The keys to ESG success

Figures across the industry share some of their best practices to improve sustainability and diversity

How can channel partners achieve the collaboration and cooperation required for ESG success?

In the pantheon of three-letter acronyms, ESG fares pretty well. Admittedly, it’s not as well-established as the CIA, KGB, FBI or BBC, but it trips off the tongue smoothly enough. The other point to make is that it covers a lot of ground because the three words contained in that acronym – environmental, social and governance – can stretch quite widely. The question is, can the channel stretch to match them?

The channel has an important part to play in helping organisations become more sustainable,” David Devine, partner programme manager at OVHcloud, told MicroScope last month. Although sustainability is unlikely to replace cost or security as a critical priority in the coming years, its an increasingly integral part of the decision-making process.”

He’s not alone in this view. A recent report from Nebula Global Services states: “Pivotal in the technology supply chain, the channels role in helping the entire sector achieve ESG success cannot be overstated. End-users and vendors both rely on the channel as part of their own regulatory compliance for Scope 3, which involves monitoring and measuring a business’s entire supply chain.”

ESG requires collaborative effort

Speaking to MicroScope, Nebula chief marketing officer Richard Eglon says: “E, S and G are the foundations of building any sustainable and successful business. As a result, the technology channel supply chain is only as strong as its weakest link in the chain, so it is imperative that firms that are more advanced on their ESG journey work more collaboratively to provide cooperation, guidance and support to those that need it the most in order to raise the standard across the overall partner ecosystem.”

Nick Bannister, vice-president of sales for Arrow’s enterprise computing solutions business in the UK, Ireland, central and eastern Europe, and Australia and New Zealand, agrees that sustainability and the drive to minimise carbon footprint are increasingly important to the channel. “As more customers look to decarbonise their often complex supply chains, sustainability is becoming an expectation,” he says.

Bannister believes collaboration across the entire ecosystem should be multi-faceted. “Channel partners can draw on the practices of their vendor and distributor partners to support their own,” he says, citing the example of Arrow’s dashboard in its cloud delivery and management platform, ArrowSphere Cloud, that provides the data required to make strategic recommendations around cloud usage as well as validate regulatory compliance.

“This allows our channel partners to assess the carbon impact of their customers, and gives a snapshot of carbon emissions now and trends over time,” he adds.

David Watts, senior vice-president and regional managing director for the UK and Ireland at TD Synnex, stresses there is still “a lot of work to do in creating an IT supply chain that is wholly sustainable and achieves net zero on Scope 3 of the GHG Protocol”. While channel partners need to work together more, “the first steps almost certainly need to be taken by the leading players in our industry and we are making a concerted effort to move towards net zero as quickly as we can”.

He says TD Synnex is “getting much closer” on Scope 1 and 2, but admits “Scope 3 is a much greater challenge as that means reducing the carbon impact of both upstream and downstream supply chains. We have been talking to our courier partners for some time about making deliveries greener and were making solid progress there”.

The upstream supply side “is extremely complex and a much bigger challenge that applies not only to our industry, but to every sector in which goods are brought into the UK and Ireland, and then moved between different locations, before they are finally delivered to the customer”.

Watts says there’s a need not just for collaboration between IT vendors and channel companies, but also between couriers and shipping companies and all the industries they serve. “As an industry, we can and must continue to seek out and adopt greener ways to move products around and work together to push for change in the supply chain,” he adds.

Mark McLardie, head of ESG at Westcon-Comstor, agrees. “Collaboration throughout the supply chain, from vendors to distributors and partners, is key if we are to create a more sustainable channel,” he says.

Like Watts, McLardie believes it’s most critical when it comes to Scope 3 emissions. “As a distributor, the nature of our business model and our position at the heart of the channel – connecting vendors with partners – means there is a need to take a highly collaborative approach when it comes to Scope 3 emissions.”

He says more than 99% of Westcon-Comstors overall emissions are within its supply chain, making its Scope 3 reduction targets especially important. “That’s why weve made these categories a top priority for emission-reduction initiatives, setting a goal of reducing Scope 3 emissions by 25% by FY30,” he adds.

The distributor has established a target to ensure 80% of its suppliers have set science-based targets by 2025. As of the end of its financial year 2023, 54.5% had committed to set targets.

“When we talk about cooperation and collaboration, I think data has to be the foundation on which everything else is built,” says McLardie, “which is why weve put it at the heart of our own ESG and sustainability strategy. So for me, the building blocks for a more sustainable channel – and one that advances ESG in the technology supply chain – can be summed up in three words: openness, sharing and data.”

The building blocks for a more sustainable channel – and one that advances ESG in the technology supply chain – can be summed up in three words: openness, sharing and data
Mark McLardie, Westcon-Comstor

Building trust

According to Geoff Greenlaw, vice-president for partners, EMEA and LatAm at Pure Storage, “now more than ever, theres an opportunity for channel partners to play a key role in ESG and sustainability efforts, by leveraging their relationships as trusted advisors to their customers”.

He claims that more and more channel partners have a sustainability division within their business, adding that “channel partners are ideally placed to help educate customers on what technologies will make a meaningful impact on their carbon emissions, help them cut through the greenwashing of inefficient solutions, and even persuade relevant stakeholders within the business by presenting key data”.

Simon Yeoman, CEO of Fasthosts, believes honesty is the key. “If the channel is to be successful in its ESG efforts, we all need to be honest about our goals, how were trying to meet them, and how far weve come,” he says. “Only by sharing openly can we really work together to make a difference for our planet. Its about trust and the willingness to collaborate, and were already seeing good movement in this direction.”

