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Structural Packaging Team

ENVIRONMENTAL REQUIREMENTS FOR PACKAGING

Author: Structural Packaging Team

Document: S002689

Revision: R

Date: 26 March 2015

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Environmental Requirements for Packaging 3/26/2015

Procedure No. S002689 Rev. R Page 2 of 14


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RECORD OF REVISIONS

Rev Date Summary of Changes

Author/

Approver

R 26 March

2015

- Corrections to the Table of Contents and Corrective Action Process

Gary Lietzke

Corinne Holmes

Q 20 March

2015

- Remove substance restriction and data collection sections (migrated to H00594 and H00642)

- Change owner/author

Gary Lietzke

Corinne Holmes

P 11 March

2014

- Added Responsible Sourcing of Raw Material Policy and references

- Added Conflict Mineral Reporting Requirements - Updated REACH requirements - Updated Orgniacally Recovered Section - Updated Appendix A PKGSDoC form - Removed Appendix B due to duplicated information

Linda Hsu

N 11 April

2013

-Updated Sec 6 “Environmental Sustainability Requirements”

-Revised the PKGSDoC to annual reporting

-Update Section 7 “Vendor Responsibilities and Requirements”

Linda Hsu

Sarah Toland

M 11 Dec 2011 -Corrected section numbering throughout.

-Deleted standard number GB/T 18455-200X from pg. 44

-Updated departmental header

-Add Section 6.1: Buy Recycled Policy

-changed Appendix A to Excel format

-removed Appendices C and D because they merely duplicated the

recycling symbols already referenced in the 6.6.1 and 6.6.2

Kimberly Braun,

Gerry Hession,

Linda Hsu,

Bahram Fallah

L 15 July 2011 -Revised Appendix A - PKGSDOC form.

-Update Sections 7 and 8.

-Revised Section 9 for updated procedures of compliance

documentation submission.

ECT Team

Joan Krajewski

K 28 May 2010 -Updated EN 13428:2004 and CEN CR 13695-2:2004

-Added section on Microsoft Policy re PVC; §4

-Added definition of CAS Number and MSPN; §5

-Revised definition of Packaging and Packaging Components; §5

-Revised instructions for supplier submissions for clarity; §9.3

-Retitled Appendix A from Supplier Declaration to Packaging

Declaration of Conformity (PKGSDOC)

-Removed Appendix B, Environmental Specification Relationships

-Renamed Annex A to Appendix B; Annex B to Appendix C; Annex

C to Appendix D

-Renamed Table A to Table 1 and

Table G to Table 2

-Removed Tables B-F, and H

Joan Krajewski,

Bahram Fallah




J 15 Jan 2010 - addition of CA RPPC source

- addition of China GB 18455-2001 and GB/T 18455-200X reference

- addition of Microsoft procedures for document submissions

- addition of reference to desiccants in DMF section

- deletion of ECHA notification requirement; not a supplier requirement

- check boxes; form lock in Packaging SDOC added

- deleted Annex A; reference to url with list inserted

- addition of url to SVHC candidate list

- title change

- alterations to restricted heavy metals and restricted hazardous

substances sections

- addition of DMF restriction

- addition of European Union (EU) REACH SVHCs list

- addition of California Proposition 65 reference

- additions / alterations to Glossary of Terms section

- alterations to References section

- addition of ‘N’ classified substances from Annex 1 of Dangerous

Substances Directive

- addition of Formaldehyde restriction

- addition of Annex B Packaging Material Types – Risk of Presence of

Restricted Substances

- addition of Appendix A Packaging Supplier Declaration of Conformity

- addition of TOC

Joan

Krajewski,

Bahram

Fallah

I 20 Jun 2008 Updated document sections 3.1, 3.2, and 4.1 with requirements for

material traceability, vendor training, internal and sub tier auditing, sub

tier risk assessment process, compliance data and material screening

management, first article inspection (FAI) plan, non-

conformity/corrective action plan, and test report data and timeliness.

