ITAM has a role in building a sustainable IT community

By Shawn Stockman

Featured in The ITAM Review, December 6, 2022

The following article features extracts from An IT Asset Manager’s Guide to ESG, a new ebook written by Shawn Stockman, Vice President, Sustainability Solutions at Onepak, Inc. which looks at the growing role of ITAM in sustainable IT and building a sustainable IT community.

How can we help?

I grew up in rural Kansas, where everyone was expected to pitch in whenever there was work to be done. On a personal level, that meant always asking oneself, “how can I help?” Once, when a local farmer had a heart attack in the middle of wheat harvest, the neighboring farmers left their own fields and harvested his wheat for him. But it wasn’t just in times of crisis that people banded together—it was an ongoing part of a shared sense of responsibility to the community. A feeling that we’re all in this together.

That mindset is what is needed now in the face of climate change and the recent emphasis on ESG (Environment, Social and Governance). But this is not a new idea.

 

We are all part of a global community

“Each member of the community gives himself to it, at the moment of its foundation.”

Jean Jacques Rousseau, 1762

 

IT asset managers (ITAMs) have a role to play in their organization’s sense of community responsibility. That role may start in defining the “community” that is impacted by the products or services your organization produces, by the people the organization employs, and by the material streams in and out of the organization. Is it limited by geography—the footprint of corporate offices or factories? Would your community comprise only your own company? Or might it also involve your peers in the profession or in your industry?

Depending on how big your organization is, the scope of your “communities” may vary, but the impact your decisions have on the planet remains the same.

Similarly, it is helpful to consider which corporate responsibilities an ITAM can affect. While the term “Corporate Social Responsibility” has been around for decades, the range of responsibilities organizations have is vast: economic, legal, ethical, philanthropic, and more recently, environmental and social responsibilities.

How ITAMs view their role affects how they view their responsibilities. We may just need a modest change of perspective.

 

The ITAM Hippocratic Oath

Almost 2,400 years ago, a visionary Greek physician invented a famous oath which doctors still refer to today—the Hippocratic oath. It goes something like this: First, do no harm. Respect privacy. Treat the whole patient, not the symptom. Consider the impact on the community (Covid is a great example of that).

So, what is the Hippocratic Oath for ITAMs? I would offer the following:
• Strive for carbon neutrality (net-zero)
• Wipe the data
• Work within your company
• Give back to your communities

Most hardware asset managers and the people they report to are in real positions of internal influence, if not control, when it comes to material streams in (asset acquisition) and out (asset disposition) of their organization.

What can ITAM do?

A simple shift from a “consumer” mindset to a “citizen” mindset involves addressing the responsibility of your actions and the impacts you may have on your communities.

1. Slow the pace of equipment refreshes

For example, when we slow the pace of refreshing equipment, we correspondingly slow the pace of pulling virgin materials and precious metals from the earth to make new equipment. Beyond a longer refresh cycle, consider buying refurbished equipment. According to Circular Computing, for each new laptop you avoid purchasing, you save 316KG of CO2 emissions, 190K liters of water and 1,200 KGs of earth’s resources. In this case, IT asset managers can play a crucial role in reducing the impact their company has on the environment.

 

2. Dispose of assets more responsibly

Additionally, ITAMs can also be social impact champions when it comes to disposing of used equipment. How about channeling some of this gear into donations to worthy community groups rather than re-marketing them for relatively modest financial return? By providing equipment to social service agencies, nonprofits, and schools, you can reduce e-waste and provide real cost savings to those institutions while providing access to people who otherwise may not have had access to a digital experience. For example, Onepak is partnering with Digitunity to provide an option for users of its ReturnCenter platform to redirect used corporate IT equipment to individuals who have none, which can positively impact their access to education, employment opportunities, legal services and healthcare. Improving digital literacy and digital equity are true positive social impacts.

