Across the modern business landscape, sustainability objectives have become an issue of primary commercial and ethical concern; not just to society at large, but also to large-scale global enterprises — especially those in the tech sector. The importance of sustainability is evidenced by the way the topic is now treated by the industry as a benchmark for its success. Indeed, research by Gartner has found that the issue of sustainability traverses all strategic technology trends for 2023, and that 50% of CIOs will have performance metrics tied to the sustainability of their IT organisation by 2025.
A great many tech and IT businesses are now fully aware that their products and services can contribute towards mitigating the climate emergency as well as drive new commercial revenue opportunities. However, there are plenty of obstacles facing organisations who want to achieve their laudable sustainability goals, and making meaningful change at corporate level is an activity fraught with any number of complex interdependencies. It first requires a combination of tech, data and changing behaviours.
But what is it about the tech industry in particular that indicates a unique requirement to take the climate crisis seriously?
Before we proceed, we have to acknowledge that the tech and IT industries can be especially damaging to the environment.
Modern technology, particularly all manner of digital tech, is currently highly dependent on the use of fossil fuels. The vast majority of hardware is composed of plastic components, as well as materials derived from mining, such as copper, zinc, iron, gold, and barium. Because of this, the extraction of the necessary resources needed to construct and maintain modern digital tech comes with a high cost for the environment, as a result of the impact of mining, deforestation, and damage caused by other pollutants.
Secondly, the tech industry also comes loaded with carbon emissions, which are only expected to intensify in the near future as demand for tech increases. Indeed, a recent study from the W Booth School of Engineering has predicted that, if the trends in the information and communication technology (ICT) industry continue at the current rate, the field will constitute 14% of all global carbon emissions by the year 2040.
Furthermore, the issue of planned obsolescence is one that continues to dog the industry as a whole. Because of these reduced product life cycles, the tech sector is producing increased amounts of e-waste, which is also blighting the environment. According to a report from the Platform for Accelerating the Circular Economy (PACE) and the UN E-Waste Coalition, the amount of e-waste generated currently increases by at least 2 million tonnes per year, and is expected to reach 120 million tonnes by 2050. Software also comes with its own environmental cost. Consider the fact that the servers and data banks that power technology use vast amounts of energy each year. Per a recent report from AFL Hyperscale, data centres are estimated to be responsible for up to 3% of global electricity consumption today and are projected to touch 4% by 2030.
But with all this in mind, what’s stopping tech companies from being more sustainable, and how can leadership teams forge a new path and work towards change? The first and most important obstacle to discuss is the way in which sustainability initiatives are measured.
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One of the main challenges facing tech companies looking to make a meaningful difference to their environmental impact is that the metrics by which businesses can measure impact sometimes remain obscure at best and inaccurate at worst. This can make it extremely difficult for businesses to accurately measure whether or not their efforts are truly making a difference.
Now, some standardisation of environmental metrics has been achieved through international regulatory bodies. Events such as the COP Climate Summit, The Paris Agreement, and the European Green Deal, have gone some ways towards standardising ESG objectives and metrics. Thanks to these initiatives, businesses can now work towards tangible and recognised sustainability KPIs that investors, customers and governments alike can agree upon and understand.
The Green Link represents one such tool; an online sustainability-focused strategy portal designed to act as ‘Sustainability as a Service’ for other businesses. We spoke with its CEO and co-founder, Bernard Lebelle, who commented that one of the main difficulties facing tech companies is that, although it’s relatively easy for them to keep track of their impact on the environment, it becomes harder to measure the effect their products/services are having once they reach the end users.
“It’s easier to calculate the carbon footprint that you have as an entire company,” he stated. “But if you’re a SaaS company providing a cloud-based portal for your users, they’re not going to be using it 24/7. Although your service needs to be available for them at all times, the actual time the product spends being used by the user is way different.”
Similarly, as Bernard points out, not all sustainability initiatives are created equal, and companies shouldn’t try to view their sustainability goals in terms of the paying of indulgences to expiate climate sins. Tech companies who use tokenistic environmental efforts as a smokescreen to perpetuate the same harmful business practices (like planting trees to make up for their high carbon emissions, and nothing else) are not embracing meaningful change.
