EMC CORPORATION 2015 WATER DISCLOSURE REQUEST. EMC Response to CDP s 2015 Water Request

Transcription

1 EMC CORPORATION 2015 WATER DISCLOSURE REQUEST EMC Response to CDP s 2015 Water Request

2 Copyright 2014 EMC Corporation. All Rights Reserved. EMC believes the information in this publication is accurate as of its publication date. The information is subject to change without notice. The information in this publication is provided as is. EMC Corporation makes no representations or warranties of any kind with respect to the information in this publication, and specifically disclaims implied warranties of merchantability or fitness for a particular purpose. Use, copying, and distribution of any EMC software described in this publication requires an applicable software license. EMC, Avamar, Data Domain, FAST, XtremIO, and VMware vsphere are either registered trademarks or trademarks of EMC Corporation in the United States and other countries. VMware is a registered trademark or trademark of VMware, Inc. in the United States and/or other countries. All other trademarks used herein are the property of their respective owners. TABLE OF CONTENTS Module: Introduction... 1 Introduction... 1 Module: Current State Context... 3 Module: Risk Assessment Procedures and Requirements... 7 Module: Implications Water Risks Water Opportunities Module: Accounting Facility Level Water Accounting (I) Facility Level Water Accounting (II) Module: Response... 31

3 6. Governance and Strategy Compliance Targets and Initiatives Module: Linkages/Tradeoff Managing trade-offs between water and other environmental issues Module: Signoff... 36

4 1 Module: Introduction Introduction 0.1 Introduction EMC Corporation (NYSE: EMC) is a global leader in enabling businesses and service providers to transform their operations and deliver information technology as a service (ITaaS). Fundamental to this transformation is cloud computing. Through innovative products and services, EMC accelerates the journey to cloud computing, helping IT departments to store, manage, protect and analyze their most valuable asset information in a more agile, trusted and cost-efficient way. Established in 1979, EMC is among the largest and most innovative information technology companies in the world today. EMC ranks 128 in the Fortune 500 and had reported revenues of $24.44 billion in Headquartered in Hopkinton, Massachusetts yet truly global, EMC s workforce of approximately 70,000 people across the globe. We operate R&D centers in Brazil, China, France, India, Ireland, Israel, the Netherlands, Russia, Singapore, and the U.S., and manufacturing facilities in the U.S. and Ireland. We believe that investing in a sustainable future makes EMC a stronger and healthier company and creates long-term value for our shareholders and other stakeholders. Our commitment to the environment centers upon addressing and reporting on the areas in which our business has the largest impacts direct or indirect and the greatest potential to drive change. EMC recognizes and embraces our role in mitigating our contributions to climate change. We participate in and critically assess the conversations regarding climate change, then adapt as appropriate by optimizing our operations, delivering products and services that enable customers to better manage the growth of data, and engaging with our supply chain partners. Although EMC has a relatively modest water footprint throughout our operations, we take a conscientious approach to conserving this important global resource today and for future generations. We have implemented practices to mitigate potential climate and water-related risks to our business operations while actively maximizing opportunities. In accordance with our Global Environmental Policy, we recognize our responsibility to be a good steward of the environment and contribute to a more sustainable planet. This commitment is integral to our corporate culture and business strategy. Our EMC-owned global manufacturing facilities are certified to the ISO environmental management standard, and we work with our suppliers to measure and minimize impacts in the supply chain. Across all business functions, we are working diligently to minimize our direct and indirect impacts on the global environment. This report contains forward-looking statements as defined under the Federal Securities Laws. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to:

5 2 (i) changes in regulations related to climate change; (ii) changes in physical climate parameters, including extreme weather events, changes in the availability of natural resources, changes in precipitation extremes and droughts, and rising sea levels; (iii) adverse changes in general economic or market conditions; (iv) delays or reductions in information technology spending; (v) the relative and varying rates of product price and component cost declines and the volume and mixture of product and services revenues; (vi) competitive factors, including but not limited to pricing pressures and new product introductions; (vii) component and product quality and availability; (viii) fluctuations in VMware, Inc. s operating results and risks associated with trading of VMware stock; (ix) the transition to new products, the uncertainty of customer acceptance of new product offerings and rapid technological and market change; (x) risks associated with managing the growth of our business, including risks associated with acquisitions and investments and the challenges and costs of integration, restructuring and achieving anticipated synergies; (xi) the ability to attract and retain highly qualified employees; (xii) insufficient, excess or obsolete inventory; (xiii) fluctuating currency exchange rates; (xiv) threats and other disruptions to our secure data centers or networks; (xv) our ability to protect our proprietary technology; (xvi) war or acts of terrorism; and (xvii) other one-time events and other important factors disclosed previously and from time to time in EMC s filings with the U.S. Securities and Exchange Commission. EMC disclaims any obligation to update any such forward-looking statements after the date of this report. 0.2 Reporting Year Enter Periods that will be disclosed Wed 01 Jan Wed 31 Dec Reporting Boundary