 

3. Consider the environmental impact of your cloud solutions

According to the US Department of Energy, data centers account for about 2 percent of all electricity use in the US, consuming 10 to 50 times the energy per floor space of a typical commercial office building. The top three cloud providers—Amazon Web Services, Google Cloud, and Microsoft Azure—account for approximately two-thirds of all rentable computing services. Now you can get a better handle on your carbon footprint if you use one of these big providers.
AWS has launched the free Customer Carbon Footprint Tool to help its customers understand the carbon emissions that their EC2 instances and other computer and networking services generate.
Microsoft recently rebranded their Sustainability Calculator as Emissions Impact Dashboard, which provides transparency into greenhouse gas emissions associated with using Microsoft cloud services and enables a better understanding of the root causes of emissions changes.
Google has combined carbon reporting features in its cloud services into Carbon Sense suite, which now has an AI based feature to help customer reduce the carbon footprint of their cloud activity.
To help customers measure their carbon footprint, Salesforce is making its Net Zero Cloud 2.0 product generally available globally. The Net Zero Cloud helps companies across industries report and track sustainability data, helping them become “net zero” organizations that eliminate as much carbon in the atmosphere as they produce.

 

4. Track ESG data

Finally, make sure you are engaged with the people in your organization charged with tracking and reporting ESG data. If your organization uses platforms like Workday, Workiva, Optel or ServiceNow, someone has already begun capturing and reporting impact data that should include activities in your department.

 

How can you help?

As you can see, there are many ways in which ITAM can already contribute to building a sustainable IT community. As you consider your organization’s role as a citizen of the world and its associated responsibilities in its communities, consider your own role in making sure your organization thoughtfully answers the bigger question of “How can we help?”

 

For the full article in The ITAM Review, please click here: https://itassetmanagement.net/2022/12/06/how-can-i-help/

Note to Healthcare: Join the Circular Economy

When it comes to pursuing a truly circular economy, there may be no industry in America more ripe for reform than the healthcare sector. It represents about 20 percent of our economy, and yet it’s still mostly mired in confusing regulations and old habits that prevent it from becoming more environmentally and socially progressive.

If you’ve been to a doctor’s office lately you can readily see evidence of that wasteful “take/make/dispose” linear economy mindset. From single-use gowns to unused supplies of sutures, syringes and gauze pads, millions of pounds of surplus medical supplies and equipment are sent to landfills and incinerators that, for various regulatory reasons, hospitals and medical companies must discard. According to Practice Greenhealth, hospitals generate over 29 pounds of waste per bed per day.

But it’s not just small supplies that are discarded. Take an old mammography machine that gets stuck in a warehouse when it’s replaced by a newer model. The older machine might have little value in this country, but would be heartily welcomed in many others where healthcare systems are starved for resources.

You know the old adage about having enough food to feed everyone already, but it’s just “a distribution problem”? It turns out that as a planet we already produce enough food for everyone, but can’t get it where it needs to go equitably.

Unused medical supplies and used equipment follow a similar pattern—excess amounts in one place are not easily redistributed to areas of need. This is a classic circular economy challenge.

But there are visionary organizations finding solutions, like Maine-based Partners for World Health (PWH), founded by a dynamic retired nurse.

I met Elizabeth McLellan recently and was inspired by what she told me. PWH works with manufacturers, distributors and over 100 hospitals and other healthcare facilities in New England to collect, sort, evaluate, repackage, and prepare these supplies and equipment for distribution to individuals, communities, and healthcare facilities in need both locally and internationally.

Locally, they have the equivalent of a lending library for reusable items like wheelchairs, crutches or home health equipment that can be borrowed and returned for reuse after patients recover.

Internationally, each year PWH sends nearly two dozen forty-foot containers of donated medical supplies and equipment to under-resourced hospitals, clinics and humanitarian organizations in places like Ukraine, Uganda, Nepal and Bangladesh. Every item they send overseas is a silent testament to how our own healthcare system is so far from the circular economy model. The average value of goods shipped in each container exceeds $200,000.

But the good news is that there is more focus than ever in the healthcare industry on sustainability and ESG (Environmental, Social, Governance) efforts. Practice Greenhealth, a membership network of more than 1,400 healthcare organizations focused on environmental sustainability, has grown by 17% in the last two years.

