In this paper, we will study the case of Intel, a semiconductor chip maker, to know about its corporate responsibility during 2009, to see how they incorporate CSR into their strategies and objectives,

International Baccalaureate Business Studies

FINAL PAPER

Lecturer: Dr. TRUONG THI NAM THANG

GROUP 6 – MBA 19:

Truong Thi Ngoc Thuy
Huynh Thi Hoang Hac
Nguyen Hai Duyen
Duong Vo Nhi Anh
Nguyen Ngoc Khanh Son

Corporate Social Responsibility (CSR) is known as the commitment of a corporation to business ethics, its contribution to the development of the economic, and the social improvement. It is nowadays considered as one important session planned in the corporation’s strategies and becomes a compulsory for a corporation’s maintenance and development. In order to do so, it is required that a corporation must be transparent in its financial report, its operation activities, and its operation principals. Moreover, following the world’s solid development, a corporation should not put profit on its first priority, yet should care about the life of its employees and the surrounding people, and care about the community’s growth and development’s. Depending on the characteristics of each corporation, different ones will have their own suitable CSR strategies.

In this paper, we will study the case of Intel, a semiconductor chip maker, to know about its corporate responsibility during 2009, to see how they incorporate CSR into their strategies and objectives, how they apply their technology and expertise to benefit the environment and society, and what they get from it.

This study contains five parts as follows:

Background of Intel Corporation
Intel’s CSR core values and strategy
Intel’s programs and its performance toward CSR goals
Awards
Conclusion

BACKGROUND OF INTEL CORPORATION:

Intel Corporation is well known as the world leading semiconductor chip manufacturer. The corporation was found in 1968 in Santa Clara by Bob Noyce and Gordon Moore, under the name of NM electronics. Later in the year, it was changed to Intel after the founders purchased the right to use the name from a company called Intelco.

At begin of establishment, Intel’s primary products were SRAM and DRAM chips. In 1971, Intel manufactured the world first microprocessor, the 4004, the first CPU on a single chip. Being driven by business and technological needs, the company shifted its focus on producing microprocessor in 1980s. Taking the most advantages as the pioneer in microprocessor development and manufacturing, Intel has been dominating the world microprocessor market since the release of its first product. As of today, the company is named as the largest chipmaker in the world, dominating the microprocessor market with over 80 percent contribution of overall sales, where more of revenue comes from Asia Pacific. Its current products include microprocessor, chipsets, motherboards, and wire-less and wired connectivity, as well as platforms that incorporate theses components.

INTEL’S CSR CORE VALUES AND STRAREGY:

Core values: For decades, the backbone of Intel corporate culture has been Intel Values: Customer Orientation, Discipline, Quality, Risk Taking, Great Place to Work, and Results Orientation. These values define who they are and how they act as employees and as a company. These values move forward toward common goals—in business and corporate responsibility.

According to Paul S. Otellini, Intel President and Chief Executive Officer, corporate responsibility is about doing the right things right. That is why throughout Intel’s history, they have focused on building an ethical culture, reducing the environment impact, investing in their employees, and engaging with communities.

Strategy:

In 2009, Intel continued to invest in their corporate responsibility priorities, despite difficult economic conditions.

Generally, Intel corporate strategy includes specific goals related to building new businesses while tackling global challenges in the areas of education, healthcare, community and environment and energy efficiency.

The following table will provide a summary of Intel’s company-wide goals in key corporate responsibility areas.

INTEL’S PROGRAM AND ITS PERFORMANCE TOWARD CSR GOALS:

Defined clearly the goals, Intel and its people have implemented each of their programs seriously.

ENVIRONMENT:

Intel incorporates environmental performance goals throughout their operations, seeking continuous improvement in energy efficiency, emission reductions, resource conservation, and other areas. Recognizing that consumer use of their products accounts for a larger portion of our overall environmental footprint, they focus on improving the energy-efficient performance of their products and collaborating with others to develop innovative ways that technology can help address long term sustainability challenges across other industries.

1. Climate Change and Energy Efficiency

Intel considers climate change an important environmental issue, and many years ago began taking steps to mitigate their impact and publicly report on their carbon footprint. They believe in a portfolio approach to emission reduction and energy management. Through a wide variety of effort, they have built a strong sustainable approach to buying and using energy in an economical and environmentally conscious manner.

Reducing Greenhouse Gas Emissions: Intel has for many years reported its Scope 1 and Scope 2 greenhouse gas emission publicly, but like many companies had an incomplete understanding of Scope ...

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1. Climate Change and Energy Efficiency

Reducing Greenhouse Gas Emissions: Intel has for many years reported its Scope 1 and Scope 2 greenhouse gas emission publicly, but like many companies had an incomplete understanding of Scope 3 emission. Scope 1 and Scope 2 refer to direct emissions from facilities and purchased electricity, respectively. Scope 3 emissions are from sources not directly attributable to a company’s manufacturing operations, but are created directly as a result of its operations or the se of its products.