Thus, initiatives like The Green Link are designed to help companies view their environmental impact in realistic terms, and work towards positive change in measurable and realistic ways. It also involved motivating all stakeholders within the organisation to understand the importance of sustainability, and think for themselves about what they can do to lessen their impact, compromise, and substitute their habits. This in turn means that these sustainability goals have been set by the employees themselves, who now fully understand the rationale behind them, rather than simply being arbitrary targets handed down from upper management.
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"...companies shouldn’t try to view their sustainability goals in terms of the paying of indulgences to expiate climate sins."
Savvy-minded business leaders want to avoid accusations of ‘greenwashing’ by cynical consumers, and ensure that their sustainability efforts are genuine and impactful. But how can they achieve this?
Firstly, businesses need to try to be discerning when it comes to what tech they invest in. Investing in digital software-as-a-service (SaaS) solutions was cited by Gartner in its Top 10 Strategic Technology Trends for 2023, demonstrating its ability as a powerful tool to help shape the innovations of the future. Sustainable SaaS solutions can offer enterprises a way of controlling and reducing their carbon footprint, through measuring their activity, streamlining processes or cutting down on e-waste, while also increasing their overall efficiency.
Indeed, there are many other new technologies out there now enabling businesses to become more carbon-neutral; such as traceability, analytics, and renewable energy. Meanwhile, AI and automation are also allowing tech executives to achieve a seamless flow of data from both analog and digital spaces. The insights from this data can then be used to benchmark corporate sustainability. Business leaders should also endeavour to switch to green energy for their data centres, and invest in alternative sources of energy. Tech businesses can also look at recycling e-waste to re-use their valuable components and resources. Less than 20% of e-waste is formally recycled, with 80% either ending up in landfill or being informally recycled.
Those companies without a specific sustainability strategy yet in place can follow the example set by other tech enterprises. For example, Google and Intel have founded the Climate Savers Computing Initiative in an effort to cut down on emissions in the tech space, and joining this kind of cause can act as a general industry-wide roadmap to sustainability along standardised, pre-agreed metrics. However, it’s important to remember that any technology, no matter how advanced, is ultimately a tool used by human agents. Unless your employees completely understand the functions of your business and products, and the significance of their effect on the environment, all their sustainability efforts will ultimately come to naught.
The most effective sustainability initiatives are successful because Chief Sustainability Officers (CSOs) have taken the time to understand the needs of the entire business across the entire end to end value chain. Similarly, CSOs need to make other department heads and employees aware that sustainability goals aren’t an impediment to their own objectives, but can in fact (if properly implemented) help to improve all other aspects of the organisation itself.
Matthew Robinson, a sustainability and ESG strategic advisor, spoke with us regarding this very same challenge: “When it comes to sustainability, I feel a lot of organisations still rely on writing a strategy, implementing new technology, or simply throw money at the problem, without fundamentally understanding how the organisation functions day to day - therefore it will, ultimately, fail.”
Matthew also drew attention to how important it was that leaders, and CSOs in particular, possess the soft skills to properly interact with other key stakeholders such as suppliers, clients and investors etc, critically educating them as to the importance of sustainability. He stated that an effective CSO has to be: “a good communicator and an active listener, who can influence behaviour, educate, and then subsequently build long-term and trusted relationships and create the change you want to see.” By re-evaluating the practices, resources, and technology used by your organisation, your enterprise is likely to, in turn, improve its operational efficiency and better motivate your workforce by ensuring that they feel as though they are contributing to the overall welfare of society and our world at large. But this only works if those employees have been educated and informed about these causes, and are willing to earnestly learn and collaborate.
Remember: no business can operate without our ecosystem, and nurturing and protecting it is our only choice if we want to ensure long-term survival. Businesses can no longer ignore sustainability: they can either engage with these goals or knowingly choose to fail. So, if you want your business to be sustainable, you might as well go about it properly.
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