Zendesk: A CX leader promoting value chain sustainability

Uncovering Zendesk’s ESG journey, Sustainability Director Shengyuan Su shares a story of climate action through its CX software-as-a-service

For a software company, there are two routes to take when approaching sustainability. The first is dealing with direct emissions—items such as Scope 1 emissions that drive the company towards immediate carbon neutrality. The other is addressing the impact that its product has on the wider value chain, which is where software-as-a-service (SaaS) providers look to enrich their clients’ experiences through their offerings.

This broadens the scope for impact. As one company intrinsically impacts the other, supplier success hinges on customer success whether that be profitability or scalability of digital solutions. This also aligns businesses based on their sustainability goals and how they can collaboratively reduce their environmental impact.

At Zendesk, provision of a great customer experience (CX) aligns with low-carbon operation, and the technology company employs expertise to help drive this down further. At the helm of this is Sustainability Director Shengyuan Su, who touts Zendesk’s technical excellence as a SaaS provider.

“We are a SaaS leader and we focus on helping companies unlock the power of customer experience and build lasting relationships,” says Su, sharing the essence of the company and its mission. “We offer our customers intelligent customer service solutions. Ultimately, this simplifies business and makes it easy for companies and customers to create connections.”

The software development business prides itself on its mission to “power exceptional service for every person on the planet”. What this means for clients is collaboration with a dedicated team with more than 15 years of experience in revolutionising online CX for clients. Most recently, though, the organisation has been evolving to further enhance its offering by harnessing the power of artificial intelligence (AI).

“Today, we have our complete customer service solution powered by AI, and we connect over 100,000 brands with hundreds of millions of customers over phone chat, messaging, and social and health centres,” Su highlights.

This statement is inclusive of organisations around the world, including the likes of Uber, Tesco and Disney in the corporate world, as well as small-to-medium enterprises.

Sustainability: A key part of business

The transformation for Zendesk is centred around environmental, social and governance (ESG) as it builds a strategy for the future and a team to execute. This journey began in 2019 when the company published its inaugural sustainability report. “Sustainability is a key component of our value, ‘care for others’,” says Su. “That includes caring for our planet and our communities. And we firmly believe that businesses can be a major force to make the world a better place”.

One strategic area of focus for Zendesk is decarbonisation across its value chain, which hinges on the team’s ability to integrate sustainability into core parts of the business, as Su explains.“This includes our workplace, product development, cloud operations and supply chain,” Following this, she highlights some key figures, indicating the success of the organisation through its achievements:

Adoption of 100% renewable energy across its global offices
Delivery of carbon-neutral products to its customers
Achieve carbon neutrality on employees’ business travel and commuting activities

To continue reducing emissions at a speed and scale that is most needed by the planet, further commitments have also been made by Su and the Zendesk team, pertaining to the emissions of the business and those embedded in third-party operations. These commitments are validated and approved by the Science-Based Target initiative (SBTi):

84.2% reduction in Scope 1 and Scope 2 emissions from its offices by 2030—based on 2019 figures
Continue sourcing 100% renewable electricity through 2030
68.4% of suppliers by emissions to set Science-Based Targets (SBTs) by 2027

Cultivating strong partnerships to accelerate sustainability

“We believe that forging robust partnerships is imperative in tackling the climate crisis, because no one company can do it alone, and we must take collective actions”, said Su.

Beyond partnering with internal cross-functional groups to reduce emissions, Zendesk is an early pioneer in purchasing engineering-focused carbon removal technologies, which are essential for achieving societal-level net zero, but in a very early commercialisation stage. Most recently, Zendesk joined Frontier. It is an advance market commitment to buy $1B+ of permanent carbon removal between 2022 and 2030. Through partnering with other climate leaders and experts in the community, Zendesk aims to send aggregate demand signals, bend the cost curve, and help these critical technologies to scale.

Su also mentions Zendesk’s partnership with Amazon Web Services (AWS), which is one its key technical vendors, in reducing product emissions.

“We built an impactful partnership with AWS to reduce product emissions,” says Su. “Sustainability has been top of mind for our product engineering team. And we know the best opportunity we have to decarbonise our product is to optimise cloud infrastructure and really improve the energy efficiency of our data instances.”

Through this partnership, the majority of its workloads was migrated to more efficient equipment and IT services, which significantly reduced its product emissions while also improving cloud performance and cost-effectiveness.

“The partnership with AWS really kick-started our supplier engagement journey, and we strive to create a systemic impact through our science-based supplier engagement target”, Su said. “By setting targets, we hope that our suppliers will not only reduce emissions that are attributable to the products or services that they deliver to Zendesk, but also inspire their own suppliers and communities to act on sustainability”.

Beyond reporting: derive ESG value from compliance practices

Zendesk is subject to the increasing ESG regulations and legislations, such as the Corporate Sustainability Reporting Directive (CSRD).

“While our ESG initiatives are primarily value-driven and our commitment to climate leadership extends well beyond compliance and legal obligations, we believe the rising regulations play a major role in enhancing ESG transparency, comparability, and accountability”, Su said. “And at Zendesk, our goal is to continue to drive progress towards our voluntary climate targets, while also ensuring compliance best practices, to keep improving the rigour of our data and pinpoint opportunities for deeper integration of sustainability principles into our business dynamics”. Enhancing compliance is a dedicated working group, which brings together a variety of expertise from internal auditing and legal to enterprise risk management.

“On an annual basis, we work with third-party auditors to independently verify our key environmental data and metrics, and we share our sustainability progress and learnings with our communities and all stakeholders through our Global Impact Report”, says Su.

“Most recently, as part of our climate leadership roadmap, we completed our inaugural climate risk assessment aligned with the TCFD and ISSB recommendations. Throughout this process, we engaged more than 12 cross-functional teams, and identified the climate-related risks and opportunities that are most relevant to our company.”

This shows the extent to which ESG is embedded throughout the organisation, but equally important, the collective efforts required to get the entire company on board. Furthermore, this process helped Su and the team to unlock critical opportunities to integrate climate risks into Zendesk’s business strategic planning, improve climate risk mitigation and adaptation capabilities, and enhance Zendesk’s resilience to the climate crisis.

A future approach to ESG as a CX technology leader

As a technology leader focusing on customer experience, Zendesk is committed to decarbonising its AI-powered solutions for customers, by working with partners to minimise the carbon footprint of its AI products and features, and transparently disclosing its AI’s environmental footprint.

“AI has big potential to help combat climate change, and we are really at an inflection point to shape how we utilise this powerful tool in a manner that is both responsible and effective”, Su says. “Every part of the AI value chain, from utilities and data centre operators to machine learning engineers, has a role to play in reducing the environmental cost of AI. Zendesk’s AI engineering team has been implementing green engineering principles to help lower the carbon footprint of our AI models, and we hope to partner with broader communities to truly harness the full potential of AI for the environment.”