In 2009, they completed a research paper, “Developing an Overall CO2 Footprint for Semiconductor Products”, to gain a better understanding of the Scope 3 impacts from our industry, including embedded CO2 in the supply chain.

Investing in Renew able Power: In 2008, Intel became the largest voluntary purchaser of green of green power in the U.S., under the U.S.EPA’s Green Power Partnership program. We committed to purchase renewable energy credits to support the generation of more than 1.3 billion kWh per year as part of a multi-year contract.

According to EPA, their purchase commitment – which includes a balanced portfolio of wind, solar, small hydroelectric and biomass sources-, has the equivalence environmental impact of taking more than 200,000 passenger vehicles off the road per year.

Climate Leadership Activities: According to Gartner Research, about 20% of the world’s emissions come from the information and communication technology (ICT) industry. Therefore, Intel collaborates on initiatives with multiple stakeholders to reduce ICT – related emission, and to identify ways that the ICT industry can help to reduce energy consumption and carbon emission across other sector of the global economy.

Intel, Google, and the World Wildlife Fund jointly launched CSCI in June 2007, with the goal of building awareness and encouraging the use of more efficient components and power management features to reduce computer-related CO2 emissions. The initiative is unique in that it unites industry, consumers, government, and conservation organizations – securing commitments from manufacturers to produce and sell more energy-efficient product and encouraging consumers to purchase computer with better efficiencies.

Intel Open Energy Initiative. Founded in 2009, the Intel Open Energy Initiative aligns and mobilizes Intel and its partners around the application of technology and open standards to accelerate the global transition to smart energy.

2. Water Conservation

Sustainable water management continues to be a key focus at Intel’s sites worldwide, so they can meet their business needs as well as the needs of their communities.

They consider efficient and environmentally sound water management throughout all stages in their operations, including reviewing access to sustainable water sources as a criterion when selecting a site for an Intel facility. They also work to understand the potential impact of their water use at the community level, and engage in discussion about responsible water use and the human right to water. 2 of the most significant programs regarding water conservation are:

Investing in Responsible Water Management. Since 1998, they have invested more than $100 million in water conservation programs at their global facilities.
Collaboration and Opportunity. In 2009, Intel became a founding member of the Washington, D.C-based Water Innovations Alliance, an industry association that focuses on developing funding, reducing regulatory barriers, increasing collaboration, and raising awareness of cutting-edge water technologies and the problems they address.

3. Waste: Reduce, Reuse, Recycle

In addition to their commitment to the environment, each year Intel recycles a high percentage of the waste from their operations. In 2009, their employees continued to identify new opportunities to minimize waste and recycle or reuse materials, from large-scale process improvements to everyday actions.

Solid waste. Since 2007, they have recycled at least 80% of the solid waste generated in their operations each year. Waste generated during construction makes up a significant portion of their solid waste.
Chemical waste. In 2008, we announced a goal to reduce our generation of chemical waste per chip by 10% by 2012 compared to 2007 levels. They are working to reverse this trend and achieve their 2012 goal; including installing systems at two of their facilities to recycle dissolved metal waste. They also established teams to identify ways to reduce tow of their largest waste streams.

4. Reducing Air Emissions

Through careful design of their production processes, they have reduced their absolute air emission since 2000, while growing their operations more than two-fold.

They work to minimize their emissions of both volatile organic compounds (VOCs) and hazardous air pollutants (HAPs).

Intel eliminated the use of ozone-depleting substances (ODSs) from manufacturing in the 1990s. They have also eliminated the use of Class I ODSs from refrigerant system.

WORKPLACE:

For over 40 years, Intel employees have been making history-collaborating to tackle some of the world’s toughest challenges and developing technical innovations that have improved lives everywhere. Their success depends on recruiting and cultivating the best talent. Intel is known for its technology, but the people behind the technology are what make the company great.

One of the six Intel Values is “Great Place to Work”, which reinforces the importance of positive employee relations as a key component of their success. They support this value by cultivating open and direct communications, rewarding and recognizing their people, and investing in career development and leadership. Feedback from regular employee surveys

1. Career Growth and Development

Their employees grow by continuous learning-on the job, in the classroom, and by connecting with others. They encourage employees to work with their managers to align their job assignments with their strengths and interests, as well as with the needs of the organization.

Management/Leadership Development. “New to Management” and “Leading for Extraordinary Results” are three-to six-month programs that expose new managers to challenging leadership scenarios, provide them with problem-solving skills, and encourage them to partner with other leaders on advanced solutions to problems.