-

H 08 Feb 2008 Updated spec format to remove table of contents, revised restricted

substances tables, deleted specific packaging material code

references (refer to specific component specification), changed vendor

reporting to include as part of component FAI review, deleted detailed

tables for restricted materials and replaced with reference to refer to

Joint Industry Guide (JIG) from the Electronics Industries Alliance

(EIA).

-

F 23 Mar 2005 Updated Table A to add ordering information for EN 13432:2000. This

document is licensed for use by individual requestors of this

information.

-

G 23 Mar 2005 Added reference specifications in “Table A”. Updated RESY

information in the “Labeling” section. -

E 14 Feb 2005 Added reference specifications table. Updated RESY information in

the “Labeling” section. -

D 27 Feb 2004 Updated cadmium limits on page 5 to 0.50 ppm to correspond with the

limitations in Table B on page 7. -

C 14 Mar 2003 Updated the embedded “Vendor Certification Form” drop down list and

cell comments. -

B 14 Nov 2002 Updated wood packaging requirements. Added EN 13428 and CR

13695-1 files. Allow PVC use on an exception by PEM basis. -

A - Initial Release, Revision Letter not tracked -




DOCUMENT CONTROL

STANDARD OPERATING PROCEDURE

Document Owner:

The Structural Packaging Team

Approval: Jane Tsilas

Signature: On file in office of Senior Director of

Packaging

Approval Date: 26 March 2015

Update Requirements: The Senior Director or its designee shall maintain this procedure. This

procedure must be reviewed and approved annually. This document and its revisions shall

remain current for no more than one year from the approval date. The Senior Director must

retain a log of document history with this procedure.

References

1. Microsoft Environmental Documents

H00642: Restricted Substance Control System for Hardware

H00594: Restricted Substances for Hardware Products

H02446: Microsoft Analytical Laboratory Approval Process and Testing Requirements

H09624: Microsoft Vendor Code of Conduct

S003817: Pallet Moisture Content Measurement and Pallet Import Treatment Procedures

C&SMS-14001-42: Enviornmental Principle

Microsoft Responsible Sourcing of Raw Material Policy

2. External Environmental Document

California Code of Regulations Title 14, Ch. 4, Art. 3 §§17942-46 and §§17946.5-17949: Rigid Plastic Packaging Container Law (RPPC)

EN 13428:2004: Packaging. Requirements Specific to Manufacturing and Composition. Prevention by Source Reduction

EN 13429:2004: Packaging. Reuse

EN 13431:2004: Packaging. Requirements for Packaging Recoverable in the Form of Energy Recovery

EN 13432:2000/AC:2005: Packaging Requirements for Packaging Recoverable Through Composting and Biodegradation

European Commission Decision 97/129/EC: Identification System

European Community for Standardization CEN CR 13695-1:2000: Packaging Requirements Part 1

European Community for Standardization CEN CR 13695-2:2004: Packaging Requirements Part 2




European Parliament and Council Directive 94/62/EEC: Packaging and Packaging Waste

Illegal Timber Regulation (EU) 995/2010

People’s Republic of China National Standard on Packaging Recycling Marks, GB/T 18455-2010

United Nations International Standards for Phytosanitary Measures, UN Standard ISPM-15

Attachments

Authorized Distribution List

External All




Table of Contents

PURPOSE .......................................................................................................................... 8

MICROSOFT ENVIRONMENTAL AND SUSTAINABILITY PRINCIPLES ........................ 8

DEFINITIONS ..................................................................................................................... 8

ENVIRONMENTAL SUSTAINABILITY REQUIREMENTS .............................................. 11

4.1 Buy Recycled Requirements ....................................................................................... 11

4.2 Recycled Content ........................................................................................................ 11

4.3 Source Reduction ........................................................................................................ 12

4.4 Recovery and Reuse of Packaging ............................................................................. 12

4.5 Wood-Based Packaging .............................................................................................. 13

4.6 Material Composition Identification Marking ............................................................... 14

NON-CONFORMITY, CORRECTIVE ACTION, AND ISSUE CLOSURE ........................ 14




PURPOSE

This document states the requirements that are specific to packaging components and constituents.

