Stage 2: Project Planning

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3. Stakeholders (NGO and investors)

A lot of times, Non-government organizations are the drivers of change to companies; however, in the case of Acer, NGOs were not involved. They were more focused on product safety such as the RoHS regulation. In regards to investors, the result of the life cycle assessment is of concern to them because when company’s ability to manage their carbon emission is poor, there is a high possibility that the company will be subjected to carbon reduction regulation in the event carbon tax is imposed. When carbon tax is in place, the cost of operation will be increased if carbon management is done poorly and it will affect the company’s overall profitability.

5.1.3 Stage 2: Project Planning

For implementation of a brand new project, it requires clear vision from the leader and before-hand planning to ensure smooth execution. This section discusses the leader’s vision and style, partners involved in carbon footprint labelling, project design and selection criteria for product.

1. Leadership:

Mr.J.T. Wang offers employees a high degree of autonomy and has confidence in employees’ strengths; therefore, employees do not need to report to chairman for this particular carbon footprint project. The department in charge was the product department and the product manager was in charge of executing the project. The project emerged when Mr.Wang clearly announced his goal in becoming a corporate socially responsible company. Having this vision in mind, the employees come up with projects that will meet this vision. According to Mr.Lai, CSR training is available to the entire company and he also travelled Malaysia the week prior to the interview to provide training for the human resource department on CSR.

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Furthermore, Acer is also a member of the World Business Council for Sustainable Development (WBCSD). The WBCSD is a CEO-led global organization whose vision is to advocate sustainable practices among businesses.

2. Partners:

Major executers: For this project, the major executers are the suppliers, the ones who provide raw material and do manufacturing. Acer provides education on its suppliers for two to three years and worked with Industrial Technology Research Institute, ITRI to provide consultation for suppliers. The cost of life cycle assessment will be covered by the suppliers themselves; Acer is not responsible for the cost incurred. Acer announces the plan to implement life cycle assessment and inform suppliers of consumer, distributor and market trend so that suppliers can be prepared for the coming trend. Acer receives the latest information on sustainable development from its international meeting. Due to the highly competitive nature of the supply chain, some suppliers even approached Acer proactively to promote its engagement in water footprint

Data verification: TUV, The life cycle assessment was done by suppliers; however, verification of data is done by TUV, the third-party organization to verify the data from life cycle assessment. The verification must meet government requirements and according to Mr.Lai, this part can cause the cost to rise.

3. Project design

In the case of Acer, the situation is different from Taisun because Acer outsources its manufacturing to suppliers. Therefore, the execution would be different between the two companies. One key point of Acer’s case is the level of bargaining power between Acer and its suppliers. Since Acer is the world’s third largest PC vender as of May 2011, it enjoys strong bargaining power with its

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suppliers. In order to win orders from Acer, suppliers must compete amongst themselves to meet the requirements from Acer. In the case of life cycle assessment, the more reliable and comprehensive the data the suppliers provide, the more likely the supplier will win order from Acer. However, if Acer is not a major player in the market, suppliers’ will of meeting the requirement would be lower because meeting the requirement increases the cost and they do not receive an equivalent amount of return from working with this particular player. While Acer’s suppliers start assessing life cycle carbon footprint, data will be generated and become important basis for the construction of carbon emission database. Once the database is established, assessing life cycle carbon footprint will become more convenient for other companies which want to implement the scheme as well.

For Acer itself, the life cycle assessment would be two parts 1) based on the carbon life cycle associated with its daily operation, for example, the electricity, fuel used, and etc. 2) the carbon footprint from the B2C part of the product life cycle. The B2C part will be composed of the transportation, packaging, marketing and storing.

The marketing department provides market analysis data and product distribution and transportation information, which is the amount of carbon footprint during transportation to product’s distribution site.

How it is done: Acer has a designated window for contact with suppliers’

corresponding window to deal with CSR related activities. Once Acer has chosen its suppliers, these suppliers will need to do life cycle assessment of the raw materials they provide to Acer. The life cycle assessment is divided into two parts: B2B and B2C. Currently, Acer has around 22 suppliers. The auditing of carbon footprint can be done within a short amount of time; however, to receive the certification from EPA, it will require two to three months. The reason why auditing can be done fast is

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because during the design, R&D and Production stage, auditing can be done before the product launching. Therefore, the data can be ready before the product is launched into the market. However, the time to obtaining the certificate can delay the marketing activities for the product.

4. Product Selection: What are the selection criteria

The considerations for selection are the complexity of assessment and completeness of information. The complexity of assessment refers to the complexity of the product and its manufacturing process; the more complex a product is, the harder it is to assess its carbon footprint. On the other hand, completeness of information will affect the quality of the life cycle assessment. As incomplete information cannot be used as a qualified source for consumers to make environmentally-wise decisions.

Product information: The model that received the carbon footprint certificate is model number AO532H, a small laptop. This model is no longer available on the market since the new model has been launched. The certificate was issued after the product is removed from the market.