International Business Machines : IBM 2020 Corporate Responsibility Report

2020

Corporate Responsibility Report

Introduction	Trust and transparency	Environment	The IBMer	Social impact	Appendix

Letter from the Chairman and CEO

While the events of 2020 have tested and tried the world's resolve in entirely new ways, they also revealed humanity's determination to adapt and emerge stronger. It was a profound reminder that, when pressed for more, individuals and organizations will rise to reinvent themselves and apply ingenuity to the most challenging of societal problems.

I am extremely proud of the work that IBMers have done to combat the global COVID-19 emergency, address systemic racism and establish new protocols for the future of work. At IBM:

• We led with purpose and culture, empowering the IBMer at the center of our efforts. As IBM focuses on leadership in the era of hybrid cloud and AI, we are taking a number of decisive steps to create a culture where all employees can thrive. In March 2020, we transitioned 95 percent of IBMers to remote work within days, and throughout the year, we launched global initiatives to support the health and well-beingof IBMers amid the pandemic. Today,
  we are shaping the future of work for a post-COVID era, building on our longtime approach to flexible and collaborative innovation. We are making every effort to address employee needs and commitments for empathy, transparency and social responsibility in this new era.
• We applied science and technology to accelerate discovery, provide trusted information and respond resiliently to the pandemic. We helped organize the High Performance Computing Consortium to equip scientists around the world with free access to supercomputing capacity in support of COVID-19research. We created and applied technology solutions, like IBM's Watson Assistant for Citizens and the IBM Digital Health Pass, to help governments and municipalities of all sizes disseminate information about COVID-19testing and best practices. Organizations from more than 25 countries turned to Watson Assistant, IBM's AI-poweredvirtual assistant for business, to field COVID-relatedquestions from customers, employees and the general public. Use of Watson Assistant grew 60 percent between January and December 2020.

Arvind Krishna

Chairman and

Chief Executive Officer

• We reinforced our fight against climate change with leadership and innovation. Environmental leadership has been foundational to IBM's culture of corporate responsibility. This is evident in our pledge to reach net zero greenhouse gas emissions by 2030 and in our support of the Climate Leadership Council's bipartisan plan to reduce carbon-basedemissions through the implementation of a carbon tax, with the proceeds of the tax to be returned to citizens through a carbon dividend. Yet making the world more sustainable will require innovation. We're working with clients to apply our hybrid cloud and AI technologies to some of the world's most significant sustainability challenges in areas like agriculture, transportation and the modernization of our electric infrastructure. At the same time, we are applying

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Introduction	Trust and transparency	Environment	The IBMer	Social impact	Appendix

Trust is IBM's license to operate. We have earned this trust through our policies, programs and projects, and by advocating for the responsible use

of technology.

the expertise of IBM Research® to help accelerate the discovery of new materials to help capture and remove carbon emissions from the atmosphere.

• We reaffirmed IBM's commitment to address long-standing social injustices, accessibility gaps and growing socioeconomic differences. In 2020, we strengthened our reporting and accountability on diversity and inclusion. We sunset our general-purposefacial recognition and analysis software products, and sponsored OneTen to help train Black candidates to fill 1 million professional roles over the next 10 years. We launched Open P-TECH®-afree digital education platform for workplace and digital skills-toengage educators and students during remote learning, and we committed to providing 1,000 paid internships for US P-TECHstudents in 2021. Our SkillsBuild® platform provided valuable reskilling support for job seekers during a most challenging macroeconomic environment. Call for Code for Racial Justice activated IBM's ecosystem to develop open source projects focusing on police and judicial reform and accountability, diverse representation,
  and policy and legislative reform.
• We worked to earn the trust of our clients and society. I cannot emphasize this enough: trust is IBM's license to operate. We have earned this trust through our policies, programs and projects, and by advocating for the responsible use of technology. This can be seen in our work with the Vatican to develop principles for ethical AI, through our leadership in data privacy, and through our firm opposition to the use of IBM technology for mass surveillance, racial profiling, violations of basic human rights and freedoms, or any purpose inconsistent with IBM's values and Principles for Trust and Transparency.