For product material requirements, refer to specifications H00594 Restricted Substances for

Hardware Products and H00642 Restricted Substance Control System for Hardware.

MICROSOFT ENVIRONMENTAL AND SUSTAINABILITY PRINCIPLES

Microsoft fully recognizes its responsibility to global environmental protection and actively pursues a

strategy that reflects this position. We also recognize that we are accountable for managing and

reporting the environmental and sustainability impact of our products and packaging materials.

It is Microsoft’s policy to work with its suppliers to identify and develop products and packaging

materials that are environmentally sound. We also want to encourage our suppliers to develop their

own plans for being environmentally responsible and meeting global regulations. The relationship

between Microsoft and its suppliers encourages each company to have environmental guidelines,

metrics showing conformance, and a willingness to share information in this important area.

We expect our suppliers to support our commitment to responsible sourcing of raw materials. Our

requirements are set forth in our Supplier Code of Conduct and supplier specifications, which are

incorporated into our hardware and packaging contracts.

Our goals are to provide products to our customers that are environmentally sustainable throughout

their lifecycles and to conduct our operations worldwide in a responsible manner.

DEFINITIONS

Composite Wood Wood-based panels made from pieces, chips, particles, or fibers bonded together with a resin, e.g., particleboard or plywood.

Distributor Any natural or legal person, including retailers, who stores or places and makes available for sale a product, substance, preparation or article on a given market on the behalf of a third party.

Forest Stewardship Council (FSC)

An international non-profit organization founded in 1993 to support environmentally-appropriate, socially-beneficial, and economically-viable management of the world’s forests. The association consists of a diverse group of representatives from environmental and social groups, the timber trade and the forestry profession, indigenous people’s organizations, community forestry groups and forest product certification organizations from around the world. Web site is http://www.fsc.org.

Hardware Products Any electrical or electronic device that is dependent on electric currents or electromagnetic fields in order to work properly, including equipment for the generation, transfer and measurement of electrical currents and fields. This category includes, but is not limited to, Microsoft’s computer peripherals, Xbox console and related accessories.

http://www.fsc.org/




Importer Any natural or legal person who is responsible for the importation of a product into a particular jurisdiction. Putting an item on the market for sale or trade is not required to be considered an importer.

Illegally harvested Timber harvested in contravention of the applicable legislation in the country of harvest.

Material A material is made up of one or more substances (e.g., an alloy is a material, which in turn is made up of a number of substances).

MPN Manufacturer Part Number. The part number used by the Manufacturer or supplier of the part.

MSPN Microsoft Part Number. The part number used by Microsoft that typically starts with X##-.

Packaging All products made of any materials of any nature to be used for the containment, protection, handling, delivery and presentation of goods from the producer to the user or the consumer. Packaging can be categorized, but is not limited to, primary, secondary and tertiary packaging.

1. Primary Packaging/Sales Packaging

Primary or sales packaging refers to packaging that is designed so as to form the final sales or retail unit intended for the final customer at the point of purchase for a given product. This includes all products that are considered non-returnable that fulfill the definition of primary packaging, such as items that are intended to be filled or packed at the point-of-sale and disposable products. Additionally, any components or ancillary items that are attached or integrated into the sales packaging, such as a bottle top or a handle, and perform a packaging function are included in the scope of the Directive. Examples of primary packaging are:

retail box

O-sleeves labels hung directly on or attached to a product

2. Secondary Packaging/ Grouped Packaging

Group or Secondary Packaging refers to packaging that groups a certain number of final sales or retail units together at the point of purchase. It can serve as a means to replenish the shelves or can be removed from the sales unit(s) without compromising the sales unit’s characteristics or packaging. Examples of secondary packaging include:

