[music] Hi, I'm Matt Watts and I'm Netat's chief evangelist. So, many of you may have noticed that ESG is becoming an increasingly important topic. By the way, it stands for environmental, social, and governance because I've had that confusion before as well. And it is increasingly becoming something that companies are focusing on at a board level. So, in this series of videos, I'm going to be speaking to our VP who is leading NetApp's ESG initiatives, who's going to talk about, you know, what are some of our corporate sustainability initiatives, what are we doing as an organization to become more sustainable in the way that we operate, and then I'm going to have a couple of different guests that are going to discuss, you know, what are we doing with regards to our portfolio, um, building our products with sustainability and emissions in mind, and how can customers start to better monitor the power usage and emissions for products. And then of course we'll also cover how we think our broader portfolio can help our customers to reduce emissions and improve their level of sustainability. But first up in this session is Lisa Borganson. So hi Lisa, maybe I'll let you introduce yourself.>> Hi Matt, thanks for having me. My name is Lisa Borguson and as Matt mentioned, I'm the VP in legal and I am leading NetUP's ESG efforts >> and suddenly become a very popular person as well, I would imagine. >> That's right, Matt. >> [laughter] >> [laughter] >> [laughter] >> So, you know, let's start off because I, funny enough, I had somebody come to me the other week and said, "One of our customers has or know, one of our competitors has had ESG write a report for them." And I thought, "Oh, wow. People really don't know what this ESG thing is all about." So, could you just tell us a little bit about whatis ESG? What what's the concept of this? >> Sure. So, um, ESG is kind of an umbrella term that [clears throat] I like to think about as how a company builds its operations to really be enduring over time. Um, you might think of it as related to one of our early values of building a model company, right? So,as you mentioned it, the acronym stands for environment, social, and [clears throat] governance. And it encompasses all three of those areas. So in the area of environment, it means things like our energy consumption or how much water we use or how much greenhouse gas emissions um our products and our operations make. In the social realm, it covers things like human rights globally. It covers things like diversity, inclusion, and belonging. And in the governance realm, it refers to really how we make sure we're managing our company well. So things like ethics, um things like um our management of our operations. So that's what ESG really means in this realm. And you're right, it's on the tip of everyone's tongue today. [snorts] andI think thesocial and governance side of things. I think certainly when I look at NetUP asa company, I think we've been doing some fantastic work for a number of years in that area. It's thee the environment, the sustainability that suddenly seems to have become so important, not just for us, but it's coming up in more and more conversations. So, why is that? Whatwhat's suddenly brought this to the forefront, Lisa? forefront, Lisa? forefront, Lisa? >> Yeah, you're right. I think it has accelerated really quickly and there's probably a convergence of events, right? So the first in my mind is really um the importance of the climate crisis. Uh that that's something that's impacting everyone around the world. It's not a regional issue. It's not a country specific issue. It's something that we're all seeing and noticing. and things like the Paris Accords where different governments get together and talk about um what they need to do in order to manage that crisis is pushing um governments and companies to do more in that area and that pushes our stakeholders in turn to um encourage changes from companies. So when I mean when I say stakeholders I mean our customers um our employees and our shareholders and investors all three of them are interested in um our environmental sustainability and the efforts we make as a company to do better in this regard. So if you think about our customers for example, when a large company like an a an oil company or a telecom company makes the decision that it wants to improve its environmental impact on the world. One of the ways that they realize they can accelerate their process their progress in that regard is by pushing their suppliers to do the same. And since we are one of their suppliers, that means that they ask us to show some commitment and effort in that regard too. Same with employees. Our employees see this climate crisis um in the world and they want to know that NetApp is a um they want to work for a place like NetApp where we're making some strides in that regard. And lastly, investors and shareholders also care about this. First of all, um there are um certain types of capital, funds, etc. who will only invest in companies who are making um important environmental strides. But in addition to that, they're they want us to build a company, as I said, that's going to endure, that's going to be able to weather these storms, and that's going to be able to help in this regard. And so, they're encouraging NetApp and other companies as well to make efforts in their environmental sustainability. So all three of those things together are all coming together at one time to push us from every angle andthat's what makes companies like NetApp move more quickly in this area. and maybe you could give us some examples, you know, because you know, sustainability, environment, it's a pretty broad topic, right? Um, andI the more I started to look into it, you've got scope one and scope two and scope three. There's a, you know, like I say, it's a