Socially, there are more organizations like PWH and Atlanta’s Medshare addressing health inequity, which refers to avoidable differences in health between different groups of people. In their most recent fiscal year, Medshare was able to improve the lives of 4.7 million people in 41 countries, including the U.S., and provide $18 million in aid.

But what about healthcare providers in areas outside the reach of organizations like Medshare and PWH? How do we enable all healthcare organizations to minimize waste and maximize their social impact? How do we measure and report those impacts?

Answer: By working with organizations like ours that plug them into the circular economy, they will derive data they can use to demonstrate that impact—whether it’s social or environmental—whether it’s a local community or one on the other side of the planet.

Onepak’s ReturnCenter platform is like the fireman in control of a firehose—able to strategically direct the flow of used equipment and supplies where they are most needed—an ESG-intelligent routing tool.

Because of our technology infrastructure, Onepak is uniquely positioned to serve as facilitators and data providers in this circular system. By operating a platform that connects all stakeholders and service providers, we can physically move valuable items back into a reuse economy and provide the credible, independent third-party “E” and “S” data about the impact of those efforts.

The healthcare industry needs better metrics to measure the social impact of reuse programs. If you have ideas about how to help these initiatives, or how your organization might benefit from joining a redistribution network, we’d love to hear from you.

Shawn Stockman Interviewed in Customized Logistics & Delivery Magazine

Onepak Vice President of Sustainability Solutions Shawn Stockman was recently interviewed in CLDA magazine discussing how to create a more inclusive culture for teams. Touting the benefits of CLDA’s training, Stockman said, “We are all in this together. Covid showed us how fragile our economies are and how interdependent we are as individuals and as companies and communities, on people from all walks of life and cultures. There is no business that can’t benefit from a better educated workforce around diversity and inclusion.”

Under Shawn’s guidance, Onepak was one of the first companies to offer this training to its team members. With its focus on being an authentic ESG-driven company, Onepak is committed to diversity and inclusion. Read the interview below, or visit this link.

CLDA Mag: Tell us about your company and your role there.

Stockman: I am the Vice President of Sustainability Solutions at OnePak. We are a reverse logistics platform company that provides carbon-neutral logistics for asset recovery and other circular economy challenges.

CLDA Mag: Why did your company decide to participate in the training?

Stockman: We are an ESG-driven company, and diversity and inclusion training is a
critical part of that strategy.

CLDA Mag: What was your reaction to the training?

Stockman: I liked the use of real people rather than actors, giving a variety of authentic viewpoints mixed in with lessons learned.

CLDA Mag: Why was that important to your company’s success?

Stockman: We work with global clients, so our customer base is extremely diverse, and we need our staff to not only represent an equal level of diversity, but also be sensitive to and appreciative of the value of other cultures and perspectives.

CLDA Mag: Why do you think it was effective?

Stockman: I liked the range of situations presented, as it represented realistic predicaments that I might find myself in, with a clear path to handling them successfully.

CLDA Mag: What changes, if any, did you make to your organization as a result of the information you got from the training?

Stockman: We incorporated quarterly information sessions in the company to touch base with each other about these issues.

CLDA Mag: Would you recommend the training to other members?

Stockman: Yes, I would because it is a great start to introducing the importance of diversity and inclusion values that every company needs. Because of CLDA’s support of the training, it allows members to take advantage of the most affordable training on this subject that we have seen on the market. The value for the dollar is exceptional.

To learn more about Onepak’s ESG initiatives, visit our ESG page.

Onepak Named to the G75 by Inbound Logistics

June, 2022 — Inbound Logistics, the information leader in supply chain and logistics management, has named Onepak to its 2022 list of top 75 green supply chain partners, the G75.

The G75 lists companies leading the way in sustainability and green logistics initiatives. The editors select 75 companies that demonstrably go above and beyond to prioritize green initiatives and help global supply chains become more sustainable. These companies are dedicated to developing and implementing best practices that leave a positive footprint on the world.

Onepak was selected for this honor based on its initiatives in reducing greenhouse gas emissions, reuse/recycling programs, sustainable packaging, sustainably sourced materials, and years of providing guidance to its supply chain partners.

