HP Global Citizenship: Custom Report Page 1 of 225 HP Global Citizenship 2010: Custom Report Letter from CEO Léo Apotheker Hewlett-Packard (HP) is a company with a history of strong global citizenship. Social and environmental responsibility are essential to our business strategy and our value proposition for customers. They are also at the heart of an obligation we all share to help create a sustainable global society. I look forward to helping advance HP's commitment to making a positive difference in the world through our people; our portfolio of products, services and expertise; and our partnerships. Our workforce of nearly 325,000 talented people is our greatest asset. Through their commitment, HP achieves extraordinary results both in our business and in our communities. With their expertise and innovative drive, we're pursuing a vision of corporate success that goes beyond just creating value for shareholders—we are helping to create a better world. We're also using our position as the world's largest information technology (IT) company to help address some of society's most pressing challenges. Our strategy is to use our portfolio and expertise to tackle complex issues—such as improving energy efficiency, enhancing the quality and accessibility of education, and making healthcare more affordable, accessible, and effective. We approach these issues in a holistic way, stretching beyond quick fixes and piecemeal solutions. We recognize that these problems are too big for any single organization to address alone, so we're teaming up with partners worldwide to find solutions. We cultivate relationships with diverse stakeholders, such as industry peers, governments, and nongovernmental organizations (NGOs). And to promote higher standards across sectors, we endorse the UN Global Compact. Throughout this report, you'll see numerous examples of how HP works with partners to solve tough problems. For instance, the HP Catalyst Initiative is tearing down obstacles that prevent students from learning science, technology, engineering, and math (STEM) by bringing together some of the world's best educators to devise new ways of teaching. Through our partnership with the Clinton Health Access Initiative (CHAI), we're helping to reduce AIDS fatalities by bringing technology and healthcare together in innovative ways. And we're helping companies decrease their environmental impact through HP Energy and Sustainability Management (ESM), a portfolio of services that enables companies to better manage their use of energy and other natural resources. Looking back at the milestones we reached in 2010, I'm proud of HP and our employees. HP's accomplishments span many areas, reflecting the breadth of our business and global scale of our operations. As we look forward, it's more important than ever for us to maintain our momentum, because the challenges we face—and the opportunities before us—have never been greater. Léo Apotheker, president and chief executive officer HP profile HP facts and figures 1 HP ships approximately 3.5 products every second. HP has approximately 145,000 sales partners and 210,000 service partners. Nearly 90% of the world's largest electric and power companies depend on HP software and solutions. Our card processing services handle over 6.6 billion transactions annually. All of the Fortune 500 pharmaceutical companies and the world's largest healthcare payers and providers are HP customers. Eighty-four percent of the world's largest transportation companies and 88% of the world's largest consumer packaged goods companies are HP customers. We manage over 200 data centers, 380,000 servers, and 5.4 million desktops. HP operates IT product reuse and recycling services in 58 countries or territories. Our software solutions stop 1.7 billion spam messages a month. At HP, we provide solutions that help people and organizations connect and create a better world. Millions of people are searching for new and better ways to live and work, increasing the demand for information technology (IT), especially in cloud computing and connectivity solutions that allow instant access to information from anywhere, at any time. This demand is emerging alongside extraordinary environmental, social, and economic forces such as climate change, rapid http://www.hp.com/hpinfo/globalcitizenship/print.html 03/05/2011 HP Global Citizenship: Custom Report Page 2 of 225 population growth, and increasing urbanization. In this new world, information is our most valuable resource and one of the keys to addressing today’s global challenges while creating tomorrow’s sustainable growth. Here are just a few ways HP solutions are helping to improve our environment, our communities, and how we live and work. Making sense of a world of data CeNSE (Central Nervous System for the Earth) enhances human interaction with the earth using an intelligent network of billions of inexpensive, highly receptive sensors. These perceive and analyze information around us with remarkable fidelity and then send the data they gather over fast computing networks to powerful data centers for real-time analysis and action. Providing access to lifesaving information HP is helping to pioneer an innovative pharmaceutical authentication system. It’s quick, easy to use, and can be accessed via text message with a basic mobile phone. This technology empowers patients with timely information about their medications and has the potential to dramatically reduce deaths caused by counterfeit drugs. Redefining the possible HP Labs is moving memristor from theory to reality. A new element of electrical circuitry, memristor operates in ways that have been compared to brain synapses. We hope that this breakthrough will lead to increasingly energy-efficient, compact, and powerful computing systems that open up more sustainable, efficient, and creative solutions for customers. Enabling the next billion Internet users HP has introduced a cloud-based service to expand access to communication and information. HP SiteOnMobile allows people in developing countries to access the Internet— many for the first time—with a basic mobile phone, even if the phone lacks web browsing and email features. Shared values HP's shared values and companywide objectives include a longstanding commitment to global citizenship. Broader than any single organization or program, global citizenship at HP determines how we align our business goals with our impact on society and the environment. A unique advantage HP’s size, scale, and global reach provide us with a unique advantage. Through investments in research and development (R&D), industry partnerships, and acquisitions, we have developed a comprehensive portfolio of IT hardware, software, and services, backed by nearly 325,000 employees2 in approximately 170 countries. Our reach allows us to have a global impact on critical issues that affect communities worldwide, such as energy and climate change, education, and healthcare. While we invest in R&D to support our business, we also search for ways to complement and further extend our existing capabilities and meet customer needs. For example, by combining the breadth and scale of our existing portfolio of products and services with the recently acquired webOS platform, we have critical pieces in place to respond to both our customers’ desire for consistent, integrated access to information and the converging industry trends of mobility and cloud computing. HP corporate summary Fortune 10 U.S. Fortune 26 Global Chief Executive Officer: Léo Apotheker Nearly 325,000 employees as of October 31, 2010 Incorporated in Delaware, United States Listed on the New York Stock Exchange with the ticker symbol HPQ Corporate and regional headquarters Recorded $126 billion USD in net revenue for fiscal year 2010 The scope of HP's business Personal systems HP is the world's leading vendor of personal computers, with the industry's broadest portfolio of notebooks, desktops, workstations, thin clients, displays, handheld devices, and personal storage solutions. Imaging and printing HP has been the worldwide leader in inkjet and laser printing for more than 20 years, advancing the digital transformation of printing while offering customers new ways to be creative, conserve resources, and improve productivity. HP Enterprise Business HP provides businesses and governments with services and technology infrastructure for the Instant-On Enterprise—helping them to serve their customers and citizens instantly, adapt easily, innovate rapidly, and manage risk and environmental responsibility. HP Financial Services HP helps customers reduce the cost of running their businesses—from planning and http://www.hp.com/hpinfo/globalcitizenship/print.html 03/05/2011 HP Global Citizenship: Custom Report Page 3 of 225 acquiring technology to retiring and replacing it. HP Corporate Investments With hundreds of dedicated researchers in seven locations worldwide, HP Labs develops solutions designed to address the most complex challenges facing our customers in the coming decade. Within its Corporate Investments segment, HP also incubates innovations such as video collaboration solutions and mobile devices associated with the recently acquired webOS platform. Revenue by segment, fiscal year 2010 Enterprise Business 46% Services 28% Enterprise Storage and Servers 16% HP Software 2% Personal Systems Group 32% Imaging and Printing Group 20% HP Financial Services 2% Revenue by region, fiscal year 2010 Americas 45% United States 35% Latin