Channel explainer: Why sustainability matters

Why is it important to have a strong green story? Where do you start, and who is going to help you? This explainer tackles those questions

Sustainability is the great challenge of our time. The planet is facing severe climate pressures, and all of us have to do our part to reduce carbon emissions and save the world for future generations.

What meeting that challenge looks like from a channel perspective is introducing measures to reduce emissions, invigorating staff to embrace positive change and making sure the lessons learnt on that journey can be shared across the ecosystem.

The risks of sitting on your hands include not only losing business, but disappointing staff and failing to take advantage of emerging revenue opportunities in guiding customers through their own net-zero journeys.

There are technology evangelists across the industry – some even have that title on their business cards – but when it comes to saving the planet, it’s different. The issue is one of personal conviction, and on the most basic level, the issue matters because individuals across the channel recognise climate change and are determined to use what influence they have to counter it.

The industry also recognises that it plays a role in generating some of the problem, and its responsibility in dealing with that.

“Datacentres consume a significant amount of energy, and this consumption is growing by 20-40% annually,” said Sheldon Lachambre, head of engineering at DoiT. “This issue is particularly prominent in smaller countries with expanding datacentre markets, where rapid growth has led to a more than tripled electricity use in Ireland since 2015.”

Given their position as trusted advisers, there is also a responsibility on the channel to develop a strong position on the issue to help guide their customers, who are facing the same challenges and compliance demands.

“As the channel accelerates a digital economy, leaders have a responsibility to ensure that a greater digital footprint doesn’t mean a greater carbon footprint,” said Sarwar Khan, sustainability director at BT Business. “Adopting a sustainable approach means reducing the impact on the societies and customers the channel serves. We know this is a top priority for many channel partners and customers, and ensuring new services and solutions don’t contribute harmfully to the environment is central to this.

“The channel is uniquely placed to play a significant role in improving sustainable practices,” he added. “Resellers and MSPs have strong, meaningful relationships with end users, allowing them to educate and inform about the risks of unsustainable practices, while vendors have the resources to kick-start processes.”

There is also the responsibility to staff. “The benefits of ESG transcend way beyond just legal compliance; it extends to sales success, investor decisions, and even customer and employee loyalty,” said Richard Eglon, chief marketing officer at Nebula Global Services. “Gen Z, with its keen focus on sustainability, is set to amplify the importance of ESG credentials even further.”

Where should the channel start?

Accepting that something has to be done on the sustainability front, the next question is where the channel should start.

Kevin Wragg, UK director of environment and quality compliance at TD Synnex, believes things start with a commitment to making a change.

“Awareness and education are where it begins – but making the commitment to sustainability and net-zero is perhaps the biggest step,” he said. “To a certain degree you can self-educate, but it’s also good to share ideas, and listen and learn about what other businesses are doing in the industry. We’ve been involved in a few industry forums and have run some of our own. It’s a question of getting out there, making contacts, asking questions and getting involved.

“In terms of commitment, as a first move there needs to be demonstrable commitment from senior management, and everyone needs to be involved. A good way to start would be by getting everyone in the business together to ask them what they think about sustainability and what you should be doing about it as a business, and then making someone within the organisation responsible for creating a plan and driving progress.”

For Steen Dalgas, senior cloud economist at Nutanix, it’s a question for the channel of making sure they are in a position to lead on the issue, given their role advising customers.

“The channel needs to be ahead of the pack when it comes to sustainability because they will be the invoicing party and therefore front of mind when IT buyers are considering sustainability factors in making a purchase decision,” he said. “To be front of the pack means that the channel partners will need to commit.”

The key thing is to make a start, and begin investigations of energy usage and working out where changes can be made.

“Be bold, be brave and commit, for long-term good,” said Alastair Wynn, business transformation director at Softcat. “It’s essential. Don’t worry if you don’t have all the detail, facts or expertise. Surround yourself with others that can help. Start with what you can measure, manage and improve internally (scope 1 and 2) first and then focus on the big goal of scope 3 within your supply chain by working collaboratively with others.”

What is Scope 1 and 2?

Any discussion about sustainability journeys always starts with discussions about Scope 1, and once that’s complete, Scope 2. This is a universal language for both the channel and customers, and most partners and distributors are well down this road, working out where they stand on the two measurements.

Wragg and Dalgas helpfully provide a definition of what the two scopes involve and how the channel can quickly understand them.

“The Green House Gas Protocol Corporate Standard classifies a company’s GHG emissions into three scopes,” said Wragg. “Scope 1 emissions are direct emissions from owned or controlled sources. Scope 2 emissions are indirect emissions from the generation of purchased energy, like gas, electricity, petrol and diesel.”

Drilling down into the detail, Dalgas provides definitions of the two measures that the channel will encounter first on their journey to carbon neutral.

“Scope 1 energy relates to directly consumed energy consumption,” he said. “For the IT sector, this is the smallest piece of the pie. Examples include fuel used to run generators in datacentres or fuel consumed if you are running a large fleet of IT engineers making in-person visits. Baselining this should be relatively easy, but may account for as little as 1% of energy consumed.