6 3 Please indicate the category that describes the reporting boundary for companies, entities, or groups for which water-related impacts are reported Companies, entities or groups over which operational control is exercised 0.4 Exclusions Are there any geographies, facilities or types of water inputs/outputs within this boundary which are not included in your disclosure? No Module: Current State 1. Context 1.1 Please rate the importance (current and future) of water quality and water quantity to the success of your organization Water quality and quantity Direct use importance rating Indirect use importance rating Please explain Sufficient amounts of good quality freshwater available for use Important Important Although EMC has a relatively small operational water footprint, the availability of high quality water is important to us for cooling, drinking and other sanitary purposes. Around the globe, we take a conscientious approach to conserving this important global resource. In our owned and operated facilities, we minimize water consumption, carefully manage wastewater, and protect stormwater quality. Sufficient quantities of high quality water are also important across EMC s value chain. EMC has a long, complex and global supply chain. Lack of access to good quality water has potential to disrupt our supply chain either by disrupting the production capability of our direct or indirect suppliers, or by impacting logistics. Water is also critical in the production of electricity to power our business and our products. In addition, water is important to EMC and our customers for cooling data centers. At our headquarters in Hopkinton, Massachusetts and our Bangalore, India Center of Excellence, wastewater is reclaimed at the onsite treatment plants, resulting in Sufficient amounts of recycled, brackish Neutral Not very important

7 4 and/or produced water available for use treated gray water which is used for cooling, sanitation, and irrigation. The availability of recycled water helps us to conserve water and mitigate water-related risks. 1.2 For your total operations, please detail which of the following water aspects are regularly measured and monitored and provide an explanation as to why or why not Water aspect Water withdrawals- total volumes Water withdrawalsvolume by sources Water discharges- total volumes Water dischargesvolume by destination Water dischargesvolume by treatment method Water discharge quality data- quality by standard effluent parameters Water consumptiontotal volume Facilities providing fullyfunctioning WASH services for all workers % of sites/facilities/operations Less than 1% Less than 1% Less than 1% Less than 1% Less than 1% Please explain In 2014, 75.2% of EMC's water withdrawal data were compiled from reliable water bills and water meter readings. In 2014, 75.2% of EMC's water withdrawal data by sources were compiled from reliable water bills and water meter readings. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. In addition, EMC protects the quality of the stormwater runoff at our corporate campus locations through an intensive management program. Water is not directly consumed in our manufacturing operations, nor is it integral to our internal manufacturing process. Water is consumed in our facilities through normal building systems use such as for cooling, drinking and other sanitary purposes. At our headquarters in Hopkinton, Massachusetts and our Bangalore, India Center of Excellence, wastewater is reclaimed at the onsite treatment plants, resulting in treated gray water which is used for cooling, sanitation, and irrigation. The water recycling/reuse data for the wastewater treatment plants are compiled from actual water meter reading at the plants.

8 5 1.2a Water withdrawals: for the reporting year, please provide total water withdrawal data by source, across your operations Source Quantity (megaliters/year) How does total water withdrawals for this source compare to the last reporting year? Comment Fresh surface water 0 Not applicable Brackish surface water/seawater 0 Not applicable Rainwater 0 Not applicable Groundwater - renewable 54 About the same Groundwater - non-renewable 0 Not applicable Produced/process water 0 Not applicable Municipal supply 1193 About the same Wastewater from another organization 0 Not applicable Total 1247 About the same 1.2b Water discharges: for the reporting year, please provide total water discharge data by destination, across your operations. Destination Quantity (megaliters/year) How does total water discharged to this destination compare to the last reporting year? Comment Fresh surface water 0 Not applicable Brackish surface water/seawater 0 Not applicable Groundwater 0 Not applicable Municipal treatment plant Total EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time.

