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Environmental, Social and Governance (ESG) programs are anything but one-size-fits-all endeavors. Instead, most organizations work closely with stakeholders to ensure that programs align with their needs, carefully considering how factors affect business and internal and external relationships.
This varies significantly according to industry, region and commercial markets. Plus, it is commonplace for ESG programs to evolve as priorities and circumstances change.
Recently, Dell published its new ESG Report for FY2023, updating its achievements and overall strategy. Let’s consider how the company has progressed – but first let’s take a brief look at the state of enterprise ESG issues today.
Also see: Top Digital Transformation Companies
Today’s Corporate ESG Issues
It is worth noting the importance of ESG programs. The issues covered in these programs affect all of our lives and are closely tied to organizations’ relationships with stakeholders, including customers and strategic partners. Empowering disadvantaged groups of customers and businesses is just good for business.
That is especially true in the U.S. where despite their myriad benefits, ESG policies have become bugaboos of “wokeness” among some politicians and groups. Many of those individuals and alliances are also attempting to dial-back broader environmental and social justice advances but are encountering resistance from progressive organizations and individuals, as well as from seemingly unlikely organizations. Those include large corporations, pension funds, insurers and investment firms.
Why would those disparate players actively protect ESG programs? A couple of issues are top of mind. First, disadvantaging specific groups of consumers and businesses to appease politicians and special interest groups is simply bad for business.
Equally important are the negative impacts that anti-ESG efforts can have on promising businesses and industries. Consider that earlier this year, 19 Republican state governors signed an open letter warning of the “direct threat” posed by ESG proliferation. Some connect the ‘E’ in ESG to renewable energy technologies and programs, such as hydroelectric, wind power and ethanol subsidies for farmers. Since many or most of the governors who signed the letter lead states that benefit from renewable energy initiatives, their anti-ESG rhetoric seems ironic in the extreme.
Finally, and perhaps most importantly, is the value that ESG programs and strategies offer to companies doing business globally. Environmental, social and governance issues vary widely in importance and scope from place to place. The variety of ESG subject matter means that organizations can craft programs to maximize value for the customers and partners they believe are most in need.
Far from being the direct threat that some U.S. state governors and other politicians and groups imagine, ESG continues to deliver substantial, welcome benefits to businesses, state institutions and consumers worldwide.
Dell’s FY 2023 ESG Report
Dell Technologies has emphasized the importance of ESG-related issues since 1998 when the company published its initial Environmental Progress Report.
Beginning in 2002, the company shifted to annual reports charting its focus on and progress in key areas, including the environment, sustainability and corporate social responsibility. The company has maintained these commitments through recent political headwinds because it understands these priorities are not only good for business but also for the communities in which they operate.
What are some of the key highlights in Dell’s new FY2023 ESG report?
First, the company refined the goals included in the FY2022 report and condensed its 25 top-level goals to:
- Achieve net zero greenhouse gas (GHG) emissions across Scopes 1, 2 and 3 by 2050.
- Reuse or recycle one metric ton of materials for every metric ton of products Dell customers buy by 2030.
- Make or utilize packaging made from recycled or renewable material for 100 percent of Dell products by 2030.
- Leverage recycled, renewable or reduced carbon emissions materials in more than half of the products Dell produces by 2030.
- Employ women as 50% of Dell’s global workforce and 40% of the company’s global people leaders by 2030.
- Employ people who identify as Black/African American or Hispanic/Latino as 25% of Dell’s U.S. workforce and 15% of its U.S. people leaders by 2030.
- Improve the lives of 1 billion people through digital inclusion by 2030 through efforts such as supply chain training and initiatives aimed at girls and women, or underrepresented groups.
- Provide support for and participation in community giving or volunteerism by 75% of Dell team members by 2030.
Additionally, in 2022 Dell began framing a trust model centered on security, privacy and ethics. Given the importance of those areas in terms of establishing and maintaining trusted relationships, the company is emphasizing “Upholding Trust” with the goal of having customers and partners rate Dell Technologies as their most trusted technology partner.
Finally, the company demonstrated its continuing commitment to diverse supplier spend by doing over $3 billion in business with small and diverse companies. Plus, for the 13th consecutive year, Dell was recognized by the Billion Dollar Roundtable (BDR), which celebrates corporations that spend at least $1 billion annually with minority- and women-owned businesses.
Further details, background information and customer/partner examples can be found in the full Dell Technologies ESG Report for FY2023.
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Final Analysis
Transformation is a concept and process that permeates the technology industry, but it also has many guises. For example, there’s the “digital transformation” strategies and solutions that so many vendors emphasize aim to help customers improve business outcomes by maximizing compute performance and data efficiency. Other efforts include process transformation, such as leveraging automation and logistical efficiencies to improve supply chain performance.
One topic less commonly discussed is corporate cultural transformation. This is when an organization continually and proactively evolves to adapt and benefit from changes in commercial markets, business practices and demand forecasts, as well as shifts in politics, economies and the environment. In my opinion, this type of transformation holds a central role in Dell Technologies’ ESG strategy and its annual ESG reports.
Many of the practical steps the company is taking—expanding the use of recycled and renewable materials, for example—simply make good business and financial sense. Others, including achieving net zero GHG emissions, reflect the company’s deep understanding of and intention to practically address climate change and other environmental issues.
Some goals enumerated in the new FY2023 report may appear aspirational but are far more practical than one might expect. At a Dell Technologies World session a few years ago, Michael Dell noted (I confess to paraphrasing here) that, “A company should look like its customers and partners.”
That is a particularly profound statement, not to mention being highly applicable to business and a wide range of public and private organizations and institutions. Without having such a vision and investing in efforts to achieve it, individuals, businesses and governments will inevitably find their vision blurring, their frontiers shrinking and their opportunities dwindling.
By embracing cultural evolution through supporting and advancing the careers of underrepresented groups, by actively improving communities and the lives of a billion people and by working to become the vendor that customers and partners trust the most, Dell Technologies will further grow its own outlook, relevance and potential for success.
Is there a greater or more important goal for any organization?
For more information, also see: Digital Transformation Guide