Feature: How to advise customers on sustainability

Claire De Bie, principal product manager at Orbus Software reveals how the IT channel can positively advise enterprise customers on carrying out sustainable business transformation.

The use of technology by businesses today has a significant impact on the environment.  Forrester Consulting has found that IT contributes to 26% of the average organisation’s scope 1 and 2 emissions.

This figure should be a wake-up call. It highlights that all organisations need to take action to be more sustainable in the future – given that all modern organisations are using IT. Any notion that sustainable transformation is reserved for manufacturing or logistics houses needs to be ditched.

On the flip side, increasingly tech-enabled businesses can look to understand not just how IT contributes to overall emissions but also how technology itself can be harnessed to manage the transition to more sustainable operations. IT channel partners that understand this and prioritise such services are in a good position to help their business customers meet sustainability goals.

Business drivers for sustainability

Beyond the obvious imperative to prioritise sustainability for the good of the planet and humanity, several key business drivers have rendered sustainability a top priority for the boardroom today.

There are financial benefits associated with more sustainable practices, for example. Creating a sustainable business can deliver significant cost savings and efficiencies and mitigate risk. By way of illustration, Kogod School of Business professor of accounting, Tharindra Ranasinghe, argues that carbon risk “affects a firm’s future profitability” and that “from a purely financial perspective, managers must work actively to reduce carbon risk.” In addition, the Harvard Business Review found that 80 per cent of academic studies indicate a positive correlation between sustainable business practices and a company’s stock price performance. Brand positioning and employee satisfaction are closely linked to sustainability, too. Deloitte has found that among employed adults 69 per cent said they want their companies to invest in sustainability efforts, like reducing carbon and waste. It’s perhaps no surprise to hear that this sentiment is higher among employees aged between 18 and 34. The clear risk is that organisations seen to disregard sustainability become unattractive places to work.

And, of course, regulation is placing increasing responsibilities on businesses to meet sustainability targets. According to a PwC report, ongoing political and regulatory changes are shaping organisations’ ESG and sustainability priorities, with expectations of further government interventions and a push for closer alignment with international standards.

The Corporate Sustainability Reporting Directive (CSRD), for instance, which came into effect in January 2023, requires large companies and SMEs operating in the EU to report on their sustainability performance. This includes direct and indirect GHG emissions, total energy consumption within a company’s reporting period, water consumption, total waste generated by business operations and more. The EU isn’t alone in this push. In the UK, incoming Sustainability Disclosure Requirements (SDR) place a range of requirements on UK businesses to yield information on sustainability across the economy. This includes corporate disclosures adhering to International Sustainability Standards Board (ISSB) Standards and transition planning disclosure requirements.

As a result, many companies across various sectors are committing to reach net-zero emissions by 2050. Plans to reach that milestone, though, are still in their relative infancy. This represents a massive opportunity for channel partners to help businesses develop and make good on such plans and targets. But what do they need to consider when advising on sustainable IT transformation?

Identifying priorities

As far as the channel is concerned, digital transformation will always be the boardroom priority it cares about the most. But digital transformation needs to be considered in context and, for all the reasons listed above, that context is increasingly going to be one of sustainability. The channel ecosystem therefore needs to understand how sustainability renders itself in enterprise landscapes. Whether it’s ESG regulation compliance, sustainable transformation, or managing IT’s environmental impact – all of these things can be in an IT consultant’s sweet spot if the priorities are right.

It’s vital, then, to identify just what those priorities are. Many organisations are unable to pinpoint these precisely. Some are unclear about the relevance of sustainability to their business, unsure of the impact that making more sustainable decisions could have on their finances or risk management. Many businesses clarify their objectives and initiate specialised sustainability initiatives with dedicated teams with the mandate to define, shape and report sustainability progress. When set up as a new office, they act in isolation from their organisation’s wider digital transformation strategy and often struggle to successfully embed sustainability aspects across the organisation. This can lead to inconsistencies and impact integrity, where prioritised business initiatives are not considering sustainability aspects of change. It may eventually increase the risk of greenwashing accusations –  making false or misleading statements about the environmental benefits of a product or practice – financial penalties and reputational impacts.

A digital blueprint

Businesses probably won’t make the most sustainable decision every time, but they need constant sight of their ESG priorities and how their assets and decisions will impact those, otherwise, it will be impossible to measure progress and adjust accordingly.

A digital blueprint is needed. Mapping the organisation – its strategies, processes, and applications – will provide teams with an inventory of the various assets they manage and how they manage them throughout the organisation. This, then, will allow teams across an organisation to perform impact analysis, in which sustainability is the key context. When considering the interdependence of tech and ESG strategies, teams will often consider this in terms of the overall impact of the company’s IT estate on ESG performance and profitability.

Data is critical to this analysis, as well as broader ESG reporting. But the data needed for ESG disclosure can be scattered across an organisation or – worse – non-existent. This, then, puts companies at risk of non-compliance with regulations. Having a digital blueprint of an organisation can help identify whether it holds that data, where it’s sourced, and how it is managed. If the blueprint reveals that the data doesn’t exist, the organization can then formulate a plan to collect it to ensure compliance.

Importantly, by providing an inventory of a company’s IT assets and their relationships with its ESG and other sustainability aspects, digital blueprints are an impactful solution for channel partners to support the many businesses looking for guidance on getting started with sustainable transformation.

Practical solutions

As a starting point, channel partners need to seek out and work with those vendors that offer the solutions that customers can practically use to meet their sustainability goals by embedding sustainability considerations into their overall, everyday business decisions. And, of course, working with those third parties that demonstrably take sustainability seriously is also a good step for channel partners to demonstrate their alignment with sustainability missions. That, of course, needs to be paired with a genuine appetite to support customers to be more sustainable and a collaborative approach to this.

It’s also important for channel partners to understand the points of view of individual stakeholders within a customer’s business when it comes to managing sustainable aspects, be it environment or people related, so they’re able to ‘speak their language’ on these matters with confidence. After all, as we’ve seen, different companies have different priorities when it comes to sustainable transformation.

Consider the initial, crucial steps in assessing the sustainability maturity of an enterprise landscape. This entails sourcing a huge amount of input from across the business to understand sustainable aspects of all solutions, systems, and processes. Even if this data is sourced – easily placing it into hands across the business becomes another struggle.

All of this can be addressed by a channel partner with the right technology solution to unify disparate data points in an end-to-end platform. A platform approach can adapt to the way a business communicates to make the sourcing of information on sustainability aspects as headache-free as possible. That data can then be visualised in repositories, dashboards and reports to be accessible to all stakeholders. Quickly, the task of climate reporting stops being elusive and becomes operationalised.

Serious about sustainability

Growing consumer awareness, increasingly stringent regulation and mandated ESG reporting mean sustainability is no longer an optional consideration during an organisation’s transformation processes. It must be integrated into decision-making criteria, alongside factors such as time, cost, impact, alignment to strategy, and investment in new technology. Ultimately, the inclusion of sustainability throughout every area of a business will ensure that organisations make informed and responsible choices.

The channel has an opportunity to support customers with effective solutions that embed sustainability into their business to do not just what’s right but what’s good for them. The time has come for the channel ecosystem to take sustainability seriously – both as a customer priority and in terms of its future. By doing so, it can be a key enabler in its customers’ drive toward sustainable transformation.