9 6 1.2c Water consumption: for the reporting year, please provide total water consumption data, across your operations Consumption (megaliters/year) How does this consumption figure compare to the last reporting year? Comment Water is not directly consumed in our manufacturing operations, nor is it integral to our internal manufacturing process. Water is consumed in our facilities through normal building systems use such as for cooling, drinking and other sanitary purposes. 1.3 Do you request your suppliers to report on their water use, risks and/or management? Yes 1.3a Please provide the proportion of suppliers you request to report on their water use, risks and/or management and the proportion of your procurement spend this represents Proportion of suppliers % Total procurement spend % Rationale for this coverage We require our suppliers to submit annual environmental reporting through the EICC s Environmental Reporting Questionnaire. The questionnaire is aligned with the CDP and Global Reporting Initiative (GRI), and collects information about suppliers carbon, water, and waste volumes, goals, and initiatives. In 2014, 98 percent of EMC s Tier 1 and Tier 2 suppliers by spend completed environmental reporting. 95 percent of those suppliers reported on water, up from 88 percent in Has your organization experienced any detrimental impacts related to water in the reporting period? No

10 7 Module: Risk Assessment 2. Procedures and Requirements 2.1 Does your organization undertake a water-related risk assessment? Water risks are assessed 2.2 Please select the options that best describe your procedures with regard to assessing water risks Risk assessment procedure Comprehensive company-wide risk assessment Coverage Scale Please explain Direct operations and supply chain Some facilities and some suppliers EMC's Chief Sustainability Officer develops and communicates EMC s sustainability strategy and collaborates with the Chief Risk Officer to integrate climate risk into EMC s corporate risk assessment. A sustainability overlay has been created detailing how water and other sustainability issues impact the likelihood and/or magnitude of strategic, financial, operational, and reputational risk. Risk registers are created to itemize specific risks for roll-up into the corporate view. In addition, we used the WBCSD Water Tool and the WRI Aqueduct Water Risk Atlas Tool to identify physical, regulatory, and reputational water risks at the country and river basin level. For our supply chain, we employ multiple indices of water risk, the IPE database, and EICC collaboration and tools, as well as working directly with our suppliers to evaluate water risk factors and associated controls. We use this information as part of our internally developed risk assessment process, which determines which sites we consider to be high risk and should therefore be prioritized for audits and spot checks over the course of the year. 2.3 Please state how frequently you undertake water risk assessments, what geographical scale and how far into the future you consider risks for each assessment Frequency Geographic scale How far into the future are risks considered? Comment Annually River basin >6 years We use the WBCSD Global Water Tool which looks at water risk for 2025 and 2050,

11 8 Annually Country >6 years and the WRI Aqueduct which has water risk projections for 2020, 2030, and We use the WBCSD Global Water Tool which looks at water risk for 2025 and 2050, and the WRI Aqueduct which has water risk projections for 2020, 2030, and Have you evaluated how water risks could affect the success (viability, constraints) of your organization's growth strategy? Yes, evaluated over the next 10 years 2.4a Please explain how your organization evaluated the effects of water risks on the success (viability, constraints) of your organization's growth strategy? EMC s internal operations are not water intensive, nor is water integral to our own manufacturing facilities. In EMC s operations, water is consumed through normal building systems use such as for cooling, drinking and other sanitary purposes. We have conducted risk assessments to look at the physical, regulatory and other risks related to water occurring now, or possibly impacting our business within the next 10 years. However, water is critical to our overall supply chain, particularly to suppliers who require water inputs and/or operate in water-stressed regions. As part of our efforts to build supply chain resiliency holistically, we began in 2014 to integrate our analyses from across sustainability functions to support targeted hypothesis testing, beginning with water, to normalize our data and prioritize the suppliers and locations with greatest risk. This approach integrates data from multiple sources, including global risk data (e.g., water risk data from the World Resources Institute) and data on supplier performance and risk (e.g., Self-Assessment Questionnaires from EICC-ON and business continuity site assessment data). Grouping suppliers based on a combination of water risk factors including water availability and quality in-region, process water use, and/or lack of water management controls allows us to target specific discussions, corrective action, and/or capability building where they will be most effective. 2.5 Please state the methods used to assess water risks Method FAO/AQUASTAT WBCSD Global Water Tool WRI water stress definition Please explain how these methods are used in your risk assessment We use the WBCSD Global Water Tool with data from FAO/AQUASTAT, and WRI Aqueduct to assess the physical, regulatory and other risks related to water occurring now, or possibly impacting our business in the future. For supply chain, our geographic risk assessment incorporates the WRI Aqueduct Water Risk Atlas, the Yale University Environmental Performance Index, and the UN World Risk Index.

