VMworld 2021: Environmental, Social, and Governance (ESG) Issues Take Center Stage

C. Drake

Summary Bullets:

  • VMworld 2021 will give greater prominence to ESG issues than any previous VMworld.
  • The challenge for VMware will be to demonstrate real transformation and momentum in its progress towards specific and measurable ESG targets.

At next week’s VMworld 2021, environmental, social, and governance (ESG) issues look set to receive greater prominence than in any previous year.  Before 2020, VMworld events had only a scattering of professional development; ESG; and diversity, equality, and inclusion (DEI) sessions but no dedicated track for those topics.  In 2020, VMware introduced the professional development track; and this year, the company plans to expand this track to include DEI and ESG sessions and rename the track to ‘Inspire Change.’

The decision to expand and formalize the focus on ESG within a dedicated track can be partly attributed to the current climate, which is seeing more and more technology companies promoting their commitment to ESG targets.

Increasingly, a commitment to ESG issues is being approached by technology firms as both a value driver and a competitive battleground.  According to VMware, which recently published its 2021 ESG update report, these commitments are not only about the transformation of its own internal operations and supply chain, but also about helping its customers achieve their own ESG goals, using VMware solutions.

Enabling customers and partners is described by VMware as a ‘cornerstone’ of how it demonstrates its progress towards its 2030 Agenda.  This is a 10-year plan that sets out 30 ESG goals and aligns them with core business strategies to ensure meaningful impact.  The strategy, which was launched in 2020, focuses on driving three outcomes – trust, equity, and sustainability – and measuring and reporting the progress achieved in these areas.

As part of the 2030 Agenda, VMware announced the Zero Carbon Committed initiative to drive global decarbonization efforts.  The program’s goal is to ensure VMware cloud partners’ data centers are powered by 100% renewable energy by 2030.  Data center and cloud providers Equinix, IBM, and Microsoft have joined the initiative.

Since the start of 2021, GlobalData has been asking business respondents to report on companies’ attitudes towards sustainability.  Only a minority of the people polled (17%) believed that the majority of companies are sincerely committed to sustainability, and almost 60% of GlobalData’s sample continue to hold a somewhat cynical view on sustainability commitments, believing them to be a ‘greenwashing’ marketing exercise in some or most cases.

The challenge for VMware, as with other technology firms, will be to demonstrate real transformation and progress towards specific and measurable ESG targets.  VMware will be able to point to highlights from the previous fiscal year, including a reduction of greenhouse gas emissions by 19% and the launch of the VMware Responsible Sourcing Program for suppliers.  VMware also knows that the industry will expect to see both a roadmap and clear momentum as it progresses with its 2030 Agenda.

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