Expressed opinions Entrepreneur Contributors are their own.
Over the past few years, environmental, social and governance (ESG) and sustainability have become an important part of the conversation surrounding corporate strategy. The companies have taken steps and raised the prospect of integrating the various aspects of ESG under a comprehensive approach. Competitive races at ESG have seen increasing promise but missed focus and alignment. Leaders are confused, many lack the necessary understanding of what ESG is and where they should go next.
As a company, HP has a strong track record of sustainability at ESG, and is the architect of Ellen Jackowski. As HP’s Chief Impact Officer and Head of Sustainable Impact, he has led the company to the A-list of climate disclosure projects for five years, in fact the company has met its carbon-reduction goals. Her work on integrating different dimensions of corporate responsibility, influence, and sustainability has earned her a lot of respect, including being named one of the “25 Badass Women Shaping Climate Action.” Greenbee. I’ve talked to Ellen about how companies can accomplish their ESG-related endeavors and programs in a way that supports their overall business strategy.
Related: Why ESG Conscious Companies Are Elastic Bodies
How do you think companies can actually take ESG out of a commitment to work strategically?
ESG is always a core value that is central to HP. From day one of the company, our founders Bill Hewlett and David Packard have compiled a list of eight corporate objectives. Although revenue and profits were evident among them, so was the term “world citizenship.” Since then, we have modernized our language and called it a lasting effect. But even then, they had foresight and understanding of the role of the corporation and its responsibility to society.
These values have evolved and deepened in HP and they continue to be strong. We have always tried to make it a priority by thinking about our material metrics, asking, “What is most important to our company and where can we make the biggest impact in society? What do our stakeholders care about the most? ”By stakeholders, we mean not only investors or customers, but also our employees and the communities we serve. We have created sustainable impact strategies that are most relevant to us and hit the mark where we can make the most impact.
I think it’s really important for everyone in the corporate space to think. What power are you bringing to the society? What skills? What tools? And how can those tools be used to improve society? At HP we have three pillars of focus: the first is about climate change. HP manufactures printers and PCs, but also sells printing and computing services, 3D printing, as well as an emerging healthcare business. It represents a significant carbon footprint. Between our printing business and the printing of printers through which paper flows every day, we know we need to take urgent steps to move towards a more regenerative economy. We recognize that we have an inseparable relationship with forests, so we focus on making sure we think holistically and do what we can to regenerate them.
Our second pillar is human rights. In this area we work to create a culture of diversity, equity and inclusion across our value chain as well as our own company. This includes empowering our supply chain workers.
And our third pillar focuses on digital equity, which is especially important right now. To that end, we’ve launched our new accelerator with the Aspen Institute. As a company that makes PCs and printers, digital equity is who we are. Essential for PC education – we’ve seen more during the epidemic than ever before. When we think about our education business and how we can help drive digital equity there as well as increase access to healthcare through our emerging healthcare business, we are historically creating economic opportunities for all, including marginalized groups. This is where we really focus now, and this is more than just a check-writing practice. We as a company have developed a strategy based on who and where the biggest problems in society are so that we can make the biggest impact.
You say that sustainability is an integral part of HP from the very beginning. What does that look like from an organizational point of view? Who is involved and how do you coordinate ESG activities?
At HP, it starts at the very top. Our entire leadership team is on board with this focus, and our board cares more about this than ever before. They get quarterly updates on our activities, and our CEO actually met with President Biden at the White House about the Build Back Better initiative. He has revealed our internal strategies centering on incredibly helpful and sustainable effects. It’s at our core. We have set a very ambitious agenda to achieve a clear goal in each of the three pillars I have mentioned.
In our corporate structure, the CEO has an expert in each direct report who is tasked with exerting a lasting impact on the part of their organization. Whether it’s our PC business, our printing business, finance, marketing, corporate affairs or human resources, everyone has leadership and a plan that aligns with the goals we set.
We have also set a digital equity goal that will accelerate digital equity to 150 million people by 2030 and is a key part of the accelerator we will be launching in February. It led my team but really involved every part of the company.
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Given that HP’s governance structure works, and its roles and responsibilities are combined in a way that enables action, what keeps you awake at night? Is there a part of your strategy that is not where you want it to be? What’s next?
