When one stakeholder insists that a company focus more closely on its sustainability strategies, the company may up its efforts. When two stakeholders speak up, the issue becomes more pressing. But when three stakeholders are talking at once, action must be taken immediately.
That’s the position that Micron Technology, Inc., (IW 500/41) the 4th largest semiconductor company in the world with revenue of $34 billion in 2018 and 34,000 employees, is in. Investors, customers and employees have converged and are very vocal about wanting to see actionable plans and results.
From the investor viewpoint, the pressure to ensure that companies have strong sustainability programs continues to grow. Last year one of the largest funds, Vanguard, launched two new index ETF funds that have an environmental, social, and governance focus.
Customers are also asking Micron about their supply chain, says Marshall Chase, director of sustainability. The company has a core set of 20 customers that grade Micron on various sustainability metrics. As Micron supplies well known electronic brands, the end customer is concerned about their own brand risk. For example, if a customer was to find out that there was child labor in Micron’s supply change it would affect the customer’s market reputation.
Customers also want Micron to be proactive in environmental stewardship and climate change, says Chase.
As for employees, “we are in a very tight talent market and are fighting for talent both within the industry and even with our customers,” says Chase. “We need to attract the younger generations and they are asking specific questions about the value system of our company. We know that if pay is equal, they will choose the company that is progressive, proactive and has inclusion as a core value.”
But Micron is up to the task. Having survived the winnowing down of the industry from 20 players ten years ago to five now, Micron can now hone in on its core values, such as sustainability. “We are in a position to solidify our sustainability programs in a number of areas, “explains Chase, “and our results could in fact become our competitive advantage.”
The company’s strategy is based on three specific areas:
--Operating thoughtfully
-- Empowering people
--Sourcing responsibly.
The objective of these efforts is to reduce the environmental impact of operations, ensure that products are sourced responsibly, and share the company’s success with the community.
The company recently released its 2019 Sustainability Report. Here are some highlights based on the three core areas.
Operating Thoughtfully
The company achieves this through a variety of programs including environmental goals. Micron set goals in 2017 to increase water and waste recycling and decrease energy use and associated greenhouse gas (GHG) emissions. They are making progress toward these goals, including implementing energy savings projects to achieve a 10% savings by 2022.
The company’s global water recycling initiatives at its manufacturing sites achieved an approximate 50% recycling rate on average.
And it’s getting employees involved in environmental issues as well through resource groups at a variety of sites. “We have set up volunteer groups of employees who are working on environmental issues,” says Chase.
Sourcing Responsibly
Micron takes an active role in managing the sourcing of its nearly 6,000 suppliers in 72 countries. The company is active in several sustainability coalitions, including the Responsible Business Alliance, that drive ethical business practices.
In 2018, the company received a score of A in the engagement of its suppliers on climate change issues from the CDP (Carbon Disclosure Project).
“Sustainability models need to extend beyond traditional models to include diversity and inclusion, "explains Sharawn Connors, vice president of Diversity and Inclusion, Micron. "Cultivating a talent pool with a diverse set of experiences and backgrounds drives innovation, helps us solve challenging problems in every aspect of our operations, and improves and informs our sustainability efforts.”
Diversity and Community
Diversity is also included in its sustainability initiative as the company feels that its inclusive hiring benefits the community and helps sustain a healthy community.
“Sustainability models need to extend beyond traditional models to include diversity and inclusion, "explains Sharawn Connors, vice president of Diversity and Inclusion, Micron. "Cultivating a talent pool with a diverse set of experiences and backgrounds drives innovation, helps us solve challenging problems in every aspect of our operations, and improves and informs our sustainability efforts.”
As far as pay equity is concerned, Micron said that it is "committed to providing equal salary to men and women in similar roles in all of its locations." To ensure less than a 1% difference, at the start of the fiscal year 2019 it invested $2.3 million in additional compensation to employees.
“We continue to work diligently to attract the broadest possible talent pool and create an inclusive culture,” wrote. Sanjay Mehrotra, CEO, in the 2019 sustainability report. “We also engage employees to amplify our impact on our communities. Our team volunteered more than 100,000 hours worldwide in 2018, and we matched $2 million in team member-directed giving. efforts.”
The company not only understands its role in the communities in which it operates but also the global impact they have.
“We are a sizable company that makes things that everyone uses, therefore making a significant impact on the world,” says Chase. “Our products are in devices that are transforming society, and so operating with these core values is essential.”