He states that Fasthosts is not keeping secrets about its move to 100% renewable energy and its efforts to reduce energy use onsite, like powering our datacentres with solar energy. “Were inviting our partners to join us in these green practices, aiming to get everyone on the same page about being more sustainable,” he says.

Laura Martin, EMEA customer success director at Conga, agrees that honesty is paramount. “The channels ESG success depends on honesty and integrity. Regardless of whether they are upstream or downstream within the supply chain, partners will need to be more honest and transparent with one another. Companies will need to disclose the information and encourage their partners to do the same,” she says.

Shared goals

Richard Farrell, chief innovation officer at Netcall, echoes many when he states ESG considerations have become increasingly important for companies and consumers alike, driving demand for sustainable and responsible practices throughout the supply chain. “To meet the growing demands from consumers, businesses need to work collaboratively to ensure theyre addressing both ESG issues and meeting targets – this includes channel partners,” he adds.

Having a shared vision and commitment to advancing ESG goals between channel partners is vital, he says. “This could be in the form of aligning values, understanding the importance of ensuring sustainability in both the short and long term, and recognising the collective responsibility from within to drive ESG change in the supply chain.”

But channel partners “must be willing to share information, discuss challenges openly and cooperate transparently to build trust and foster productive relationships that will help deliver successful ESG projects”. He says “it is also important to ensure a clear governance structure is established” and failure to do so in the early stages of a partnership “can cause issues when it comes to responsibilities and accountability”.

Gigamon’s senior channel manager for northern Europe, Sam Lambert, says that while ESG is a pressing topic for the channel, the IT industry “has been behind the curve when it comes to implementing ESG practices”. Now is the time for the channel to prioritise ESG success, he says. “By mutually agreeing to do so, channel partners and vendors can dedicate the necessary resources towards better policies and practices and see real improvements both in carbon emissions and social impact.”

Lambert argues that ESG in the channel “cannot work without proper support across vendor and partner networks”.

Sheryl Moore, head of sustainability at Stone Group, says partners “need to understand that ESG challenges are beyond the remit of just one organisation or vendor, and appreciate that we are all contributing to climate change and social impact and therefore all have the opportunity to make a difference”.

She adds that transparency in the supply chain on sourcing of materials and labour practices “is key, as is the circular economy with e-waste being the fastest growing waste stream in the world”.

Joanne Ballard, managing director of Mundus Consulting, believes partners can cooperate and collaborate in their ESG efforts. They can learn from each other by sharing carbon reduction and transition plans to identify synergies, quick wins and medium- to long-term gains. They can also work to improve product and transportation information to aid carbon calculations.

“We are all, believe it or not, pulling in one direction,” she remarks, “but as there are so many frameworks and, dependent upon the size of the organisation, regulations that need to be adhered to, we find ourselves recording and reporting in many different ways.”

We are all on the ESG journey together and should be sharing our success, failure, plans and records as far as possible to assist all our stakeholders. A sustainable business journey is bigger than any one organisation
Joanne Ballard, Mundus Consulting

Like Moore, she cites the importance of transparency in ensuring greater collaboration and support between channel partners in advancing ESG in the technology supply chain. “We are all on the ESG journey together and should be sharing our success, failure, plans and records as far as possible to assist all our stakeholders. A sustainable business journey is bigger than any one organisation,” Ballard stresses.

According to Will Ominsky, vice-president for managed service provider sales at Nerdio, one of the key ways channel partners can collaborate is in developing standardised metrics and frameworks for measuring the impact of ESG initiatives. “By establishing common reporting standards, they can provide customers and vendors with transparent and comparable data on their ESG performance,” he says.

“It’s great that so many channel partners have their own ESG strategies and practices in place,” he adds, but they can collectively drive progress toward ESG success “by sharing best practices and lessons learned with their peers”. To this end, channel partners “should align their ESG initiatives and goals to ensure they are working towards common objectives”.

Building mutual trust and respect among channel partners is crucial for collaboration. “This involves demonstrating integrity, reliability and transparency in all interactions, as well as honouring commitments and respecting each other’s expertise and contributions,” Ominsky argues.

“If the channel can establish a shared understanding of the importance of ESG principles, and a common vision for advancing ESG within the technology supply chain, this can form a strong foundation for collaboration and cooperation between channel partners,” he adds.

Bob Pigott, strategic programmes director at CAE Technology Services, singles out Scope 3 emissions on products and services as one of the key areas for channel collaboration. But this requires greater transparency and availability of carbon data from vendors to cover production, transportation, average life use and decommissioning.

This type of information helps customers make more informed decisions around infrastructure or service lifecycles and for comparing vendors or solutions. “CAE is actively working with its key vendor partners in these areas,” he reveals, but the vast SKU catalogues that vendors carry and the high volume of orders processed each day means “there is still work to be done to make this a seamless data transaction, rather than by bespoke request”.

He accepts it is “a big challenge” for all partners but it also provides “an opportunity to come together as a community to collaborate”. As a first step, they should recognise they are all facing similar challenges in certain areas and come together to share specific best practice, while also agreeing a standardised model of what data vendors should provide to users, including a common understanding for specific areas, such as the “end user life of product period”. Having a common understanding, “provides clarity for vendors, partners and end users when they are making key critical infrastructure or service decisions”.

Summing up, Oliver Mason, managing director of KOcycle, keeps his observation short and sweet: “Collaboration and communication are vital when we talk about maximising the impact of an ESG strategy. Ideas that best serve the planet and the people within it should not be seen as USPs [unique selling points], but as knowledge that can be shared to drive awareness across the channel.”

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