G75

For the full list of G75 winners, please visit https://www.inboundlogistics.com/cms/article/2022-g75-inbound-logistics-75-green-supply-chain-partners/

How IT Asset Managers Can Have a Bigger Impact on the World

The recent IAITAM ACE conference in Las Vegas provided ample opportunities for conversations with IT asset managers responsible for moving hardware from place to place. If there was any one big take-away, it was that when it comes to ESG (environment, social and governance), most IT asset managers had either never heard of it or never thought it really had much to do with them. But IT asset managers can have a bigger impact on their organizations and on the world.

It’s been said that every job is a climate job because we all do things that impact the climate. At Onepak, we say every job is an ESG job, because anyone can get involved in the development and adoption of practices that address their company’s impact on the environment and on the communities in which it operates.

Best practices in ESG mean that you:

  • Measure and minimize your impact on the environment (E).
  • Operate under strong codes of business and social ethics around equality, diversity and inclusion (S).
  • Have strong policies in place around fair and equal pay, employee rights, executive comp, and environmentally sustainable business practices (G).

When we talk to upper management at most companies, these leaders will enthusiastically nod in agreement about the importance of instilling ESG principals in their companies. Unfortunately, that doesn’t always filter down through their entire organization.

And that’s precisely where IT asset managers can have a real impact. Most ITAMs on the hardware side are in positions of real influence, if not control, in their organizations when it comes to what happens to their used IT equipment. They are often able to bring a fresh perspective to tired old habits.

Here’s one example. The industry has a tradition of refreshing most equipment every three years. But is that really necessary? As you consider that habit—and it’s really only a habit—you begin to realize that it began not because it made sense for client needs, but because it was a way for leasing companies to maximize profits.

What’s the solution? How about building analytics to objectively judge when you really need to refresh equipment. When does break/fix truly outweigh the cost of replacement? Since each asset type has a different usable life—longer for servers, shorter for laptops—for some, every five years makes more sense. So why treat them all the same?

When we slow the pace of refreshing equipment, we correspondingly slow the pace of pulling virgin materials such as precious metals (used in making electronics) from the earth to make new equipment. In this case, IT asset managers can play a crucial role in reducing the impact their company has on the environment.

ITAMs can also be ESG champions when it comes to how to dispose of used equipment. How about channeling some of this gear into donations to worthy community groups rather than remarketing them for relatively modest amounts? (Watch for Onepak’s announcement on a new program for that soon.)

Finally, depending on how much of an appetite for activism you might have, you can even become active in the governance part of your company—the G in ESG. What policies does your company have in place to minimize its ecological impact and maximize its social impact? Why not become an internal champion for both?

In the end, it’s all about thinking about your job differently. IT asset managers can have real influence when they begin to consider their roles as part of the circular economy.

While there may be lots of general information about ESG, there is not a lot about it as it relates to IT asset management. But that’s about to change, with our upcoming e-book on the subject—stay tuned.

Meanwhile, If you would like to be included in the conversation about developing standards for measuring the social impact of donating used IT equipment, please contact me at shawn.stockman@onepak.com.

Next Gen Logistics Challenge

The dates of the Customized Logistics and Delivery Association’s Final Mile Forum to take place in Miami this year have changed to June 29 through July 1.

At this event, college students are invited to participate in the Next Gen Logistics Challenge, a competition which will award the members of the winning team with options for internships with association member companies. The new dates will allow college teams more time to prepare and present their solutions.

Onepak is a proud member of the Customized Logistics and Delivery Association (CLDA), which is a non-profit trade association comprised of logistics professionals, carriers, shippers, drivers, air cargo logistics providers, 3PLs and vendors servicing today’s supply chain companies.

Onepak’s VP of Sustainability Solutions, Shawn Stockman, suggested the idea for the Logistics Challenge to the Diversity & Inclusion Committee of the CLDA, of which he is a member. Mr. Stockman will also serve as a judge in the Challenge.

“The Challenge is one way the CLDA is building partnerships with Universities that have specialized programs in the logistics and supply chain fields of study,” said Stockman. “Onepak and the CLDA are particularly interested in working with historically black colleges and universities as a way to improve diversity in the industry.”

