the

implementation into the supply chain for broadest benefit.

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Procedure No. N/A Rev. B

6.2 Use of Recycled Content and Design for Recycling

Recycled content of paper in Microsoft packaging is variable by material type. The intent of specification

S002689 is to set and drive a goal with suppliers for achieving levels of recycled content. Through

reporting, we can determine which material types and vendors meet these target levels.

Microsoft suppliers are required to target a minimum 25% pre- or post-consumer recycled content in

packaging whenever possible. We strive to use soy based or biodegradable inks, in conjunction with our

increased use of paper print materials, enabling the packaging component to be recycled in many local

municipality recycling facilities around the globe. For Rigid Plastic Packaging Containers (RPPC),

Microsoft requires that all suppliers worldwide comply with the State of California’s RPPC Law, where all

RPPC packaging supplied to Microsoft must contain a minimum of 25% post-consumer recycled content.

For suppliers using paperboard and corrugated fiberboard materials in their packaging composition,

Microsoft uses specification S002689 to target the use of 50% recycled content in the overall program,

25% of which must be post-consumer. This is intended to apply as an average for our paper based

packaging, as corrugated generally has a higher recycled content, and other papers may be lower. 100%

of the paper based packaging components must be recyclable at the end of life. They must be devoid of

any heavy metals that could be harmful to the environment. Each packaging component is specified to

be properly labeled and easily separable by design to provide ease of recycling.

This year, Microsoft will improve specification S002689 by incorporating requirements for a minimum

recycled content by paper type and specification of the appropriate use of paper type, striving for the

highest recycled content as compatible with other paper attributes such as printability and quality. In

addition, the paper specifications will include Forest Stewardship Council (FSC) certification as support

for Microsoft’s commitment to use paperboard generated by suppliers who practice responsible

forestry. This is a part of a chain of custody certification to advise consumers, which packaging products

are FSC certified.

6.3 FY 2010 Achievements

There were significant Microsoft packaging sustainability improvements in FY 2010 as outlined in our

NPC Annual Report dated October 31, 2010. Following, are just three of those achievements.

6.3.1 Elimination of PVC from packaging

2005, Microsoft removed Polyvinyl Chloride (PVC) from product packaging and reduced the use of

plastic clamshells. In FY 2010, PVC was completely phased out of Microsoft hardware products, in favor

of packaging innovations such as Project Landscape, using recycled paperboard.

6.3.2 Personal Computer Hardware Peripherals

The Microsoft hardware design group partnered with our suppliers to redesign PC Hardware packaging, introducing a new “Landscape” packaging design platform in 2009. Landscape packaging was designed to help standardize packaging across hardware devices and is based on “right sizing” the package to minimize material. The packaging platform incorporates multiple sustainability strategies such as: the

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Procedure No. N/A Rev. B

use of renewable materials, increased recycled content and recyclability at end of life and a reduction in traditional retail packaging components. Additionally, the increased use of paperboard and new materials achieved volume reductions of packaging thus aiding efficient transport and shipping of the products. The Landscape packaging also eliminated the PET dual-piece (front and back panel) clamshell and replaced it with recyclable paper. Landscape packaging is produced in multiple sizes for each of the hardware peripheral products. Each

size provides different estimated dimensional reductions and standardized packaging for each product

group. Figure 3, below, depicts some examples of the current products with associated packaging

reduction percentages: large has 30% less volume; medium has 23% less volume; and small has 12% less

volume.

