Greening the IT supply chain

One of the biggest levers that businesses have in promoting sustainability is by lobbying the companies that supply stuff to them. If a supplier is unable or unwilling to provide evidence of sustainable practices, or improving sustainability in their organisation, then a business should find a supplier who can do this. As businesses add sustainability credentials as criteria for their purchase decisions, the market will promote suppliers who provide these credentials.

The consumer segment looking for sustainable goods is known as “LOHAS” by marketing professionals, who love a good acronym. LOHAS stands for “Lifestyles of Health and Sustainability. Of course, once an acronym exists, you can bet there will be companies making a grab for the dollars. The LOHAS marketing segment was valued in 2014 as having a global value of $500 billion, growing at 10% annually.

Sadly, there doesn’t appear to be a similar term (or estimated market value) for business to business transactions. Which is a shame, because while consumer preference is a major driver for retailers, it has less direct influence on other business behaviour (of course, there will be some secondary effects). This market must exist, but I couldn’t find figures on it’s size.

It is usual for businesses that adopt sustainability practices to start by tackling the issues inside their own organisations. An excellent next step is to review their supply chain, and to select suppliers who are willing to take the sustainability journey. This is the so-called “greening of the supply chain”.

We can see this starting to influence the global IT companies such as Apple, Google, Xerox and Toshiba. Naturally, each company has its own interpretation of what sustainability means, and this is reflected in the approach each takes.

I will explore this further in future posts.