TD Synnex Sustainability Strategy Will Require Channel Partner Coordination, Supply Chain Data Sharing

Global IT distributor TD-Synnex has announced various near- and long-term sustainability goals that will require data sharing with various supply chain partners. Take a closer look, and the effort reveals potential sustainable IT opportunities and challenges for channel partners worldwide.

Among the key items to note: The TD Synnex plan, approved by the Science Based Targets initiative (SBTi), will require certain partners and customers to have science-based sustainability targets by fiscal year 2028.

As a result, the TD-Synnex march to net-zero greenhouse gas (GHG) emissions could influence rival distributors and channel partners worldwide -- including cloud services providers (CSPs), software developers, hardware makers and IT services firms, Sustainable Tech Partner believes.

TD Synnex: Sustainability Plan, Net Zero Goal, Partner Requirements

TD Synnex has set the following near- and long-term sustainability goals. We've highlighted the partner and customer requirements in bold.

• Overall Net-Zero Target: TD SYNNEX commits to reach net-zero greenhouse gas emissions across the value chain by FY2045.
• Near-Term Targets: TD SYNNEX commits to reduce absolute scope 1 and 2 GHG emissions 42% by FY2030 from a FY2022 base year. TD SYNNEX also commits that 90% of its suppliers by spend covering purchased goods and services, will have science-based targets by FY2028. TD SYNNEX further commits that 58% of its customers by revenue covering use of sold products, will have science-based targets by FY2028.
• Long-Term Targets: TD SYNNEX commits to reduce absolute Scope 1, 2 and 3 GHG emissions 90% by FY2045 from a FY2022 base year.

TD Synnex Sustainability Plan: Key Questions, Market Influence

In terms of actual numbers, we don't know how many TD Synnex partners and customers will need to align with the IT distributor's sustainability plan by fiscal year 2028. We've reached out to the company for additional comment, and will update this article if we receive additional context from the company.

TD Synnex, based in Clearwater, Florida, and Fremont, California, has roughly 23,000 employees. The IT distributor's supply chain involves:

• Roughly 200,000 products and services;
• approximately 2,500 technology vendors; and
• roughly 150,000 customers -- most of which are VARs (value-added resellers), MSPs (managed IT service providers), IT consulting, and systems integrators.

Again, we don't know how many of those vendors and customers will need to align with the TD Synnex sustainability plan. But among the potential areas of concern: Worldwide, only 31% of partners track Scope 1 and 2 emissions, and just 23% of partners record their Scope 3 emissions, according to research firm Canalys said.

Sustainable IT Services: Signs of Progress

Still, there are some clear signs of progress. Generally speaking, most major IT suppliers and service providers -- companies such as Amazon Web Services, Cisco Systems, Google, IBM, Microsoft and SAP -- have also developed sustainability plans that will require certain supply chain partners to track and share their Scope 3 emissions data.

Also of note: Ingram Micro, a major TD Synnex rival that's preparing for a potential IPO (initial public offering, issues an annual ESG report.

Moreover, roughly 50% of partners worldwide said that they expect to generate revenue from sustainability solutions in 2024 – up three percentage points from 47% in 2023, according to research firm Canalys.

Among the key sectors to watch: MSP-centric software and distribution companies, which have been mostly quiet about their sustainability efforts and associated partner opportunities.

Indeed, RMM (remote monitoring and management) and cloud distributors have software that could help partners and customers to potentially monitor and manage carbon emissions. But so far, MSP-centric software and cloud companies such as ConnectWise, Kaseya, N-able, NinjaOne and Pax8 have said little about their sustainable IT strategies and associated partner developments. (Though Pax8 emphasizes its social impact.)

TD Synnex Sustainability Plan: Executive Perspectives

Meanwhile, TD Synnex is marching forward with its one net-zero plan.

In a prepared statement about the sustainability effort, Adam Rutstein, VP of corporate citizenship and sustainability, TD Synnex, said: "As we celebrate the validation of our targets, we recognize that the hard work now begins. To this end, we are building roadmaps within each region to reach our goals, and also are encouraging our stakeholders to align with climate science by also working toward a commitment to science-based 1.5 C and net-zero targets."

Added TD Synnex CEO Rich Hume: “I was privileged to sign our commitment to the SBTi Business Ambition Pledge as one of my first acts as CEO of TD SYNNEX following the merger that created our company in September 2021, so it’s safe to say sustainability has been a priority for our business from Day 1. I thank all the co-workers involved in building our roadmap to achieving these goals. The approval by SBTi is a testament to their hard work and commitment.”

Sustainable IT Services: Growing Trend?

Overall, the TD-Synnex strategy reinforces growing global momentum for sustainable IT services -- though the trend also faces various economic and political hurdles, particularly in the United States, Sustainable Tech Partner believes.

We'll be watching and listening for more sustainable IT updates from TD Synnex. We expect the company's next quarterly earnings call to potentially arrive in June 2024.