Intel University. In 2009, Intel invested approximately $267 million in employee training and development. Intel University provides a comprehensive development curriculum, including new employee orientation, cultural integration, skills training, professional certification, and external education.
Tuition Assistance. Their Tuition Assistance Program provides financial assistance to eligible U.S. employees who are completing job-related degree programs or course work. In 2009, they invested $10.9 million in employees who participated in the program.

2. Health and Safety, and Employee Wellness

Their safety and wellness programs help employees enjoy a better quality of life. These programs also contribute to Intel’s success, since employees who are physically and mentally fit can be more productive.

2009 Safety Update. In 2009, they reached 105,000 people with environmental, health, and safety (EHS) training, including over 2,200 online, instructor-led, and on-the-job EHS classes held during the year.
Health and Safety Management System. In addition to maintaining their ISO 14001 certification for environmental management systems, their ongoing commitment to continuous improvement across EHS topics was acknowledged through their Corporate EHS Group’s initial certification to OHSAS 18001, the internationally recognized standard for occupational health and safety management system.
Wellness Programs. Intel is committed to providing a portfolio of wellness programs that help our employees evaluate, maintain, and improve their own health and that of their families. In 2009, 27,205 Intel employees participated in the Wellness Check.

COMMUNITY:

According to Shelly Esque, Intel Vice President of Corporate Affairs Group, Intel is committed not just to being a good and responsible neighbor, but also to sharing the innovative ideas and professional skills of their employees with their communities around the world.

1. Intel Involved and Skills-Based Volunteering

Since 1995, the Intel Involved program has matched the skill and passion of their employees with volunteer opportunities. Every year, employees donate hundreds of thousands of hours mentoring young people, restoring parks, lending their technical expertise, serving on nonprofit boards, and performing other vital tasks.

Volunteering for Education. During the past decade, Intel employees have volunteered more than 3 million hours for education-related activities. In 2009, they piloted a new program, the Intel Education Service Corps (IESC). IESC volunteers travel to schools, orphanages, and other locations in developing countries to facilitate installation of Intel-powered classmate PCs, and teach students, teachers, and parents how to use them.
Volunteering for the Environment. Intel volunteer activities reflect strong employee interest in protecting the environment, promoting sustainability, and raising awareness of environmental concerns, such as Global Earth Day, in April 2009, planting activities of volunteers from Intel New Mexico, etc.

2. The Intel Foundation and Community Giving

Each year, Intel and its employees, supported by the Intel Foundation, contribute millions of dollars to education, community programs, and disaster relief efforts.

The Intel Foundation. Founded in 1989, the Intel Foundation provides funding for national and local grants to promote innovation in classrooms and empower women and underserved youth to reach their potential. The Intel Foundation is funded solely by donations from Intel Corporation.`1
Employee Giving. Every year, we are inspired by the generosity of our employees, who, in addition to volunteering their time, donate millions of dollars to their communities worldwide. Despite continued economic uncertainty, employee and retiree contributions to the Community Giving Campaign for 2009 increased 3% over 2008 to a record $12 million. With the Intel Foundation match, the total contribution amounted to more than $22.7 million. In 2009, for the second year in a row, Intel placed in the top 10 United Way corporate campaigns in the U.S., and they received numerous recognitions from local United Way organizations for their commitment.

EDUCATION:

“Education is one of the best ways to change the future of individuals, regions, or even counties.” Said Lila Ibrahim, General Manager, Intel Emerging Markets Platform Group.

Intel believes that to succeed in today’s global economy, children need a solid math and science foundation coupled with 21st century skills, such as digital literacy, problem solving, critical thinking, and collaboration.

Intel works with governments, education leaders, non-governmental organizations, and other technology companies to bring about a transformation in education through technology, Internet connectivity, digital content, and improved teaching methods. Over the last decade, Intel has invested more than $1 billion, and our employees have volunteered over 3 million hours, toward improving education in over 60 countries.

1. Inspiring Young Innovators

To help inspire the next generation of scientists and engineers, and shine a spotlight on excellence, Intel encourages student interest in science and math by sponsoring science competitions and promoting innovative school science and math programs. They also collaborate on initiatives that help young people develop teamwork and technology skill in fun, engaging environments. They are the lead sponsor of two premier science competitions, the Intel International Science and Engineering Fair (Intel ISEF) and the Intel Science Talent Search (Intel STS), which are both programs of Society for Science & the Public.

Intel® Learn Program. Designed for children aged 8-18 is underserved communities, and supported by both Intel and the Intel Foundation, the Intel® Learn Program extends learning beyond classrooms to informal environments in local community centers. Since the program’s inception in 2003, more than 1 million learners have participated, and it is now available in 13 countries, including 3 that were added in 2009.

