Europe is taking a lead on sustainability, according to Logicalis CEO Bob Bailkoski.

Bailkoski said IDC recently delivered a list of the top priorities for CEOs on a region-by-region basis.

Logicalis’ Bob Bailkoski

“The No. 1 priority for CEOs in EMEA was ESG [environmental, social and governance]. In the U.S., it was in the top five, and in Asia Pacific, it was in the top five. But in EMEA it was No. 1, and that’s a really encouraging trend,” he said.

Moreover, the report aligns with what companies are seeing in Europe, said Bailkoski.

“It’s a growing trend around the world, but Europe is leading the way in ESG. That’s really encouraging and one that’s new for a lot of organizations. If this survey had been done five years ago, it probably wouldn’t have featured in any top five trends or priorities for CEOs. That’s then driving priorities for the rest of the organization. And in particular, CIOs, where there’s a lot of energy and carbon consumption, have to respond to that.”

With headquarters in the UK, the Logicalis CEO has been visiting customers in Germany, Spain and Portugal. One consistent theme coming through those conversations was sustainability.

“Some of those organizations were scratching their heads, trying to work out how they can reduce their carbon footprint. I was speaking with CIOs and IT leaders, and they were still looking to organizations like Logicalis to help them.”

As a result, Logicalis has developed a range of solutions to help customers measure their carbon footprints in specific solution areas. For example, it can help get a baseline of their existing carbon footprint in networking and conductivity.

“We can tell them the changes that will be made on the implementation of the solution that we recommend. That’s putting in a variety of different benchmarks and vendor support, to enable us to give that guidance.”

CEOs Incentivized on Carbon Reduction

The U.K.-based channel firm is doing the same internally. In Europe it has been using the EcoVadis platform to measure its carbon footprint baseline amongst a variety of other ESG initiatives. It is now extending that globally.

And for the first time, part of Bailkoski’s bonus as CEO will be dependent on Logicalis achieving certain sustainability metrics.

“That’s also a factor in many of our customers’ worlds as well,” said Bailkoski. “The CEOs are incentivized on certain carbon reduction initiatives in the context of a broader ESG set of incentives. And that is trickling down organizations, which means it’s at the forefront of a lot of our customers’ thinking now.”

Bailkoski also sees a time when sustainability will become the top priority for firms in the U.S.

“Part of it is consumer-led to a certain extent. The big organizations, which inevitably have U.S. headquarters and listed organizations where there’s a regulatory impact, it is part of their agenda. Of course, the U.S. market is absolutely massive, and includes a huge number of privately owned companies. And it’s no secret that over the last 20-or-so years, Europe has taken a leading role in managing a response to ESG-type issues.

“There’s no doubt in my mind that it will become a number one issue in the U.S. and Asia Pacific. It’s only a matter of time before it becomes the No. 1 issue for organizations globally.”

Customer demand and investor sentiment will drive the change, he added. Investment firm BlackRock CEO Larry Fink is a high profile example. He has publicly said that investors will increasingly direct their holdings toward companies focused on sustainability.

“It is becoming more and more of a big issue,” said Bailkoski.

Partners Should Talk Business Benefits of Sustainability

IDC’s Stuart Wilson confirmed this at the Channel Partners Europe event in London last month. When channel partners are talking to customers, he urges them to drive home the business benefits of sustainability.

“That sustainable approach will deliver those customers,” said Wilson. “If you can align it with how it’s going to save them money, how it’s going to make them more attractive in the eyes of their customers, then suddenly that message resonates a lot. We are seeing more and more RFPs requesting information on the sustainability matrix of the partner. But it’s really making sure the focus on sustainability is for the right reasons and actually aligned with your business model.”