Participating student teams must define a problem in the first/final mile industry, and propose how they  would apply an emerging technology to solve it.

“What we love about this Challenge is that it encourages students not only to engage with the industry to define current gaps in processes, but it empowers them to look at technologies like AI, IoT, blockchain, renewable energy, automation, reusable packaging or nearly any other technology for a possible solution,” Stockman added.

The Logistics Challenge creates opportunities for students and faculty to attend and participate in the CLDA’s annual conference that is held across the US.

Key dates:

Abstract/Entry due: Friday, March 11, 2022

Competition Day will take place virtually: Friday, April 15, 2022

Winners announced: The following week (and internships begin in June)

The top three teams will be invited to present their pitches in Miami on Thursday, June 30, 2022.

Full event description (with link to entry form) can be found here.

 

Students and faculty from the top three teams will be offered complimentary admission and meals on the day of the event.

Team members will be able to attend all educational programs that day, visit exhibiting companies, and participate in a networking reception that evening.

Please help spread the word to any logistics or supply chain student you know!

 

4 Reasons to Gain Control of your ITAD Logistics

Four reasons to gain control of your ITAD logistics – A new white paper from Onepak

For IT asset managers, one of the most common practices in IT asset disposition is also one of the riskiest. Most ITAD providers bundle logistics into their service offering for the sake of simplicity and convenience to their customers. However, the downsides of this practice can outweigh the benefits.

Just as we might rely on a general contractor building a house to hire competent subcontractors, we count on the ITAD providers to work with logistics providers to take care of assets from pickup through delivery. But each time a company hires another company there is a little more disconnection and loss of visibility and control. And often there are more disputes.

If the two parties are not tightly integrated, there are likely to be gaps in com- munication and blind spots. How do you know how many assets were picked up—or which ones? How do you know that some of them didn’t get broken or lost in transit? How do you know the true costs of logistics as separate from the value of your assets?

  1. Asset Tracking

The importance of tracking IT assets from the point of pickup is rarely disputed. From the time assets leave a company’s facility, visibility is a key issue for an IT asset manager (ITAM). And an ITAM’s visibility is solely a function of the ITAD provider’s capability for transparency. The reality is that very few ITAD providers actually perform their own logistics—they outsource it—and that’s the first disconnect.

Click here to read the entire white paper and learn why it’s important to gain control of your ITAD logistics!

For more information visit our technology page.

Calling All Logistics & Supply Chain Students: Next Gen Challenge

The information and dates in this blog have been updated. For the updated information, please visit this link: https://wp.onepak.com/next-gen-logistics-challenge/

 

At the Customized Logistics and Delivery Association’s Final Mile Forum to take place in February in Miami, college students are invited to participate in the Next Gen Logistics Challenge, a competition which will award the members of the winning team with options for internships with association member companies.

OnePak is a proud member of the Customized Logistics and Delivery Association (CLDA), which is a non-profit trade association comprised of logistics professionals, carriers, shippers, drivers, air cargo logistics providers, 3PLs and vendors servicing today’s supply chain companies.

OnePak’s VP of Sustainability Solutions, Shawn Stockman, suggested the idea for the Challenge to the Diversity & Inclusion Committee of the CLDA, of which he is a member. Mr. Stockman will also serve as a judge in the Challenge.

“The Challenge is one way the CLDA is building partnerships with Universities that have specialized programs in the logistics and supply chain fields of study,” said Stockman. “OnePak and the CLDA are particularly interested in working with HBCUs as a way to improve diversity in the industry.”

Participating student teams must define a problem in the first/final mile industry, and propose how they  would apply an emerging technology to solve it.

“What we love about this Challenge is that it encourages students not only to engage with the industry to define current gaps in processes, but it empowers them to look at technologies like AI, IoT, blockchain, renewable energy technologies, automation, reusable packaging or nearly any other technology for a possible solution,” Stockman added.

The Challenge creates opportunities for students and faculty to attend and participate in the CLDA’s annual conference that is held across the US.

Key dates:

Abstract/Entry due January 31.