12 9 WRI Aqueduct Other: Yale Environmental Performance Index (EPI) 2.6 Which of the following contextual issues are always factored into your organization's water risk assessments? Issues Choose option Please explain Current water availability and quality parameters at a local level Current water regulatory frameworks and tariffs at a local level Current stakeholder conflicts concerning water resources at a local level Current implications of water on your key commodities/raw materials Current status of ecosystems and habitats at a local level Current river basin management plans Current access to fully-functioning WASH services for all employees Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, not yet included Relevant, included EMC uses the WRI Aqueduct Tool to identify water quality and quantity risks for our own operations. For our supply chain, we use the EICC tools to collect information on suppliers water use, management, initiatives, and goals; and use an internally developed risk assessment process, which includes data from Aqueduct as well as the Yale Environmental Performance Index (EPI) and the UN World Risk Index. EMC uses the WRI Aqueduct Water Risk Atlas Tool to identify water-related regulatory risks for its own operations at the country and river basin level. EMC uses the WRI Aqueduct Water Risk Atlas Tool to identify water-related reputational risks for our own operations at the country and river basin level. We also regularly check the database of water pollution violations maintained by the Institute of Public & Environmental Affairs (IPE) in China. We work through the EICC and directly with our suppliers to evaluate risk factors and associated controls. We also have an internally developed risk assessment process that determines which sites we consider to be high risk, and are prioritized for audits and spot checks over the course of the year. EMC used the WRI Aqueduct Water Risk Atlas Tool to identify risks to ecosystems and habitats for its own operations at the country and river basin level. EMC has developed extensive health and safety procedures that are regularly updated to comply with governmental regulations, standards, and best business practices. Job safety analyses, risk assessments, and comprehensive training support and drive our policies and procedures. We conduct audits and inspections to ensure the effectiveness of these policies

13 10 Estimates of future changes in water availability at a local level Estimates of future potential regulatory changes at a local level Estimates of future potential stakeholder conflicts at a local level Estimates of future implications of water on your key commodities/raw materials Estimates of future potential changes in the status of ecosystems and habitats at a local level Scenario analysis of availability of sufficient quantity and quality of water relevant for your operations at a local level Scenario analysis of regulatory and/or tariff changes at a local level Scenario analysis of stakeholder conflicts concerning water resources at a local level Scenario analysis of implications of water on your key commodities/raw materials Scenario analysis of potential changes in the status of ecosystems and habitats at a local level Other Relevant, included for some facilities/suppliers Relevant, not yet included Relevant, not yet included Relevant, not yet included Relevant, not yet included Relevant, not yet included Relevant, not yet included Relevant, not yet included Relevant, not yet included Relevant, not yet included and procedures, and engage our employees to continuously improve our programs. EMC used the WRI Aqueduct Water Risk Atlas Tool to project change in water stress scenarios for its own operations at the country and river basin level. We also use the Aqueduct data at the city level to assess current and future risks at our supplier sites.