Figure 3: Project Landscape Packaging Volume Reduction for PCHW

6.3.3 Xbox 360® Retail Package Improvements

Microsoft launched the new, leaner Xbox 360® consoles in June 2010. Since the original introduction in 2001, Xbox® and Xbox 360® have grown rapidly in the home entertainment industry. The new Xbox 360® packaging (Figure 4) incorporates several environmental improvements over the previous product packaging:

Lighter weight - average 9% weight reduction, excluding the console and peripherals

Reduced Packaging Footprint - average 5% overall packaging dimensional reduction, fewer materials used

Use of paperboard from sustainably managed forests

Increased post-consumer recycled content in the paperboard

Selected material friendly to recycling and recovery

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Procedure No. N/A Rev. B

Figure 4: Xbox 360® Console Containers

7 SUMMARY OF INITIATIVES IN THIS PLAN

The following Action Plan Table 3 will help to calculate and document the environmental improvements

to packaging that Microsoft has been developing and implementing. The Action Plan table summarizes

the initiatives Microsoft will employ over the next three years to demonstrate incremental

improvements in the environmental factors of Microsoft brand packaging to report to the APC. The

table lists the KPIs for the APC, the action items associated with improving each KPI and the date of the

next reporting and the reporting measures. This Action Plan covers July, 2010 through June 30, 2014.

The first Annual Report under the newly revised APC will be submitted October 31, 2011 and will include

only the KPIs associated with our packaging brands in our Australia warehouse. Annually thereafter,

Microsoft will submit an Annual Report on or before October 31 to document improvements in the KPIs.

We view this Action Plan as a living document that will evolve and change as our packaging products

improve and reach goals annually. We have committed to additional Microsoft audit programs to gain

baseline information of our supplier manufacturing processes including environmental management

systems (EMS), more precise % recycling content of materials, and energy consumption statistics. We

plan to submit additions to our action items outlined in Table 3 annually as more baseline information is

available for analysis.

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15 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Table 3: Action Plan Table

Covenant Performance Goals and KPIs Actions Baseline Data Target or Performance

Goal Timeline or Milestones

1. Design – Optimise packaging to achieve

resource efficiency and reduce environmental

impact without compromising product quality

and safety

KPI 1 Proportion of signatories in the supply

chain implementing the SPG for design or

procurement of packaging

Target: 70% of Covenant signatories with

documented policies and procedures for

evaluating and procuring packaging using the

SPG or equivalent

Target: 70% of Covenant signatories assessing

100% of new packaging and 50% of existing

packaging against the guidelines

Continue to be a signatory of the

APC. Contribute financially to APC

and submit Action Plans and Annual

Reports.

Signatory since 2009. Reporting through Fiscal

Year (FY) 2013.

Continue

Include packaging suppliers in Microsoft (MS) supplier audit program to document if they have an Environmental Management System (EMS).

To be determine. Report the % of MS packaging suppliers that have an EMS.

80% of MS packaging suppliers will have a documented EMS

October 31, 2012 Report the baseline % of MS packaging suppliers with an EMS.

October 31, 2015 Annual Report for 80% of MS suppliers with an EMS

Beginning FY 2010 it is MS policy to

require packaging suppliers to

provide full material declaration for

all components in all packaging to

monitor substances of concern such

as heavy metals, Bisphenol-A and

phthalates.

N/A Document 100% of

substances comprising

MS packaging.

Continue

Improve 5% from product launch to

subsequent product launch for one

or more of the following:

Reduction in total weight

Reduction in packaging

Previous product

launch weight or

volume and recycled

content will be used as

baseline data for

improvement of the

5% reduction in weight or

volume 5% increase in use

of recycled materials from

product launch to

subsequent product

Product launch to

product launch based

on the schedule.

Report Annually.

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16 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

component material (weight)

Increase use of recycled content

Reduction in product to package

volume ratio

next generation. launch.

Calculate the weight of total

packaging sold into Australia

770 tonnes in FY 2009 Decrease by 5% year over

year

Annually

Continue to develop electronic

distribution of products and services

where appropriate to eliminate

packaging. Promote electronic

delivery methods to consumers.

Products that still

utilize packaging.

Implement one new

electronic distribution

product per year.

Annually

Covenant performance goals and KPIs Actions Baseline Data Target or Performance

Goal Timeline or Milestones

2. Recycling – the efficient collection and

recycling of packaging

KPI 2 N/A (Not Applicable to Individual

Signatories)

KPI 3 Proportion of signatories with on-site

recovery systems for recycling used packaging

KPI 4 Proportion of signatories with a policy to

buy products made from recycled packaging

KPI 5 N/A (Not applicable to individual signatories).