Trays or packaging support for multiple games or a group of games sold at retail locations

3. Tertiary Packaging/ Transport Packaging

Tertiary or transport packaging refers to packaging that is designed for the purpose of protecting the sales units and/or grouped packages from transportation and handling damages while being transferred to another economic operator, such as a warehouse, distributor, or an end-user. Tertiary packaging does not go as far to include road, rail, ship, or air containers that transport operators use in their operations. Examples of tertiary packaging include:

Master Cartons or Shippers

plastic and wooden pallets

plastic and wooden crates

corrugated carton as bulk shippers




Packaging Component

Any part of packaging that can be separated by hand or by using simple physical means. Examples:

plastic blister

foam end caps

cushions

Packaging Constituent

The smallest part from which packaging or its components are made and which cannot be separated by hand or by using simple physical means. Examples:

for the packaging component “printed label” the constituents are - unprinted label - printing ink including solvents

for the packaging component “enameled glass” the constituents are - plain glass - enamels ready to use including medium

for the packaging component “printed multi-layer film“ the constituents are - base film - tie coat - barrier - top film - printing ink

Prevention by Source Reduction

A process to achieve the minimum adequate weight and/or volume of primary and/or secondary and/or tertiary packaging, while maintaining identical requirements, when performance and user acceptability remains unchanged and/or adequate, thereby minimizes the impact on the environment.

Recycled Content Definitions

Components made from materials that would have otherwise entered the waste stream. Claims regarding recycled content should specify the percentage of pre-consumer and post-consumer content according to the following definitions:

Pre-Consumer Material

Materials and manufacturing byproducts directed towards reusing or recycling rather than entering the waste stream. Pre-consumer material does not include materials and by-products generated by, and reused in, the original manufacturing process (see Industrial Scrap). Examples of pre-consumer material include: sawdust sold by a lumber yard to a fiber board manufacturer, and paper trimmings left over during manufacturing that are sold to another manufacturer for use in their paper products.

Post-Consumer Material

Materials generated by consumer, business, or institutional sources that have served their intended use or completed their lifecycle and would be destined for disposal had they not been diverted from the waste stream for reuse or recycling. One example of post-consumer material is polypropylene bottles that are recycled, pelletized and used in the manufacturing of fleece garments.

Industrial Scrap

Materials and manufacturing byproducts reused within a company’s manufacturing process. One example of industrial scrap is polypropylene bottles that are rejected at the end of the manufacturing process and redirected back to the beginning of the manufacturing process, rather than being disposed or diverted to another company. In most jurisdictions, this material is not considered recycled material.

Rigid Plastic Packaging Containers (RPPC)

Any plastic package possessing a relatively inflexible finite shape or form that is capable of maintaining its shape while holding other products. It must have minimum capacity of eight fluid ounces or its equivalent volume and maximum capacity of five fluid gallons or its equivalent volume. Including, but not limited to: bottles, cartons and other receptacles for sale or distribution. Rigid plastic packaging containers are capable of at least one closure (including, but not limited to, closure occurring during the production or manufacturing process), including heat-sealed plastic clamshell packaging.




Special Collectible Marketing or promotional items such as game figurines and other similar game accessories that Microsoft regulates differently than other materials included with software and games. Microsoft will inform the supplier if their product falls under this category.

Supplier A manufacturer who provides packaging components or materials directly to Microsoft or Microsoft manufacturing partners.

Trader Any natural or legal person who, in the course of a commercial activity, sells or buys on the internal market timber or timber products already placed on the internal market.

Textiles Fabrics or cloths commonly formed by weaving, knitting or spinning together as well as the natural and artificial fibers that constitute them.

