In the future, business models based on the circular economy will play a key role in making sustainable use of the planet’s limited resources. The CHG-MERIDIAN Group, which is operating in 27 countries, has been managing technology investments for 40 years. The principles of the circular economy have been at the heart of its business model throughout this time. CHG-MERIDIAN experts Virginie Versavel from Belgium, Jan-Thore Johnsen from Norway, and Klaus Form from Germany explain how customers and the environment are benefiting from this.
Versavel: The need to protect the climate is now at the top of the agenda in Belgium and Luxembourg, particularly in its companies. More and more customers are asking for carbon footprint data for their IT equipment or for certified reports on the disposal of their devices and the raw materials they contain. One of the reasons behind this trend is that a growing number of companies are publishing non-financial information on sustainability and corporate social responsibility, and selecting suppliers according to how green they are. Policymakers have a strong influence on environmental awareness, for example by giving sustainability criteria a considerable weighting of 30 percent in public tenders.
Form: In Germany, the focus is increasingly on this topic. The term ‘green IT’ established itself several years ago with the rapid advance of technology around the globe. Demand for green, energy-efficient solutions along the entire value chain has steadily increased since then.
Johnsen: Norway has undergone a major evolution. We owe our prosperity to North Sea oil, yet we are pioneers when it comes to climate protection. We are very proud of the fact that 95 percent of our electricity comes from hydro, solar, or wind power, that we do not have any coal-fired power plants, and that almost half of all vehicles sold in the first quarter of 2020 were electric. Policymakers have a strong influence on environmental awareness, for example by giving sustainability criteria a considerable weighting of 30 percent in public tenders.
Green Mountain is based in Norway and specializes in sustainable data centers that combine carbon neutrality with the highest security standards. The data centers are operated using hydroelectric power and cooled for most of the year by the rough Norwegian weather and the icy waters in the fjords. The high-performance servers are used by international companies to run complex and energy-intensive vehicle development projects for example.
Johnsen: Our first task is to raise awareness. When it comes to sustainability, it is important for companies to understand that 95 percent of the IT equipment they want to replace still has a value for someone else. We support this by considering the entire technology lifecycle, rather than just providing product financing. This starts with the rollout and the productive phase and ends with the return of equipment and the professional refurbishment for the secondary market. Our partnership with Green Mountain in Norway, which we entered into last year, is a flagship project in this respect. Green Mountain runs carbon-neutral data centers and has seen an increase in demand for secure and sustainable end-of-life services in recent years. As experts in this field, we support Green Mountain with this.
Form: Our technology centers in GrossGerau, Germany, and Skien, Norway, are an important part of the entire value chain, as it is here that we refurbish IT assets for the secondary market. The centers themselves have been designed with sustainability in mind and use renewable energy and eco-friendly packaging.
Versavel: The principles of the circular economy are firmly embedded in our corporate philosophy, and this has been independently verified. For example, the cyclical use of IT hardware in our leasing model has been assessed by VITO, a leading European research organization in the field of cleantech and sustainable development. VITO has over 20 years’ experience in environmental impact assessments.
Form: The European General Data Protection Regulation has placed even greater responsibility on companies to look after their data. CHG-MERIDIAN has extensive process expertise in this area. For us, service management involves offering our customers a solution with high data security at any point in the technology lifecycle, for example if a device is defective. At the end of the lease term, our ISO-certified eraSURE® process ensures that there is no more data on the device before it enters its next lifecycle.
Febelfin (Fédération belge du secteur financier) is the official federation of the Belgian finance sector and is headquartered in Brussels. Its Circular Economy Taskforce was established in 2018 with the objective of promoting the principles of the circular economy from a financial standpoint. Alongside the Belgian Leasing Association and other experts in the field, CHG-MERIDIAN is an active member of the Taskforce, which has recently published its Circular Economy Charter. It supports all players in the market and in business with the implementation of resource-efficient processes and enables the restructuring of their linear business models into more sustainable business models.
Versavel: In mid-2017, the Circular Flanders initiative was launched in Belgium, with more than 100 companies participating to finance green deals on different levels, including CHG-MERIDIAN. Since then, I have been a member of the Circular Economy Taskforce at Febelfin, the federation of the Belgian financial sector. We have finalized a Circular Economy Charter, describing how Belgian companies can benefit from and contribute to the circular economy through leasing. Specific examples are cited to demonstrate these benefits.
Johnsen: CHG-MERIDIAN Norway is working closely with digdir, the Norwegian Digitalisation Agency, which develops sustainable procurement guidelines based on the circular economy. I am one of a group of experts exploring how sustainability criteria can be integrated into public tenders. As a result of this work, we are jointly developing a new guideline for selecting sustainability criteria in public tenders. Part of this is considering the question of whether to lease or to buy. The answer is simple: it makes more sense financially and environmentally to lease any items that lose value.
Form: The principles of the circular economy are firmly established in our business model, and our technology centers in Germany and Norway have become an integral element of the value chain for sustainable IT solutions. After all, we achieve very high refurbishment rates of 95 percent here, and last year this enabled us to give more than 697,000 assets a second lifecycle. We want to refine what we are doing, beyond end-of-life services, and become even better. That is why we have made a conscious effort to put sustainability on our agenda for 2020.
Norway has set itself the goal of providing an effective digital public administration for its citizens. The government believes that prioritizing digitalization policy is an important factor in the country’s economic strength. The Norwegian Digitalisation Agency will be the government’s most important tool to coordinate and accelerate the digitalization of the public sector in Norway. The agency will be subordinate to the Ministry of Local Government and Modernisation, and have a more prominent role as a rule setter and a supplier. Its main target groups will be central and local government bodies, the voluntary sector, and businesses.
Account Manager Industrial Solutions:
Working with customers and prospects in Belgium and Luxembourg, and with suppliers globally, she has observed a growing interest – and need for support – in sustainability matters. She has been attending summits and meetings at national and European level for many years, delivering presentations on the subjects of sustainability and the circular economy. In 2017, she steered the evaluation of CHG-MERIDIAN's business model that was carried out by research organization VITO. She has been a member of the Belgian Circular Economy Taskforce at Febelfin since 2018.
Senior Technical Sales:
When Johnsen joined CHG-MERIDIAN in 2017, he initiated a dialog with the Norwegian digital agency digdir and since 2018 has been part of an expert group there, advising on the development of selection criteria for sustainable public sector procurement. Several years ago, he developed a sustainability reporting system for customers that is now used by the technology center in Skien, Norway.
Head of Group Service Delivery:
Klaus Form is responsible for operational end-of-life processes in the company’s two technology centers, among other things, and for refurbished equipment sales on the global secondary IT market. He and his employees turn the principles of the circular economy into reality each and every day.