14 Which of the following stakeholders are always factored into your organization's water risk assessments? Stakeholder Choose option Please explain Customers Employees Investors Local communities NGOs Other water users at a local level Regulators River basin management authorities Statutory special interest groups at a local level Suppliers Relevant, not yet included Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, included for some facilities/suppliers Relevant, not yet included Relevant, included for some facilities/suppliers Relevant, not yet included Relevant, not yet included Relevant, included Our customers use water for cooling their data centers. Lack of access to quality water and/or higher water prices may reduce their capacity and thus demand for EMC s products and services. The availability of clean, safe drinking water is important to our employees and operations. EMC used the WRI Aqueduct Water Risk Atlas Tool to identify water-related physical, regulatory and reputational risks at the country and river basin level. Our investors care about EMC's reputation with regard to conservation of water. EMC used the WRI Aqueduct Water Risk Atlas Tool to identify water-related regulatory and reputational risks at the country and river basin level. We identified water quality and quantity risks for our own operations at the country and river basin level, and engaged local community groups in key regions in water stewardship programs and community involvement activities. We have used water risk assessment tools developed by NGOs, such as the WBCSD Water Tool and the WRI Aqueduct Water Risk Atlas Tool. In addition, we have NGOs representing water interests included in our stakeholder engagement process. We will factor other water users at a local level into the water risk consideration as issues arise. We engage local regulators on various environmental and social matters, and comply with any local regulations and regulatory requests. Water is not directly consumed in our manufacturing operations, nor is it integral to our internal manufacturing process. We do not consider river basin management authorities relevant in our water risk assessment. Water is not directly consumed in our manufacturing operations, nor is it integral to our internal manufacturing process. We are not aware of any statutory special interest groups that would arise any water risks. We assess water risk across the manufacturing locations used by our Tier 1 and Tier 2 suppliers using a range of indices and databases evaluating water quality and quantity, climate change adaptation, environmental health, and past pollution complaints and violations. We also ask our suppliers to report on water risk as part of the EICC SAQ and the EICC Environmental Reporting Tool, and continue to expand our analysis of that information to identify any areas of concern and to develop mitigation strategies.

15 12 Stakeholder Choose option Please explain Water utilities/suppliers at a local level Other Relevant, included for some facilities/suppliers We work with local utilities on water-related issues and concerns for our owned and operated facilities. Module: Implications 3. Water Risks 3.1 Is your organization exposed to water risks, either current and/or future, that could generate a substantive change in your business, operations, revenue or expenditure? Yes, direct operations and supply chain 3.2 Please provide details as to how your organization defines substantive change in your business, operations, revenue or expenditure from water risk EMC defines a substantive change as one that has impacts on our direct operations and/or our supply chain. Water-related impacts would be considered substantive to EMC if they cause a material impact to our costs of goods through rising component prices, reduced component availability, extensive damage to inventory, or labor shortages. Substantive impacts would also be those that lengthen time-to-market, reduce market demand, or affect a large or critical part of our workforce or physical infrastructure. Positive impacts that are substantive to EMC s business may arise from new market opportunities that drive demand for EMC products and services. For questions W3.2a-c, we used the WRI Aqueduct water risk tool to assess EMC's direct operations - our campus facilities, manufacturing facilities, and COEs (Centers of Excellence). Those facilities that have "Medium to High", "High" or "Extremely High" overall water risk are considered to be facing water risk that could generate a substantive change in our business, operations, revenue or expenditure.

16 13 3.2a Please provide the number of facilities* per river basin exposed to water risks that could generate a substantive change in your business, operations, revenue or expenditure and the proportion of total operations this represents Country United States of America United States of America United States of America River basin Number of facilities Merrimack River Proportion of total operations exposed to risk within river basin (%) Comment Includes EMC's corporate headquarters and campus locations in Hopkinton, Bedford, and Southborough Massachusetts. We have grouped facilities in Hopkinton into one facility for reporting purposes, thus fewer facilities than what was reported in Other: Blackstone Franklin manufacturing facility, Franklin Massachusetts Other: Coyote Watershed China Yongding He 1 Less than 1% China COE, Beijing China China Yangtze River (Chang Jiang) Includes one EMC facility in Santa Clara and one VMware facility (consisting of multiple buildings on a single campus) in Palo Alto California China COE, Shanghai and Chengdu China India Cauvery River India COE, Bangalore India Israel United States of America United States of America Other: Yarkon River Other: Jordan Watershed Other: San Francisco Bay Watershed 1 Less than 1% Israel COE, Herzliya Israel 1 Less than 1% Utah COE, Draper Utah EMC facility in Pleasanton California