In the pages that follow, you will find example after example of how IBMers applied their talents and technology last year to counter some of the world's most challenging problems.

Their remarkable resilience and ingenuity underscore IBM's collective commitment to emerge stronger by building

a more sustainable, equitable and secure future.

Arvind Krishna

Chairman and Chief Executive Officer

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Introduction

Trust and transparency

Environment

The IBMer

Social impact

Appendix

Building a more sustainable, equitable future

IBM's commitment to corporate responsibility has been essential to its success for over a century. Although 2020 presented many challenges, we are determined to emerge stronger and remain steadfast to the values that have served our company well-by operating with trust and transparency, protecting the environment, supporting the IBMer, driving social impact at scale, and setting the standard for Good Tech.

Our ESG strategy reflects IBM's belief that corporate responsibility drives long-term value not just in our business, but also for IBM stakeholders, including clients, shareholders, employees and the societies in which we operate. We engage stakeholders on material ESG issues such as protecting the environment, supporting employees and maintaining rigorous governance practices. We set goals, measure our progress and report the results as matters of transparency and accountability.

This approach includes a wide range of partnerships, collaborations and engagements, because we recognize that large societal challenges cannot be overcome by any single industry sector or public entity. These engagements often create opportunities for IBM's innovation and expertise to address critical challenges-from helping clients save energy to creating a more sustainable food supply, to assisting COVID-19 research with AI and supercomputing.

This report shares IBM's recent progress and current work to help build a more sustainable, equitable future for our company and its stakeholders. IBMers take pride in our company's history as a vanguard in environmental protection, inclusive employment policies and more-and we take seriously the obligation to continue our legacy of corporate responsibility.

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Introduction	Trust and transparency	Environment	The IBMer	Social impact	Appendix

Operating with trust and transparency

1. foundation of trust

Trust is a foundational aspect of IBM's business. Today, in societies that are increasingly connected and sometimes wary of new technologies, maintaining trust has led IBM to focus on ethical technology development, on building privacy and security into our products and services, and on sharing our experience and expertise with the world.

People expect all data, especially personal information, to be used responsibly and kept secure, and IBM agrees-so we take clear positions on data privacy, data security, and the positive effect regulations can have on our industry. Our products and services have powerful features to govern access to data, enabling IBM's clients to be more proactive about their privacy practices and ready to comply with new regulations.

Trust is also essential to society's acceptance of technologies such as AI, which are increasingly used to inform decisions that affect people's lives. IBM is embedding ethical governance throughout our development work, and building software and systems that can help clients proceed responsibly. We also share IBM's expertise with our industry, seek alliances to promote technology ethics, and oppose the use of IBM technology for any purpose inconsistent with our Principles for Trust and Transparency, including mass surveillance

or racial profiling.

"IBM will continue bringing the best of our technology and expertise to aid the pandemic recovery and other challenges. This work is guided by our AI Ethics Board and adheres to long-standing principles that have earned IBM the trust of society and our clients for over a century."

Christina Montgomery

Vice President and Chief Privacy Officer

IBM's culture of ethics and integrity defines how we do business and conduct all our relationships. All IBMers review the IBM Business Conduct Guidelines each year, and IBM requires its 15,000 suppliers to meet our ethical business standards-and to have management systems for social and environmental responsibilities-as part of their commercial relationship with IBM.

You can learn more about IBM's commitments to security, privacy, ethical AI and more at the IBM Trust Center.

IBM AI

Ethics Board

IBM's AI Ethics Board is a central, cross-disciplinary body that fosters a culture of ethical, responsible and trustworthy AI and other technologies throughout IBM. It supports a centralized governance, review and decision-making process for our tech ethics policies, practices, communications, research, products

and services.

For example, the board was consulted from the earliest conceptual stages of the IBM Digital Health Pass, developed to assist pandemic recovery. Generic "vaccine passports" could result in privacy concerns or inequitable access, so IBM's solution was designed to share personal information only after individual consent and to enable everyone to benefit. Our board engaged in the development stages, with reviews continuing as the solution is deployed.

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