“Scope 2 relates to indirect energy consumed – most commonly being electricity. Nutanix partnered with a third party, nZero, to measure our scope 2 emissions – in our datacentres and offices. This process has been a journey to ensure we could produce meaningful data.”

What is Scope 3?

Scope 3 is the hardest to achieve, and the one where the industry is working hard, collaboratively, to get the entire supply chain into a position where emissions are measurable and reductions can be made.

“Scope 3 emissions are particularly challenging because they encompass all indirect emissions associated with a company’s value chain,” said Jerry Mumford, Keepit vice-president for the UK, Ireland and EMEA.

The challenges of measuring emissions that originate outside a company are understandably complex, and as a result, Scope 3 is an area many don’t like to dwell for fear of having their efforts scrutinised. However, it is inevitable that these emissions will need to be tackled, and the channel can take some positive action.

“Whilst it can be difficult to control Scope 3 emissions, it’s not impossible,” said Khan. “Channel companies need to set goals with their supply chain providers. For example, at BT, we expect our major suppliers to have sustainability targets in place within six months of working with us. This guarantees that we share a similar ethos and can collaborate to create a greener future.”

The channel is traditionally a competitive animal, but many are having to learn that when it comes to saving the planet, collaboration, sharing best practices and supply chain transparency are all required.

The other positive is that those wrestling with Scope 3 will find themselves in good company, according to Wragg.

“This is a ‘whole-industry’ challenge – and one that’s replicated in every other sector,” he said. “In that sense, it’s a much bigger, global issue. What we really need is clean energy. Until that arrives, the best way forward is to use forms of transport that are more energy efficient and make use of renewable sources. This is something TD Synnex is looking at right now – and we know that many other companies in the industry are doing the same. Of course, Scope 3 also covers the downstream supply chain, and resellers may themselves be able to do something about reducing the number of journeys or consolidate deliveries they make to customer premises. They may also be able to use electric vehicles that make use of renewable sources for deliveries.”

What are the risks of not doing it?

Eglon is blunt when asked about the dangers or doing nothing. “Your business will not exist in 10 years,” he said.

That might sound harsh, but channel companies are already losing business if they have a weak sustainability position, and there are also other dangers that will ultimately undermine a business.

“The risks of not addressing sustainability are significant, including reputational damage, regulatory non-compliance, and missed opportunities for cost savings, profitability and innovation,” said Munford. “By failing to implement sustainable practices, companies may face increased operational costs and environmental impact. Sustainability and profitability are not mutually exclusive, and Keepit highlights that a sustainable company (uses fewer resources, less waste) is a profitable one.”

The market is changing, and customers are already expecting the channel to deliver a sustainable option.

Wragg has seen the issue climb up the corporate agenda. “It’s also becoming commercially essential,” he said. “For many public sector and large enterprise bids, reseller partners need to show that they are making every effort to minimise their carbon impact – weighting towards environment; social and governance factors can be as much as 40% now. To win business, partners will need to have a clear carbon reduction strategy in place.”

“There are also more regulations coming into play, such as the EU’s [European Union’s] Corporate Sustainability Reporting Directive, which mandates organisations to report on and provide mitigation for the impact of their operations and supply chain. That comes into force this year, and I’d expect something similar to be introduced in the UK at some point after the election.”

Where can the channel get help?

Trade bodies, vendors, and fellow MSPs and resellers are all places where advice and guidance can be sought by the channel.

Vendors have introduced sustainability certifications and programmes to encourage the move to net-zero, and the spirit of collaboration has seen many share their approaches in sustainability documents and at events.

Steve Pearce, group head of marketing at Kyocera Document Solutions UK, said it viewed its role as helping to populate the channel with more carbon neutral expertise that could be shared across its ecosystem.

“At Kyocera UK, we are taking some channel partners on a green journey, helping one partner become carbon neutral themselves,” he said. “We continue to work with our skilled team internally to make our partners’ sustainable transition as smooth as possible and share our practice. Subsequently, channel partners can learn from other organisations that have achieved net-zero status like us, but they must take their initial first green step.”

Lasse Fredslund, the CMS Product Owner at .Net open-source CMS provider Umbraco, echoes the experience of reaching out to vendors as a first port of call.

“Working with vendor partners is a great first step, particularly if they’ve already started on their own sustainability journeys,” he said. “In our CMS industry, the cloud giants are already on their own path to net-zero, and we’ve been able to tap into that to reduce our own Scope 1 and 2 emissions. There are also a number of organisations that provide useful information on measuring and then reducing carbon emissions from websites.” 

Distributors, the traditional providers of a lot of channel training and support, are also active in providing assistance.

“For our part, we will try to help partners in whatever way we can, even if it’s just pointing them in the right direction,” said Wragg. “We’re also offering our resellers and vendors accredited training, which is underwritten by the Institute of Environmental Management and Assessment. This three-day course will enable you to build a carbon reduction plan, calculate your own carbon footprint, and submit data to organisations like the Carbon Disclosure Project and the Science-Based Targets initiative.”

Ultimately, the message is to reach out, to talk to all tiers of the channel, and lean on vendors and groups such as Techies Go Green, to ensure this is not a challenge faced alone.

“From one another, nobody can win alone in the race to zero; everyone has a part to play, and hence collaboration and partnership is crucial,” said Wynn.

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