ENVIRONMENTAL SUSTAINABILITY REQUIREMENTS

This section provides requirements concerning the reduction of Microsoft’s environmental footprint

and related information on EU Packaging Directive’s design requirements for packaging. These

requirements apply to those suppliers that are involved in the design and/or manufacturing of

packaging, including material composition.

4.1 Buy Recycled Requirements

Microsoft is committed to purchasing materials that are environmentally preferable and/or made of

recycled materials whenever such products meet quality requirements and are available at

comparable prices and terms. These requirements allow Microsoft to efficiently and effectively

utilize natural resources, create markets for the materials collected in recycling programs, reduce

solid waste volumes and disposal costs, and serve as a model for responsible green business

solutions. Microsoft seeks to source from suppliers who can and will provide materials with greater

recycled content and sustainable materials.

4.2 Recycled Content

Microsoft requires that suppliers provide information regarding the amount of recycled content

material used in the composition of their packaging (if applicable). If using recycled materials, these

minimum limits apply for these types of recycled content:

Average percentage of pre-consumer recycled content – 25% minimum content

Average percentage of post-consumer recycled content – 25% minimum content

Average percentage of industrial scrap – No minimum requirement

The information can be based on a yearly average and does not necessarily reflect the amount of

recycled content in every component of packaging material. Suppliers are required to supply

certification upon request to Microsoft.

4.2.1 Paperboard Materials

Microsoft requires the use of 50% recycled content in its composition, 25% of which must be post-

consumer, for suppliers using paperboard and corrugated fiberboard materials in the composition of




their packaging. The amount of recycled content in components can vary depending on the material

type and required performance.

Paperboard packaging components must contain 95% paper materials; any whole-surface

composites (i.e., waxes, clays, laminates, plastics, or metals) must represent less than 5% of the

materials composition.

4.2.2 Rigid Plastic Packaging Containers (RPPC)

Microsoft requires suppliers who provide Rigid Plastic Packaging Container (RPPC) packaging to

comply with the State of California’s RPPC law, implemented via Title 14 of the California Code of

Regulations, Chap. 4, Art. 3, §§17942-46 and §§17946.5-49, and administered by the California

Integrated Waste Management Board. As such, Microsoft requires RPPC packaging suppliers to

identify plastic packaging types and components, along with the percentage (%) of the reportable

post-consumer recycled plastics content out of the total weight of the packaging.

For those parts sold in the State of California, all RPPC packaging supplied to Microsoft must

contain a minimum of 25% post-consumer recycled content. Suppliers may be required to certify

the recycled content by Microsoft.

4.3 Source Reduction

Microsoft requires that packaging conform to EN 13428:2004: “Packaging. Requirements specific to

manufacturing and composition. Prevention by source reduction.” This Standard requires packaging

that is designed to be composed of the minimum amount of material necessary without

compromising the product. Note the packaging must still perform its functions for protection,

containment, transportation, marketing and presentation of the product. The packaging weight and

volume should be limited to the minimally adequate design necessary to maintain the level of

safety, hygiene, and acceptance of the product. EN 13428:2004 provides the methodology to

comply with this requirement.

4.4 Recovery and Reuse of Packaging

In order for packaging to be reusable or recoverable, it must demonstrate compliance with EN

13429:2004: “Packaging. Reuse,” which requires that packaging be designed, produced and

commercialized in such a way as to permit reuse, recovery and minimize its impact on the

environment when disposed. Packaging must be recoverable through at least one of the following

ways:

1. material recycling; 2. incineration with energy recovery; 3. composting or biodegrading.

Reuse in this case means a package is reused for the exact purpose that it was originally intended

and used. Suppliers claiming packaging to be compostable must demonstrate compliance with EN

13432:2000 “Requirements for packaging recoverable through composting and biodegradation -

Testing scheme and evaluation criteria for the final acceptance of packaging.”




