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The most mature and most successful environmental sustainability program area was carbon neutrality.
Microsoft had achieved its goal of carbon neutrality, made as a public commitment by Brad Smith, every
year since its introduction in July 2012. The goal had been achieved primarily through an internal carbon
fee that was charged to all operating groups based on their air travel, direct emissions, and electricity use.
The revenue from the fee was used to fulfill Microsoft’s own public carbon neutrality commitments and
also to fund grants and to develop low carbon business tools and technology that would reduce carbon
emissions more broadly. Brad Smith explained in a white paper:

Microsoft’s carbon program is central to our commitment to sustainability. The [carbon] fee is
designed to incent efficiency, investments in carbon reducing innovations, and the development of
sustainable energy projects and technologies — all of which help minimize our environmental
impact.
Since we implemented the carbon fee in July 2012, we have reduced our emissions by more than
9 million metric tons of carbon dioxide equivalent, invested in more than 14 million megawatt-hours
(MWh) of green power, and had an impact on more than seven million people through carbon-offset

community project investments.° The fee has helped establish a culture of sustainability in our
company: sustainability is now an expectation of our leadership for how we operate our
datacenters and facilities.

Technology was often a crucial part of the solution, as well as an opportunity for Microsoft. For example,
Microsoft developed software that used real-time carbon emissions data to alert grid operators and building
managers when they were using carbon unnecessarily.
In the area of energy, Microsoft had also made a public commitment and set a SMART goal: use at least
50% renewable energy sources (wind, solar, and/or hydro-energy) by 2018, and 60% by 2020.
The water area was in an earlier stage of development. Microsoft had a general goal to establish water
stewardship but had developed a more specific goal only very recently to, by 2025, safely return to
communities and nature an amount of water equal to what was consumed in water-stressed regions. Setting
the societal water goal was designed to encourage the creation of tools and services that addressed global
water challenges. Microsoft employees had already partnered with the company Ecolab to develop a
dashboard rich with water usage data, another example of a product that was good for the environment and
good for Microsoft business, as it ran on Microsoft’s Azure cloud service. Elizabeth firmly believed that the
best solutions — those considered to be “bright green” (on the dashboard) — were both good for the
environment and good for Microsoft’s business.
The Microsoft operational goal for waste was to reduce overall waste and divert at least 90% from
landfills at the Puget Sound headquartered campus. The societal goal was to design products, buildings, and
operations around resource reduction and reuse, enabling a more resource-efficient and productive
economy. Towards that end, the Devices Environmental Product Compliance team performed life-cycle
assessments of Microsoft products to determine when in the life cycle the products had the greatest
environmental impact. These assessments could be used by engineering to design products that minimized
that impact. Additionally, all of Microsoft’s hardware products complied with the applicable restricted
substance requirements such as the European Union’s Restriction of the use of certain Hazardous
Substances in Electrical and Electronic Equipment (RoHS) Directive. To achieve compliance, Microsoft
conducted routine nroduct material testing and reauired sunnliers to submit full material declarations for the