Competition Day at Final Mile Forum in Miami: Thurs, Feb. 24.

Full event description (with link to entry form) can be found here.

 

All meals the day of the event will be free for students (and faculty) attending.

Team members will be able to attend all educational programs that day, visit exhibiting companies, and participate in a networking reception that evening.

Please help spread the word to any logistics or supply chain student you know!

What can Sustainable Logistics do for the Final Mile Industry?

Welcome to the language of today’s supply chain. What do terms like ESG, Sustainability, Corporate Social Responsibility, Circular Economy, and Going Green  mean for members of the final mile industry? And how can individual logistics carriers make the most of these emerging trends? That was the topic explored by a panel of CLDA (Customized Logistics and Delivery Association) members from key sustainability related fields at the Final Mile Forum.

Organizing their discussion around the traditional SWOT analysis (strengths, weaknesses, opportunities and threats), the panel looked at the escalating role that sustainability will play in the logistics space.

Setting the Context

The final-mile industry will be affected by two major trends over the next decade: a shift by retailers and other shippers towards companies involved with ESG (environment, social and governance) and the global transition among manufacturers toward a circular economy. The panel kicked off with some definitions of these terms.

The term ESG is the latest buzzword in the evolution of corporate social responsibility. Investment firms are shifting billions of dollars of investor funds away from fossil fuels and towards companies that practice sustainability. They are looking for ways to invest in companies that:

  • Measure and minimize their impact on the environment (E)
  • Operate under strong codes of social ethics around gender equality, diversity and inclusion in their work force and communities (S)
  • Have strong policies in place around fair and equal pay, employee rights and executive compensation (G).

Shippers and retailers will be coming under increased pressure from their stockholders and customers to demonstrate their commitment to ESG principles. That will mean they will be looking for final-mile providers that can help them achieve their ESG goals. Many are developing standards or scorecards for their supply chain partners that require them to document their progress toward these values. For example, they may require a last-mile provider to report on emissions avoided through their use of electric vehicles. That’s because these shippers could count those benefits toward their own net-zero goals.

The term “circular economy” refers to the shift away from the traditional linear “take, make, waste” approach of mining virgin materials, manufacturing products for a single use and disposing of them. In a circular economy, goods are produced in a way that enables reuse and recycling of materials that will be fed back into the supply chain. For example, many final-mile providers that deliver large goods such as furniture are commonly stuck with disposal fees for the single-use packaging discarded after installation. A circular model would enable the recovery and return of that packaging for multiple uses.

In these larger contexts, “going green” takes on a new meaning. It can refer to first/final mile providers switching their office to renewable energy or transitioning to electric vehicles (EVs). It can include looking at the ratio of independent contractors to employees or having policies in place to address gender equality or racial diversity. Sustainability is not just about lowering one’s carbon footprint. It can also mean increasing one’s community impact.

Weighing the Factors

The panel translated the traditional SWOT analysis into a format that applies to this transition:

  • Strengths = Reasons for moving towards sustainable business practices
  • Weaknesses = Barriers that could get in the way of this transition
  • Threats = Consequences of not making the transition
  • Opportunities = Rewards for moving in this direction.

Reasons for making the move – The panel discussed the benefits to first/final mile carriers of moving toward sustainable business practices, which may include lower operating costs. These would be especially true for those carriers that begin using electric vehicles (EVs). As an added benefit, EVs generate more data, which can help improve efficiency, lower costs and be used as a selling point with shippers that need to meet their own net-zero goals or ESG benchmarks.

Barriers to entry – Carriers considering a transition to EVs may encounter some barriers. They will need to persuade or incentivize their independent contractors to make the switch. For fleet owners, it will mean a substantial upfront cost. There is also the matter of installing charging stations. Those that rent facilities will need to get landlord buy-in to the cost of installing those facilities. Another consideration is whether the local electric grid could handle the load of several EVs charging at once. In addition, there is currently a shortage of these vehicles. Right now, most commercial EV makers have sold out of their initial production runs.

