xerox.com

Our Letter

Dear Stakeholders:

I write this letter at a time when most economies around the world are emerging from the shadows of recession. Although the worst impacts of the economic downturn may have begun to recede, some of the consequences are likely to have a long-term impact – not all of it bad.

Let me cite just one example in our own business. In an effort to reduce costs over the past few years, most financial services companies pushed their customers to accept online statements as an alternative to paper statements. Some went so far as to charge for paper. That type of transactional printing – a lot of it done by Xerox – is not coming back.

You might think that’s of concern to us. In fact, it is not. Our services business is very adept at helping our customers move from paper to digital documents. It’s a wonderful version of the triple bottom-line. It saves money for our customers. It makes money for Xerox. And it makes for a greener world for all of us.

There are, of course, thousands of examples of this phenomenon – this is being called the “new normal.” It’s reflected in our new positioning for the company – Ready for Real Business. Businesses everywhere are focused on finding new ways to do business that are more cost effective, add greater customer value and are sustainable over the long haul.

That same thinking and focus have spilled over into the way we think about our efforts in citizenship. A case in point is our efforts to broaden and expand the number of young people entering the fields of science, technology, engineering and mathematics – the STEM disciplines. We’ve been at that for nearly half a century.

During the civil rights struggles of the 1960s, Xerox vowed to become part of the solution. We started a program to send our scientists and engineers into the schools of Rochester, New York, to teach science to inner-city students and mentor them as well.

“The more we do, the more we see the potential of what is possible. We are not
discouraged by the enormity of what lies ahead; we are motivated by it.”

We established relationships with several engineering schools at historically black colleges. We invested considerable money in scholarship programs aimed at underrepresented minorities. We signed on as a founding member of the National Action Committee for Minorities in Engineering (NACME).

Today, we still support all these programs and many more. We were a founding member of FIRST, the widely acclaimed national robotics competition for high schoolers. We were also a founding member of the National Academy Foundation’s Academies of Engineering – schools within schools in more than 160 districts in disadvantaged areas – that prepare high schoolers for college educations and careers in STEM. It’s no accident that today we have a very diverse technical and engineering community within Xerox.

I am a good example. I came to Xerox as a summer engineering intern from Brooklyn Polytechnic Institute, was hired by Xerox, sent to Columbia University for a Master’s degree in engineering and never left the company.

I’m sure that Xerox’s demonstrated and enduring commitment on this issue is why President Obama asked me earlier this year to help galvanize the U.S. business community to increase the number of young people who pursue STEM degrees and careers. More than a hundred major corporations have signed on to the effort. It’s called Change the Equation and we hope through our efforts we’ll do just that – shift the education dynamic from a declining interest in STEM to generating more active participation among students and educators.

Now here’s the “new normal” rub. I sense a strong level of both frustration and commitment. We’re frustrated because all of our companies are doing a lot in this area and can point to individual successes, yet the national needle has barely budged. We’re committed to changing that because the future of our companies and our country depends on it.

The brutal reality is that despite all the effort and local successes, we are falling further and further behind at the national level. In order to maintain America’s leadership in the global economy, we need a constant stream of innovation and invention. And that starts with mentoring and preparing a new generation of innovators. It’s an easy position for Xerox to support. Investments in innovation and in STEM have shaped our company for decades and will influence our future for many years to come. So, we were quick to put our hand up in supporting these objectives of Change the Equation:

  • Improving STEM teaching at all grade levels, with a larger and more diverse cadre of highly capable and inspirational STEM teachers.
  • Inspiring student appreciation and excitement for STEM programs and careers to increase success and achievement in school and opportunities for a collegiate education, especially among females and students of color.
  • Achieving a sustained commitment to improving STEM education from business leaders, government officials, STEM educators and other stakeholders through innovation, communication, collaboration and data-based decision making.

“We are part of an ongoing experiment to prove that good citizenship and good results
are not only compatible but synergistic – in good times and in challenging times.”

The devil, of course, is always in the details – in this case how we measure progress. Identifying sustainable, achievable and meaningful metrics is important work that has already begun. It won’t be easy, but it is essential.

Within Xerox, that is also an ongoing challenge. How do we identify the right set of metrics and then measure against them to assure that good intentions are being translated into quantifiable results? It’s not as easy as you might think. Take our worldwide supply chain and its impact on sustainability. There are a lot of expectations and regulations that aren’t always aligned. Customers and shareholders often have competing interests. The United States and a variety of countries in which we do business are not always on the same page. Trying to do the right thing by all these stakeholders can have unintended consequences that result in the wrong thing.

This is one of our major challenges where our stakeholders and Xerox want to be even more responsive to the quest for a greener world and just societies. Translating these lofty aims into real business metrics will take tenacity, wisdom and courage.

We do some wonderful things with hard data to support our accomplishments – particularly in areas that impact the environment. You will see some of them in this report. Yet the more we do, the more we see the potential of what is possible. We are not discouraged by the enormity of what lies ahead; we are motivated by it. All of us recognize that we are on a journey with no end. As good as we are today, we must and we will be even better tomorrow.

I’d be remiss if I didn’t mention that Xerox got a lot bigger and a lot stronger early in 2010 with the acquisition of Affiliated Computer Services. ACS brings with it more than $6 billion in revenue, more than doubles our employee base and adds knowledge and expertise that make the new Xerox the world’s leading enterprise for business process and document management. It also brings us new responsibilities that we are eager to embrace. This report touches on ACS’s citizenship activities. With ACS now a Xerox Company, we know our values will permeate throughout the ACS workforce and stimulate even more community engagement and responsibility among our combined workforce that is now 133,000 people strong.

Although we take a lot of pride in our record on citizenship, we know that we owe a lot to Xerox people who have gone before us. They paved the way and built a culture in which good citizenship is integrated into the way we conduct ourselves today. Even in the midst of economic stress and uncertainty, Xerox people continue to volunteer in their communities under company-sponsored programs. The Xerox Foundation continues to invest in making our world a little better. And Xerox people lend their expertise to a myriad of boards and advisory councils in the non-profit world. I’m in awe of how seriously they take our collective responsibility to give back.

You will see that philosophy running throughout this report. It’s organized around five themes that capture the essence of our citizenship efforts:

  • Conducting our business with integrity and transparency builds credibility and attracts investors.
  • Aligning our resources around customer need provides the revenue stream that enables investment in innovation and future growth.
  • Nurturing a greener world through sustainable innovation and development saves money, creates value and helps develop new markets.
  • Creating a great workplace for our people strengthens our competitiveness.
  • Leveraging our resources to make our world better improves the quality of life for our people and the economic climate for our customers.

We are a much bigger company today. We offer a much broader portfolio of services and technology. We have significantly expanded our global reach. But certain things remain the same. Xerox people remain passionate about honoring the legacy we have been given and passing it on even stronger to those who will follow us. You can be sure we will not rest on our laurels. We believe we are part of an ongoing experiment to prove that good citizenship and good results are not only compatible but synergistic – in good times and in challenging times.

Ursula M. Burns signature
Ursula M. Burns
Chief Executive Officer