The Big Talking Point in Europe in 2023? Sustainability

By Christine Horton

In Europe, there’s one word on everyone’s lips as we head into 2023: sustainability. Whether you are a channel partner, vendor or analyst, sustainability is dominating conversation throughout EMEA.

This is point of differentiation between the European and U.S. IT channels. Analyst firm Canalys noted recently that U.S. partners are trailing behind Europe on sustainability by several years. Be assured, it’s not a case of one upmanship. A huge factor is that the regulatory environment around sustainability in Europe is more mature than that in the U.S.

In France, for example, 30% of public sector RFPs must contain refurbished equipment. In the U.K., all companies bidding for government contracts worth more than £5 million a year must commit to achieving net-zero emissions by 2050 and have published a carbon reduction plan.

Earlier this year, Bob Bailkoski, CEO of global channel firm Logicalis, confirmed the No.1 priority for CEOs in EMEA was ESG [environmental, social and governance]. Referring to IDC stats, he said: “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.

Also for the first time, part of Bailkoski’s bonus as CEO is 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.”

Customer Expectation Driving Partner Behavior

HPE’s head of worldwide head of partner sales, George Hope, also noted the regional focus on sustainability.

“Some of the more recent conversations with the European partners, they’re more focused on sustainability. That’s a that’s a hot topic here, versus the U.S.,” he admitted at the recent HPE Discover event in Frankfurt, Germany.

Both his, and HPE CEO Antonio Neri’s presentations, highlighted sustainability. Indeed, Neri said sustainability was one of the pillars upon which HPE is building its strategic road map.

Of course, HPE isn’t the only vendor pushing sustainability messaging out to partners. It is a key talking point across the vendor spectrum. But the huge momentum around sustainability isn’t being driven by the vendors – it’s coming from customers.

Customers, investors and suppliers expect the organizations they work with, or purchase from, to have sustainability initiatives in place. In fact, research by Schneider Electric and Canalys shows that more than 75% of customer RFPs have sustainability criteria included today. Sixty-nine percent of partners confirm that customer environmental considerations are driving IT investment decisions.

David Terry, VP, IT channels Europe, Schneider Electric, agreed that going into 2023, will become a critical area of focus for the channel.

“There’s no doubt we’ll see more partners seeking to upskill their teams and diversify their service models. Research has shown that customers are increasingly looking to partners as trusted experts within key areas such as energy management, energy efficiency and carbon reduction.”

Terry pointed to net zero being less than a decade away.

“It’s vital partners recognize that building a sustainable ecosystem is paramount to the future of their business, and the planet.”

Sustainability Sells

Looking to 2023 and beyond, almost nine out of 10 business leaders expect to increase their organisation’s investment in sustainability over the next two years.

With energy prices skyrocketing, customers urgently need to reduce energy consumption and improve efficiency. This need will only increase in 2023.

The good news for partners is that sustainability sells. HP reported $3.5 billion in new sales in 2021 where sustainability was a deciding factor. Also of interest: Nine in 10 U.K. business leaders believe there is a connection between environmental sustainability and long-term profitability. Survey respondents ranked “customer demand“ (49%) and “the potential for revenue generation“ (38%) as the biggest motivators for action. Two-thirds (65%) of U.K. businesses believe that addressing environmental issues will be material to business results.

Partners are realizing that sustainability in no longer a nice-to-have. To be credible to customers in 2023, they will need to take the lead on sustainability.