Consequences of not making the move – What happens if logistics providers don’t make the transition to sustainable business practices? They could lose drivers. Rideshare companies are competing for drivers that have EVs because an increasing share of the market is demanding this. Shippers may develop their own sustainable fleets and bypass final-mile providers that are slow to transition. Retailers that are ESG-driven will rate and reward providers that meet their criteria for sustainability and drop those that don’t. Unpredictable fuel costs and ever-changing regulations may drive up the cost of doing business the old way. Customers may move their business to other providers that address environmental, social or governance issues.

Rewards for the transition – The rewards of embracing a transition to sustainability and ESG values will compound over time. Progressive carriers will attract forward-thinking drivers, team members and customers. ESG-oriented retailers and other shippers will want to do business with them. Carriers will run their companies more efficiently and enhance their standing in their communities. And a carrier that transitions to EVs capable of vehicle-to-grid charging will actually be helping to stabilize the local grid as part of a distributed energy network.

Next Steps

The CLDA is becoming more involved in helping its members tackle the issues involved in ESG. The Diversity & Inclusion Committee introduced members to a cost-effective way to train their team members to create a more inclusive workplace through an on-line training course.

For more information or to find out how to get involved with the CLDA, please contact us.

How to partner with social enterprises in the value chain

GreenBiz, Steve Schmida & Dan Viederman | October 19, 2021

We have a hard road ahead to achieve the United Nations Sustainable Development Goals (SDGs) by 2030. But we’re seeing strategic global companies step up — setting ambitious targets and mainstreaming within core business strategy. Here, a company’s own value chain is an obvious starting point. How might a product’s journey from design to post-consumption better benefit communities and the environment along the way?

A growing number of leading companies are answering this question, in part, through partnerships with social enterprises. Social enterprises are mission-led organizations — for-profit or nonprofit — that tap market forces to explicitly create social or environmental impact. Catalyst 2030 (a global network of social entrepreneurs) and Resonance (a mission-led global consulting firm) recently completed new research exploring how companies are strategically engaging social enterprises in their value chains and beyond.

What we found is that social enterprises have much to offer: They’re testing and scaling innovative new business models that can help companies solve key sustainability challenges; reach underserved customer populations; and advance more ethical, more resilient supply chains.

When a company engages a social enterprise — as a supplier, a distributor or a B2B service provider — directly within its existing value chain, it takes money it would have spent anyway and directs it toward a partner that will also create social or environmental value.

SAP found that by directing just 5% of its addressable procurement spend to social enterprises, it could unlock tens of millions of dollars each year for social impact.

When done right, value chain partnerships between corporations and social enterprises channel substantial resources toward creating impact and meeting corporate sustainability goals. (Indeed, SAP found that by directing just 5 percent of its addressable procurement spend to social enterprises, it could unlock tens of millions of dollars each year for social impact.) Such partnerships can also very effectively serve the broader strategic interests of companies. They can mitigate social and environmental risk, boost brand reputation, build inroads to new markets, unearth novel consumer insights and spark innovation.

3 ways social enterprises can partner within corporate value chains

From huge multinationals such as Johnson & Johnson and Unilever to smaller local firms, corporations around the world have started exploring collaboration with social enterprises. Such partnerships generally follow one of three formats: Social enterprises acting as suppliers; social enterprises acting as last-mile distributors; and social enterprises acting as innovative business-to-business (B2B) service providers.

1. Social enterprises as suppliers

Social enterprises can facilitate responsible sourcing by advancing sustainable production practices and ensuring fair labor. They can do this by acting directly as suppliers. For example: Vega Coffee helps its organic coffee farmers — 95 percent of whom are women — in Colombia and Nicaragua streamline the supply chain and increase their incomes by also processing, roasting and packaging their beans; Javara is working to sustain Indonesia’s food biodiversity heritage by helping local farmers, foragers and food artisans access national and international markets; and Evrnu’s innovative technologies upcycle discarded clothing into high-quality raw materials for the textile industry.

They can also act more indirectly, by advancing sustainability and equity at the first mile. Take GoodWeave, which helps companies ensure and certify that their supply chains are child-labor-free; MyAgro, which has a mobile layaway platform to allow smallholder farmers to purchase seeds, fertilizer and other critical farming inputs in small increments; eKutir, which boosts on-farm productivity and incomes by helping farmers in Asia and Africa access critical information, finance and markets through its Farmex mobile platform; and FairAgora, a Thai social enterprise with practical digital solutions for supply chain compliance, sustainability and fair labor.