2. Empowering Teachers

Because a single teacher can reach generations of students, Intel believes that supporting teachers is the most effective way to improve education. Intel’s professional development initiative aims to better equip teachers so they can help students worldwide develop the technology literacy and critical-thinking, problem-solving, and collaboration skills needed for success.

Intel® Teach Program. Since 1999, the Intel® Teach Program has helped teachers’ integrate technology and create active learning environments in their classrooms. Intel Teach offers in-depth professional development for K-12 teachers, helping them implement real-life projects and make concrete changes in their teaching through the effective integration of technology. By the end of 2009, the program had provided professional development for over 7 million teachers worldwide. Intel is on target to train 10 million teachers by 2011.
skooolTM Learning and Teaching Technology. The skooolTM Learning and Teaching Technology program supports math and science learning for students 13 to 15 years old – the age when many young people progress from concrete learning to more abstract thinking. The program is now available in 23 countries and 7 languages, and has reached over 3 million students.

3. Investing in Higher Education, Research, and Entrepreneurship

Intel and the Intel Foundation support university programs for faculty and students to advance research and education in computer science and engineering – as well as initiatives aimed at increasing the number of women and under-represented minorities in these fields.

Intel® Higher Education. The Intel® Higher Education program is active in more than 80 countries, interacts with more than 1,700 universities through curriculum programs, and in engaged in over 250 research projects worldwide. More than 285,000 students now have the skills to develop software with the latest technology when they graduate.
Research Fellowships. Intel funds research related to microprocessor technology, high-volume manufacturing, computer science, and a variety of other disciplines critical to our industry. In 2009, they awarded grants totaling over $9 million to support research at leading universities around the world. They also provided graduate fellowship support and undergraduate student funding for hundreds of students in 2009.
Entrepreneurship Programs. Their entrepreneurship programs are designed to eliminate the barriers between technical engineering educators and their business school counterparts by promoting communications and serving as catalysts for new business development in local economies. Professors in more than 25 countries combined new entrepreneurial skills with technical expertise to help foster innovation and new business startups in 2009.

PERFORMANCE SUMMARY AND RESULTS:

While 2009 was considered a global economic recession year, Intel reported their 23rd consecutive year of profitability. Their performance and results did impact the economic, the environment, and society at local, regional, and global levels.

Economic Impact:

They provided high-paying jobs and created indirect investments in the form of non-Intel jobs and tax revenue. In 2008, Intel commissioned HIS Global Insight to conduct an independent study of Intel’s economic impact in the U.S and Europe, including their direct and indirect role in fueling economic growth, creating jobs, and enhancing productivity across multiple industries. The table below illustrates 4 layers of Intel’s impact on the economic:

Environment Impact:

Intel teams consider environmental impact when they design Intel buildings, set performance levels for manufacturing tools, and establish goals for new production processes. They have joined forces with businesses and governments worldwide to find and promote additional ways that technology can be used to address environmental challenges across all sectors of the economy. They also recognize that this represents a market opportunity for Intel and are helping to drive initiatives aimed at using technology for data collection, analysis, and modeling, to enable better energy management and actions to reduce environmental impact.

The below chart interpret what they have achieved towards the product- related environmental goals

Society Impact:

Through their programs and investments, they have significant impacts on the society which are expressed in their goals and here are their performance results for them:

AWARDS:

With what Intel has done during 2009, they received more than 80 corporate responsibility awards and recognitions. Below are just some of them:

CONCLUSION:

With the Intel Corporate Responsibility analysis, we find that although Intel faced challenges in reducing their water use and waste generation in 2009, they have almost completed their goals. The success of Intel’s CSR programs are thank to their specifically and perfectly planned objectives. The social responsibilities are understood thoroughly from the top management to each of their employee. We also see that their incorporating CSR into their strategies and objectives did bring them an increase in benefits. The benefits mentioned here are obviously not only the increased productivities, but also the binding culture within the corporation. These benefits are also not limited to Intel, but to the global issues. CSR has become a significant feature of business practices in the global economy. By investing in CSR, Intel is investing in sustainability and broader economic, social, and environmental goals.

From the case studied, we find out that CSR plays an important role in nowadays global business. It can help to enhance the corporation‘s reputation by building trusted relationship around the world. However, for Vietnamese corporations, implementing CSR is a big challenge, especially the medium and small ones. The crucial barrier does not due to the expenses, but the commitments from top management. Some corporations implement CSR passively. If they do not understand clearly about CSR, they could not incorporate CSR with their daily operation and business. That is the responsibility of top management to believe in the importance of CSR, to pioneer and support CSR programs within the corporation. In the age of globalization, a single business does not only represent itself but its country. Therefore, social responsibility cannot be just a tip of the iceberg, just one added aspect; it should be the corporation’s essence. The more social responsibilities a corporation has, the more productivity it gains.

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