17 14 3.2b Please provide the proportion of financial value that could be affected at river basin level associated with the facilities listed in W3.2a Country River basin Financial reporting metric United States of America Merrimack River Other: % of square footage United States of America Other: Blackstone Other: % of square footage 1-5 United States of America Other: Coyote Watershed Other: % of square footage 6-10 United States of America Other: San Francisco Bay Watershed Other: % of square footage 1-5 Proportion of chosen metric that could be affected within the river basin United States of America Other: Jordan Watershed Other: % of square footage Less than 1% China Yongding He Other: % of square footage Less than 1% China Yangtze River (Chang Jiang) Other: % of square footage 1-5 India Cauvery River Other: % of square footage 1-5 Israel Other: Yarkon River Other: % of square footage Less than 1% Comment 3.2c Please list the inherent water risks that could generate a substantive change in your business, operations, revenue or expenditure, the potential impact to your direct operations and the strategies to mitigate them Country River basin Risk driver Potential impact Description of impact Timeframe Likelihood Magnitude of potential financial impact Response strategy Costs of response strategy Details of strategy and costs United States of America Sacramen to River - San Joaquin River Physical- water stress Higher operating costs Disruption to operations; operational cost 1-3 years Highly probable Medium investment in new technology Medium Incorporating water efficiency and conservation technologies across EMC's operations, such as cloud computing,

18 15 adaptive cooling and free-air cooling. United States of America Other: Charles River Physical- water stress Higher operating costs Disruption to operations; operational cost 1-3 years Probable Medium investment in new technology Medium Incorporating water efficiency and conservation technologies across EMC's operations, such as cloud computing, adaptive cooling and free-air cooling. Consume net zero water in the manufacturin g operations. At our building campus within the basin, EMC protects the quality of stormwater runoff through an intensive management program. India Cauvery River Physical- water stress Higher operating costs Disruption to operations; operational 1-3 years Probable Medium investment in new technology Medium Incorporating water efficiency and conservation

19 16 cost technologies across EMC's operations, such as cloud computing, adaptive cooling and free-air cooling. Israel Not known Physical- water stress Higher operating costs Disruption to operations; operational cost 1-3 years Highly probable Lowmedium investment in new technology Medium Incorporating water efficiency and conservation technologies across EMC's operations, such as cloud computing, adaptive cooling and free-air cooling. China Yongding He Physical- water stress Higher operating costs Disruption to operations; operational cost 1-3 years Highly probable Medium investment in new technology Medium Incorporating water efficiency and conservation technologies across EMC's operations, such as cloud computing, adaptive cooling and free-air cooling. United States of America Merrimack River Physical- Flooding Property damage Disruption to operations; Cleanup/rep air costs 4-6 years Probable High Infrastructu re investment Medium Building a resilient business infrastructure

20 17 that doesn't depend on a single facility. India Cauvery River Physical- Flooding Higher operating costs Disruption to operations; operational cost 4-6 years Highly probable Mediumhigh Infrastructu re investment Medium Building a resilient business infrastructure that doesn't depend on a single facility. United States of America Sacramen to River - San Joaquin River Physical- Declining water quality Higher operating costs Disruption to operations; operational cost 4-6 years Highly probable Mediumhigh investment in new technology Medium Incorporating water efficiency and conservation technologies across EMC's operations, such as cloud computing, adaptive cooling and free-air cooling. Consume net zero water in the manufacturin g operations. At our building campus within the basin, EMC protects the quality of stormwater runoff through an intensive

21 18 management program. Israel Not known Physical- Declining water quality Higher operating costs Disruption to operations; operational cost 4-6 years Highly probable Lowmedium investment in new technology Medium Incorporating water efficiency and conservation technologies across EMC's operations, such as cloud computing, adaptive cooling and free-air cooling. United States of America Other: countrywide Regulatory- Higher water prices Other: Constraint to future growth Reduced demand for goods/servic es >6 years Probable Medium investment in new technology Medium Aggressively engineering for energy and water efficiency in R&D. China Yongding He Reputational- Inadequate access to water, sanitation and hygiene Brand damage Reputational damage if not using water in an equitable way >6 years Unlikely Medium Other: Comply with local legal requirement s or company own internal standards, whichever is more stringent Lowmedium Monitoring new regulations pertaining to water. United States of America Sacramen to River - San Joaquin River Regulatory- Regulation of discharge quality/volum es leading to Higher operating costs Higher infrastructur e costs 4-6 years Probable Other: Comply with local legal requirement s or Lowmedium Lowmedium Monitoring new regulations pertaining to water.