verybroad topic. I mean, could you just give us a little bit of a feeling as to, you know, what are the sorts of things that NetApp can do as a company or are doing as a company thatreally help to address this environment side of things? >> Sure. So I think NetApp has a history of um working in this area of sustainability. Our products for example are Energy Star certified in the United States. They meet the Wii requirements inthe EU. We've had an environmental management system that's ISO certified for many years. Uh but as I mentioned, it's time for us to really up our game. So, one of the things that we have done is we've joined something called the science-based target initiative. And that is a um a group of companies essentially that commit or pledge to changing their operations and their greenhouse gas emissions in order to um adhere to that 1.5 degree Celsius increase in the world's temperature. Um and that comes again from those kind of Paris accords that notion that keeping the world's temperature at that level will help manage the climate crisis better. So that's one thing that we've done is we've joined that initiative which commits us to making some changes in our greenhouse gas emissions to keep to that 1.5 degree Celsius. But in order to do that um we have to do a little bit more. So, the other thing that we're doing right now is we're um engaging in some calculations of our actual greenhouse gas emissions. You mentioned scope one, scope two, and scope three, and those might not be familiar to all of our listeners, but you could think of scope one and scope two as your greenhouse gas emissions that relate specifically to your operations, things that come out of your own company and how you run your company. Scope three refers to your products and what kind of emissions those products um emit essentially as they're used or as they're built and shipped and used at the customer. So we're making efforts to calculate those emissions very carefully because you can't manage what you can't measure, right? And then secondly, we're working to create some decarbonization strategies. Essentially figure out real tangible ways that we can reduce those greenhouse gas emissions both in our own operations but also in how our products are used or built or shipped so that we can re make a real um difference. We're going to be developing those strategies and figuring out how to get to those strategies. We're doing it really right now.So, it's an exciting time to be at NetApp if you care about this topic.>> AndI and you know what, it's been increasingly obvious for me the more that I've been involved with this, the more that I've been talking about it, the more people really do care about it. Um, and you know, and I think some of thesteps that we're taking, Ithink, you know, are very are positive. They're the right, but they're the right things to be doing. Andto pick up on something you just said, Lisa, that what worries me andI'm glad thatit's absolutely not the approach we're taking is this has to be rooted in fact. It has to be, you know, based on kind of tangible things. I do worry that people could sort of see this as an opportunity to market themselves or toput out marketing when actually you know this is such an important topic and any steps that you take as an organization simply have to be kind of grounded in things like science-based target initiatives else you know what do they really stand for >> and in real calculations right not in a guess of what we're doing and not in um what I would call performative measures I think what we've seen in society recently is that those same stakeholders, our customers, our employees and our investors will come for those companies who are engaged in what you call greenwashing, which is kind of um these performative measures on the edges. Netup is looking to do um something that's really going to be tangible and meaningful um to help this problem and again to build a company that's enduring >> and it's you know yet [clears throat] another reason why I've been here for 17 years and I continuing to enjoy working for NetApp because we continue to take these things seriously. I think we are building a model company and you know I think this is just another example of that. So it's uh it's fantastic to hear. Um, so I guess all it goes to say, you know, Lisa, thank you ever so much for kind of sharing some thoughts and perspectives with us. Um, we're going to talk more about some of these measurements in the next kind of videos that we're going to do. We're going to talk about something called payer, which is the product attribute impact assessment algorithm that we've also joined. We joined that back in December 2021. It goes to exactly what you were just saying, Lisa. we need to be able to truly effectively and accurately measure the life cycle, the full kind of life cycle analysis for the carbon footprint of our systems. Um, so I'm looking forward to talking about that with Chris Luth and some other colleagues as we go into more of the series. So for now, Lisa, thank you ever so much for joining. Um, always nice to see you and nice to get your perspective on this. >> Thanks again for having me, Matt. >> It's an absolute pleasure. And for everybody who's watching, um, there's a link to our ESG report in the description if you'd like to see some of the steps that we've been taking over the last couple of years. Um, but more importantly as well, come back and join me as we start to publish the next of these series where we're going to go into more details around, as I said earlier on, what it means for us as a company when we think about the products we build and what it means for us as we think about the products and solutions and the potential positive impacts they could have on you, our customers. So, thank you very much for listening. Ow! [music] Ow!