Timberland, for example, has partnered with the social enterprise Other Half Processing to build leather supply chains from ranches that use regenerative grazing practices. And IKEA has partnered with social enterprises including Industree, which incubates and accelerates female artisan collectives in India and Africa. Such partnerships have helped IKEA create over 30,000 jobs across six countries while unlocking competitive differentiation with a changing set of unique, handcrafted products.

2. Social enterprises as last-mile distributors

Many global companies struggle with how to best connect with “last-mile” customers in emerging markets. This is a challenge that social enterprises are well-positioned to help solve. Through their deep know-how, innovative new business models and existing local networks, social enterprises can help companies better understand and access hard-to-reach markets.

Such collaboration benefits companies as they hunt for new market opportunity. But it also, more importantly, brings needed products and services to traditionally underserved consumers.

Examples of social enterprises that act as distribution partners include Kasha (a mobile e-commerce platform that confidentially sells and delivers women’s health and personal care products in Rwanda), mPharma (which has partnered with major pharmaceutical companies to get medicines more affordably and reliably to African consumers) and Kidame Mart (which empowers rural female entrepreneurs in Ethiopia to provide last-mile distribution of fast-moving consumer goods).

3. Social enterprises as B2B service providers

Social enterprises can help companies advance sustainability and social responsibility initiatives not just at points of supply and distribution, but all along their value chains and operations. These partnerships present a wide range of possibilities.

The social enterprise mPedigree, for instance, provides brands and consumers with a way to protect themselves from counterfeit products; Guild Education partners with major companies to offer higher education and reskilling benefits to corporate employees; and Closing the Loop provides companies a creative waste-compensation solution to facilitate waste-free procurement of electronics.

Although the value chain’s first and last miles generally present the lowest-hanging fruit for partnering with social enterprises, it’s important to keep an open mind to the full range of potential opportunities.

There needs to be strong commitment and motivation among leadership and key business units in a company

to support the growth of social enterprise partnerships.

How to prepare for and pursue partnerships

Partnerships between social enterprises and companies can be immensely rewarding — but they don’t happen overnight. It’s important that companies first lay the internal groundwork for successful collaboration.

To start are policies, systems and timelines in place that will allow the flexibility, support and runway that early social enterprise partnerships may require? Social enterprises, after all, may not be accustomed to working at the scale or under the same stringent criteria as multinationals.

Next — and critically — internal buy-in can make or break any partnership. There needs to be strong commitment and motivation among leadership and key business units in a company to support the growth of social enterprise partnerships. Without this support, a company’s partnership champions will be fighting an uphill — and likely unsuccessful — battle.

Here, a good place to start is to understand the key performance indicators (KPIs) of key business units, such as procurement or marketing, and build a case for partnership around these targets. Even better, find ways to align these KPIs with social impact and sustainability objectives — an effort in which executive sponsorship and support will be vital for success.

Even when the necessary support is in place, some companies abandon their partnership efforts because of the difficulty in finding qualified and well-matched social enterprise partners — a search that often must be done country by country, market by market.

Here, trusted intermediaries — such as the Social Enterprise World Forum, Aga Khan Foundation, Acumen or Ashoka — can act as conduits, helping corporates connect with aligned social enterprises. Further, software platforms and databases such as SAP Ariba, Good Market, SupplyChange and Thomasnet can be valuable tools, allowing companies to search for sustainable suppliers and B2B service providers.

Today’s business climate is making it both more necessary and more possible to partner with social enterprises. Integrating such collaboration into corporate value chains, although not always easy, presents an opportunity for big returns — for people, planet and companies.

Some of the above content was excerpted and/or adapted from the recently released report “Catalyzing Collaboration: How & Why Corporates & Social Enterprises Should Partner to Achieve the Sustainable Development Goals.”

 

Phone: (888) 625-6116

Fax: (508) 247-9300