In terms of what keeps me awake at night, it’s about digital equity. The epidemic has opened our eyes to the problems that have existed for so long and which are getting worse. Half of the world’s population is still offline, especially marginalized and underprivileged communities. They withstand the shocks of disconnection.
Our partnership with the Aspen Institute will launch a pilot initiative to provide nonprofit advice and financing opportunities focused on the advancement of digital equity. I’m really excited about this, but what keeps me awake at night is confirming that it’s launched, it drives the impact of our expectations, and we’ve reached the goal of accelerating digital equity for 150 million people. That’s a big number, so we’re spending a lot of time thinking about it.
In the first year, we will pilot it in the United States, India and Morocco, and it will expand year after year to reach that goal by 2030. We want to accurately measure our progress and ensure that we are as transparent in our accounting of climate and human rights as possible. We report honestly and clearly on our progress in our annual Sustainable Impact Report each year. The point is to provide real impact. It’s not just a big goal.
For the next level, we are systematically changing the culture in HP to align with our sustainable impact strategies. One way we can be sure that this is really entering the organization is through the Performance Management System we launched last year. Each of our 53,000 HP employees is encouraged to set a sustainable impact performance management goal for themselves in their work roles. This is a fundamental change in empowering every single employee.
HP is a rare company where sustainability is part of the strategy from the very beginning. Is such alignment critical? Is there a way to catch others?
Whether or not this is important, I’m going to share the amount of new sales we’ve determined because of our activities on sustainable impact. The figure is $ 3.5 billion. That’s up from 1 billion last year and a little over বিল 1 billion last year. Going from এক 1 billion to 3.5 3.5 billion this year shows that the trend is only growing. From a general business standpoint, this is absolutely essential. Customers are tuned about this. They are feeling the effects of climate change. They feel the effects of digital division. They’re looking to buy from companies that share their value, and for us, it’s a sales differentiator. We are winning the market because of our actions.
Our numbers should be a clear wake-up call for any organization that is not focusing on this right now. It’s a way to differentiate yourself. Becoming a sustainable, equitable company is not the only way to win business, but if you don’t, you will lose your customer base.
Continuing the way we are as human beings is clearly not sustainable. We all felt pressure. I live in Northern California, where wildfires start early in the season and are more severe and long lasting. No matter where you are in the world, you have your own local example of the impact of climate change or the digital divide that affects your community. If our children do not have access to education, it creates a very worrying future for all of us.
What do you think about changing corporate culture, not just setting goals and achieving them, but increasing transparency?
There are a few keys to that equation. One is to set the vision for which you are aiming, as a company and across the value chain. At HP, we have an incredible program called Amplify Impact, where we take our sustainable impact strategies across three pillars and hire our channel partners to help us change our entire industry. Here, for the first time, we make it public that Sustainable Impact has helped the company win more than $ 3.5 billion in new sales in FY21. We understand that HP alone is not going to solve the problem. It is essential to have a clear vision and to line it up.
The second is to clearly empower people to be a part of the solution. It’s very inspiring. No matter where you are in the job, HP or anywhere else, you can influence these issues. At HP, for example, our personal systems team is designing next-generation PCs from a digital segmentation perspective, thinking of lower economic levels and adding accessibility features so that people with disabilities can compute with equality and parity. We spend a lot of time thinking about each of our three pillars and how each HP leader can encourage their employees to be part of the solution. Hitting big targets is taking everyone.
We have covered many places. What’s next for HP?
I just want to say more about our Digital Equity Accelerator partnership with the Aspen Institute and how we chose Aspen. As has been true in some of our other programs, where we have partnered with the World Wildlife Fund or Conservation International on forests, we are going where experts are. We acknowledge what we contribute to the solution, but we also know that we cannot do it alone, and that means partnering with experts. We are really proud of what we have been able to create. It is a shared opportunity and a shared responsibility. I think it’s important to think about who can contribute to others and who can be part of the solution? We are thrilled with the progress we have made, but we look forward and see that there is still much to be done.
Related: Why ESG Reporting Can Be Your Company’s Next Winning Step