All Covenant signatories will have a formal,

Support “Buy Recycled” principles.

Include packaging suppliers in MS

supplier audit program to measure

their compliance with MS

Specification S002689 requirement

of purchasing 25% pre- or post-

consumer recycled content, or 50%

for paperboard/corrugate

packaging.

To be Determined. Target a minimum of 25%

pre- or post-consumer

recycled content

whenever possible.

RPPC Packaging must

contain a minimum of

25% post-consumer

recycled content

Paperboard/corrugate

must contain 50%

recycled content, 25% of

which must be post-

consumer.

Begin auditing

packaging suppliers for

recycled content by

October 31 2012. 90%

of packaging suppliers

audited by October 31,

2013.

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17 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

documented policy of buying recycled products

or materials

Formalize and document recycled content preference policy in MS packaging Specification S002689 and circulate to suppliers. Indicate preference to suppliers of recycled content when performance, safety, regulatory and cost requirements are met.

N/A Update MS Specification

S002689 with recycled

content preference policy

and circulate to 100% of

MS suppliers. Follow-up

training as needed.

October 31, 2011

Promote recycling and educate

consumers to recycle our products

through Australian internet websites

and/or Microsoft websites.

N/A Develop a recycling

information page on

Microsoft.com

October 31, 2011

Report total weight of non-

recyclable consumer packaging sold

per annum in Australia market.

44.1 tonnes in FY 2009 Improve by at least 5%

year over year.

APC Annual Reporting

Provide packaging and electronic

product recycling take-back program

at Microsoft branded company

stores.

Microsoft branded

stores currently take

electronic products for

recycling, but not

packaging.

Provide packaging

recycling take-back

program at Microsoft

branded company stores.

October 31, 2012

Perform a waste audit of MRSC

Australia distribution warehouse in

Sydney, Australia to determine

onsite recycle and recovery systems.

To be determined Determine the baseline % of packaging recycled at MRSC national distribution warehouse

October 31, 2011

Improve MRSC Australia national distribution warehouse waste management to include 100% recycling of materials that are recycled by the Australia Territory Municipal recycling system. Utilize

To be determined 100% recycling of primary, secondary and tertiary packaging disposed of at the MRSC Australia national

October 31, 2012

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18 Microsoft Commitment to Environmental Sustainability Safety, Compliance & Sustainability Policies and Procedures

Municipal recycling programs to maximize recovery rates.

distribution warehouse.

Covenant performance goals and KPIs Actions Baseline Data Target or Performance

Goal Timeline or Milestones

3. Product stewardship – a demonstrated

commitment to product stewardship by the

supply chain and other signatories

KPI 6. Proportion of signatories that have

formal processes for working with others to

improve design and recycling of packaging

KPI 7. Proportion of signatories demonstrating

other product stewardship outcomes for

packaging

KPI 8. Reduction in the number of packaging

items in litter

Document the existing Microsoft

packaging phase and gate driven

production lifecycle process in a

report format. Enhance to more

closely align with APC Sustainable

Packaging Guidelines.

N/A Convert electronic

internal tool to a report

format that can be made

public.

October 31, 2011

Charter MS Center of Excellence (CoE).

N/A Company-wide stewardship of packaging sustainability.

October 31, 2011

Continue ISO 14001 Certification No ISO Certifications ISO 14001 Certification in

Microsoft global supply

chain operations.

October 31, 2011

Reduce the number of components in Microsoft packaging.

Previous product launch component number will be used as baseline data for improvement of the next generation.

Continuous reduction in the number of packaging items in packaging

Annual reporting of the number of packaging items in MS packaging at MRSC

Identify an anti-litter reduction or

education program in Australia &

submit to MS upper management

for approval of financial support.

N/A MS approved financial

support of a local

Australian anti-litter

organization.

Submit

recommendation in FY

2011 Annual Report.