22 19 higher compliance costs company own internal standards, whichever is more stringent 3.2d Please list the inherent water risks that could generate a substantive change in your business operations, revenue or expenditure, the potential impact to your supply chain and the strategies to mitigate them Country Rest of world River basin Risk driver Physical- Flooding Potential impact Supply chain disruption Description of impact Extreme weather events such as hurricanes, floods, and droughts have potential to disrupt our supply chain either by disrupting the production capability of our direct or indirect suppliers, or by impacting logistics. If suppliers' manufacturing or logistics operations are Timeframe Likelihood 1-3 years Probable High Magnitude of potential financial impact Response strategy Develop flood emergency plans Engagement with suppliers Promote best practice and awareness Supplier diversification Tighter supplier performance standards Other: Supply Chain Business Continuity Planning Costs of response strategy Medium Details of strategy and costs EMC s Supply Chain Business Continuity Planning (BCP) program sets strategies to prepare for, and react to, potential disruptions from events such as natural disasters, civil unrest, and financial instability. Our framework is based on three pillars: global sites mapping,

23 20 closed or delayed, EMC could experience delays in fulfilling customer orders, either from our fully owned and operated manufacturing facilities or our Configure to Order nodes. risk assessment and mitigation planning, and event monitoring and disaster recovery. First, EMC maps our part numbers to the global supplier sites where they are produced. After mapping, each part is assessed for risk across multiple dimensions, including: Natural disaster and other geographic risks Supplier capability to recover from risk scenarios Supplier financial risk. Based on the risk assessment, we then identify proactive actions to mitigate (e.g. alternate source qualifications, buffer plans, etc.) to optimize our supply chain s flexibility, cost, and risk

24 profile. Each supplier site mapped to an EMC part number is monitored around the clock for adverse events, including natural disasters such as floods or severe storms. With parts already mapped to sites, EMC can immediately begin response and recovery procedures when such an event occurs. In 2014, we implemented a proactive playbook to address seasonal flooding in Thailand. By regularly monitoring rainfall, dam levels, and climactic factors such as ocean temperatures against our supplier sites flood defense capacities we are able to assess flood risk weeks 21

25 22 before flooding actually occurs and proactively take appropriate action. Rest of world Physical- water scarcity Physical- water stress Supply chain disruption Lack of sufficient access to water has significant potential impacts, ranging from the direct (e.g., lack of water for manufacturing processes) to the indirect (e.g., insufficient water for power generation, leading to lack of electricity; limited access to sanitary and drinking water for employees; citizen unrest due to perceived or actual competition for water resources). Unknown Unlikely High Engagement with suppliers Promote best practice and awareness Medium EMC engages with suppliers, through our reporting requirements as well as our supplier scorecards and QBRs, to promote strategies to reduce water and energy use in all aspects of their operations. This approach has the benefit of proactively strengthening their ability to continue operations in an environment with limited access to water. 4. Water Opportunities 4.1 Does water present strategic, operational or market opportunities that substantively benefit/have the potential to benefit your organization? Yes

26 23 4.1a Please describe the opportunities water presents to your organization and your strategies to realize them Country or region Companywide Companywide Companywide Companywide Opportunity Sales of new products/services Sales of new products/services Sales of new products/services Cost savings Strategy to realize opportunity Aggressively engineering for energy efficiency in R&D. Actively engaging with governmental bodies in product specifications development. Providing business continuity solutions for customers including offsite storage and Cloud Computing. We are leveraging our own products and technologies virtualization, data deduplication, and Fully Automated Storage Tiering (EMC FAST) to deliver significant energy and cost savings on our journey to the cloud. We engaged with the US EPA and Storage Networking Industry Association (SNIA) in developing the efficiency metric specification used by the EPA for the ENERGY STAR Data Center Storage Specification. EMC RSA Archer Business Continuity Management platform provides centralized disaster recovery and crisis management, allowing for fast response during a crisis. Exploring new market and service opportunities in energy efficiency information technology; Investing in innovative approaches to reduce and/or manage energy and water consumption in IT. We continually strive to develop new hardware, software and tools--flash drives, virtualization, data deduplication, Fully Automated Storage Tiering (EMC FAST), adaptive cooling, efficient power supplies to deliver significant energy and cost savings. R&D in Big Data. Big Data analytics and other emerging technologies are creating profound opportunities for redefining how technology can best be used to solve pressing social and environmental issues. Through the use of EMC's technology, we can better understand and address environmental and social issues such as climate change, the need for STEM education, and public health initiatives. Continuing to look for opportunities to reduce water usage by incorporating water efficiency and conservation features in our owned and operated facilities worldwide. Estimated timeframe >6 years 1-3 years >6 years Please explain demand for new and existing products and services that provide greater resilience in the IT infrastructure. demand for new and existing products and services that allow IT organizations to run their data centers more efficiently with less water required for cooling as well as for energy production. demand for new and existing products and services to leverage Big Data in understanding and addressing water risk. 1-3 years Reduced water footprint; cost saving. Company- Staff retention Continuing to raise water awareness, engage employees in 1-3 years brand value; increased