4.5 Wood-Based Packaging

Microsoft will not purchase wood-based packaging or product components from any suppliers

engaged in the following activities in any of their downstream manufacturing operations or supply

chain:

Logging of any ancient forests

Material is derived from by-products that have origins from ancient forests

Material originates in other protected areas, except as permitted by land use management guidelines

Microsoft does allow the use of materials from the above areas from indigenous and/or long-settled

forest-dependent communities in ancient forest areas who control and manage their resources in an

ecologically responsible manner, as certified by the Forest Stewardship Council, in worldwide

locations where certification is available (see Definitions for more information on the FSC).

Microsoft requires its EMEA suppliers to comply with the Illegal Timber Regulation (EU) 995/2010.

The Regulation prohibits the placing on the EU market of illegally harvested timber and products

derived from such timber. The Regulation applies to both imported and domestically produced

timber and timber products. Examples of obligated timber derived products include unfilled

packaging, cartons, boxes, cases, bags, trays. Recycled products as well as printed papers such

as books, magazines, and newspapers are not in scope of the Regulation - neither are filled

packaged products.

EMEA suppliers (including Distribution, Manufacturers, and Replicators) will likely be classified as

‘traders’ and will have to implement traceability procedures to identify from whom timber and timber

based products, such as packaging, were obtained.

Suppliers who imported into the EU timber derived products such as unfilled packaging are also in-

scope as ‘Operators’ and have additional obligations to exercise ‘due diligence’. Regulation (EU)

No 607/2012 provides additional requirements regarding the due diligence system.

The Illegal Timber Regulation (EU) 995/2010 requires records to be maintained for at least five

years. Penalties for non-compliance include fines, seizure, and immediate suspension of

authorization to trade.

Microsoft requires its Suppliers to present necessary records of compliance with Regulation (EU)

995/2010 within seven (7) days of request.

The EU guidance on the Timber Directive counters the trade in illegally harvested timber and timber

products through three key obligations:

1. It prohibits the placing on the EU market of illegally harvested timber and products derived from such timber;

2. It requires EU traders who place timber products on the EU market to exercise 'due diligence';

3. It requires keeping records of their suppliers and customers.




Many countries have strict treatment and marking requirements for wood packaging imported into

their territory. For requirements on phyto-sanitary treatment of wood packaging, certification

markings and import requirements, as outlined in UN Standard ISPM-15, refer to specification

S003817 Pallet Moisture Content Measurement and Pallet Import Treatment Procedures.

4.6 Material Composition Identification Marking

Microsoft requires that suppliers have their packaging marked to identify recyclability and the

material types that the packaging comprises.

4.6.1 European Union Material Identification Requirement

The EU Packaging Directive requires that packaging is marked to indicate its packaging’s material

composition, per European Commission Decision 97/129/EC: Identification System. This decision

outlines a numbering system to indicate packaging types. Current international industry accepted

methods generally reflect this numbered marking system, and it is generally common practice of

manufacturers of packaging to mark it for the purpose of declaring its material composition. Practice

is to place the numeral within the Möbius Loop symbol (the international recyclable symbol) with the

abbreviation for the material type placed below it.

NON-CONFORMITY, CORRECTIVE ACTION, AND ISSUE CLOSURE

Microsoft requires suppliers to respond to Non-conformities in the following manner:

1. Inform Microsoft immediately when a suspected or confirmed non-conformity is identified. The persons to be contacted are the Tier 1 Supplier and the Sourcing or Vendor Account Manager.

2. Confirm through testing that Non-conformity exists (and not a false-positive result). 3. Begin an investigation into the cause and extent of the Non-conformity. 4. Undertake Corrective Action and root cause analysis immediately.

Microsoft places suppliers in various categories based on audit and other performance information.

A low audit score will place a supplier on restricted status, which means the supplier will not be

awarded new work. A supplier can also be placed on probation status, which means their

performance needs to be improved or else they are placed on restricted status. Supplier

performance information will be tracked in the Ariba tool and provided to the Sourcing team to

assist them with business decisions.