Framework for responsible sourcing of compute, hardware, and data for AI systems.
Hanzo AI Team (@hanzoai)
Created: 2025-12-17
sustainabilitysupply-chainethicsgovernance
Requires: HIP-200, HIP-250
HIP-270: AI Supply Chain Responsibility
Abstract
This HIP establishes the framework for responsible sourcing across Hanzo AI's supply chain, including compute infrastructure, hardware, data, and services. It defines standards for environmental, social, and governance criteria in supplier selection and ongoing management.
Scope
Supply Chain Categories
Category
Components
ESG Relevance
Compute
Cloud providers, data centers
Energy, carbon, labor
Hardware
GPUs, servers, networking
Materials, labor, e-waste
Data
Training data, annotations
Privacy, labor, consent
Services
Software, consulting, contractors
Labor, security, ethics
Tier Classification
Tier
Definition
Due Diligence Level
Critical
>$1M annual spend or core to operations
Full assessment
Significant
$100K-$1M annual spend
Standard assessment
Standard
<$100K annual spend
Basic assessment
Compute Sourcing
Cloud Provider Standards
Environmental Criteria
Criterion
Requirement
Weight
Renewable energy
>50% renewable, trajectory to 100%
High
Carbon reporting
Public Scope 1, 2, 3 emissions
High
PUE
<1.3 average
Medium
Water usage
WUE reporting, reduction targets
Medium
E-waste
Responsible disposal, circularity
Medium
Social Criteria
Criterion
Requirement
Weight
Labor practices
Fair labor certification
High
Supply chain
Conflict mineral due diligence
Medium
Community impact
Local hiring, engagement
Low
Governance Criteria
Criterion
Requirement
Weight
Security
SOC 2 Type II, ISO 27001
High
Privacy
GDPR compliance, data residency
High
Business continuity
Disaster recovery, SLAs
Medium
Transparency
Public sustainability reports
Medium
Provider Assessment
Current Provider Evaluation
Provider
Renewable %
Carbon Neutral
PUE
Assessment
AWS
100% by 2025
2040 target
1.2
Acceptable
GCP
100% matched
Carbon neutral
1.1
Preferred
Azure
100% by 2025
2030 target
1.2
Acceptable
Region Selection
Prioritize regions with:
Lowest carbon intensity
Highest renewable percentage
Acceptable latency
Data residency compliance
Data Center Requirements
For colocation or owned infrastructure:
Requirement
Standard
Renewable energy
100% or credible pathway
PUE
<1.4
Water efficiency
WUE <1.0 L/kWh
Certifications
ISO 14001, ISO 50001
Location
Climate-resilient, low-carbon grid
Hardware Sourcing
GPU & Server Standards
Environmental Criteria
Criterion
Requirement
Manufacturer sustainability
Public ESG commitments
Energy efficiency
Current generation, efficient design
Conflict minerals
Conflict-free sourcing certification
Packaging
Minimal, recyclable packaging
Social Criteria
Criterion
Requirement
Labor practices
RBA (Responsible Business Alliance) membership
Supply chain audits
Third-party labor audits
Health & safety
Documented H&S programs
Hardware Lifecycle
Procurement
Practice
Implementation
Right-sizing
Match hardware to actual needs
Consolidation
Shared resources where possible
Efficiency focus
Latest generation for efficiency
Operation
Practice
Implementation
Utilization tracking
Monitor and optimize usage
Maintenance
Proper maintenance for longevity
Lifecycle planning
Plan refresh cycles
End-of-Life
Practice
Implementation
Reuse
Internal redeployment first
Resale
Certified resale for working equipment
Recycling
R2/e-Stewards certified recyclers
Data destruction
Certified data destruction
Data Sourcing
Training Data Standards
Consent & Rights
Requirement
Standard
Licensing
Clear commercial use rights
Consent
Appropriate consent for personal data
Attribution
Proper attribution where required
Opt-out
Respect opt-out requests
Quality & Ethics
Requirement
Standard
No stolen content
Due diligence on data sources
No illegal content
Filtering for illegal material
Bias review
Assessment of representation
Privacy protection
PII handling procedures
Annotation & Labeling
Labor Standards
Requirement
Standard
Fair wages
Living wage in local context
Working conditions
Reasonable hours, breaks
Worker wellbeing
Support for disturbing content
Transparency
Disclosed labor practices
Provider Assessment
Criterion
Evaluation
Wage verification
Third-party or self-reported
Conditions audit
Annual assessment
Worker feedback
Grievance mechanisms
Certifications
B Corp, Fair Trade, or equivalent
Data Provider Selection
Tier
Due Diligence
Primary
Full assessment, ongoing monitoring
Secondary
Standard assessment, periodic review
Incidental
Basic assessment, terms review
Services & Contractors
Software & Services
Category
ESG Criteria
SaaS
Security, privacy, accessibility
Consulting
Labor practices, D&I
Contractors
Fair treatment, proper classification
Contractor Standards
Requirement
Standard
Classification
Proper employee/contractor classification
Benefits
Appropriate benefits for relationship
Payment
Timely, fair payment
Conditions
Reasonable working conditions
Supplier Management
Assessment Process
Initial Assessment
1. Categorize by tier
↓
2. Complete assessment questionnaire
↓
3. Review publicly available information
↓
4. Conduct due diligence (tier-appropriate)
↓
5. Score against criteria
↓
6. Make selection decision
Ongoing Monitoring
Activity
Frequency
Tier
Performance review
Quarterly
Critical
ESG review
Annual
Critical, Significant
News monitoring
Continuous
Critical
Re-assessment
Biennial
All
Supplier Scorecard
Dimension
Weight
Criteria
Environmental
30%
Carbon, energy, waste
Social
30%
Labor, community, safety
Governance
20%
Ethics, transparency, security
Performance
20%
Quality, reliability, cost
Issue Management
Issue Severity
Severity
Examples
Response
Critical
Human rights violation, major breach
Immediate suspension
High
Labor violations, significant ESG failure
Remediation plan
Medium
Policy gaps, minor violations
Improvement plan
Low
Documentation gaps, minor issues
Noted for improvement
Remediation Process
Issue identified
↓
Severity assessment
↓
Supplier notification
↓
Remediation plan development
↓
Implementation monitoring
↓
Verification
↓
Closure or escalation