December 20, 2001
E-Waste Not, Calvert Says to Computer Companies
by William Baue
The Calvert Group has filed shareowner resolutions with the major U.S. computer producers, urging
them to investigate ways to counteract electronic waste.
As you read these lines on your computer, do you consider what will become of this mass of
electronic circuitry and plastic casing once it has outlived its usefulness? And do you think
about the number of environmentally hazardous materials that go into producing it? And even if you
recycle it, do you know whether this recycling is happening in an environmentally-sound manner?
Electronics companies have long considered the environmental impact of their
products. However, many of their stakeholders believe that electronics producers need to step up
their efforts to keep pace with the problem, which is concentrated at either end of the product
life-cycle. About half of the 700 chemical compounds required to manufacture one computer
workstation are hazardous, according to a shareowner resolution filed with IBM (ticker: IBM) by the Calvert Group.
At the other end of
the life-cycle, only 11 percent of the 20 million computers that became obsolete in 1998 were
recycled, according to National Safety Council estimates cited in Calvert's IBM resolution. The
council expects this year's computer obsolescence to more than double the 1998 estimate, surpassing
40 million units. And electronics recycling programs vary in their degree of environmental
Calvert has filed similar shareowner resolutions with four other computer
companies: Hewlett-Packard (HWP),
Gateway (GTW), Apple (AAPL), and Compaq (CPQ). Calvert is also
negotiating with Dell (DELL),
possibly avoiding the necessity of filing a resolution there. Calvert Senior Social Research
Analyst and Acting Director of Social Research Julie Gorte characterized the resolutions as
requesting further study.
"All we've asked the companies to do is a feasibility study for
[post-consumer computer] collection, and then to study the options for reducing the amount of
hazardous material that's put into the computers in the first place--which many of them are already
doing in many ways," said Dr. Gorte.
Only IBM is trying to remove the resolution from its
proxy by pleading to the U.S. Securities and Exchange
Commission (SEC) that the issue hasn't been under consideration for over a year. "Whether it's
on the proxy or not, we're going to be talking to IBM about this," said Dr. Gorte. "And believe
me, if it's not on the proxy this year, just wait a year."
A new European Union law
requires computer companies to reduce their use of hazardous components and pay for recycling of
their products. "They see the handwriting on the wall," said Dr. Gorte. It is in these companies'
best interest to take a proactive approach to establishing environmentally-friendly manufacturing
protocols and take-back initiatives here in the United States. "Their worst nightmare is for fifty
states or God knows how many hundreds of localities to make their own rules and have them all be
different," continued Dr. Gorte.
As of now, many computer companies (including IBM, HP,
Compaq and Dell) have take-back programs in place. The main obstacle to their success is
financial: consumers must pay between $10 and $35 for the service. Scott Cassel, director of the
University of Massachusetts-based Product Stewardship Institute, considers
this charge a significant disincentive, and has devised an alternative way to finance product
"Government agencies working with the Product Stewardship Institute prefer that
the cost of new products sold include in it the cost to manage the used product at the end of its
useful life," said Mr. Cassel. The institute also favors creating incentives for companies to
change their product designs to incorporate less hazardous materials.
However, Dr. Gorte
pointed out that computers represent only the tip of the electronics iceberg. E-waste also
includes smaller electronic items, such as cell phones and palm pilots. As well, emerging
technologies such as digital television are creating obsolescence in larger items.
everybody starts scrapping their TVs, this is gonna be like, 'Hey, if you liked El Nino, you'll
love climate change.' It's a much bigger problem than just computer waste," said Dr. Gorte. "So
this is the starting point--this is the stake in the sand, if you will."