27 24 wide local communities, and make EMC a great place to work. We continue to encourage our employees to participate in local water stewardship programs and volunteering. EMC has partnered with charity: water, a non-profit organization bringing clean, safe drinking water to people in developing nations. This campaign aims to raise awareness and funding for the installation of wells in Ethiopia. In the campaign to-date in 2015, more than $100,000 was raised, bringing more than 3,400 people clean water. employee retention Module: Accounting 5. Facility Level Water Accounting (I) 5.1 Water withdrawals: for the reporting year, please complete the table below with water accounting data for all facilities included in your answer to W3.2a Facility reference number Country River basin Facility name Total water withdrawals (megaliters/year) at this facility How does the total water withdrawals at this facility compare to the last reporting year? Please explain the change if substantive Facility 1 United States of America Merrimack River EMC Headquarters, Hopkinton Massachusetts About the same Facility 2 United States of America Merrimack River RSA Facilities, Bedford Massachusetts 7.0 About the same Facility 3 United States of America Merrimack River Southborough Facilities, Southborough Massachusetts 16.5 About the same Facility 4 United States of America Other: Blackstone Franklin Manufacturing Facility, Franklin Massachusetts 89.1 About the same

28 25 Facility 5 Facility 6 Facility 7 Facility 8 United States of America United States of America United States of America United States of America Other: Coyote Watershed Other: Coyote Watershed Other: San Francisco Bay Watershed Other: Jordan Watershed Santa Clara Facilities, Santa Clara California VMware Facilities, Palo Alto California Pleasanton Facilities, Pleasanton California Utah COE, Draper Utah 16.3 Facility 9 China Yongding He China COE, Beijing China 0.2 Facility 10 Facility 11 China China Yangtze River (Chang Jiang) Yangtze River (Chang Jiang) China COE, Shanghai China 2.1 China COE, Chengdu China 2.5 Facility 12 India Cauvery River India COE, Bangalore India 74.9 Facility 13 Israel Other: Yarkon River Israel COE, Herzliya Israel 4.7 About the same About the same About the same About the same About the same About the same About the same About the same About the same 5. Facility Level Water Accounting (II) 5.1a Water withdrawals: for the reporting year, please provide withdrawal data, in megaliters per year, for the water sources used for all facilities reported in W5.1 Facility reference number Fresh surface water Brackish surface water/seawater Rainwater Groundwater (renewable) Groundwater (nonrenewable) Produced/process water Municipal water Facility Facility Facility Facility Facility Facility Wastewater from another organization Comment

29 26 Facility Facility Facility Facility Facility Facility Facility Water discharge: for the reporting year, please complete the table below with water accounting data for all facilities included in your answer to W3.2a Facility reference number Total water discharged (megaliters/year) at this facility How does the total water discharged at this facility compare to the last reporting year? Please explain the change if substantive Facility 1 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 2 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 3 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 4 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 5 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 6 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water

30 27 Facility 7 Facility 8 Facility 9 Facility 10 Facility 11 Facility 12 Facility 13 discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. 5.2a Water discharge: for the reporting year, please provide water discharge data, in megaliters per year, by destination for all facilities reported in W5.2 Facility reference number Fresh surface water Municipal Treatment Plant Seawater Groundwater Comment Facility 1 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 2 EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. Facility 3 EMC does not generate industrial wastewater from our operations. Our sanitary

31 28 Facility 4 Facility 5 Facility 6 Facility 7 Facility 8 Facility 9 Facility 10 Facility 11 Facility 12 Facility 13 wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. EMC does not generate industrial wastewater from our operations. Our sanitary wastewater is treated either on-site or by municipal sewage facilities. We do not measure water discharge data at this time. 5.3 Water consumption: for the reporting year, please provide water consumption data for all facilities reported in W3.2a